Exhibit 10.1
CASS INFORMATION SYSTEMS, INC.
Director'S Indemnification Agreement
This Director's Indemnification Agreement is entered into by and between
Cass Information Systems, Inc., a Missouri corporation ("Corporation") and
____________________ ("Indemnitee"), a member of the Board of Director of the
Corporation, as of this 15th day of April, 2003.
WITNESSETH:
WHEREAS, it is essential to the success of the Corporation to retain and
attract highly competent people as Directors, and such people have become more
reluctant to serve as directors or in other capacities unless they are provided
with adequate protection through insurance and/or adequate indemnification
against inordinate risks of claims and actions against them arising out of their
service to and activities on behalf of the Corporation; and
WHEREAS, the uncertainties relating to Directors' liability insurance and
indemnification have increased the difficulty of attracting and retaining such
highly competent Directors; and
WHEREAS, the Corporation has determined that the increased difficulty in
attracting and retaining such persons is detrimental to the best interests of
the Corporation's stockholders and that the Corporation should act to assure
such Directors that there will be increased certainty of such protection in the
future; and
WHEREAS, it is reasonable, prudent and necessary for the Corporation to
contractually obligate itself to indemnify, and to advance expenses on behalf
of, such Directors to the fullest extent permitted by applicable law so that
they will serve or continue to serve the Corporation free from undue concern
that they will not be so indemnified; and
WHEREAS, this Agreement is a supplement to and in furtherance of the
Articles of Incorporation and Bylaws of the Corporation and any resolutions
adopted pursuant thereto, and shall not be deemed a substitution therefor, nor
to diminish or abrogate any rights of Indemnitee thereunder.
NOW, THEREFORE, in consideration of the mutual premises and covenants set
forth herein and the Indemnitee's continued service as a Director of the
Corporation, the Corporation and Indemnitee do hereby agree as follows:
1. Agreement to Serve. Indemnitee agrees to continue to serve as a
Director of the Corporation for so long as he or she is duly elected or
appointed or until such time as he or she tenders his or her resignation in
writing.
2. Definitions. As used in this Agreement:
(a) The term "Proceeding" shall include any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that Indemnitee (i) is or was a Director of
the Corporation (or any predecessor or subsidiary of the Corporation), or (ii)
is or was serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise.
(b) The term "Expenses" shall mean expenses (including attorneys'
fees and amounts paid in settlement by Indemnitee) which are actually and
reasonably incurred by Indemnitee in connection with a Proceeding against
Indemnitee; provided, however, the term "Expenses" shall not include amounts of
judgments, fines, or penalties assessed against Indemnitee or incurred in
relation thereto.
(c) The term "other enterprise" shall include employee benefit
plans; the term "fines" shall include any excise taxes assessed on a person with
respect to an employee benefit plan; and the term "serving at the request of the
Corporation" shall include any service as a director or officer of the
Corporation which imposes duties on, or involves services by, such director or
officer with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the Corporation" as referred to in this
Agreement.
3. Indemnity in Third-Party Proceedings. The Corporation shall indemnify
Indemnitee in accordance with the provisions of this Paragraph 3, against all
Expenses, judgments, fines, and penalties actually and reasonably incurred by
Indemnitee in connection with the defense or settlement of any Proceeding
against Indemnitee, other than a Proceeding by or in the right of the
Corporation to procure a judgment in its favor against Indemnitee, but only if
Indemnitee acted in good faith and in a manner which he or she reasonably
believed to be in or not opposed to the best interests of the Corporation, and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe that his or her conduct was unlawful. The termination of any such
Proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, in and of itself, create a presumption
that Indemnitee did not act in good faith in a manner which he or she reasonably
believed to be in or not opposed to the best interests of the Corporation; and,
with respect to any criminal proceeding, that Indemnitee had reasonable cause to
believe that his or her conduct was unlawful.
4. Indemnity in Proceedings By or In the Right of the Corporation. The
Corporation shall indemnify Indemnitee in accordance with the provisions of this
Paragraph 4, against all Expenses actually and reasonably incurred by Indemnitee
in connection with the defense or settlement of any Proceeding by or in the
right of the Corporation to procure a judgment in its favor against Indemnitee
by reason of the fact that Indemnitee (i) is or was a Director of the
Corporation, or (ii) is or was serving at the request of the Corporation as a
Director or officer of another corporation, partnership, joint venture, trust or
other enterprise while a Director of the Corporation, but only if Indemnitee
acted in good faith and in a manner which he or she reasonably believed to be in
or not opposed to the best interests of the Corporation, except that no
indemnification for Expenses shall be made under this Paragraph in respect of
any claim, issue, or matter as to which Indemnitee shall have been adjudged to
be liable to the Corporation for negligence or misconduct in the performance of
his or her duty to the Corporation, unless and only to the extent that the court
in which such Proceeding was brought shall determine upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, Indemnitee is fairly and reasonably entitled to indemnity for such
Expenses which such court shall deem proper.
