HD » Topics » 3. Indemnification .

This excerpt taken from the HD 10-Q filed Sep 4, 2007.

3.             Indemnification.

(a)           The Company hereby agrees to indemnify and hold harmless each of the Lehman Lenders, Lehman Brothers, MLCC, MLPF&S, the other Lenders and each of their respective affiliates and all their respective officers, directors, partners, trustees, employees, controlling persons and agents (each, an Indemnified Person) from and against any and all losses, claims, damages and liabilities to which any Indemnified Person may become subject arising out of or in connection with this Commitment Letter, the Credit Facility, the use of the proceeds therefrom, any of the other transactions contemplated by this Commitment Letter or any other transaction related thereto or any claim, litigation, investigation or proceeding relating to any of the foregoing (each a “Claim” and collectively the “Claims”), regardless

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of whether any Indemnified Person is a party thereto, and to reimburse each Indemnified Person promptly upon demand for all reasonable legal and other expenses reasonably incurred by it in connection with investigating, preparing to defend or defending, or providing evidence in or preparing to serve or serving as a witness with respect to, any lawsuit, investigation, claim or other proceeding relating to any of the foregoing (including, without limitation, in connection with the enforcement of the indemnification obligations set forth herein); provided, however, that no Indemnified Person will be entitled to indemnity hereunder in respect of any loss, claim, damage, liability or expense to the extent such loss, claim, damage, liability or expense results from (i) the willful misconduct or gross negligence of such Indemnified Person, (ii) any material breach by such Indemnified Person of its representations or obligations under this Commitment Letter or (iii) the violation by such Indemnified Person of any law, rule or regulation binding upon such Indemnified Person (the matters set forth in the foregoing clauses (i) through (iii) being collectively referred to as the “Indemnity Exclusions”).  In no event will any Indemnified Person be liable on any theory of liability for indirect, special or consequential damages, lost profits or punitive damages as a result of any failure to fund the Credit Facility or otherwise in connection with the Credit Facility.  No Indemnified Person will be liable for any damages arising from the use by unauthorized persons of information, projections or other materials sent through electronic, telecommunications or other information transmission systems that are intercepted by unauthorized persons, except to the extent such use resulted from the gross negligence or willful misconduct of such Indemnified Person.

(b)           The Company further agrees that, without the prior written consent of each of Lehman and Merrill Lynch, which consent will not be unreasonably withheld, it will not enter into any settlement of a lawsuit, claim or other proceeding against any Indemnified Person arising out of this Commitment Letter or the Transactions unless such settlement includes an explicit and unconditional release from the party bringing such lawsuit, claim or other proceeding of such Indemnified Person.

(c)           In case any action or proceeding is instituted involving any Indemnified Person for which indemnification is to be sought hereunder by such Indemnified Person, then such Indemnified Person will promptly notify the Company of the commencement of any action or proceeding; provided, however, that the failure so to notify the Company will not relieve the Company from any liability that they may have to such Indemnified Person pursuant to this Section 3 or from any liability that they may have to such Indemnified Person other than pursuant to this Section 3.  Notwithstanding the above, following such notification, the Company may elect in writing to assume the defense of such action or proceeding, and, upon such election, they will not be liable for any legal costs subsequently incurred by such Indemnified Person (other than reasonable costs of investigation and providing evidence) in connection therewith, unless (i) they have failed to provide counsel reasonably satisfactory to such Indemnified Person in a timely manner, (ii) counsel provided by the Company reasonably determines that its representation of such Indemnified Person would present it with a conflict of interest or (iii) the Indemnified Person reasonably determines that there may be legal defenses available to it which are different from or in addition to those available to the Company.  In connection with any one action or proceeding, the Company will not be responsible for the fees and expenses of more than one separate law firm (in addition to local counsel) for all Indemnified Persons.

(d)           The Company, the Lehman Lenders, Lehman Brothers, MLCC and MLPF&S agree that if any indemnification or reimbursement sought pursuant to this Section 3 is judicially determined to be unavailable for a reason other than those as provided in the Indemnity Exclusions, then the Company will contribute to the amount paid or payable by the Lehman Lenders, Lehman Brothers, MLCC or MLPF&S as the case may be, as a result of such losses, claims, damages, liabilities and expenses for which such indemnification or reimbursement is held unavailable (i) in such proportion as is appropriate to reflect the relative benefits to the Company, on the one hand, and the Lehman Lenders, Lehman Brothers, MLCC or MLPF&S, as the case may be, on the other hand, in connection with the transactions to which such indemnification or reimbursement relates, or (ii) if the allocation provided by

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clause (i) above is judicially determined not to be permitted, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative faults of the Company, on the one hand, and the Lehman Lenders, Lehman Brothers, MLCC or MLPF&S, on the other hand, as well as any other equitable considerations.

4.             Expiration of Commitment.  The Commitments will expire at 5:00 p.m., New York City time, on July 9, 2007 unless on or prior to such time you have executed and returned to Lehman Brothers a copy of this Commitment Letter, the Fee Letter and the Engagement Letter.  If you do so execute and deliver to Lehman Brothers this Commitment Letter, the Fee Letter and the Engagement Letter, the Lehman Lenders and MLCC agree to hold their respective Commitments available for you until 5:00 p.m., New York City time, on September 30, 2007.  The Commitments will terminate on the Closing Date, and you agree to rely exclusively on your rights and the commitments set forth in the Credit Documentation in respect of all loans and extensions of credit to be made after the Closing Date.

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