EXHIBIT 10.1
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this "Agreement") is made this ____ day
of __________, 2004, between Xenonics Holdings, Inc., a Nevada corporation (the
"Company"), and _______________________, an individual ("Indemnitee").
RECITALS
WHEREAS, Indemnitee is either a member of the board of directors
("Board" or "Board of Directors"), an officer, an employee or an agent of the
Company, or more than one of such positions, or is serving at the request of the
Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, and in such capacity or
capacities is performing a valuable service for the Company;
WHEREAS, the Corporation has adopted bylaws ("Bylaws") providing for
the indemnification of the officers, directors, employees and agents of the
Company or individuals serving at the request of the Company as directors,
officers, employees or agents of another corporation, partnership, joint
venture, trust or other enterprise; ("Covered Persons");
WHEREAS, the Bylaws and Nevada Revised Statute ("NRS") Sections 78.751
and 78.7502 (the "State Statutes") specifically provide that they are not
exclusive, and thereby contemplate that agreements may be entered into between
the Company and a Covered Person with respect to indemnification of such Covered
Person;
WHEREAS, Indemnitee is willing to serve, to continue to serve, and to
take on additional service for and on behalf of the Company on the condition
that Indemnitee is indemnified as set forth in this Agreement;
WHEREAS, it is intended that Indemnitee shall be paid promptly by the
Company all amounts necessary to effectuate in full the indemnity provided in
this Agreement; and
WHEREAS, to induce Indemnitee to continue to serve as a director,
officer, employee or agent, the Company has determined and agreed to enter into
this Agreement with Indemnitee.
NOW, THEREFORE, in consideration of Indemnitee's continued service as a
director or officer of the Company after the date hereof, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and Indemnitee hereby agree as follows:
AGREEMENT
1. Indemnification of Indemnitee. The Company hereby agrees to
hold harmless and indemnify Indemnitee to the fullest extent authorized or
permitted by the provisions of the State Statutes, or any successor statute or
amendment thereof, or any other statutory provisions authorizing or permitting
such indemnification that is adopted after the date of this Agreement.
2. Additional Indemnity. Subject only to the exclusions set forth
in Section 3 of this Agreement, the Company hereby further agrees to hold
harmless, indemnify and defend Indemnitee:
(a) against any and all expenses (including fees for
attorneys, accountants, private investigators, court and transcript costs, fees
and expenses of witnesses, travel expenses and all other like disbursements or
expenses reasonably incurred by or for Indemnitee), judgments damages, fines,
penalties and amounts paid in settlement (including all interest assessments and
other charges paid or payable in connection with or in respect of such judgment,
fines, penalties, or amounts paid in settlement) actually and reasonably
incurred by or for Indemnitee in connection with any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (including an action by or in the right of the Company)(a "Covered
Action") to which Indemnitee is made a party as a result of the fact that at the
time of the act or omission which is the subject matter of such Covered Action
the Indemnitee was a director, officer, employee or agent of the Company, and
(b) otherwise to the fullest extent as may be provided to
Indemnitee by the Company under the non-exclusivity provisions the Bylaws of the
Company and the State Statutes. The provisions of this Agreement are in addition
to, and not in limitation of, the provisions of such Bylaws and the State
Statutes.
3. Limitations on Additional Indemnity. No indemnity pursuant to
Sections 1 and 2 of this Agreement shall be paid by the Company to the extent
that:
(a) payment therefor is actually made to Indemnitee under
a valid and collectible insurance policy or policies, except with respect to any
excess amount due to Indemnitee beyond the amount of payment to Indemnitee under
such insurance policy or policies. Notwithstanding the availability of such
insurance policy or policies, Indemnitee also may claim indemnification from the
Company pursuant to this Agreement by assigning to the Company in writing any
claims of Indemnitee under such insurance policy or policies to the extent of
the amount Indemnitee is paid by the Company;
(b) Indemnitee is indemnified by the Company otherwise
than pursuant to this Agreement;
(c) final judgment is rendered against Indemnitee for the
payment of dividends or other distributions to stockholders of the Company in
violation of the provisions of Subsection 2 of Nevada Revised Statutes Section
78.300, as amended;
(d) final judgment is rendered against Indemnitee for an
accounting of profits made from the purchase or sale by Indemnitee of securities
of the Company pursuant to the
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provisions of Section 16(b) of the Securities Exchange Act of 1934, as amended
(the "Act"), or other similar provisions of any federal, state or local
statutory law;
(e) Indemnitee's conduct giving rise to the claim for
indemnification is finally adjudged by a court of competent jurisdiction to have
been a breach of fiduciary duty which involved intentional misconduct, fraud or
a knowing violation of the law; and/or
(f) except as otherwise provided in this Agreement, in
connection with all or any part of a suit or other proceeding which is initiated
or maintained by or on behalf of Indemnitee, or any suit or other proceeding by
Indemnitee against the Company or its directors, officers, employees or other
agents, unless (i) such indemnification is expressly required by Nevada law;
(ii) the suit or other proceeding was expressly authorized by an official act of
the Board of Directors of the Company or (iii) such indemnification is provided
by the Company, in its sole discretion, pursuant to the powers vested in the
Company under Nevada law.
