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EXHIBIT 10.3
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (the "Agreement") is made as of
this 23rd day of December, 1997 between DTI HOLDINGS, INC., a Missouri
corporation (the "Company"), and Xxxxxx X. Xxxxxx (the "Director").
RECITALS
1. The Director is a member of the Board of Directors of the
Company and in such capacity is performing valuable services for the Company.
B. Section 6.5 of the By-laws of the Company (the "By-laws"),
provides for the indemnification of the officers, directors, agents and
employees of the Company to the full extent authorized by law.
C. The provisions of Section 351.355 of the General and
Business Corporation Laws of Missouri (the "Indemnification Statute") provides,
among other provisions, that a corporation shall have the power, subject to
certain exceptions, to give any further indemnity to its directors and officers,
including indemnification agreements, provided such indemnity is authorized,
directed and provided for in such corporation's articles of incorporation.
D. The Company presently maintains one or more policies of
Directors and Officers Liability Insurance ("D&O Insurance"), insuring against
certain liabilities which the Company's directors and officers may incur as they
perform services for the Company.
E. The Company deems it appropriate to enter into agreements
with its directors to provide them with greater indemnification against the
liabilities they incur in the performance of services for the Company.
TERMS
NOW, THEREFORE, in consideration of the Director's agreement
to continue service as a director of the Company, the parties hereto agree as
follows:
1. Indemnity of Director. The Company agrees to indemnify the
Director and hold him harmless to the full extent authorized or permitted by the
provisions of the Indemnification Statute, or by any amendment thereof, or by
any other statutory provisions authorizing or permitting such indemnification
which may be adopted after the date hereof.
2. Maintenance of Insurance. The Company may, but shall not be
required to, continue all or any part of the D&O Insurance it has in force and
effect as of the date hereof. If the Company continues to maintain the D&O
Insurance, such insurance shall be primary, to the extent of the coverage
provided thereby, and the Company's agreement to provide the indemnification set
forth herein shall be effective only to the extent that the Director is not
reimbursed pursuant to the coverage
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maintained under the D&O Insurance or any comparable insurance. If the Company
does not maintain such insurance, the Company shall fully indemnify the
Director in accordance with the provisions of Section 1 and Section 3 of this
Agreement.
3. Additional Indemnity. Subject only to the exclusion set
forth in Section 4 hereof, the Company hereby agrees to indemnify the Director
and hold him harmless from and against any and all expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by the Director in connection with any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (including any action by or in the right of the Company) to
which the Director is, was or at any time becomes a party (other than a party
plaintiff suing on his own behalf or derivatively on behalf of the Company), or
is threatened to be made a party (other than a party plaintiff suing on his own
behalf or derivatively on behalf of the Company) by reason of the fact that the
Director is or was at any time a director, officer, employee or agent of the
Company, or is or was serving or at any time serves at the request of the
Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including, without
limitation, Digital Teleport, Inc.
4. Limitation on Indemnity. Notwithstanding any other
provision of this Agreement to the contrary, the Company shall not indemnify any
Director from or on account of such person's conduct which is finally adjudged
to have been knowingly fraudulent or deliberately dishonest or to have
constituted willful misconduct.
5. Continuation of Indemnity. All of the Company's agreements
and obligations contained herein shall continue (a) during the period that the
Director is a director, officer, employee or agent of the Company or is or was
serving at the request of the Company as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other enterprise,
including, without limitation, Digital Teleport, Inc. and (b) thereafter so
long as the Director shall be subject to any possible including, without
limitation, Digital Teleport Inc. claim or threatened, pending or completed
action, suit or proceeding, whether civil, criminal or investigative, by reason
of the fact that the Director is or was a director of the Company or serving in
any other capacity referred to herein.
6. Notification and Defense of Claim. Promptly after the
Director receives notice of the commencement of any action, suit or proceeding,
the Director will, if a claim in respect thereof is to be made against the
Company under this Agreement, notify the Company of the commencement thereof.
