Securityholders Agent. (a) By virtue of the approval of the Merger and this Agreement by the Indemnifying Holders and without any further action of any of the Indemnifying Holders or the Company, at the Closing, Fortis Advisors LLC shall be constituted and appointed as the Securityholders’ Agent. The Securityholders’ Agent shall be the exclusive agent and attorney in fact for and on behalf of the Indemnifying Holders to: (i) execute, as the Securityholders’ Agent, this Agreement and any agreement or instrument entered into or delivered in connection with the Transactions, (ii) give and receive notices, instructions and communications permitted or required under this Agreement, or any other agreement, document or instrument entered into or executed in connection herewith, for and on behalf of any Indemnifying Holder, to or from Acquirer (on behalf of itself or any other Indemnified Person) relating to this Agreement or any of the Transactions and any other matters contemplated by this Agreement or by such other agreement, document or instrument (except to the extent that this Agreement expressly contemplates that any such notice or communication shall be given or received by each Indemnifying Holder individually), (iii) review, negotiate and agree to and authorize Acquirer to reclaim an amount of cash from the Indemnity Escrow Fund in satisfaction of claims asserted by Acquirer (on behalf of itself or any other Indemnified Person, including by not objecting to such claims) pursuant to this Article VIII, (iv) object to such claims pursuant to Section 8.6, (v) consent or agree to, negotiate, enter into, or, if applicable, contest, prosecute or defend, settlements and compromises of, and demand arbitration and comply with Orders of courts and awards of arbitrators with respect to, such claims, resolve any such claims, take any actions in connection with the resolution of any dispute relating hereto or to the Transactions by arbitration, settlement or otherwise, and take or forego any or all actions permitted or required of any Indemnifying Holder or necessary in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing and all of the other terms, conditions and limitations of this Agreement, (vi) consult with legal counsel, independent public accountants and other experts selected by it, solely at the cost and expense of the Indemnifying Holders, (vii) consent or agree to any amendment to this Agreement or to waive any terms and conditions of this Agreement providing rights or benefits to the Indemnifying Holders (other than with respect to the payment of the Merger Consideration less the Indemnity Escrow Amount) in accordance with the terms hereof and in the manner provided herein, (viii) pursuant to Section 1.6, review, negotiate, object to, accept or agree to Acquirer’s calculation of Company Net Working Capital, and (ix) take all actions necessary or appropriate in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing, in each case without having to seek or obtain the consent of any Person under any circumstance. Notwithstanding the foregoing, the Securityholders’ Agent shall have no obligation to act on behalf of the Indemnifying Holders, except as expressly provided herein, in the Escrow Agreement and in the Securityholders’ Agent Engagement Agreement, and for purposes of clarity, there are no obligations of the Securityholders’ Agent in any ancillary agreement, schedule, exhibit or the Company Disclosure Letter. Acquirer, Merger Sub and their respective Affiliates (including after the Effective Time, the Surviving Corporation) shall be entitled to rely on the appointment of Fortis Advisors LLC as the Securityholders’ Agent and treat such Securityholders’ Agent as the duly appointed attorney-in-fact of each Indemnifying Holder and has the duties, power and authority provided for in this Section 8.7. The Indemnifying Holders, and such Indemnifying Holder’s successors as if expressly confirmed and ratified in writing by such Indemnifying Holder, shall be bound by all actions taken and documents executed by the Securityholders’ Agent in connection with this Article VIII, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement, and all defenses which may be available to any Indemnifying Holder to contest, negate or disaffirm the action of the Securityholders’ Agent taken in good faith under this Agreement, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement are waived. Acquirer and other Indemnified Persons shall be entitled to rely exclusively on any action or decision of the Securityholders’ Agent. The Person serving as the Securityholders’ Agent may be removed or replaced from time to time, or if such Person resigns from its position as the Securityholders’ Agent, then a successor may be appointed, by the holders of a majority in interest of the aggregate amount of cash then held in the Indemnity Escrow Fund (or, in the event that there is no cash then held in the Indemnity Escrow Fund by the Indemnifying Holders collectively having a Pro Rata Share greater than 50%) upon not less than 30 days’ prior written notice to Acquirer. The immunities and rights to indemnification shall survive the resignation or removal of the Securityholders’ Agent or any member of the Advisory Group and the Closing and/or any termination of this Agreement and the Escrow Agreement. No bond shall be required of the Securityholders’ Agent. (b) Certain Indemnifying Holders have entered into an engagement agreement (the “Securityholders’ Agent Engagement Agreement”) with the Securityholders’ Agent to provide direction to the Securityholders’ Agent in connection with its services under this Agreement, the Escrow Agreement and the Securityholders’ Agent Engagement Agreement (such Indemnifying Holders, including their individual representatives, collectively hereinafter referred to as the “Advisory Group”). Neither the Securityholders’ Agent nor its members, managers, directors, officers, contractors, agents and employees nor any member of the Advisory Group (collectively, the “Securityholders’ Agent Group”) shall be liable to any Indemnifying Holder for any act done or omitted hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement as the Securityholders’ Agent while acting in good faith (and any act done or omitted pursuant to the advice of counsel shall be conclusive evidence of such good faith) and without gross negligence or willful misconduct. The Indemnifying Holders shall severally but not jointly indemnify the Securityholders’ Agent Group and hold it harmless against any loss, Liability, claim, damage, fee, cost or expense (including fees, disbursements and costs of skilled professionals and in connection with seeking recovery from insurers), judgments, fines or amounts paid in settlement incurred without gross negligence, willful misconduct or bad faith on the part of the Securityholders’ Agent and arising out of, resulting from or in connection with the acceptance or administration of its duties hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement including all reasonable out-of-pocket costs and expenses and legal fees and other legal costs reasonably incurred by the Securityholders’ Agent (collectively, the “Securityholders’ Agent Expenses”). If not paid directly to the Securityholders’ Agent by the Indemnifying Holders, such Securityholders’ Agent Expenses may be recovered by the Securityholders’ Agent first, from the Expense Fund, and second, from the portion of the Indemnity Escrow Fund otherwise distributable to the Indemnifying Holders (and not distributed or distributable to an Indemnified Person or subject to a pending indemnification claim of an Indemnified Person) on or after the Escrow Release Date pursuant to the terms hereof, at the time of distribution, and such recovery will be made from the Indemnifying Holders according to their respective Pro Rata Share of such Securityholders’ Agent Expenses. The Indemnifying Holders acknowledge that the Securityholders’ Agent shall not be required to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges or pursuant to this Agreement, the Escrow Agreement or the transactions contemplated hereby or thereby. Furthermore, the Securityholders’ Agent shall not be required to take any action unless the Securityholders’ Agent has been provided with funds, security or indemnities which, in its determination, are sufficient to protect the Securityholders’ Agent against the costs, expenses and liabilities which may be incurred by the Securityholders’ Agent in performing such actions. (c) After the Closing, any notice or communication given or received by, and any decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, the Securityholders’ Agent that is within the scope of the Securityholders’ Agent’s authority under Section 8.7(a) shall constitute a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of all the Indemnifying Holders and their successors and shall be final, binding and conclusive upon each such Indemnifying Holder and its successors; and each Indemnified Person shall be entitled to rely exclusively upon any such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction as being a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, each and every such Indemnifying Holder. Acquirer, Merger Sub, the Surviving Corporation and the Indemnified Persons are hereby relieved from any Liability to any Person for any acts done by them in accordance with such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of the Securityholders’ Agent. (d) Acquirer will withhold each Indemnifying Holder’s Pro Rata Share of $100,000 (the aggregate amount so withheld from all Indemnifying Holders, the “Expense Fund Amount”) from the portion of the Merger Consideration otherwise payable by Acquirer to such Indemnifying Holders pursuant to Section 1.3(a)(i), Section 1.3(a)(ii), Section 1.3(a)(iii)(A) and Section 1.3(a)(iv) and pay such amount at Closing to the Securityholders’ Agent (the aggregate Expense Fund Amount held by the Securityholders’ Agent at any given time, the “Expense Fund”). The Expense Fund Amount shall be available for use by the Securityholders’ Agent in connection with the performance of the Securityholders’ Agent’s duties and obligations under this Agreement, the Securityholders’ Agent Engagement Agreement and the Escrow Agreement, and the Securityholders’ Agent shall pay any amounts remaining in the Expense Fund to Acquirer for distribution by Acquirer to the Indemnifying Holders in accordance with their respective Pro Rata Shares at such time as the Securityholders’ Agent determines to be appropriate. The Securityholders’ Agent is not providing any investment supervision, recommendations or advice and shall have no responsibility or liability for any loss of principal of the Expense Fund other than as a result of its gross negligence or willful misconduct. The Securityholders’ Agent is not acting as a withholding agent or in any similar capacity in connection with the Expense Fund, and has no tax reporting or income distribution obligations. The Indemnifying Holders shall not receive interest or other earnings on the Expense Fund Amount. For tax purposes, the Expense Fund Amount shall be treated as having been received and voluntarily set aside by the applicable Indemnifying Holders following the Effective Time. For the avoidance of doubt, no Indemnifying Holders shall have any rights in or claims to the Expense Fund Amount. (e) The Securityholders’ Agent shall be entitled to: (i) rely upon the Spreadsheet, (ii) rely upon any signature believed by it to be genuine, and (iii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Indemnifying Holder or other party. (f) The powers, immunities and rights to indemnification granted to the Securityholders’ Agent Group hereunder: (i) are coupled with an interest and shall be irrevocable and survive the death, incompetence, bankruptcy or liquidation of any Indemnifying Holder and shall be binding on any successor thereto, and (ii) shall survive the delivery of an assignment by any Indemnifying Holder of the whole or any fraction of his, her or its interest in the Indemnity Escrow Fund.