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5. Indemnification of Expenses of Successful Party. Notwithstanding any
other provision of this Agreement, to the extent that Indemnitee has been
successful on the merits or otherwise, in defense of any Proceeding against
Indemnitee, or in defense of any claim, issue, or matter therein, Indemnitee
shall be indemnified against all Expenses actually and reasonably incurred by
Indemnitee in connection therewith.
6. Advances of Expenses. At the written request of Indemnitee, the
Expenses incurred by Indemnitee in any Proceeding against Indemnitee shall be
paid by the Corporation in advance of the final disposition of such Proceeding;
provided, however, that Indemnitee hereby agrees to promptly repay such amount
to the Corporation to the extent that it is ultimately determined that
Indemnitee is not entitled to indemnification. If the Corporation makes an
advance of expenses pursuant to this Paragraph 6, the Corporation shall be
subrogated to every right of recovery Indemnitee may have against any insurance
carrier from whom the Corporation has purchased insurance for such purpose.
7. Right of Indemnitee to Indemnification Upon Application; Procedure Upon
Application.
(a) Any indemnification under Paragraphs 3 and 4 or advance under
Paragraph 6, unless ordered by a court, shall be paid no later than 45 days
after receipt of the written request of Indemnitee, unless a determination is
made within said 45-day period by (i) the Board of Directors, (ii) independent
legal counsel in a written opinion, or (iii) the shareholders of the Corporation
that indemnification of the Director is not proper in the circumstances because
he has not met the applicable standard of conduct set forth in the foregoing
Paragraphs. Any such determination shall be made by the Board of Directors by a
majority vote of a quorum of the Directors who were not parties to the
Proceeding, or if such a quorum is not obtainable, a quorum of disinterested
Directors; or by written opinion of independent legal counsel, selected by the
majority vote of a quorum of the Directors who were not parties to the
Proceeding, or if such a quorum is not obtainable, a quorum of disinterested
Directors; or by the shareholders.
(b) The right to indemnification or advancement of Expenses as
provided by this Agreement shall be enforceable by Indemnitee in any court of
competent jurisdiction. The burden of proving that indemnification or advances
are not appropriate shall be on the Corporation. Neither the failure of the
Corporation, including its Board of Directors or independent legal counsel or
shareholders, to have made a determination prior to the commencement of such
action that Indemnitee has met the applicable standard of conduct nor an actual
determination by the Corporation, including its Board of Directors or
independent legal counsel or shareholders, that Indemnitee has not met such
standard shall be a defense to the action or create a presumption that
Indemnitee has not met the applicable standard of conduct. Indemnitee's Expenses
actually and reasonably incurred in connection with successfully establishing
his or her right to indemnification or advances, in whole or in part, shall also
be indemnified by the Corporation.
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(c) With respect to any Proceeding for which indemnification is
requested, the Corporation will be entitled to participate therein at its own
expense and, except as otherwise provided below, the Corporation may assume the
defense thereof, with counsel satisfactory to Indemnitee. After notice from the
Corporation to Indemnitee of its election to assume the defense of a Proceeding,
the Corporation will not be liable to Indemnitee under this Agreement for any
Expenses subsequently incurred by Indemnitee in connection with the defense
thereof, other than as provided below. The Corporation shall not settle any
Proceeding in any manner that would impose any penalty or limitation on
Indemnitee without Indemnitee's written consent. Indemnitee shall have the right
to employ counsel in any Proceeding but the fees and expenses of such counsel
incurred after notice from the Corporation of its assumption of the defense of
the Proceeding shall be at the expense of Indemnitee, unless (i) the employment
of counsel by Indemnitee has been authorized by the Corporation; (ii) Indemnitee
shall have reasonably concluded that there may be a conflict of interest between
the Corporation and Indemnitee in the conduct of the defense of a Proceeding; or
(iii) the Corporation shall not in fact have employed counsel to assume the
defense of a Proceeding, in each of which cases the fees and expenses of
Indemnitee's counsel shall be advanced by the Corporation. Notwithstanding the
foregoing, the Corporation shall not be entitled to assume the defense of any
Proceeding brought by or in the right of the Corporation.
