INDEMNIFICATION AGREEMENT
Exhibit 10.26
This Indemnification Agreement made and entered into this day of , 2007
(the “Agreement”), by and between TomoTherapy Incorporated, a Wisconsin corporation (the
“Company”), and , Indemnitee (“Indemnitee”):
WHEREAS, highly competent persons are becoming more reluctant to serve publicly held
corporations as directors, officers or in other capacities unless they are provided with adequate
protection through insurance and indemnification against inordinate risks of claims and actions
against them arising out of their service to and activities on behalf of corporations;
WHEREAS, the difficulties of obtaining adequate insurance and uncertainties relating to
indemnification have increased the difficulty of attracting and retaining such persons;
WHEREAS, Sections 180.0850 through 180.0859 of the Wisconsin Business Corporation Law (the
“WBCL”) provide both mandatory and discretionary indemnification for directors and officers of
Wisconsin corporations;
WHEREAS, the Board of Directors (the “Board”) of the Company has determined that the Company
should act to assure such persons that there will be increased certainty of such protection in the
future by providing, in addition to indemnification provided by law, certain indemnification
rights;
WHEREAS, it is reasonable, prudent, and necessary for the Company contractually to obligate
itself to indemnify such persons to the fullest extent permitted by applicable law so that they
will serve or continue to serve the Company free from undue concern that they will not be so
indemnified; and
WHEREAS, Indemnitee is willing to serve, continue to serve, and to take on additional service
for or on behalf of the Company on the condition that he or she be so indemnified;
NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the
Company and Indemnitee do hereby covenant and agree as follows:
Section 1. Services by Indemnitee. Indemnitee agrees to serve as a director, officer,
employee, or agent (collectively, the “Representative”) of the Company. Indemnitee may at any time
and for any reason resign from such position (subject to any other contractual obligation or other
obligation imposed by operation of law), in which event the Company shall have no obligation to
provide indemnification rights pursuant to this Agreement.
Section 2. Indemnification. The Company shall indemnify Indemnitee to the fullest extent
permitted by applicable law in effect on the date hereof or as such laws may from time to time be
amended. Without diminishing the scope of the indemnification provided by this Section 2, the
indemnification rights of Indemnitee provided hereunder shall include, but shall not be limited to,
those rights set forth hereinafter, except to the extent expressly prohibited by
applicable law.
Section 3. Action or Proceeding Other than an Action by or in the Right of the Company. In
addition to the indemnification of Indemnitee provided pursuant to the other provisions hereof,
Indemnitee shall be entitled to the indemnification rights provided in this Section 3 if he or she
is a party or is threatened to be made a party to any threatened, pending, or completed action,
suit, or proceeding, whether civil, criminal, administrative, or investigative in nature, other
than an action by the Company, by reason of the fact that he or she is or was a Representative or
fiduciary of the Company or is or was serving at the request of the Company as a Representative or
fiduciary of any other entity or by reason of anything done or not done by him or her in such
capacity. Pursuant to this Section 3, Indemnitee shall be indemnified against all expenses
(including attorneys’ fees), costs, judgments, penalties, fines, and amounts paid in settlement or
litigation actually and reasonably incurred by him or her in connection with such action, suit, or
proceeding (including, but not limited to, the investigation, defense, or appeal thereof), unless
such amounts were incurred because Indemnitee breached or failed to perform a duty owed to the
Company and the breach or failure to perform constitutes:
| (a) | a willful failure to deal fairly with the Company or its shareholders in connection with a matter in which Indemnitee has a material conflict of interest; | ||
| (b) | a violation of criminal law, unless Indemnitee had reasonable cause to believe that his or her conduct was lawful or no reasonable cause to believe that his or her conduct was unlawful; | ||
| (c) | a transaction from which Indemnitee derived an improper personal profit; or | ||
| (d) | willful misconduct. |
Section 4. Actions by or in the Right of the Company. In addition to the indemnification of
Indemnitee provided pursuant to the other provisions hereof, Indemnitee shall be entitled to the
indemnification rights provided in this Section 4 if he or she is a person who was or is made a
party or is threatened to be made a party to any threatened, pending, or completed action or suit,
whether civil, criminal, administrative, or investigative in nature, brought by or in the right of
the Company to procure a judgment in its favor by reason of the fact that he or she is or was a
Representative or fiduciary of the Company or is or was serving at the request of the Company as a
Representative or fiduciary of any other entity by reason of anything done or not done by him or
her in any such capacity. Pursuant to this Section 4, Indemnitee shall be indemnified against all
expenses (including attorneys’ fees) and costs actually and reasonably incurred by him or her in
connection with such action or suit (including, but not limited to, the investigation, defense,
settlement, or appeal thereof), unless such amounts were incurred because Indemnitee breached or
failed to perform a duty owed to the Company and the breach or failure to perform constitutes:
2
| (a) | a willful failure to deal fairly with the Company or its shareholders in connection with a matter in which Indemnitee has a material conflict of interest; | ||
| (b) | a violation of criminal law, unless Indemnitee had reasonable cause to believe that his or her conduct was lawful or no reasonable cause to believe that his or her conduct was unlawful; | ||
| (c) | a transaction from which Indemnitee derived an improper personal profit; or | ||
| (d) | willful misconduct. |
Section 5. Indemnification for Costs, Charges, and Expenses of Successful Party.