4. Continuation of Indemnity. All agreements and obligations of
the Company contained in this Agreement shall continue during the period
Indemnitee is a Covered Person, and shall continue thereafter for so long as
Indemnitee shall be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that Indemnitee was a Covered Person.
5. Advancement of Expenses. In the event Indemnitee incurs costs
or expenses in connection with the defense of any such civil, criminal,
administrative or investigative action, suit or proceeding (including any costs
or expenses incurred for any appeal therefor), the Company agrees to pay such
costs or expenses as they are incurred and in advance of the final disposition
of the action, suit or proceeding within 30 calendar days of submission of bills
or vouchers for such costs or expenses, provided that Indemnitee delivers to
Company prior to such payment a written undertaking by or on behalf of
Indemnitee to repay the amount paid by the Company if it is ultimately
determined by a court of competent jurisdiction that Indemnitee is not entitled
to be indemnified by the Company. By such undertaking, Indemnitee agrees to
reimburse the Company for all amounts paid by the Company in defending such
civil, criminal, administrative or investigative action, suit or proceeding
against Indemnitee, including amounts paid in settlement, in the event and only
to the extent that it is ultimately determined by a court of competent
jurisdiction that Indemnitee is not entitled to be indemnified by the Company
for such expenses under the provisions of the State Statute, Bylaws, this
Agreement or otherwise. However, in the case of an action brought against
Indemnitee by the Company pursuant to the provisions of Section 16(b) of the
Act, or other similar provisions of any federal, state or local statutory law
for an accounting of profits made from the purchase or sale by Indemnitee of
securities of the Company, Indemnitee's costs and expenses will not be advanced
unless such advancement is approved by the Board of Directors by a majority vote
of a quorum consisting of directors who are not parties to the action, suit or
proceeding, or, if such a quorum cannot be obtained, by independent legal
counsel in a written opinion that such indemnification is proper in the
circumstances.
6. Presumptions and Effect on Certain Proceedings. Upon making a
request for indemnification, Indemnitee shall be presumed to be entitled to
indemnification under this Agreement. The termination of any action, suit or
proceeding by judgment, order, settlement,
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arbitration award, conviction or by a plea of nolo contendere or its equivalent
shall not affect this presumption except as may be provided in Section 3 of this
Agreement.
7. Notification and Defense of Claim. Promptly after receipt by
Indemnitee of notice of the commencement of any action, suit or proceeding, if a
request with respect thereto is to be made against the Company under this
Agreement, Indemnitee shall notify the Company of the commencement thereof; but
the failure by Indemnitee to notify the Company will not relieve the Company of
any liability which it may have to Indemnitee under this Agreement or otherwise.
