This excerpt taken from the BLT 10-Q filed May 9, 2008.
SECTION 7.4. General Provisions
(a) Each party entitled to indemnification under this Article VII (an Indemnified Party) agrees to give the party or parties bearing the related indemnification obligation hereunder (each an Indemnifying Party, which notice in the case of the Shareholders, shall be made to the Shareholders Representative on behalf of the applicable Shareholders), written notice (describing in reasonable detail the facts and circumstances with respect to the subject matter of such claim or action), within 10 days after receipt by such Indemnified Party of written notice of any claim, assertion, event or proceeding by or in respect of a third party (a Third-Party Claim); provided, however that the failure of an Indemnified Party to notify the Indemnifying Parties shall relieve the Indemnifying Parties from its obligation to indemnify only to the extent that the Indemnifying Parties are actually prejudiced as a result of such failure. If a Third-Party Claim is made against an Indemnified Party, the Indemnifying Parties shall have the right to assume, through counsel of their own choosing (and reasonably satisfactory to the Indemnified Party), the defense or settlement of any such Third-Party Claim at their own expense. If the Indemnifying Parties elect to assume the defense of any such Third-Party Claim, the Indemnified Party may participate in such defense and to employ counsel separate from the counsel employed by the Indemnifying Parties, but in such case the expenses of the Indemnified Party and its counsel shall be paid by the Indemnified Party. If the Indemnifying Parties choose to defend any Third-Party Claim, the Indemnified Party shall cooperate in the defense and prosecution thereof. Such cooperation shall include the retention and (upon the Indemnifying Parties request) the provision to the Indemnifying Parties of access to its records and personnel reasonably relating to any such Third-Party Claim during normal business hours and on a mutually convenient basis. If the Indemnifying Parties elect to assume the defense of any such Third-Party Claim, the Indemnified Party shall not pay, or permit to be paid, any part of any claim or demand arising from such asserted liability unless the Indemnifying Parties consent in writing to such payment (which consent shall not be unreasonably withheld or delayed) or unless the Indemnifying Parties, subject to the last sentence of this Section 7.4(a), withdraw from the defense of such asserted liability, or unless a final judgment from which no appeal may be taken by or on behalf of the Indemnifying Parties is entered against the Indemnified Party for such liability. If the Indemnifying Parties shall fail to defend or, if after commencing or undertaking any such defense, shall fail to prosecute or shall withdraw from such defense, the Indemnified Party shall have the right to undertake the defense or settlement thereof, and in such case the expenses of the Indemnified Party and its counsel shall be paid by the Indemnifying Parties. If the Indemnified Party assumes the defense of any such Third-Party Claim pursuant to this Section 7.4(a) and proposes to settle such Third-Party Claim prior to a final judgment thereon or to forgo any appeal
with respect thereto, then the Indemnified Party shall give the Indemnifying Parties prompt written notice thereof, and the Indemnifying Parties shall have the right to participate in the settlement or assume or reassume the defense of such Third-Party Claim.
(b) If any Indemnified Party desires to assert any claim for indemnification provided for under this Article VII other than a claim in respect of, arising out of or involving a Third-Party Claim, such Indemnified Party shall notify the Indemnifying Parties in writing of such claim promptly after becoming aware of the existence of such claim; provided, however, that the failure of an Indemnified Party to notify the Indemnifying Parties shall relieve the Indemnifying Parties from the obligation to indemnify only to the extent that the Indemnifying Parties are actually prejudiced as a result of such failure. Any such notice shall (taking into account the information then available to the Indemnified Parties), describe in reasonable detail the claim and related Losses incurred by the applicable Indemnified Party (or provide a good faith estimate thereof). If the Indemnifying Parties do not notify the Indemnified Party within 30 calendar days following their receipt of such notice that the Indemnifying Parties dispute liability to the Indemnified Party (including any dispute made on the basis that the Indemnifying Parties lack sufficient information to assess the validity or amount of the claim), such claim specified by the Indemnified Party in such notice shall be conclusively deemed a liability of the Indemnifying Parties hereunder and the Indemnifying Parties shall pay the amount of such liability to the Indemnified Party on demand or, in the case of any notice in which the amount of the claim (or any portion thereof) is estimated, on such later date when the amount of such claim (or such portion thereof) becomes finally determined. If the Indemnifying Parties provide, within 30 days after delivery to them of the claim notice from the Indemnified Party, to the Indemnified Party notice of the Indemnifying Parties dispute of the claim, the Indemnifying Parties and the Indemnified Party shall attempt to resolve the claim, by mutual agreement, legal action or otherwise.
(c) Each of the Shareholders, Parent and the Purchaser hereby acknowledges and agrees that its sole and exclusive remedy with respect to any and all claims relating to the subject matter of this Agreement and the Transaction Documents shall be pursuant to the indemnification provisions set forth in this Article VII, except in the case of fraud or as otherwise expressly provided in Sections 6.1 and 6.3. In furtherance of the foregoing, each of the Shareholders, Parent and the Purchaser hereby waives, to the fullest extent permitted under applicable law, any and all rights, claims and causes of action (other than claims of, or causes of action arising from fraud) it may have against any other party hereto arising under or based on any Federal, state or local statute, law, ordinance, rule or regulation (including, any such rights, claims or causes of action arising under or based on common law or otherwise) except pursuant to the express indemnification provisions set forth in this Article VII.
(d) Anything herein to the contrary notwithstanding, no breach of any representation, warranty, covenant or agreement contained in this Agreement or any Transaction Document shall give rise to any right on the part of any party hereto, after the consummation of the purchase and sale of the Shares contemplated hereby, to rescind this Agreement or any Transaction Document or any of the transactions contemplated hereby or thereby.
(e) Subject to the Shareholders (or the Companys) rights to be indemnified for lost or diminished value of the Company under Section 7.2(b), in no event shall any party hereto be liable for any special, indirect, incidental or consequential damages.
(f) Any amount paid pursuant to this Article VII (other than pursuant to Section 7.2(b)) shall be treated as an adjustment to the Purchase Price for Tax purposes, unless otherwise required by applicable law.
(g) In no event shall the individuals who serve as trustees of trusts that are Shareholders be personally liable for any breaches of representation, warranties, covenants or agreements set forth in any Transaction Document.