Appears in 2 contracts

Sources: Merger Agreement, Merger Agreement (Imperva Inc)

Securityholders Agent. (a) ~~By virtue of the approval of the Merger and this Agreement by the Indemnifying Holders and without any further action of any of the Indemnifying Holders or the Company, at~~ At the Closing, Fortis Advisors LLC shall be constituted and appointed as the Securityholders’ Agent. The Securityholders’ Agent shall be the exclusive agent and ~~attorney in~~ attorney-in-fact for and on behalf of the Indemnifying Holders to: (i) execute, as the Securityholders’ Agent, this Agreement and any agreement or instrument entered into or delivered in connection with the Transactions, (ii) give and receive notices, instructions and communications permitted or required under this Agreement, the Escrow Agreement or any other agreement, document or instrument entered into or executed in connection herewith, for and on behalf of any Indemnifying Holder, to or from Acquirer (on behalf of itself or any other Indemnified Person) relating to this Agreement or any of the Transactions and any other matters contemplated by this Agreement or by such other agreement, document or instrument (except to the extent that this Agreement expressly contemplates that any such notice or communication shall be given or received by each Indemnifying Holder individually), (iii) review, negotiate and agree to and authorize Acquirer to reclaim an amount of cash from the ~~Indemnity~~ Escrow Fund in satisfaction of claims asserted by Acquirer (on behalf of itself or any other Indemnified Person, including by not objecting to such claims) pursuant to this Article ~~VIII~~VII, (iv) object to such claims pursuant to Section ~~8.6~~7.7, (v) consent or agree to, negotiate, enter into, or, if applicable, contest, prosecute or defend, settlements and compromises of, and demand arbitration and comply with Orders of courts and awards of arbitrators with respect to, such claims, resolve any such claims, take any actions in connection with the resolution of any dispute relating hereto or to the Transactions by arbitration, settlement or otherwise, and take or forego any or all actions permitted or required of any Indemnifying Holder or necessary in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing and all of the other terms, conditions and limitations of this Agreement, (vi) consult with legal counsel, independent public accountants and other experts selected by it, solely at the cost and expense of the Indemnifying Holders, (vii) consent or agree to any amendment to this Agreement or to waive any terms and conditions of this Agreement providing rights or benefits to the Indemnifying Holders (other than with respect to the payment of the ~~Merger Consideration less the Indemnity Escrow Amount~~Adjusted Consideration) in accordance with the terms hereof and in the manner provided herein, (viii) pursuant to Section ~~1.6~~1.2, review, negotiate, object to, accept or agree to Acquirer’s calculation of Company Net Working ~~Capital,~~ Capital and (ix) take all actions necessary or appropriate in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing, in each case without having to seek or obtain the consent of any Person under any circumstance. Notwithstanding the foregoing, the Securityholders’ Agent shall have no obligation to act on behalf of the Indemnifying Holders, except as expressly provided herein, in the Escrow Agreement and in the Securityholders’ Agent Engagement Agreement, and for purposes of clarity, there are no obligations of the Securityholders’ Agent in any ancillary agreement, schedule, exhibit or the Company Disclosure Letter. Acquirer, ~~Merger Sub~~ Subco and their respective Affiliates (including after the ~~Effective Time~~Closing Date, the ~~Surviving Corporation~~Company) shall be entitled to rely on the appointment of Fortis Advisors LLC as the Securityholders’ Agent and treat such Securityholders’ Agent as the duly appointed attorney-in-fact of each Indemnifying Holder and has having the duties, power and authority provided for in this Section ~~8.7~~7.8. The Indemnifying ~~Holders, and such Indemnifying Holder’s successors as if expressly confirmed and ratified in writing by such Indemnifying Holder,~~ Holders shall be bound by all actions taken and documents executed by the Securityholders’ Agent in connection with this Article ~~VIII, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement~~VII, and all defenses which may be available to any Indemnifying Holder to contest, negate or disaffirm the action of the Securityholders’ Agent taken in good faith under this Agreement, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement are waived. Acquirer and other Indemnified Persons shall be entitled to rely exclusively on any action or decision of the Securityholders’ Agent. The Person serving as the Securityholders’ Agent may be removed or replaced from time to time, or if such Person resigns from its position as the Securityholders’ Agent, then a successor may be appointed, by the holders of a majority in interest of the aggregate amount of cash then held in the ~~Indemnity~~ Escrow Fund (or, in the event that there is no cash then held in the ~~Indemnity~~ Escrow Fund by the Indemnifying Holders collectively having a Pro Rata Share greater than 50%) upon not less than 30 days’ prior written notice to Acquirer. The immunities and rights to indemnification shall survive the resignation or removal of the Securityholders’ Agent or any member of the Advisory Group and the Closing and/or any termination of this Agreement and the Escrow Agreement. No bond shall be required of the Securityholders’ Agent. The Securityholders’ Agent shall be entitled to: (i) rely upon the Spreadsheet; (ii) rely upon any signature believed by it to be genuine; and (iii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Indemnifying Holder or other party. The powers, immunities and rights to indemnification granted to the Securityholders’ Agent Group hereunder: (i) are coupled with an interest and shall be irrevocable and survive the death, incompetence, bankruptcy or liquidation of any Indemnifying Holder and shall be binding on any successor thereto; and (ii) shall survive the delivery of an assignment by any Indemnifying Holder of the whole or any fraction of his, her or its interest in the Escrow Fund. (b) Certain Indemnifying Holders have entered into an engagement agreement (the “Securityholders’ Agent Engagement Agreement”) with the Securityholders’ Agent to provide direction to the Securityholders’ Agent in connection with its services under this Agreement, the Escrow Agreement and the Securityholders’ Agent Engagement Agreement (such Indemnifying Holders, including their individual representatives, collectively hereinafter referred to as the “Advisory Group”). Neither the Securityholders’ Agent nor its members, managers, directors, officers, contractors, agents and employees nor any member of the Advisory Group (collectively, the “Securityholders’ Agent Group”) shall be liable to any Indemnifying Holder for any act done or omitted hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement as the Securityholders’ Agent while acting in good faith (and any act done or omitted pursuant to the advice of counsel shall be conclusive evidence of such good faith) and without gross negligence or willful misconduct. The Indemnifying Holders shall severally but not jointly indemnify the Securityholders’ Agent Group and defend and hold it harmless against any loss, Liability, claim, damage, fee, ~~cost~~ fine, cost, amount paid in settlement, judgment or expense ~~(including fees, disbursements and costs of skilled professionals and in connection with seeking recovery from insurers), judgments, fines or amounts paid in settlement~~ incurred without gross negligence, willful misconduct or bad faith on the part of the Securityholders’ Agent and arising out of, resulting from or in connection with the acceptance or administration of its duties hereunder, ~~under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement~~ including all reasonable out-of-pocket costs and expenses and legal fees and other legal and skilled professionals’ costs reasonably incurred by the Securityholders’ Agent and in connection with seeking recovery from insurers (collectively, the “Securityholders’ Agent Expenses”). If not paid directly to the Securityholders’ Agent by the Indemnifying Holders, such Securityholders’ Agent Expenses may be recovered by the Securityholders’ Agent first, from the Expense Fund, second, and ~~second~~with the prior written consent of the Advisory Group, from the portion of the ~~Indemnity~~ Escrow Fund otherwise distributable to the Indemnifying Holders (and not distributed or distributable to an Indemnified Person or subject to a pending indemnification claim of an Indemnified Person) on or after the Escrow Release Date pursuant to the terms hereof, at the time of distribution, and third, directly from the Indemnifying Holders. Any such recovery will be made from the Indemnifying Holders according to their respective Pro Rata ~~Share~~ Shares of such Securityholders’ Agent Expenses. The Indemnifying Holders acknowledge that the Securityholders’ Agent shall not be required to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges or pursuant to this Agreement, the Escrow Agreement or the transactions contemplated hereby or thereby. Furthermore, the Securityholders’ Agent shall not be required to take any action unless the Securityholders’ Agent has been provided with funds, security or indemnities which, in its determination, are sufficient to protect the Securityholders’ Agent against the costs, expenses and liabilities which may be incurred by the Securityholders’ Agent in performing such actions. The immunities and rights to indemnification shall survive the resignation or removal of the Securityholders’ Agent or any member of the Advisory Group and the Closing and/or any termination of this Agreement and the Escrow Agreement. (c) After the Closing, any notice or communication given or received by, and any decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, the Securityholders’ Agent that is within the scope of the Securityholders’ Agent’s authority under Section ~~8.7(a~~7.8(a) shall constitute a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of all the Indemnifying Holders and ~~their successors and~~ shall be final, binding and conclusive upon each such Indemnifying Holder and ~~its successors;~~ such Indemnifying Holder’s successors as if expressly confirmed and ~~each~~ ratified in writing by such Indemnifying Holder, and all defenses which may be available to any Indemnifying Holder to contest, negate or disaffirm the action of the Securityholders’ Agent taken in good faith under this Agreement, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement are waived. Each Indemnified Person shall be entitled to rely exclusively upon any such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction as being a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, each and every such Indemnifying Holder. Acquirer, ~~Merger Sub~~Subco, the ~~Surviving Corporation~~ Company (from and after the Closing Date) and the Indemnified Persons are hereby relieved from any Liability to any Person for any acts done by them in accordance with such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of the Securityholders’ Agent. (d) Acquirer will withhold each Indemnifying Holder’s Pro Rata Share of $100,000 (the aggregate amount so withheld from all Indemnifying Holders, the “Expense Fund Amount”) from the portion of the Merger Consideration otherwise payable by Acquirer to such Indemnifying Holders pursuant to Section 1.3(a)(i), Section 1.3(a)(ii), Section 1.3(a)(iii)(A) and Section 1.3(a)(iv) and pay such amount at Closing to the Securityholders’ Agent (the aggregate Expense Fund Amount held by the Securityholders’ Agent at any given time, the “Expense Fund”). The Expense Fund Amount shall be available for use by the Securityholders’ Agent in connection with the performance of the Securityholders’ Agent’s duties and obligations under this Agreement, the Securityholders’ Agent Engagement Agreement and the Escrow Agreement, and the Securityholders’ Agent shall pay any amounts remaining in the Expense Fund to Acquirer for distribution by Acquirer to the Indemnifying Holders in accordance with their respective Pro Rata Shares at such time as the Securityholders’ Agent determines to be appropriate. The Securityholders’ Agent is not providing any investment supervision, recommendations or advice and shall have no responsibility or liability for any loss of principal of the Expense Fund other than as a result of its gross negligence or willful misconduct. The Securityholders’ Agent is not acting as a withholding agent or in any similar capacity in connection with the Expense Fund, and has no tax reporting or income distribution obligations. The Indemnifying Holders shall not receive interest or other earnings on the Expense Fund Amount. For tax purposes, the Expense Fund Amount shall be treated as having been received and voluntarily set aside by the applicable Indemnifying Holders following the Effective Time. For the avoidance of doubt, no Indemnifying Holders shall have any rights in or claims to the Expense Fund Amount. (e) The Securityholders’ Agent shall be entitled to: (i) rely upon the Spreadsheet, (ii) rely upon any signature believed by it to be genuine, and (iii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Indemnifying Holder or other party. (f) The powers, immunities and rights to indemnification granted to the Securityholders’ Agent Group hereunder: (i) are coupled with an interest and shall be irrevocable and survive the death, incompetence, bankruptcy or liquidation of any Indemnifying Holder and shall be binding on any successor thereto, and (ii) shall survive the delivery of an assignment by any Indemnifying Holder of the whole or any fraction of his, her or its interest in the Indemnity Escrow Fund.