With respect to any such action, suit or proceeding as to which Indemnitee
notifies the Company as required herein:
(a) The Company shall be entitled to participate therein
at its own expense; and
(b) Except as otherwise provided below, to the extent
that it may wish, the Company, jointly with any other indemnifying party
similarly notified, shall be entitled to assume the defense of Indemnitee with
counsel reasonably satisfactory to Indemnitee. After notice from the Company to
Indemnitee of its election to assume the defense of Indemnitee in the action,
suit or proceeding, the Company will not be liable to Indemnitee under this
Agreement for any legal or other expenses subsequently incurred by Indemnitee in
connection with the defense thereof, other than reasonable costs of
investigation or as otherwise provided below. Indemnitee shall have the right to
employ its own counsel in such action, suit or proceeding, but the fees and
expenses of such counsel incurred after notice from the Company of its
assumption of the defense shall be at the sole expense of Indemnitee unless (i)
the employment of counsel by Indemnitee at the Company's expense has been
authorized in writing by the Company; (ii) Indemnitee shall have reasonably
concluded, upon advice of counsel experienced in such matters, that there may be
a conflict of interest between the Company and Indemnitee in the conduct of the
defense of such action; or (iii) the Company shall not in fact have employed
counsel to assume the defense of such action, suit or proceeding. In each such
instance set forth in (i) through (iii) of this paragraph (b), the reasonable
cost of Indemnitee's counsel shall be borne by the Company. Notwithstanding the
foregoing, the Company shall not be entitled to assume the defense of any
action, suit or proceeding brought against Indemnitee by or on behalf of the
Company or as to which Indemnitee shall have reasonably made the conclusion
provided in (ii) above.
(c) The Company shall not be liable to indemnify
Indemnitee under this Agreement for any amounts paid in settlement of any action
or claim effected without the Company's prior written consent. The Company shall
not settle any action or claim in any manner that would impose any penalty or
limitation on Indemnitee without Indemnitee's prior written consent. Neither the
Company nor Indemnitee will unreasonably withhold consent to any proposed
settlement.
8. Enforcement.
(a) The Company expressly confirms and agrees that it has
entered into this Agreement and assumed the obligations imposed on the Company
hereby in order to induce
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Indemnitee to continue as a Covered Person, and acknowledges that Indemnitee is
relying on this Agreement in continuing in such capacity.
(b) In the event Indemnitee is required to bring any
action to enforce his or her rights or to collect moneys due under this
Agreement, the Company shall advance Indemnitee all of Indemnitee's reasonable
fees and expenses in bringing and pursuing such action. Indemnitee shall be
responsible for reimbursement to the Company of such advance in the event that
Indemnitee is not successful in such action.
9. No Employment Rights. Nothing in this Agreement is intended to
confer on Indemnitee any right to continue in the employ of the Company for any
period of time or to interfere with or otherwise restrict in any way the rights
of the Company or of Indemnitee, which rights are hereby expressly reserved by
each, to terminate Indemnitee's service at any time and for any reason, with or
without cause, except as may be provided otherwise in an agreement, if any,
between the Company and Indemnitee.
10. Severability. Each of the provisions of this Agreement are
separate and distinct and independent of one another, so that if any provision
of this Agreement shall be held by a court of competent jurisdiction to be
invalid or unenforceable for any reason, such invalidity or unenforceability
shall not effect the validity or enforceability of the other provisions of this
Agreement. If any provision of this Agreement is so held to be invalid or
unenforceable, the parties agree that the court making such determination shall
have the power to amend such provision or to delete specific words or phrases so
that such provision shall then be enforceable to the fullest extent permitted by
law unless such change is contrary to the intent of the parties hereto.
11. Subrogation. In the event of payment to Indemnitee under this
Agreement, the Company shall be subrogated to the extent of the amount of such
payment to all rights of recovery of Indemnitee, who shall execute all papers
required and shall do everything that may be necessary or reasonable to secure
such rights, including, without limitation, the execution of such documents
necessary or reasonable to enable the Company to effectively bring suit to
enforce such rights.
12. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Nevada without resort to
conflict of laws principles.
13. Binding Effect; Amendment. This Agreement shall be binding on
the parties, their heirs, personal representatives, successors and assigns, and
shall inure to the benefit of Indemnitee, his or her heirs, personal
representatives and assigns, and to the benefit of the Company, its successors
and assigns. No amendment, modification, termination or cancellation of this
Agreement shall be effective unless in a writing signed by both parties.
14. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given (i) when delivered by hand and receipted for by the party to whom
said communication shall have been directed or (ii), if mailed by certified or
registered mail with postage prepaid, on the third business day after the date
on
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which said communication is so mailed and addressed to the appropriate party at
the following address:
If to Indemnitee:
If to the Company: Xenonics Holdings, Inc.
0000 Xxxxxxxxxx Xx.
Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Chairman of the Board
A party may change its address by delivering notice of such change in
the manner set forth in this Section 14.
IN WITNESS WHEREOF, the parties hereto have executed this
Indemnification Agreement as of the date first above written.
"Indemnitee" Xenonics Holdings, Inc.
______________________________ By: ___________________________
Its: __________________________
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