Indemnification by Shareholders Each Shareholder shall, severally and not jointly, to the extent permitted by applicable Law, indemnify and hold harmless REIT, its subsidiaries each of their respective trustees, directors, officers, employees, representatives and agents, in their capacity as such and each Person, if any, who controls REIT within the meaning of the Securities Act or the Exchange Act, and the heirs, executors, successors and assigns of any of the foregoing (collectively, the “REIT Indemnified Parties”) from and against any and all Covered Liabilities suffered, directly or indirectly, by any REIT Indemnified Party by reason of or arising out of any untrue statement or alleged untrue statement or omission or alleged omission contained or incorporated by reference in the Registration Statement under which the sale of Registrable Securities was registered under the Securities Act (or any amendment thereto), or any Prospectus, preliminary Prospectus, or free writing prospectus (as defined in Rule 405 promulgated under the Securities Act) related to such Registration Statement or any amendment thereof or supplement thereto, in reliance upon and in conformity with information furnished to REIT by such Shareholder expressly for use therein; provided, however, that (i) the indemnity agreement contained in this Section 5.2 shall not apply to amounts paid in settlement of any such Covered Liability if such settlement is effected without the consent of such Shareholder (which consent shall not be unreasonably withheld), and (ii) in no event shall the total amounts payable in indemnity by a Shareholder under this Section 5.2 exceed the net proceeds received by such Shareholder in the registered offering out of which such Covered Liability arises. The indemnity in this Section 5.2 shall remain in full force and effect regardless of any investigation made by or on behalf of any REIT Indemnified Person. For the avoidance of doubt, a Shareholder is not a “REIT Indemnified Party.”
Indemnification by Stockholders From and after the Closing, subject to the other terms and conditions of this Article IX, the Stockholders, severally and not jointly (in accordance with their Pro Rata Shares, provided that, notwithstanding anything to the contrary set forth herein or in any Ancillary Document, for all breaches or defaults of any individual Stockholder’s representations, warranties, covenants or agreements, the indemnification obligations of each Stockholder to the Parent Indemnitees shall be specific to such Stockholder in breach or default of any such representations, warranties, covenants or agreements), shall indemnify and defend each of Parent and its Affiliates (including the Company Entities) and their respective Representatives (collectively, the “Parent Indemnitees”) against, and shall hold each of them harmless from and against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by, or imposed upon, the Parent Indemnitees based upon, arising out of, with respect to or by reason of:
(a) any inaccuracy in or breach of any of the representations or warranties of the Company contained in this Agreement or in any certificate or instrument delivered by or on behalf of the Company, the Stockholder Representative or any Stockholder pursuant to this Agreement;
(b) any breach, violation or non-fulfillment of any covenant, agreement or obligation to be performed by the Company Entities (if before or at the Closing), the Stockholder Representative (if after the Closing), or any Stockholder pursuant to this Agreement or in any certificate or instrument delivered by or on behalf of the Company, the Stockholder Representative or any Stockholder pursuant to this Agreement;
(c) any claim made by any Stockholder relating to such Person’s rights with respect to the Total Merger Consideration, or the calculations and determinations set forth on the Consideration Spreadsheet (and any allocations in respect thereof);
(d) any claims of any Stockholder under the Stockholders Agreement or any claims of any Stockholder that the appointment of the Stockholder Representative, or any indemnification or other obligations of such Stockholder under this Agreement or any Ancillary Document, is or was not enforceable against such Stockholder;
(e) any amounts paid to the holders of Dissenting Shares, including any interest required to be paid thereon, that are in excess of what such holders would have received hereunder had such holders not been holders of Dissenting Shares, plus any reasonable expenses incurred by the Parent Indemnitees arising out of the exercise of such appraisal or dissenters’ rights;
(f) any amounts paid or required to be paid by Parent or any of its Affiliates (including the Surviving Corporation) pursuant to Section 5.09; or
(g) any Transaction Expenses or Closing Indebtedness to the extent not paid or satisfied by the Company at or prior to the Closing, or if paid by Parent or Merger Sub at or prior to the Closing, to the extent not deducted in the determination of Closing Merger Consideration.
Indemnification by Buyer Subject to the limitations set forth in this Section 10.1, Buyer agrees to indemnify, defend and hold Sellers and their Affiliates and their respective officers, directors, partners, members, stockholders, employees, agents, representatives, successors and permitted assigns (collectively, the “Seller Indemnitees”), harmless from and in respect of any and all Losses, net of the proceeds from any insurance policies or other third party reimbursement for, or any tax benefit Sellers actually receives as a result of, such loss, that they may incur arising solely out of or relating to:
(i) any breach of any representation or warranty made by Buyer (in each case without regard to any “materiality” qualifier contained therein) in this Agreement, the Schedules, or any other Transaction Document delivered by Buyer pursuant to this Agreement;
(ii) any breach of any representation or warranty made by Buyer (in each case without regard to any “materiality” qualifier contained therein) in this Agreement as if such representation or warranty were made on and as of the Closing Date;
(iii) any breach by Buyer of any covenant or obligation of Buyer in this Agreement or any other Transaction Document delivered pursuant to this Agreement; or
(iv) any claim by any Person for brokerage or finder’s fees or commissions or similar payments based upon any agreement or understanding alleged to have been made by any such Person with Buyer or any Affiliate (or any Person acting on their behalf) in connection with any of the Contemplated Transactions; provided, however, that Buyer shall have no obligation to indemnify any Seller Indemnitee to the extent that Sellers are required to indemnify the Buyer Indemnitees or would be so required but for the limitations set forth in Section 10.1(d).