8. Limitation on Indemnification. No payment pursuant to this Agreement
shall be made by the Corporation:
(a) if such payments are prohibited by any applicable bank or bank
holding company law or regulation;
(b) to indemnify or advance funds to Indemnitee for Expenses with
respect to Proceedings initiated or brought voluntarily by Indemnitee and not by
way of defense, except with respect to Proceedings brought to establish or
enforce a right to indemnification under this Agreement; provided, however, such
indemnification or advancement of Expenses may be provided by the Corporation in
specific cases if the Board of Directors by a majority vote of a quorum of the
Directors who were not parties to the Proceeding, or if such quorum is not
obtainable, a quorum of disinterested Directors, finds it to be appropriate;
(c) to indemnify Indemnitee for any Expenses, judgments, fines, or
penalties sustained in any Proceeding for which payment is actually made to
Indemnitee under a valid and collectible insurance policy, except in respect of
any excess beyond the amount of payment under such insurance;
(d) to indemnify Indemnitee for any Expenses, judgments, fines or
penalties resulting from Indemnitee's conduct which is finally adjudged to have
been fraudulent, deliberately dishonest or willful misconduct; or
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(e) if a court of competent jurisdiction finally determines that
such payment hereunder is unlawful.
9. Indemnification Hereunder Not Exclusive. The indemnification provided
by this Agreement shall not be deemed exclusive of any other rights to which
Indemnitee may be entitled under the Articles of Agreement or the Bylaws of the
Corporation, any agreement, any vote of shareholders or disinterested Directors,
the laws of the State of Missouri, or otherwise, both as to action in his or her
official capacity and as to action in another capacity while holding such
office. The indemnification provided by this Agreement shall continue as to
Indemnitee even though he or she may have ceased to be a Director and shall
inure to the benefit of the heirs, executors and administrators of Indemnitee.
10. Partial Indemnification. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Corporation for a portion of the
Expenses, judgments, fines, or penalties actually and reasonably incurred by him
or her in any Proceeding but not, however, for the total amount thereof, the
Corporation shall nevertheless indemnify Indemnitee for the portion of such
Expenses, judgments, fines, or penalties to which Indemnitee is entitled.
11. Maintenance of Liability Insurance.
(a) The Corporation hereby covenants and agrees that, as long as
Indemnitee continues to serve as a Director of the Corporation, and thereafter
as long as Indemnitee may be subject to any Proceeding, the Corporation, subject
to subsection (c) below, shall maintain in full force and effect Directors' and
Officers' liability insurance ("D&O Insurance") in reasonable amounts from
established and reputable insurers.
(b) In all D&O Insurance policies, Indemnitee shall be named as an
insured in such a manner as to provide the Indemnitee the same rights and
benefits as are accorded to the most favorably insured of the Corporation's
Directors and Officers.
(c) Notwithstanding the foregoing, the Corporation shall have no
obligation to obtain or maintain D&O Insurance if the Corporation determines in
good faith that such insurance is not reasonably available, the premium costs
for such insurance are disproportionate to the amount of coverage provided, the
coverage provided by such insurance is so limited by exclusions that it provides
an insufficient benefit, or Indemnitee is covered by similar insurance
maintained by a subsidiary of the Corporation.
12. Savings Clause. If this Agreement or any portion hereof is invalidated
on any ground by any court of competent jurisdiction, the Corporation shall
nevertheless indemnify Indemnitee to the extent permitted by any applicable
portion of this Agreement that has not been invalidated or by any other
applicable law.
13. Notice. Indemnitee shall, as a condition precedent to his or her right
to be indemnified under this Agreement, give to the Corporation notice in
writing as soon as practicable of any Proceeding for which indemnity will or
could be sought under this Agreement. Notice to the Corporation shall be
directed to:
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Cass Information Systems, Inc.
Attn: Chairman of the Board
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
(or such other address as the Corporation shall designate in writing to
Indemnitee). Notice shall be deemed received three days after the date
postmarked if sent by prepaid mail, properly addressed. In addition, Indemnitee
shall give the Corporation such information and cooperation as it may reasonably
require and as shall be within Indemnitee's power.
14. Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall be deemed to constitute one and the same
instrument.
15. Applicable Law. This Agreement shall be governed by, and construed and
interpreted in accordance with, the law of the State of Missouri without regard
to its laws governing conflicts of laws.
16. Successors and Assigns. This Agreement shall be binding upon the
Corporation and its successors and assigns, and shall inure to the benefit of
Indemnitee and his or her heirs, executors or administrators.
17. Amendments. No amendment, waiver, modification, termination, or
cancellation of this Agreement shall be effective unless in writing signed by
both parties hereto. The indemnification rights afforded to Indemnitee hereby
are contract rights and may not be diminished, eliminated, or otherwise affected
by amendments to the Articles of Incorporation or By-Laws of the Corporation or
by other agreements.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the date first written above.
Cass Information Systems, Inc.
__________________________________
"Corporation" "Indemnitee"
By:_________________________________
Name:_______________________________ __________________________________
Title:______________________________ Signature
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