Notwithstanding the other provisions of this Agreement and in addition to the rights to
indemnification set forth elsewhere herein, to the extent that Indemnitee has served as a witness
on behalf of the Company or has been successful on the merits or otherwise, including, without
limitation, the dismissal of an action, with or without prejudice, or in defense of any action,
suit, or proceeding referred to in Sections 3 and 4 hereof, or in defense of any claim, issue, or
matter therein, he or she shall be indemnified against all costs, charges, and expenses (including
attorneys’ fees) actually and reasonably incurred by him or her or on his or her behalf in
connection therewith. This Section shall not be construed to limit or prohibit other rights to
indemnification provided herein or by statute that may be available and such other rights shall not
be dependent on the outcome of any action.
Section 6. Partial Indemnification. In addition to the rights to indemnification set forth
elsewhere herein, if Indemnitee is only partially successful in the defense, investigation,
settlement, or appeal of any action, suit, investigation, or proceeding described in Section 3 or 4
hereof, and as a result, is not entitled under the other provisions of this Agreement to
indemnification by the Company for the total amount of the expenses (including attorneys’ fees),
costs, judgments, penalties, fines, and amounts paid in settlement actually and reasonably incurred
by him or her, the Company shall nevertheless indemnify Indemnitee, as a matter of right pursuant
to Section 5 hereof, to the extent Indemnitee has been partially successful.
Section 7. Determination of Entitlement to Indemnification. Upon written request by Indemnitee
for indemnification pursuant to this Agreement, the entitlement of Indemnitee to indemnification
pursuant to the terms of this Agreement shall be determined by the following person or persons who
shall be empowered to make such determination:
| (a) | by a majority vote of a quorum of the Board consisting of directors who are not at the time parties to the same or related proceedings; provided, however, that if a quorum of disinterested directors cannot be obtained, by a majority vote of a committee duly appointed by the Board and consisting solely of two or more directors who are not at the time parties to the same or related proceedings, directors who are parties to the same |
3
| or related proceedings being able to participate in the designation of members of the committee; | |||
| (b) | by independent legal counsel selected by a quorum of the Board or its committee in the manner prescribed in (a) above or, if unable to obtain such a quorum or committee, by a majority vote of the full Board, including directors who are parties to the same or related proceedings; | ||
| (c) | by a panel of three arbitrators consisting of one arbitrator selected by those directors entitled under (b) above to select independent legal counsel, one arbitrator selected by the director seeking indemnification, and one arbitrator selected by the two arbitrators previously selected; | ||
| (d) | by an affirmative vote of shares determined in accordance with Section 180.0725 of the WBCL, shares owned by or voted under the control of persons who are at the time parties to the same or related proceedings, whether as plaintiffs or defendants, or in any other capacity, being ineligible to vote in making the determination; or | ||
| (e) | by a court pursuant to Section 180.0854 of the WBCL. |
Any costs or expenses (including attorneys’ fees) incurred by Indemnitee in connection with
his request for indemnification hereunder shall be borne by the Company. The Company hereby
indemnifies and agrees to hold Indemnitee harmless therefrom irrespective of the outcome of the
determination of Indemnitee’s entitlement to indemnification. If the person making such
determination shall determine that Indemnitee is entitled to indemnification as to part, but not
all, of the application for indemnification, such person shall reasonably prorate such partial
indemnification among such claims, issues, or matters.
