MONCLA WELL SERVICE, INC., NO. 83013 OF THE
15TH JUDICIAL DISTRICT COURT; PROVIDED, HOWEVER, SELLERS' TOTAL AGGREGATE
LIABILITY UNDER THIS
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INDEMNITY (OTHER THAN WITH RESPECT TO BREACHES OF REPRESENTATIONS AND WARRANTIES
AND COVENANTS IN SECTION
2.21, ARTICLE VII AND LOSSES RELATED TO THE PROFIT
SHARING PLAN IN THE EVENT AN IRS FAVORABLE DETERMINATION LETTER ON PLAN
TERMINATION IS NOT RECEIVED AND/OR THE COMPLIANCE STATEMENT IN RESPONSE TO THE
VCP SUBMISSION IS NOT RECEIVED, WITH RESPECT TO WHICH THERE WILL BE NO
LIMITATION) SHALL BE LIMITED TO TWENTY-FIVE MILLION AND NO/100 DOLLARS
($25,000,000.00), INCLUSIVE OF LEGAL FEES AND COSTS OF DEFENSE INCURRED BY
SELLERS IN PERFORMING THEIR OBLIGATIONS UNDER THIS SECTION 10.2 AND SELLERS
SHALL HAVE NO OBLIGATION TO INDEMNIFY ANY INDEMNIFIED PARTY WITH RESPECT TO ANY
LOSS, NOTICE OF WHICH IS GIVEN TO SELLERS AFTER(1) EIGHTEEN (18) MONTHS AFTER
THE CLOSING, AS TO ALL REPRESENTATIONS, WARRANTIES AND COVENANTS OTHER THAN
THOSE FOR WHICH A LONGER PERIOD IS SPECIFIED IN 10.2(A)2 THROUGH 10.2(A)5; (2)
THE LATER OF THE THIRD (3RD) ANNIVERSARY OF THE CLOSING AND THIRTY (30) DAYS
AFTER THE EXPIRATION OF THE STATUTE OF LIMITATIONS, AS TO ALL REPRESENTATIONS,
WARRANTIES AND COVENANTS CONTAINED IN SECTION 2.23; (3) THIRTY (30) DAYS AFTER
THE EXPIRATION OF THE STATUTE OF LIMITATIONS ON ASSESSMENT AND COLLECTION OF
TAXES AS TO THOSE CONTAINED IN ARTICLE VII; (4) THIRTY-SIX (36) MONTHS FROM THE
CLOSING OF THE PROFIT SHARING PLAN TRUST AND FROM THE CLOSING OF THE CAFETERIA
PLAN AS TO REPRESENTATIONS AND WARRANTIES AND COVENANTS CONTAINED IN ARTICLE
VIII PERTAINING TO THEM; AND (5) THOSE CONTAINED IN SECTIONS 2.2, 2.9(A) AND
2.21 SHALL NOT EXPIRE; PROVIDED, HOWEVER, THAT EXCEPT FOR LOSSES UNDER SECTION
2.21 AND ARTICLE VIII, FOR WHICH NO HURDLE SHALL APPLY, SELLERS SHALL HAVE NO
OBLIGATION TO INDEMNIFY PURCHASERS UNTIL THE TOTAL LOSS INCURRED BY THE
COMPANIES OR PURCHASERS EXCEEDS A HURDLE OF ONE MILLION FIVE HUNDRED THOUSAND
AND NO/100 DOLLARS ($1,500,000.00); PROVIDED, THAT IN EITHER CASE SELLERS SHALL
BE RESPONSIBLE FROM THE FIRST DOLLAR OF LOSS.
THE DEFENSE OF ALL SUCH CLAIMS
AND ACTIONS SHALL BE UNDERTAKEN BY SELLERS USING COUNSEL SELECTED BY THEM
(ACTING THROUGH MONCLA) AND REASONABLY ACCEPTABLE TO PURCHASER.
SETTLEMENTS OF
EACH SUCH CLAIM SHALL REQUIRE THE APPROVAL OF BOTH SELLERS AND PURCHASER, WHICH
APPROVAL SHALL NOT BE UNREASONABLY
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WITHHELD.
THE REMEDIES SET FORTH IN THIS SECTION 10.2(A) SHALL BE THE EXCLUSIVE
REMEDIES OF THE INDEMNIFIED PARTIES.
SELLERS' INDEMNIFICATION OBLIGATIONS SHALL
BE JOINT AND SEVERAL AND IN SOLIDO BUT NO SELLER SHALL HAVE AN INDEMNIFICATION
LIABILITY FOR MORE THAN HIS SHARE OF THE PORTION OF THE PURCHASE PRICE.
SELLERS
HEREWITH AGREE TO CONTRIBUTE AMONG THEMSELVES IN ORDER TO SHARE THE
INDEMNIFICATION LIABILITY IN PROPORTION TO THEIR SHARES OF THE PURCHASE PRICE.
(B)
PURCHASER HEREBY AGREES TO DEFEND AND INDEMNIFY SELLERS AGAINST AND
TO HOLD SELLERS HARMLESS FROM ANY AND ALL LOSS INCURRED OR SUFFERED BY SELLERS
ARISING OUT OF ANY FAILURE TO PERFORM, MISREPRESENTATION OR BREACH OF ANY
WARRANTY, COVENANT OR AGREEMENT MADE OR TO BE