Indemnification by Sellers (a) Each Seller shall jointly and severally indemnify Acquiror and its subsidiaries (the “Acquiror Indemnified Parties”) against and hold them harmless from any loss, liability, claim, damage or expense including legal fees and expenses (collectively, “Losses”) suffered or incurred by such Acquiror Indemnified Party arising from, relating to or otherwise in respect of:
(i) any breach of any representation or warranty of Sellers contained in this Agreement or certificate delivered by or on behalf of Sellers pursuant thereto, in each case other than with respect to Section 2.07 (but only excluding Section 2.07 to the extent a breach of the applicable representation or warranty would give rise to an indemnification claim pursuant to Section 7.01(a)(iii) or Section 7.01(a)(iv));
(ii) any breach of any covenant of Sellers contained in this Agreement and any liability (whether known, unknown, accrued, unaccrued, contingent, matured or unmatured) of Kos Investments and Kos Holdings in existence at the Closing Date other than any item that would give rise to an indemnification claim pursuant to Section 7.01(a)(iii) or Section 7.01(a)(iv) and liability that is discharged in connection with the Closing;
(iii) all liability for Taxes of Kos Investments and Kos Holdings allocable to the Preclosing Period as determined under Section 7.03(b); and
(iv) all liability for the Preclosing Periods (as a result of Treasury Regulation § 1.1502-6(a), by contract or otherwise) for Taxes of any entity or person (other than Kos Investments and Kos Holdings) which is or has ever been affiliated with Kos Investments or Kos Holdings if such Tax arises as a result of such affiliation.
(b) In no event shall Acquiror be indemnified to the extent of any liabilities taken into account in the calculation of the Closing Payment. The indemnification provided in this Article VII shall be the sole and exclusive remedy of Acquiror against Sellers for monetary relief under this Agreement or in respect of the transactions contemplated hereby. Each party hereto agrees that the previous sentence shall not limit or otherwise affect any non-monetary right or remedy which any party may have under this Agreement or otherwise limit or affect any party’s right to seek equitable relief, including the remedy of specific performance.
Indemnification by Buyers (a) From and after the Closing, and subject to this ARTICLE 8, Buyers, jointly and severally, shall defend, indemnify and hold harmless Seller and each of its Affiliates and their respective officers, directors, employees and agents (collectively, the “Seller Indemnitees”) from and against, and pay or reimburse the Seller Indemnitees for, any and all Losses to the extent resulting from: (i) any breach of any representation or warranty made by Buyers in ARTICLE 3; or (ii) any breach in performance by Buyers of any of their respective covenants or agreements contained herein. Seller Indemnitees shall not be entitled to recover under Section 8.3(a)(i) for an individual claim or group of related claims unless and until the amount of Losses that otherwise would be payable pursuant to Section 8.3(a)(i) with respect to such claim or group of related claims exceeds the Per Claim Threshold, provided, further, that no claims by Seller Indemnitees shall be asserted under Section 8.3(a)(i) unless and until the aggregate amount of Losses that would otherwise be payable hereunder exceeds on a cumulative basis the Indemnification Deductible, and then only to the extent such Losses exceed the Indemnification Deductible. Any such individual claims or group of related claims for the amounts less than the Per Claim Threshold shall be ignored in determining whether the Indemnification Deductible has been exceeded. The Per Claim Threshold and the Indemnification Deductible shall not apply with respect to any: (i) claims for indemnification for any breach of a Fundamental Representation; or (ii) claims with respect to any Buyer’s actual and intentional fraud with respect to any express provisions in this Agreement.
(b) Notwithstanding the limitations set forth above in Section 8.3(a), Buyers shall not be liable for indemnification for any claims made pursuant to Section 8.3(a)(i) in excess of $102,500,000.
(c) Notwithstanding anything to the contrary herein, the limitations in Section 8.3(b) shall not apply with respect to any: (i) claims for indemnification for any breach of a Fundamental Representation; or (ii) claims with respect to any Buyer’s actual and intentional fraud with respect to any express provisions in this Agreement; provided, however, in no event shall the aggregate monetary obligations of Buyers or any of their respective Affiliates in connection with the transactions contemplated by this Agreement exceed the Final Purchase Price.
(d) For purposes of calculating Losses hereunder (but not for purposes of establishing whether a breach has occurred), any materiality qualifications in the representations and warranties in ARTICLE 3 shall be disregarded.