Appears in 2 contracts

Sources: Share Purchase Agreement, Share Purchase Agreement (Yelp Inc)

Securityholders Agent. ~~(a) By virtue of~~ In the ~~approval of~~ event that the Merger ~~and this Agreement by the Indemnifying Holders~~ is approved, effective upon such vote and without any further ~~action~~ act of any shareholder, the Company Shareholders shall be deemed to have approved, among other matters, the indemnification and escrow terms set forth in Section 9, the Working Capital Adjustment provisions of Section 1.11 hereof, the terms of the ~~Indemnifying Holders or~~ Escrow Agreement and the Company, at the Closing, Fortis Advisors LLC shall be constituted and appointed as the Securityholders’ Agent. The Securityholders’ Agent shall be the exclusive agent and attorney in fact for and on behalf terms of the ~~Indemnifying Holders to: (i) execute~~Registration Rights Agreement, ~~as the Securityholders’ Agent, this Agreement~~ and ~~any agreement or instrument entered into or delivered~~ shall irrevocably appoint Eric ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ their agent for all purposes in connection ~~with~~ therewith (the ~~Transactions~~"Securityholders' Agent"), ~~(ii)~~ including to give and receive ~~notices, instructions~~ notices and ~~communications permitted or required under this Agreement, or any other agreement, document or instrument entered into or executed in connection herewith, for and on behalf of any Indemnifying Holder~~communications, to authorize delivery to Parent of Parent Common Stock, cash or ~~from Acquirer (on behalf of itself or any~~ other Indemnified Person) relating to this Agreement or any of the Transactions and any other matters contemplated by this Agreement or by such other agreement, document or instrument (except to the extent that this Agreement expressly contemplates that any such notice or communication shall be given or received by each Indemnifying Holder individually), (iii) review, negotiate and agree to and authorize Acquirer to reclaim an amount of cash property from the ~~Indemnity~~ Escrow ~~Fund in satisfaction of claims asserted by Acquirer (on behalf of itself or any other Indemnified Person~~Fund, ~~including by not objecting~~ to ~~such claims) pursuant to this Article VIII, (iv)~~ object to such ~~claims pursuant~~ deliveries, to ~~Section 8.6, (v) consent or~~ agree to, negotiate, enter ~~into, or, if applicable, contest, prosecute or defend,~~ into settlements and compromises of, and demand ~~arbitration~~ dispute resolution pursuant to the Escrow Agreement and comply with ~~Orders~~ orders of courts and awards of arbitrators with respect ~~to, such~~ to indemnification claims, ~~resolve any such claims, take any actions in connection with the resolution of any dispute relating hereto or~~ and to the Transactions by arbitration, settlement or otherwise, and take or forego any or all actions permitted or required of any Indemnifying Holder or necessary in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing and all of the other terms, conditions and limitations of this Agreement, (vi) consult with legal counsel, independent public accountants and other experts selected by it, solely at the cost and expense of the Indemnifying Holders, (vii) consent or agree to any amendment to this Agreement or to waive any terms and conditions of this Agreement providing rights or benefits to the Indemnifying Holders (other than with respect to the payment of the Merger Consideration less the Indemnity Escrow Amount) in accordance with the terms hereof and in the manner provided herein, (viii) pursuant to Section 1.6, review, negotiate, object to, accept or agree to Acquirer’s calculation of Company Net Working Capital, and (ix) take all actions necessary or appropriate in the judgment of the Securityholders’ ' Agent for the accomplishment of the foregoing~~, in each case without having to seek or obtain the consent of any Person under any circumstance~~. ~~Notwithstanding the foregoing,~~ Eric ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇eby accepts his appointment as the Securityholders~~’ Agent~~ ' Agent. Parent shall ~~have no obligation~~ be entitled to ~~act on behalf of the Indemnifying Holders, except as expressly provided herein, in the Escrow Agreement and in~~ deal exclusively with the Securityholders’ ' Agent ~~Engagement Agreement~~on all matters relating to Section 9, and for purposes of clarity, there are no obligations of the Securityholders’ Agent in any ancillary agreement, schedule, exhibit or the Company Disclosure Letter. Acquirer, Merger Sub and their respective Affiliates (including after the Effective Time, the Surviving Corporation) shall be entitled to rely conclusively (without further evidence of any kind whatsoever) on ~~the appointment~~ any document executed or purported to be executed on behalf of Fortis Advisors LLC as the Securityholders’ Agent and treat such Securityholders’ Agent as the duly appointed attorney-in-fact of each Indemnifying Holder and has the duties, power and authority provided for in this Section 8.7. The Indemnifying Holders, and such Indemnifying Holder’s successors as if expressly confirmed and ratified in writing by such Indemnifying Holder, shall be bound by all actions taken and documents executed any Company Shareholder by the Securityholders’ ' Agent ~~in connection with this Article VIII~~(including, without limitation, the ~~Escrow Agreement or the Securityholders’ Agent Engagement Agreement, and all defenses which may be available to any Indemnifying Holder to contest, negate or disaffirm the action~~ execution of the Securityholders’ Agent taken in good faith under this Agreement, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement are waived. Acquirer and other Indemnified Persons shall be entitled to rely exclusively on any action or decision of the Securityholders’ Agent. The Person serving as the Securityholders’ Agent may be removed or replaced from time to time, or if such Person resigns from its position as the Securityholders’ Agent, then a successor may be appointed, by the holders of a majority in interest of the aggregate amount of cash then held in the Indemnity Escrow Fund (or, in the event that there is no cash then held in the Indemnity Escrow Fund by the Indemnifying Holders collectively having a Pro Rata Share greater than 50%) upon not less than 30 days’ prior written notice to Acquirer. The immunities and rights to indemnification shall survive the resignation or removal of the Securityholders’ Agent or any member of the Advisory Group and the Closing and/or any termination of this Agreement and the Escrow Agreement. No bond shall be required of the Securityholders’ Agent. (b) Certain Indemnifying Holders have entered into an engagement agreement (the “Securityholders’ Agent Engagement Agreement”) with the Securityholders’ Agent to provide direction to the Securityholders’ Agent in connection with its services under this Agreement, the Escrow Agreement and the ~~Securityholders’ Agent Engagement~~ Registration Rights Agreement (such Indemnifying Holders, including their individual representatives, collectively hereinafter referred to as the “Advisory Group”). Neither the Securityholders’ Agent nor its members, managers, directors, officers, contractors, agents and employees nor any member of the Advisory Group (collectively, the “Securityholders’ Agent Group”) shall be liable to any Indemnifying Holder for any act done or omitted hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement as the Securityholders’ Agent while acting in good faith (and any act done or omitted pursuant to the advice of counsel shall be conclusive evidence of such good faith) and without gross negligence or willful misconduct. The Indemnifying Holders shall severally but not jointly indemnify the Securityholders’ Agent Group and hold it harmless against any loss, Liability, claim, damage, fee, cost or expense (including fees, disbursements and costs of skilled professionals and in connection with seeking recovery from insurers), judgments, fines or amounts paid in settlement incurred without gross negligence, willful misconduct or bad faith on the part of the Securityholders’ Agent and arising out of, resulting from or in connection with the acceptance or administration of its duties hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement including all reasonable out-of-pocket costs and expenses and legal fees and other legal costs reasonably incurred by the Securityholders’ Agent (collectively, the “Securityholders’ Agent Expenses”). If not paid directly to the Securityholders’ Agent by the Indemnifying Holders, such Securityholders’ Agent Expenses may be recovered by the Securityholders’ Agent first, from the Expense Fund, and second, from the portion of the Indemnity Escrow Fund otherwise distributable to the Indemnifying Holders (and not distributed or distributable to an Indemnified Person or subject to a pending indemnification claim of an Indemnified Person) on or after the Escrow Release Date pursuant to the terms hereof, at the time of distribution, and such recovery will be made from the Indemnifying Holders according to their respective Pro Rata Share of such Securityholders’ Agent Expenses. The Indemnifying Holders acknowledge that the Securityholders’ Agent shall not be required to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges or pursuant to this Agreement, the Escrow Agreement or the transactions contemplated hereby or thereby. Furthermore, the Securityholders’ Agent shall not be required to take any action unless the Securityholders’ Agent has been provided with funds, security or indemnities which, in its determination, are sufficient to protect the Securityholders’ Agent against the costs, expenses and liabilities which may be incurred by the Securityholders’ Agent in performing such actions. (c) After the Closing, any notice or communication given or received by, and any decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, the Securityholders’ Agent that is within the scope of the Securityholders’ Agent’s authority under Section 8.7(a) shall constitute a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of all the Indemnifying Holders and their successors and shall be final, binding and conclusive upon each such Indemnifying Holder and its successors; and each Indemnified Person shall be entitled to rely exclusively upon any such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction as being a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, each and every such Indemnifying Holder. Acquirer, Merger Sub, the Surviving Corporation and the Indemnified Persons are hereby relieved from any Liability to any Person for any acts done by them in accordance with such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of the Securityholders’ Agent. (d) Acquirer will withhold each Indemnifying Holder’s Pro Rata Share of $100,000 (the aggregate amount so withheld from all Indemnifying Holders, the “Expense Fund Amount”) from the portion of the Merger Consideration otherwise payable by Acquirer to such Indemnifying Holders pursuant to Section 1.3(a)(i), Section 1.3(a)(ii), Section 1.3(a)(iii)(A) and Section 1.3(a)(iv) and pay such amount at Closing to the Securityholders’ Agent (the aggregate Expense Fund Amount held by the Securityholders’ Agent at any given time, the “Expense Fund”). The Expense Fund Amount shall be available for use by the Securityholders’ Agent in connection with the performance of the Securityholders’ Agent’s duties and obligations under this Agreement, the Securityholders’ Agent Engagement Agreement and the Escrow Agreement, and the Securityholders’ Agent shall pay any amounts remaining in the Expense Fund to Acquirer for distribution by Acquirer to the Indemnifying Holders in accordance with their respective Pro Rata Shares at such time as the Securityholders’ Agent determines to be appropriate. The Securityholders’ Agent is not providing any investment supervision, recommendations or advice and shall have no responsibility or liability for any loss of principal of the Expense Fund other than as a result of its gross negligence or willful misconduct. The Securityholders’ Agent is not acting as a withholding agent or in any similar capacity in connection with the Expense Fund, and has no tax reporting or income distribution obligations. The Indemnifying Holders shall not receive interest or other earnings on the Expense Fund Amount. For tax purposes, the Expense Fund Amount shall be treated as having been received and voluntarily set aside by the applicable Indemnifying Holders following the Effective Time. For the avoidance of doubt, no Indemnifying Holders shall have any rights in or claims to the Expense Fund Amount. (e) The Securityholders’ Agent shall be entitled to: (i) rely upon the Spreadsheet, (ii) rely upon any signature believed by it to be genuine, and (iii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Indemnifying Holder or other party. (f) The powers, immunities and rights to indemnification granted to the Securityholders’ Agent Group hereunder: (i) are coupled with an interest and shall be irrevocable and survive the death, incompetence, bankruptcy or liquidation of any Indemnifying Holder and shall be binding on any successor thereto, and (ii) shall survive the delivery of an assignment by any Indemnifying Holder of the whole or any fraction of his, her or its interest in the Indemnity Escrow Fund.the

