What is an environmental indemnity agreement?
An environmental indemnity mitigates a lender’s exposure for environmental risks that are associated with real property ownership by indemnifying the lender against all losses associated with environmental compliance, monitoring, and remediations (see Drafting Note, Losses).
What is indemnification language?
Indemnification clauses are clauses in contracts that set out to protect one party from liability if a third-party or third entity is harmed in any way. It’s a clause that contractually obligates one party to compensate another party for losses or damages that have occurred or could occur in the future.
How important is indemnification language in a contract?
Why are indemnification provisions important? Indemnification clauses allow a contracting party to: Customize the amount of risk it is willing to undertake in each transaction and with every counterparty. Protect itself from damages and lawsuits that are more efficiently borne by the counterparty.
What is a non recourse carve out guaranty?
Nonrecourse carve-out guarantees, also known as “bad boy” or springing recourse guarantees, are designed to require the guarantor to repay the loan (or portions thereof) if the borrower commits any of the specified bad acts, or where the borrower takes steps to prevent the lender from enforcing on its collateral, such …
What is a Hazardous Substances Certificate and indemnity agreement?
Hazardous Substances Agreement means that certain Certificate and Indemnity Agreement Regarding Building Laws and Hazardous Substances of even date herewith executed by Borrower in favor of Lenders and Agent substantially in the form of Exhibit H attached hereto, as such certificate and indemnity agreement may be …
Are indemnification clauses necessary?
The most important part of an indemnification clause is that it protects the indemnified party from lawsuits filed by third parties. This protection is important because damaged parties are still able to pursue compensation for their losses even if this clause isn’t in the contract.
What is an indemnification clause and why might I want to include one in a contract?
“To indemnify” means to compensate someone for his/her harm or loss. In most contracts, an indemnification clause serves to compensate a party for harm or loss arising in connection with the other party’s actions or failure to act. The intent is to shift liability away from one party, and on to the indemnifying party.
What does environmental indemnification mean?
Environmental Indemnification . The Borrower shall indemnify, protect, and hold each Indemnified Party harmless from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, proceedings, costs, expenses (including, without limitation,…
Does a borrower have to indemnify an indemnified party?
Borrower shall have no obligation to indemnify an Indemnified Party for damage or loss resulting from such Indemnified Party’s gross negligence or willful misconduct. Environmental Indemnification.
Can a contractor be indemnified for exacerbation of conditions?
However, these clauses usually will not indemnify the contractor for exacerbation of conditions or for other contamination releases that the contractor causes by its own actions or omissions.
What is an example of a construction indemnity?
For example, if there is existing contamination of an owner’s site due to leaking underground tanks, historic disposal practices, etc., the owner or general contractor will indemnify the contractor for such liability.