The failure to notify the Company will relieve the Company from any liability
hereunder to the extent the Company can show prejudice as a result of such
failure, and will not relieve the Company from any liability which it may have
to the Director otherwise than under this Agreement. With respect to any such
action, suit or proceeding as to which the Director notifies the Company of the
commencement thereof:
(a) The Company will 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) will be entitled to assume the
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defense thereof with counsel satisfactory to Director. After the Company
notifies the Director of its election to assume such defense, the Company will
not be liable to the Director under this Agreement for any legal or other
expenses the Director subsequently incurs in connection with the defense
thereof other than reasonable costs of investigation or as otherwise provided
below. The Director shall have the right to employ his counsel in such
action, suit or proceeding, provided that the fees and expenses of such counsel
incurred after the Company has provided the Director with notice that it is
assuming the defense shall be at the Director's expense, unless (i) the Company
has authorized the Director's employment of counsel, (ii) the Director shall
have reasonably concluded that there may be a conflict of interest between the
Company and the Director 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, in each of which cases the fees and expenses of such counsel shall
be at the Company's expense. The Company shall not be entitled to assume the
defense of any action, suit or proceeding brought by or on behalf of the Company
or as to which the Director shall have made the conclusion provided for in (ii)
above.
(c) The Company shall not be liable to indemnify the
Director for any amounts paid in settlement of any action or claim effected
without the Company's written consent. The Company shall not settle any action
or claim in any manner which would impose any penalty or limitation on the
Director without the Director's written consent. Neither the Company nor the
Director will unreasonably withhold his or its consent to any proposed
settlement.
7. Repayment of Expenses. The Director shall reimburse the
Company for all reasonable expenses the Company pays in defending any civil or
criminal action, suit or proceeding against the Director in the event and to the
extent that it shall be ultimately determined that the Director is not entitled
to be indemnified by the Company for such expenses under the provisions of the
Indemnification Statute, the By-laws, this Agreement or otherwise. Prior to such
determination, the Company shall make such advances as shall be reasonably
necessary to pay such expenses of the Director, provided the Company receives an
undertaking from the Director to repay such advances in the event it is
ultimately determined that the Director is not entitled to be indemnified
therefor.
8. Enforcement.
(a) The Company expressly confirms and agrees that it
has entered into this Agreement and assumed the obligations imposed hereby in
order to induce the Director to continue as a director of the Company, and
acknowledges that the Director is relying upon this Agreement in continuing in
such capacity.
(b) In the event that the Director is required to bring
any action to enforce any rights or to collect any money due under this
Agreement and is successful in such action, the Company shall reimburse the
Director for all of the Director's reasonable fees and expenses in bringing and
pursuing such action.
9. Separability. Each provision of this Agreement is a
separate and distinct agreement, independent of the others. If any provision
shall be held to be invalid or unenforceable for any reason, such invalidity or
unenforceability shall not affect the validity or enforceability of any of the
other provisions.
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10. Governing Law; Binding Effect; Amendment and Termination.
(a) This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Missouri, without reference to its
rules governing conflicts of laws.
(b) This Agreement shall be binding upon the Director
and the Company and shall inure to the benefit of the Director, his heirs,
personal representatives and assigns and to the benefit of the Company, its
successors and assigns.
(c) In the event that the Company shall make any
payment to or on behalf of the Director under the terms of this Agreement,
whether in satisfaction of any judgment, payment in settlement, reimbursement of
expenses, or otherwise, the Company shall succeed to, and have by way of
subrogation, all of the rights theretofore possessed by the Director against any
other person, firm or corporation for or on account of the lawsuit, claim or
matter in respect of which the payment was made, including, without limitation,
full subrogation to any claim or right the Director had or may have had against
any insurance company providing D&O Insurance to the Company, its officers and
directors.
(d) No amendment, modification, termination or
cancellation of this Agreement shall be effective unless in writing signed by
both parties hereto.
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IN WITNESS WHEREOF, the parties hereto have executed this
Indemnification Agreement as of the day and year first above written.
DTI HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Xxxxxxx X. Xxxxxxxxx
President and Chief
Executive Officer
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
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