Appears in 1 contract

Sources: Merger Agreement (Messagemedia Inc)

Securityholders Agent. (a) ~~By virtue of the approval of the Merger and this Agreement by the Indemnifying Holders and without any further action of any of the Indemnifying Holders or the Company, at~~ At the Closing, Fortis Advisors LLC shall be constituted and appointed as the Securityholders’ Agent. The Securityholders’ Agent shall be the exclusive agent and ~~attorney in~~ the true and lawful attorney-in-fact for and on behalf of the ~~Indemnifying Holders~~ Company Securityholders to: (i) execute, as the Securityholders’ Agent, this Agreement and any agreement or instrument entered into or delivered in connection with the Transactions, (ii) give and receive notices, instructions and communications permitted or required under this Agreement, or any other agreement, document or instrument entered into or executed in connection herewith, for and on behalf of any ~~Indemnifying Holder~~Company Securityholder, to or from Acquirer (on behalf of itself or any other Indemnified Person) relating to this Agreement or any of the Transactions and any other matters contemplated by this Agreement or by such other agreement, document or instrument (except to the extent that this Agreement expressly contemplates that any such notice or communication shall be given or received by each ~~Indemnifying Holder~~ Company Securityholder individually), (iii) review, negotiate and agree to and authorize Acquirer to reclaim an amount ~~of cash~~ from the ~~Indemnity~~ Escrow Fund in satisfaction of claims asserted by Acquirer (on behalf of itself or any other Indemnified Person, including by not objecting to such claims) pursuant to this Article VIII, (iv) object to such claims pursuant to Section 8.6, (v) consent or agree to, negotiate, enter into, or, if applicable, contest, prosecute or defend, settlements and compromises of, and demand arbitration and comply with Orders of courts and awards of arbitrators with respect to, such claims, resolve any such claims, take any actions in connection with the resolution of any dispute relating hereto or to the Transactions by arbitration, settlement or otherwise, and take or forego any or all actions permitted or required of any ~~Indemnifying Holder~~ Company Securityholder or necessary in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing and all of the other terms, conditions and limitations of this Agreement, (vi) consult with legal counsel, independent public accountants and other experts selected by it, solely at the cost and expense of the ~~Indemnifying Holders~~Company Securityholders, (vii) consent or agree to any amendment to this Agreement or to waive any terms and conditions of this Agreement providing rights or benefits to the ~~Indemnifying Holders~~ Company Securityholders (other than with respect to the payment of the Merger Consideration less the ~~Indemnity~~ Escrow Amount) in accordance with the terms hereof and in the manner provided herein, (viii) pursuant to Section 1.6, review, negotiate, object to, accept or agree to Acquirer’s calculation of Company Net Working ~~Capital,~~ Capital and (ix) take all actions necessary or appropriate in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing, in each case without having to seek or obtain the consent of any Person under any circumstance. Notwithstanding the foregoing, the Securityholders’ Agent shall have no obligation to act on behalf of the ~~Indemnifying Holders~~Company Securityholders, except as expressly provided herein, in the Escrow Agreement and in the Securityholders’ Agent Engagement Agreement, and for purposes of clarity, there are no obligations of the Securityholders’ Agent in any ancillary agreement, schedule, exhibit or the Company Disclosure Letter. The Securityholders’ Agent shall be entitled to: (i) rely upon any signature reasonably believed by it to be genuine and (ii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Company Securityholder or other party. Acquirer, Merger Sub and their respective Affiliates (including after the Effective Time, the Surviving Corporation) shall be entitled to rely on the appointment of Fortis Advisors LLC as the Securityholders’ Agent and treat such Securityholders’ Agent as the duly appointed attorney-in-fact of each ~~Indemnifying Holder~~ Company Securityholder and has having the duties, power and authority provided for in this Section 8.7. The ~~Indemnifying Holders~~powers, immunities and rights to indemnification granted to the Securityholders’ Agent Group hereunder: (i) are coupled with an interest and shall be irrevocable and survive the death, incompetence, bankruptcy or liquidation of any Company Securityholder and shall be binding on any successor thereto, and ~~such Indemnifying Holder’s successors as if expressly confirmed and ratified~~ (ii) shall survive the delivery of an assignment by any Company Securityholder of the whole or any fraction of his, her or its interest in ~~writing by such Indemnifying Holder,~~ the Escrow Fund. The Company Securityholders shall be bound by all actions taken and documents executed by the Securityholders’ Agent in connection with this Article VIII, ~~the Escrow Agreement or the Securityholders’ Agent Engagement Agreement,~~ and all defenses which may be available to any Indemnifying Holder to contest, negate or disaffirm the action of the Securityholders’ Agent taken in good faith under this Agreement, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement are waived. Acquirer and other Indemnified Persons shall be entitled to rely exclusively on any action or decision of the Securityholders’ Agent. The Person serving as the Securityholders’ Agent may be removed or replaced from time to time, or if such Person resigns from its position as the Securityholders’ Agent, then a successor may be appointed, by the holders of a majority in interest of the aggregate amount of cash then held in the Indemnity Escrow Fund (or, in the event that there is no cash then held in the Indemnity Escrow Fund by the Indemnifying Holders Company Securityholders collectively having a Closing Pro Rata Share greater than 50%% and Company Securityholders holding at least 50% of the Company Series B Stock (as of immediately prior to the Effective Time) upon not less than 30 days’ prior written notice to Acquirer. The immunities and rights to indemnification shall survive the resignation or removal of the Securityholders’ Agent or any member of the Advisory Group and the Closing and/or any termination of this Agreement and the Escrow Agreement. No bond shall be required of the Securityholders’ Agent. (b) Certain ~~Indemnifying Holders~~ Company Securityholders have entered into an engagement agreement (the “Securityholders’ Agent Engagement Agreement”) with the Securityholders’ Agent to provide direction to the Securityholders’ Agent in connection with its services under this Agreement, the Escrow Agreement and the Securityholders’ Agent Engagement Agreement (such ~~Indemnifying Holders~~Company Securityholders, including their individual representatives, collectively hereinafter referred to as the “Advisory Group”). Neither the Securityholders’ Agent nor its members, managers, directors, officers, contractors, agents and employees nor any member of the Advisory Group (collectively, the “Securityholders’ Agent Group”) shall be liable to any ~~Indemnifying Holder~~ Company Securityholder for any act done or omitted hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement as the Securityholders’ Agent while acting in good faith (and any act done or omitted pursuant to the advice of counsel shall be conclusive evidence of such good faith) and without gross negligence or willful misconduct. The ~~Indemnifying Holders~~ Company Securityholders shall severally but not jointly (with such Liability determined in accordance with such Company Securityholders’ Indemnity Pro Rata Share) indemnify the Securityholders’ Agent Group and defend and hold it the Securityholders’ Agent Group harmless against any