Section 8. Presumptions and Effect of Certain Proceedings. The Secretary of the Company shall,
promptly upon receipt of Indemnitee’s request for indemnification, advise in writing the Board or
such other person or persons empowered to make the determination as provided in Section 7 that
Indemnitee has made such request for indemnification. Upon making such request for
indemnification, Indemnitee shall be presumed to be entitled to indemnification hereunder and the
Company shall have the burden of proof in the making of any determination contrary to such
presumption. If the person or persons so empowered to make such determination shall have failed to
make the requested indemnification within sixty (60) days after receipt by the Company of such
request, the requisite determination of entitlement to indemnification shall be deemed to have been
made and Indemnitee shall be absolutely entitled to such indemnification, absent actual and
material fraud in the request for indemnification. The termination of any action, suit,
investigation, or proceeding described in Section 3 or 4 hereof by judgment, order, settlement, or
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself: (i) create a
presumption that Indemnitee acted in bad faith and in a manner which he or she reasonably believed
to be opposed to the best interests of the Company, and, with respect to any criminal action or
proceeding, that Indemnitee had reasonable cause to
4
believe that his or her conduct was unlawful; or (ii) otherwise adversely affect the rights of
Indemnitee to indemnification except as may be provided herein.
Section 9. Advance of Expenses and Costs. All reasonable expenses and costs incurred by
Indemnitee (including attorneys’ fees, retainers, and advances of disbursements required of
Indemnitee) shall be paid by the Company in advance of the final disposition of such action, suit,
or proceeding at the request of Indemnitee within twenty (20) days after the receipt by the Company
of a statement or statements from Indemnitee requesting such advance or advances from time to time.
Indemnitee’s entitlement to such expenses shall include those incurred in connection with any
proceeding by Indemnitee seeking an adjudication or award in arbitration pursuant to this
Agreement. Such statement or statements shall reasonably evidence the expenses and costs incurred
by him in connection therewith and shall include or be accompanied by an undertaking by or on
behalf of Indemnitee to repay such amount if it is ultimately determined that Indemnitee is not
entitled to be indemnified against such expenses and costs by the Company as provided by this
Agreement or otherwise.
Section 10. Remedies of Indemnitee in Cases of Determination not to indemnify or to Advance
Expenses. In the event that a determination is made that Indemnitee is not entitled to
indemnification hereunder or if payment has not been timely made following a determination of
entitlement to indemnification pursuant to Sections 7 and 8, or if expenses are not advanced
pursuant to Section 9, Indemnitee shall be entitled to a final adjudication in an appropriate court
of the State of Wisconsin or any other court of competent jurisdiction of his or her entitlement to
such indemnification or advancement of expenses or costs. Alternatively, Indemnitee at his or her
option may seek an award in arbitration to be conducted by a single arbitrator pursuant to the
rules of the American Arbitration Association, such award to be made within sixty (60) days
following the filing of the demand for arbitration. The Company shall not oppose Indemnitee’s
right to seek any such adjudication or award in arbitration or any other claim but may oppose such
claim. Such judicial proceeding or arbitrator shall be made de novo and Indemnitee shall not be
prejudiced by reason of a determination, if so made, that he or she is not entitled to
indemnification. If a determination is made or deemed to have been made pursuant to the terms of
Section 7 or 8 hereof that Indemnitee is entitled to indemnification, the Company shall be bound by
such determination and shall be precluded from asserting that such determination has not been made
or that the procedure by which such determination was made is not valid, binding, and enforceable.
The Company further agrees to stipulate in any such court or before any such arbitrator that the
Company is bound by all the provisions of this Agreement and is precluded from making any assertion
to the contrary. If the court or arbitrator shall determine that Indemnitee is entitled to any
indemnification hereunder, the Company shall pay all reasonable expenses (including attorneys’
fees) and costs actually incurred by Indemnitee in connection with such adjudication or award in
arbitration (including, but not limited to, any appellate proceedings).