loss, Liability, claim, damage, fee, ~~cost or expense (including fees~~fine, ~~disbursements and costs of skilled professionals and in connection with seeking recovery from insurers)~~cost, ~~judgments~~judgment, ~~fines or amounts~~ amount paid in settlement or expense incurred without gross negligence, willful misconduct or bad faith on the part of the Securityholders’ Agent and arising out of, resulting from or in connection with the acceptance or administration of ~~its~~ the Securityholders’ Agent’s duties hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement including all reasonable out-of-pocket costs and expenses and legal fees and other legal costs reasonably incurred by the Securityholders’ Agent (collectively, the “Securityholders’ Agent Expenses”). If not paid directly to the Securityholders’ Agent by the ~~Indemnifying Holders~~Company Securityholders, such Securityholders’ Agent Expenses may be recovered by the Securityholders’ Agent ~~first, from the Expense Fund, and second,~~ from the portion of the ~~Indemnity~~ Escrow Fund otherwise distributable to the ~~Indemnifying Holders~~ Company Securityholders (and not distributed or distributable to an Indemnified Person or subject to a pending indemnification claim of an Indemnified Person) on or after the Escrow Release Date pursuant to the terms hereof, at the time of distribution, and such recovery will be made from the ~~Indemnifying Holders~~ Company Securityholders according to their respective Indemnity Pro Rata ~~Share~~ Shares of such Securityholders’ Agent Expenses. The ~~Indemnifying Holders~~ Company Securityholders acknowledge that the Securityholders’ Agent shall not be required to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges or pursuant to this Agreement, the Escrow Agreement, the Securityholders’ Agent Engagement Agreement or the transactions contemplated hereby or thereby. Furthermore, the Securityholders’ Agent shall not be required to take any action unless the Securityholders’ Agent has been provided with funds, security or indemnities which, in its determination, are sufficient to protect the Securityholders’ Agent against the costs, expenses and liabilities which may be incurred by the Securityholders’ Agent in performing such actions. (c) After the Closing, any notice or communication given or received by, and any decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, the Securityholders’ Agent that is within the scope of the Securityholders’ Agent’s authority under Section 8.7(a) shall constitute a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of all the ~~Indemnifying Holders and their successors~~ Company Securityholders and shall be final, binding and conclusive upon each such ~~Indemnifying Holder and its successors~~Company Securityholder; and ~~each~~ all defenses which may be available to any Company Securityholder to contest, negate or disaffirm the action of the Securityholders’ Agent taken in good faith under this Agreement, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement are waived. Each Indemnified Person shall be entitled to rely exclusively upon any such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction as being a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, each and every such ~~Indemnifying Holder~~Company Securityholder. Acquirer, Merger Sub, the Surviving Corporation and the Indemnified Persons are hereby relieved from any Liability to any Person for any acts done by them in accordance with such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of the Securityholders’ Agent. (d) ~~Acquirer will withhold each Indemnifying Holder’s Pro Rata Share~~ The Securityholders’ Agent shall use the Securityholders’ Agent Fund to (i) make any payment required to be made for the account of ~~$100,000~~ the Company Securityholders pursuant to this Agreement, (ii) pay any Transaction Expenses not otherwise paid at the ~~aggregate amount so withheld from all Indemnifying Holders,~~ Closing or taken into account in the ~~“Expense Fund Amount”) from the portion~~ calculation of the Merger Consideration ~~otherwise payable by Acquirer to such Indemnifying Holders pursuant to Section 1.3(a)(i), Section 1.3(a)(ii), Section 1.3(a)(iii)(A~~(including any Transaction Expenses incurred after the Closing) and ~~Section 1.3(a)(iv~~(iii) ~~and~~ pay ~~such amount at Closing to~~ all Securityholders’ Agent Expenses incurred by or on behalf of the Securityholders’ ~~Agent (the aggregate Expense Fund Amount held by the~~ Agent, in its capacity as such, including all Securityholders’ Agent at Expenses incurred in connection with any ~~given time~~pending or threatened dispute or claim with respect to this Agreement, any agreement, document or instrument entered into pursuant to this Agreement, or the ~~“Expense Fund”)~~Transactions. The ~~Expense~~ Securityholders’ Agent Fund ~~Amount shall~~ will be ~~available for use~~ held or disbursed, in whole or in part, as determined by the Securityholders’ Agent in connection with the performance of the Securityholders’ Agent’s duties and obligations under this Agreement, the Securityholders’ Agent Engagement Agreement and the Escrow Agreement, and the Securityholders’ Agent shall pay any amounts remaining in the Expense Fund to Acquirer for distribution by Acquirer to the Indemnifying Holders in accordance with their respective Pro Rata Shares at such time as the Securityholders’ Agent determines to be appropriateits sole discretion. The Securityholders’ Agent is not providing any investment supervision, recommendations or advice and shall have no responsibility or liability for any loss of principal of the ~~Expense~~ Securityholders’ Agent Fund other than as a result of its gross negligence or willful misconduct. The Securityholders’ Agent is not acting as a withholding agent or in any similar capacity in connection with the ~~Expense~~ Securityholders’ Agent Fund, and has no tax reporting or income distribution obligations. The Indemnifying Holders shall not receive interest or other earnings on the Expense Fund Amount. For tax purposes, the Expense Fund Amount shall be treated as having been received and voluntarily set aside retention by the applicable Indemnifying Holders following the Effective Time. For the avoidance of doubt, no Indemnifying Holders shall have any rights in or claims to the Expense Fund Amount. (e) The Securityholders’ Agent shall be entitled to: (i) rely upon the Spreadsheet, (ii) rely upon any signature believed by it to be genuine, and (iii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Indemnifying Holder or other party. (f) The powers, immunities and rights to indemnification granted to the Securityholders’ Agent ~~Group~~ of any amounts in the Securityholders’ Agent Fund shall not be evidence that the Company Securityholders or the Securityholders’ Agent have any liability under this Agreement. Any amounts received by the Securityholders’ Agent, in its capacity as such, including any amounts released from the Escrow Fund, may be used at the Securityholders’ Agent’s discretion to increase the Securityholders’ Agent Fund. If the Securityholders’ Agent determines to release all or a portion of the Securityholders’ Agent Fund to the Company Securityholders, such amounts will be distributed to the Paying Agent for further distribution to the Company Securityholders in accordance with their respective Escrow Distribution Pro Rata Shares. No interest shall accrue or be paid on any amounts payable from the Securityholders’ Agent Fund to the Company Securityholders or any other Person hereunder~~: (i~~. The determination by the Securityholders’ Agent of amounts payable under this Section 8.7(d) ~~are coupled with an interest and~~ shall be ~~irrevocable~~ final and survive the death, incompetence, bankruptcy or liquidation of any Indemnifying Holder and shall be binding on any successor thereto, and (ii) shall survive the delivery of an assignment by any Indemnifying Holder of the whole or any fraction of his, her or its interest in the Indemnity Escrow Fundbinding.

Appears in 1 contract

Sources: Merger Agreement (Etsy Inc)

Securityholders Agent. (a) By ~~virtue~~ voting in favor of the adoption of this Agreement, the approval of the principal terms of the Merger, and the consummation of the Merger or participating in the Merger and ~~this Agreement by~~ receiving the ~~Indemnifying Holders and without any further action of any of~~ benefits thereof, including the ~~Indemnifying Holders or~~ right to receive the Company, at the Closing, Fortis Advisors LLC shall be constituted and appointed as the Securityholders’ Agent. The Securityholders’ Agent shall be the exclusive agent and attorney in fact for and on behalf of the Indemnifying Holders to: (i) execute, as the Securityholders’ Agent, this Agreement and any agreement or instrument entered into or delivered consideration payable in connection with the ~~Transactions~~Merger, each Company Securityholder shall be deemed to irrevocably agree, constitute and appoint the Securityholders’ Agent (iiand by the execution of this Agreement as Securityholders’ Agent as of the date hereof, the Securityholders’ Agent hereby accepts its appointment) ~~give~~ as the true, exclusive and ~~receive notices~~lawful agent and attorney-in-fact of each of the Company Securityholder and Indemnifying Parties as of the Effective Time, ~~instructions and communications permitted or required under~~ for all purposes in connection with this Agreement, ~~or any other agreement~~the Transaction Documents and the transactions contemplated hereby and thereby, ~~document or instrument entered into or executed~~ including in connection ~~herewith,~~ with claims for indemnification under ‎Article 8 and ~~on behalf of any Indemnifying Holder,~~ to or from Acquirer (on behalf of itself or any other Indemnified Person) relating to this Agreement or any of the Transactions and any other matters contemplated by this Agreement or by such other agreement, document or instrument (except to the extent that this Agreement expressly contemplates that any such notice or communication shall be given or received by each Indemnifying Holder individually), (iii) review, negotiate and agree to and authorize Acquirer to reclaim an amount of cash from the Indemnity Escrow Fund in satisfaction of claims asserted by Acquirer (on behalf of itself or any other Indemnified Person, including by not objecting to such claims) pursuant to this Article VIII, (iv) object to such claims pursuant to Section 8.6, (v) consent or agree to, negotiate, and enter ~~into~~into and execute settlements, ~~or, if applicable, contest, prosecute or defend, settlements~~ adjustments and compromises of, and respond to or object to notices, demand arbitration and comply with ~~Orders~~ orders of courts and awards of arbitrators with respect to, any claims or disputes hereunder, to consent and vote in favor of the adoption of this Agreement and the transactions contemplated hereby, including pursuant to any proxies granted to it under any Merger Support Agreement and otherwise exercising any rights granted to it under any Merger Support Agreement to give effect to such ~~claims, resolve any such claims, take any actions in connection with the resolution of any dispute relating hereto or~~ Merger Support Agreement and to this Agreement and to the ~~Transactions by arbitration, settlement or otherwise~~transactions contemplated hereby, and to take all other actions that are either (i) necessary or ~~forego any or all actions permitted or required of any Indemnifying Holder or necessary~~ appropriate in the judgment of ~~the~~ Securityholders’ Agent for the accomplishment of the foregoing ~~and all of~~ (ii) specifically mandated or permitted by the ~~other terms, conditions and limitations~~ terms of this Agreement or any Merger Support Agreement, (viiii) ~~consult with legal counsel, independent public accountants and other experts selected by it, solely at the cost and expense of the Indemnifying Holders, (vii) consent~~ or agree to any amendment to this Agreement or to waive any terms and conditions of this Agreement providing rights or benefits to the Indemnifying Holders (other than with respect to the payment of the Merger Consideration less the Indemnity Escrow Amount) as may otherwise be needed in accordance with the terms hereof and in the manner provided herein, (viii) pursuant to Section 1.6, review, negotiate, object to, accept or agree to Acquirer’s calculation of Company Net Working Capital, and (ix) take all actions necessary or appropriate in the judgment furtherance of the Securityholders’ ~~Agent for the accomplishment of the foregoing, in each case without having to seek or obtain the consent of any Person~~ Agent’s obligations under ~~any circumstance. Notwithstanding the foregoing, the Securityholders’ Agent shall have no obligation to act on behalf of the Indemnifying Holders, except as expressly provided herein, in the Escrow~~ this Agreement and the agreements ancillary hereto, including updating the Consideration Spreadsheet from time to time as may be required or necessary to give effect to the terms hereof. Such actions may include collecting from Company Securityholders and providing to the Acquirer documents in ~~the Securityholders’ Agent Engagement Agreement,~~ connection with discovery or other information requests pursuant to any legal process. The Acquirer and for purposes of clarity, there are no obligations of the Securityholders’ Agent in any ancillary agreement, schedule, exhibit or the Company Disclosure Letter. Acquirer, Merger Sub and their respective its Affiliates (including after the Effective Time, the Surviving Corporation) shall be entitled to rely on the appointment of ~~Fortis Advisors LLC as~~ the Securityholders’ Agent and treat such Securityholders’ Agent as the duly appointed attorney-in-fact of each ~~Indemnifying Holder~~ Company Securityholder and ~~has~~ as having the duties, power and authority provided for in this Section ~~8.7~~8.10. ~~The Indemnifying Holders~~By approving this Agreement, each Company Securityholder agrees that all actions taken by the Securityholders’ Agent under this Agreement shall be binding upon such Company Securityholder and ~~such Indemnifying Holder’s successors~~ its successors, as if such action was expressly confirmed and ratified in writing by such Company Securityholder. This power of attorney is coupled with an interest and is irrevocable. (b) The Securityholders’ Agent may be removed by action of the Indemnifying ~~Holder~~Parties that are entitled to receive a majority of the Merger Consideration. In the event of the resignation, removal, death, or incapacity of the Securityholders’ Agent, a successor Securityholders’ Agent shall thereafter be ~~bound~~ appointed by vote or written consent of Indemnifying Parties that are entitled to receive a majority of the Merger Consideration, and such appointment shall become effective only upon written notice by such Indemnifying Parties to Acquirer. Any new or successor Securityholders’ Agent will assume all ~~actions taken~~ rights and ~~documents executed~~ obligations of the initial Securityholders’ Agent under this Agreement. (c) Solely as between the Securityholders’ Agent and the Indemnifying Parties, the Securityholders’ Agent will incur no liability of any kind with respect to any action or omission by the Securityholders’ Agent in connection with its services pursuant to this ~~Article VIII~~Agreement and any agreements ancillary hereto, except in the ~~Escrow Agreement~~ event of liability directly resulting from the Securityholders’ Agent’s fraud, gross negligence or willful misconduct. Solely as between the Securityholders’ Agent ~~Engagement Agreement~~and the Indemnifying Parties, ~~and all defenses which may be available to any Indemnifying Holder to contest, negate or disaffirm the action of~~ the Securityholders’ Agent ~~taken in good faith under this Agreement~~shall not be liable for any action or omission pursuant to the advice of counsel. The Indemnifying Parties shall indemnify, ~~the Escrow Agreement or~~ defend and hold harmless the Securityholders’ Agent ~~Engagement~~ from and against any and all losses, liabilities, damages, claims, penalties, fines, forfeitures, actions, fees, costs and expenses (including the fees and expenses of counsel and experts and their staffs and all expense of document location, duplication and shipment) (collectively, “Securityholders’ Agent Expenses”) arising out of or in connection with the Securityholders’ Agent’s execution and performance of this Agreement ~~are waived. Acquirer~~ and ~~other Indemnified Persons shall be entitled~~ any agreements ancillary hereto, in each case as such Securityholders’ Agent Expense is suffered or incurred; provided, that in the event that any such Securityholders’ Agent Expense is finally adjudicated to ~~rely exclusively on any action~~ have been directly caused by the fraud, gross negligence or ~~decision~~ willful misconduct of the Securityholders’ Agent~~. The Person serving as~~ , the Securityholders’ Agent ~~may be removed~~ will reimburse the Indemnifying Parties the amount of such indemnified Securityholders’ Agent Expense to the extent attributable to such fraud, gross negligence or ~~replaced from