Section 11. Other Rights to Indemnification. The indemnification and advancement of expenses
(including attorneys’ fees) and costs provided by this Agreement shall not be deemed exclusive of
any other rights to which Indemnitee may now or in the future be entitled under any provision of
the Bylaws of the Company, Articles of Incorporation of the Company, this Agreement, any vote of
shareholders or disinterested directors, provision of law, or otherwise.
5
Section 12. Attorneys’ Fees and Other Expenses to Enforce Agreement. In the event that
Indemnitee is subject to or intervenes in any proceeding in which the validity or enforceability of
this Agreement is at issue or seeks an adjudication or award in arbitration to enforce his or her
rights under, or to recover damages for breach of this Agreement, Indemnitee, if he or she prevails
in whole or in part in such action, shall be entitled to recover form the Company and shall be
indemnified by the Company against, any actual expenses for attorneys’ fees and disbursements
reasonably incurred by him or her.
Section 13. Duration of Agreement. This Agreement shall continue until and terminate upon the
later of: (i) ten (10) years after Indemnitee has ceased to occupy any of the positions or have
any of the relationships described in Sections 1, 3 and 4 of this Agreement; and (ii) the final
termination of all pending or threatened actions, suits, proceedings, or investigations with
respect to Indemnitee.
Section 14. Severability. Each section and subsection of this Agreement shall be considered
separable and if, for any reason, any section or paragraph herein is determined to be invalid and
contrary to any existing or future laws, such invalidity shall not impair or affect those portions
of the Agreement which are valid.
Section 15. Agreement in Counterparts. This Agreement may be executed in several counterparts
and all so executed shall constitute one agreement, binding on all of the parties hereto,
notwithstanding that all of the parties may not be signatories to the same counterpart, provided
that each party is a signatory to at least one counterpart.
Section 16. Captions and References. Titles or captions contained in this Agreement are
inserted only as a matter of convenience and for reference, and in no way define, limit, extend or
describe the scope of this Agreement or the intent of any provisions hereof.
Section 17. Amendment. This Agreement may only be amended by a written instrument executed by
all of the parties.
Section 18. Notice by Indemnitee. Indemnitee agrees promptly to notify the Company in writing
upon being served with any summons, citation, subpoena, complaint, indictment, information, or
other document relating to any matter which may be subject to indemnification covered hereunder,
either civil, criminal, or investigative.
Section 19. Notices. All notices required or permitted to be given hereunder shall be in
writing and shall be deemed to have been given to a party at the earlier of the date (i) when
actually delivered to such party, (ii) when facsimile transmitted to such party to the facsimile
number indicated for such party below (or to such other facsimile number for a party as such party
may have substituted by notice pursuant to this Section) or (iii) when mailed to such party by
registered or certified U.S. Mail (return receipt requested) or sent by overnight courier,
confirmed by receipt, and addressed to such party at the address designated below for such party
(or to such other address for such party as such party may have substituted by notice pursuant to
this Section):
6
| (a) | If to the Company: | 0000 Xxxxxx Xxx | ||||||
| Xxxxxxx, XX 00000 | ||||||||
| Attn: General Counsel | ||||||||
| (b) | If to Indemnitee: | |||||||
| (c) | with a copy to: | |||||||
or to such other address as may have been furnished to Indemnitee by the Company or to the Company
by Indemnitee, as the case may be.
Section 20. Applicable Law and Construction. This Agreement and the validity and construction
hereof shall be determined and governed in all respects by the internal laws of the State of
Wisconsin. This Agreement shall be construed without regard to any rules of construction regarding
the party responsible for the drafting hereof.
Section 21. Binding Effect and Benefit. This Agreement shall be binding upon and inure to the
benefit of the Indemnitee and his or her respective heirs, administrators, executors, successors,
assigns and legal representatives.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first
appearing above.
| TOMOTHERAPY INCORPORATED | ||||||
| By: | ||||||
| , Indemnitee | ||||||
7