time to time, or if such Person resigns from its position as~~ willful misconduct. In no event will the Securityholders’ ~~Agent, then a successor may~~ Agent be ~~appointed, by the holders of a majority in interest~~ required to advance its own funds on behalf of the ~~aggregate amount~~ Indemnifying Parties or otherwise. Notwithstanding anything in this Agreement to the contrary, any restrictions or limitations on liability or indemnification obligations of ~~cash then held in the Indemnity Escrow Fund (or, in the event that there is no cash then held in the Indemnity Escrow Fund by~~ the Indemnifying ~~Holders collectively having a Pro Rata Share greater than 50%) upon~~ Parties set forth elsewhere in this Agreement are not ~~less than 30 days~~intended to be applicable to the indemnities provided to the Securityholders’ ~~prior written notice to Acquirer~~Agent under this section. The ~~immunities and rights to indemnification shall~~ foregoing indemnities will survive the Closing, the resignation or removal of the Securityholders’ Agent or ~~any member of~~ the ~~Advisory Group and the Closing and/or any~~ termination of this ~~Agreement and the Escrow~~ Agreement~~. No bond shall be required of the Securityholders’ Agent~~. (bd) Certain Indemnifying Holders have entered into an engagement agreement (the “Securityholders’ Agent Engagement Agreement”) with the Securityholders’ Agent to provide direction to the Securityholders’ Agent in connection with its services under this Agreement, the Escrow Agreement and the Securityholders’ Agent Engagement Agreement (such Indemnifying Holders, including their individual representatives, collectively hereinafter referred to as the “Advisory Group”). Neither the Securityholders’ Agent nor its members, managers, directors, officers, contractors, agents and employees nor any member of the Advisory Group (collectively, the “Securityholders’ Agent Group”) shall be liable to any Indemnifying Holder for any act done or omitted hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement as the Securityholders’ Agent while acting in good faith (and any act done or omitted pursuant to the advice of counsel shall be conclusive evidence of such good faith) and without gross negligence or willful misconduct. The Indemnifying Holders shall severally but not jointly indemnify the Securityholders’ Agent Group and hold it harmless against any loss, Liability, claim, damage, fee, cost or expense (including fees, disbursements and costs of skilled professionals and in connection with seeking recovery from insurers), judgments, fines or amounts paid in settlement incurred without gross negligence, willful misconduct or bad faith on the part of the Securityholders’ Agent and arising out of, resulting from or in connection with the acceptance or administration of its duties hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement including all reasonable out-of-pocket costs and expenses and legal fees and other legal costs reasonably incurred by the Securityholders’ Agent (collectively, the “Securityholders’ Agent Expenses”). If not paid directly to the Securityholders’ Agent by the Indemnifying Holders, such Securityholders’ Agent Expenses may be recovered by the Securityholders’ Agent first, from the Expense Fund, and second, from the portion of the Indemnity Escrow Fund otherwise distributable to the Indemnifying Holders (and not distributed or distributable to an Indemnified Person or subject to a pending indemnification claim of an Indemnified Person) on or after the Escrow Release Date pursuant to the terms hereof, at the time of distribution, and such recovery will be made from the Indemnifying Holders according to their respective Pro Rata Share of such Securityholders’ Agent Expenses. The Indemnifying Holders acknowledge that the Securityholders’ Agent shall not be required to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges or pursuant to this Agreement, the Escrow Agreement or the transactions contemplated hereby or thereby. Furthermore, the Securityholders’ Agent shall not be required to take any action unless the Securityholders’ Agent has been provided with funds, security or indemnities which, in its determination, are sufficient to protect the Securityholders’ Agent against the costs, expenses and liabilities which may be incurred by the Securityholders’ Agent in performing such actions. (c) After the Closing, any Any notice or communication given or received by, and any decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, the Securityholders’ Agent that is within the scope of the Securityholders’ Agent’s authority under this Section ~~8.7(a)~~ 8.10 shall constitute a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of all the ~~Indemnifying Holders and their successors and~~ Company Securityholders ‎and shall be final, binding and conclusive upon each such ~~Indemnifying Holder and its successors~~Company Securityholder; and each Indemnified Person shall be entitled to rely exclusively upon any such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction as being a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, each and every such ~~Indemnifying Holder~~Company Securityholders. The Acquirer, Merger Sub, Merger Sub II, the Surviving ~~Corporation~~ Corporation, the Surviving Company and the Indemnified Persons are hereby relieved from any Liability to any Person for any acts done by them in accordance with such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of the Securityholders’ Agent. (d) Acquirer will withhold each Indemnifying Holder’s Pro Rata Share of $100,000 (the aggregate amount so withheld from all Indemnifying Holders, the “Expense Fund Amount”) from the portion of the Merger Consideration otherwise payable by Acquirer to such Indemnifying Holders pursuant to Section 1.3(a)(i), Section 1.3(a)(ii), Section 1.3(a)(iii)(A) and Section 1.3(a)(iv) and pay such amount at Closing to the Securityholders’ Agent (the aggregate Expense Fund Amount held by the Securityholders’ Agent at any given time, the “Expense Fund”). The Expense Fund Amount shall be available for use by the Securityholders’ Agent in connection with the performance of the Securityholders’ Agent’s duties and obligations under this Agreement, the Securityholders’ Agent Engagement Agreement and the Escrow Agreement, and the Securityholders’ Agent shall pay any amounts remaining in the Expense Fund to Acquirer for distribution by Acquirer to the Indemnifying Holders in accordance with their respective Pro Rata Shares at such time as the Securityholders’ Agent determines to be appropriate. The Securityholders’ Agent is not providing any investment supervision, recommendations or advice and shall have no responsibility or liability for any loss of principal of the Expense Fund other than as a result of its gross negligence or willful misconduct. The Securityholders’ Agent is not acting as a withholding agent or in any similar capacity in connection with the Expense Fund, and has no tax reporting or income distribution obligations. The Indemnifying Holders shall not receive interest or other earnings on the Expense Fund Amount. For tax purposes, the Expense Fund Amount shall be treated as having been received and voluntarily set aside by the applicable Indemnifying Holders following the Effective Time. For the avoidance of doubt, no Indemnifying Holders shall have any rights in or claims to the Expense Fund Amount. (e) The Securityholders’ Agent ~~shall be entitled to: (i) rely upon~~ hereby represents and warrants that it has all necessary corporate power and authority to enter into this Agreement and the ~~Spreadsheet~~other Transaction Documents to which it is a party; and the execution, ~~(ii) rely upon any signature believed~~ delivery and performance by it to be genuine, and (iii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Indemnifying Holder or other party. (f) The powers, immunities and rights to indemnification granted to the Securityholders’ Agent ~~Group hereunder:~~ of this Agreement and the other Transaction Documents to which it is a party in accordance with the respective terms thereof has been duly authorized according to all necessary corporate action on the part of the Securityholders’ Agent. This Agreement and the other Transaction Documents to which it is a party, when executed and delivered, will be duly executed and delivered by the Securityholders’ Agent and, assuming the due authorization, execution and delivery by the other parties hereto, constitute the legal, valid and binding obligation of the Securityholders’ Agent, enforceable against the Securityholders’ Agent in accordance with its terms, subject only to the effect, if any, of (i) ~~are coupled with an interest~~ applicable bankruptcy and ~~shall be irrevocable and survive~~ other similar laws affecting the ~~death, incompetence, bankruptcy or liquidation~~ rights of ~~any Indemnifying Holder and shall be binding on any successor thereto,~~ creditors generally and (ii) ~~shall survive the delivery~~ rules of ~~an assignment by any Indemnifying Holder of the whole or any fraction of his~~law governing specific performance, ~~her or its interest in the Indemnity Escrow Fund~~injunctive relief and other equitable remedies.

Appears in 1 contract

Sources: Merger Agreement (Gatsby Digital, Inc.)

Securityholders Agent. (a) ~~By virtue of the approval of the Merger and this Agreement by the Indemnifying Holders and without any further action of any of the Indemnifying Holders or the Company, at~~ At the Closing, ~~Fortis Advisors LLC~~ Shareholder Representative Services LLC, shall be constituted and appointed as the Securityholders’ Agent. ~~The~~ For purposes of this Agreement, the term “Securityholders’ ~~Agent~~ Agent” shall be mean the exclusive agent ~~and attorney in fact~~ for and on behalf of the ~~Indemnifying Holders to~~Company Securityholders to take all actions necessary or appropriate on behalf of the Company Securityholders in connection with this agreement and the agreements ancillary hereto, including without limitation: (i) execute, as ~~the~~ Securityholders’ Agent, this Agreement and any agreement or instrument entered into or delivered in connection with the ~~Transactions,~~ transactions contemplated hereby; (ii) give and receive notices, ~~instructions~~ instructions, and communications permitted or required under this ~~Agreement,~~ Agreement or any other agreement, document or instrument entered into or executed in connection herewith, for and on behalf of any ~~Indemnifying Holder~~Company Securityholder, to or from ~~Acquirer~~ Acquiror (on behalf of itself or any other Indemnified Person) relating to this Agreement or any of the ~~Transactions~~ transactions and ~~any~~ other matters contemplated ~~by this Agreement or by such other agreement, document or instrument~~ hereby (except to the extent that this Agreement expressly contemplates that any such notice or communication shall be given or received by each ~~Indemnifying Holder~~ Company Securityholder individually), ; (iii) review, negotiate and agree to and authorize ~~Acquirer~~ deliveries to ~~reclaim an amount~~ Acquiror of ~~cash~~ from the ~~Indemnity~~ Escrow Fund in satisfaction of claims asserted by ~~Acquirer~~ Acquiror (on behalf of itself or any other Indemnified Person, including by not objecting to such claims) pursuant to this ~~Article VIII,~~ ARTICLE 8; (iv) object to such claims pursuant to Section ~~8.6,~~ 8.4; (v) consent or agree to, negotiate, enter into, or, if applicable, contest, prosecute or defend, settlements and compromises of, and demand arbitration and comply with ~~Orders~~ orders of courts and awards of arbitrators with respect to, such claims, resolve any such claims, take any actions in connection with the resolution of any dispute relating hereto or to the ~~Transactions~~ transactions contemplated hereby by arbitration, settlement or otherwise, and take or forego any or all actions permitted or required of any ~~Indemnifying Holder~~ Company Securityholder or necessary in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing and all of the other terms, conditions and limitations of this Agreement, ; (vi) consult with legal counsel, independent public accountants and other experts reasonably selected by it, solely at the cost and expense of the ~~Indemnifying Holders,~~ Company Securityholders; (vii) consent or agree to any amendment to this Agreement or to waive any terms and conditions of this Agreement providing rights or benefits to the ~~Indemnifying Holders~~ Company Securityholders (other than with respect to the payment of the Aggregate Merger ~~Consideration less the Indemnity Escrow Amount~~Consideration) in accordance with the terms hereof and in the manner provided herein, ; and (viii~~) pursuant to Section 1.6, review, negotiate, object to, accept or agree to Acquirer’s calculation of Company Net Working Capital, and (ix~~) take all actions necessary or appropriate in the judgment of the Securityholders’ Agent for the accomplishment of the foregoing, in each case without having to seek or obtain the consent of any Person under any circumstance. Notwithstanding the foregoing, the Securityholders’ Agent shall have no obligation to act on behalf of the Indemnifying Holders, except as expressly provided herein, in the Escrow Agreement and in the Securityholders’ Agent Engagement Agreement, and for purposes of clarity, there are no obligations of the Securityholders’ Agent in any ancillary agreement, schedule, exhibit or the Company Disclosure Letter. AcquirerAcquiror, Merger Sub and their respective Affiliates (including without limitation, after the Effective Time, the Surviving ~~Corporation~~Entity) shall be entitled to rely on the appointment of ~~Fortis Advisors~~ Shareholder Representative Services LLC as the Securityholders’ Agent and treat such Securityholders’ Agent as the duly appointed attorney-in-fact of each ~~Indemnifying Holder~~ Company Securityholder and has having the duties, power and authority provided for in this Section ~~8.7~~8.6. The ~~Indemnifying Holders, and such Indemnifying Holder’s successors as if expressly confirmed and ratified in writing by such Indemnifying Holder,~~ Company Securityholders shall be bound by all actions taken and documents executed by the Securityholders’ Agent in connection with this ~~Article VIII, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement~~ARTICLE 8, and all defenses which may be available to any Indemnifying Holder to contest, negate or disaffirm the action of the Securityholders’ Agent taken in good faith under this Agreement, the Escrow Agreement or the Securityholders’ Agent Engagement Agreement are waived. Acquirer Acquiror and other Indemnified Persons shall be entitled to rely exclusively on any action or decision of the Securityholders’ Agent. The Person serving as the Securityholders’ Agent may be ~~removed or~~ replaced from time to ~~time, or if such Person resigns from its position as the Securityholders’ Agent, then a successor may be appointed,~~ time by the holders of a majority in interest of the ~~aggregate amount of cash then held in the Indemnity~~ Escrow Fund ~~(or, in the event that there is no cash then held in the Indemnity Escrow Fund by the Indemnifying Holders collectively having a Pro Rata Share greater than 50%)~~ upon not less than 30 thirty (30) days’ prior written notice to ~~Acquirer~~Acquiror. The immunities and rights to indemnification shall survive the resignation or removal of the Securityholders’ Agent ~~or any member of the Advisory Group~~ and the Closing and/or any termination of this ~~Agreement and the Escrow~~ Agreement. No bond shall be required of the Securityholders’ Agent. (b) Certain Indemnifying Holders have entered into an engagement agreement (the “Securityholders’ Agent Engagement Agreement”) with the Securityholders’ Agent to provide direction to the Securityholders’ Agent in connection with its services under this Agreement, the Escrow Agreement and the Securityholders’ Agent Engagement Agreement (such Indemnifying Holders, including their individual representatives, collectively hereinafter referred to as the “Advisory Group”). Neither the Securityholders’ Agent nor its members, managers, directors, officers, contractors, agents and employees nor any member of the Advisory Group (collectively, the “Securityholders’ Agent Group”) shall be liable to any Indemnifying Holder for any act done or omitted hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement as the Securityholders’ Agent while acting in good faith (and any act done or omitted pursuant to the advice of counsel shall be conclusive evidence of such good faith) and without gross negligence or willful misconduct. The Indemnifying Holders shall severally but not jointly indemnify the Securityholders’ Agent Group and hold it harmless against any loss, Liability, claim, damage, fee, cost or expense (including fees, disbursements and costs of skilled professionals and in connection with seeking recovery from insurers), judgments, fines or amounts paid in settlement incurred without gross negligence, willful misconduct or bad faith on the part of the Securityholders’ Agent and arising out of, resulting from or in connection with the acceptance or administration of its duties hereunder, under the Escrow Agreement or under the Securityholders’ Agent Engagement Agreement including all reasonable out-of-pocket costs and expenses and legal fees and other legal costs reasonably incurred by the Securityholders’ Agent (collectively, the “Securityholders’ Agent Expenses”). If not paid directly to the Securityholders’ Agent by the Indemnifying Holders, such Securityholders’ Agent Expenses may be recovered by the Securityholders’ Agent first, from the Expense Fund, and second, from the portion of the Indemnity Escrow Fund otherwise distributable to the Indemnifying Holders (and not distributed or distributable to an Indemnified Person or subject to a pending indemnification claim of an Indemnified Person) on or after the Escrow Release Date pursuant to the terms hereof, at the time of distribution, and such recovery will be made from the Indemnifying Holders according to their respective Pro Rata Share of such Securityholders’ Agent Expenses. The Indemnifying Holders acknowledge that the Securityholders’ Agent shall not be required to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges or pursuant to this Agreement, the Escrow Agreement or the transactions contemplated hereby or thereby. Furthermore, the Securityholders’ Agent shall not be required to take any action unless the Securityholders’ Agent has been provided with funds, security or indemnities which, in its determination, are sufficient to protect the Securityholders’ Agent against the costs, expenses and liabilities which may be incurred by the Securityholders’ Agent in performing such actions. (c) After the Closing, any notice or communication given or received by, and any decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, the Securityholders’ Agent that is within the scope of the Securityholders’ Agent’s authority under Section 8.7(a) shall constitute a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of all the Indemnifying Holders and their successors and shall be final, binding and conclusive upon each such Indemnifying Holder and its successors; and each Indemnified Person shall be entitled to rely exclusively upon any such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction as being a notice or communication to or by, or a decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of, each and every such Indemnifying Holder. Acquirer, Merger Sub, the Surviving Corporation and the Indemnified Persons are hereby relieved from any Liability to any Person for any acts done by them in accordance with such notice, communication, decision, action, failure to act within a designated period of time, agreement, consent, settlement, resolution or instruction of the Securityholders’ Agent. (d) Acquirer will withhold each Indemnifying Holder’s Pro Rata Share of $100,000 (the aggregate amount so withheld from all Indemnifying Holders, the “Expense Fund Amount”) from the portion of the Merger Consideration otherwise payable by Acquirer to such Indemnifying Holders pursuant to Section 1.3(a)(i), Section 1.3(a)(ii), Section 1.3(a)(iii)(A) and Section 1.3(a)(iv) and pay such amount at Closing to the Securityholders’ Agent (the aggregate Expense Fund Amount held by the Securityholders’ Agent at any given time, the “Expense Fund”). The Expense Fund Amount shall be available for use by the Securityholders’ Agent in connection with the performance of the Securityholders’ Agent’s duties and obligations under this Agreement, the Securityholders’ Agent Engagement Agreement and the Escrow Agreement, and the Securityholders’ Agent shall pay any amounts remaining in the Expense Fund to Acquirer for distribution by Acquirer to the Indemnifying Holders in accordance with their respective Pro Rata Shares at such time as the Securityholders’ Agent determines to be appropriate. The Securityholders’ Agent is not providing any investment supervision, recommendations or advice and shall have no responsibility or liability for any loss of principal of the Expense Fund other than as a result of its gross negligence or willful misconduct. The Securityholders’ Agent is not acting as a withholding agent or in any similar capacity in connection with the Expense Fund, and has no tax reporting or income distribution obligations. The Indemnifying Holders shall not receive interest or other earnings on the Expense Fund Amount. For tax purposes, the Expense Fund Amount shall be treated as having been received and voluntarily set aside by the applicable Indemnifying Holders following the Effective Time. For the avoidance of doubt, no Indemnifying Holders shall have any rights in or claims to the Expense Fund Amount. (e) The Securityholders’ Agent shall be entitled to: (i) rely upon the Spreadsheet, (ii) rely upon any signature believed by it to be genuine, and (iii) reasonably assume that a signatory has proper authorization to sign on behalf of the applicable Indemnifying Holder or other party. (f) The powers, immunities and rights to indemnification granted to the Securityholders’ Agent Group hereunder: (i) are coupled with an interest and shall be irrevocable and survive the death, incompetence, bankruptcy or liquidation of any Indemnifying Holder and shall be binding on any successor thereto, and (ii) shall survive the delivery of an assignment by any Indemnifying Holder of the whole or any fraction of his, her or its interest in the Indemnity Escrow Fund.

Appears in 1 contract

Sources: Merger Agreement (Rapid7, Inc.)

Common use of Securityholders Agent Clause in Contracts