EXHIBIT 15
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT, dated as of January 15, 2002 (this
"Agreement"), among Western Multiplex Corporation, a Delaware corporation
(together with its successors, the "Company"), Ripplewood Partners, L.P., a
Delaware limited partnership (together with its successors and permitted
assigns, "Partners"), Ripplewood Employee Co-Investment Fund, L.P., a Delaware
limited partnership (together with its successors and permitted assigns,
"Co-Investment"), and WMC Holding L.L.C., a Delaware limited liability company
(together with its successors and permitted assigns, "Holding," and together
with Partners and Co-Investment, the "Investors").
W I T N E S S E T H :
WHEREAS, the Company proposes to enter into an Agreement and Plan
of Reorganization (as amended, supplemented otherwise modified from time to
time, the "Reorganization Agreement") among the Company, Proxim, Inc., a
Delaware corporation ("Proxim"), and Walnut-Pine Merger Corp., a Delaware
corporation and wholly-owned subsidiary of the Company ("Merger Sub"), pursuant
to which, among other things, upon the terms and subject to the conditions set
forth therein, Merger Sub will merge (the "Merger") with and into Proxim and
Proxim will become a wholly-owned subsidiary of the Company;
WHEREAS, concurrently with the execution of the Reorganization
Agreement and as a condition and inducement to Proxim's willingness to enter
into the Reorganization Agreement, each of the Investors has agreed to enter
into a Voting Agreement (each as amended, supplemented otherwise modified from
time to time, a "Voting Agreement," and collectively, the "Voting Agreements"),
with Proxim; and
WHEREAS, concurrently with the execution of the Voting Agreements
and as a condition and inducement to the Investors' willingness to enter into
the Voting Agreements, the Company has agreed to indemnify each of the Investors
and certain other persons pursuant to the terms set forth herein.
NOW, THEREFORE, in consideration of the mutual agreements and
understandings set forth herein, the parties hereto hereby agree as follows:
Section 1 Indemnification.
(a) The Company shall indemnify and hold harmless (x) each of the
Investors and each of its Affiliates (as defined below) and any controlling
person of any of the foregoing, (y) each of the foregoing's respective
directors, officers, employees and agents and (z) each of the heirs, executors,
successors and assigns of any of the foregoing from and against any and all
damages, claims, losses, expenses, costs, obligations and Liabilities (as
defined below) including, without limiting the generality of the foregoing,
Liabilities for all reasonable attorneys' fees and expenses (including attorney
and expert fees and expenses incurred to
enforce the terms of this Agreement) (collectively, "Losses and Expenses")
suffered or incurred by any such indemnified person or entity to the extent
arising from, relating to or otherwise in respect of, any governmental or other
third party claim against such indemnified person that arises from, relates to
or is otherwise in respect of the execution, delivery or performance of the
Reorganization Agreement or the Voting Agreements or the consummation or
proposed consummation of the Merger and the transactions related thereto or
arising therefrom, including, without limitation, any Losses and Expenses
arising from or under any federal, state or other securities law, but excluding
any Losses and Expenses in respect of any breach by such Investor of the Voting
Agreement to which such Investor is a party. The indemnification provided by the
Company pursuant to this Section 1 is separate from and in addition to any other
indemnification by the Company to which the indemnified person may be entitled.
(b) With respect to third-party claims, all claims for
indemnification by an indemnified person (an "Indemnified Party") hereunder
shall be asserted and resolved as set forth in this Section 1. In the event that
any written claim or demand for which the Company would be liable to any
Indemnified Party hereunder is asserted against or sought to be collected from
any Indemnified Party by a third party, such Indemnified Party shall promptly
notify the Company in writing of such claim or demand (the "Claim Notice"),
provided that the failure to promptly provide a Claim Notice will not affect an
Indemnified Party's right to indemnification except to the extent such failure
materially prejudices the Company. The Company shall have twenty (20) days from
the date of receipt of the Claim Notice (the "Notice Period") to notify the
Indemnified Party (i) whether or not the Company disputes the liability of the
Company to the Indemnified Party hereunder with respect to such claim or demand
and (ii) whether or not it desires to defend the Indemnified Party against such
claim or demand. All costs and expenses incurred by the Company in defending
such claim or demand shall be a liability of, and shall be paid by, the Company.
Except as hereinafter provided, in the event that the Company notifies the
Indemnified Party within the Notice Period that it desires to defend the
Indemnified Party against such claim or demand, the Company shall have the right
to defend the Indemnified Party by appropriate proceedings and shall have the
sole power to direct and control such defense; provided, however, that (A) if
the Indemnified Party reasonably determines that there may be a conflict between
the positions of the Company and of the Indemnified Party in conducting the
defense of such claim or that there may be legal defenses available to such
Indemnified Party different from or in addition to those available to the
Company, then counsel for the Indemnified Party shall be entitled to conduct the
defense at the expense of the Company to the extent reasonably determined by
such counsel to be necessary to protect the interests of the Indemnified Party
and (B) in any event, the Indemnified Party shall be entitled at its cost and
expense to have counsel chosen by such Indemnified Party participate in, but not
conduct, the defense. The Indemnified Party shall not settle a claim or demand
without the consent of the Company. The Company shall not, without the prior
written consent of the Indemnified Party, settle, compromise or offer to settle
or compromise any such claim or demand on a basis which would result in the
imposition of a consent order, injunction or decree which would restrict the
future activity or conduct of the Indemnified Party or any Affiliate thereof or
if such settlement or compromise does not include an unconditional release of
the Indemnified Party for any liability arising out of such claim or demand. If
the Company elects not to defend the Indemnified Party against such claim or
demand, whether by not giving the Indemnified Party timely notice as provided
above or otherwise, then the amount of any such claim or demand or, if the same
be contested by the Indemnified Party, that portion thereof as to which such
defense is unsuccessful
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(and the reasonable costs and expenses pertaining to such defense) shall be the
liability of the Company hereunder. The Indemnified Party and Company shall each
render to each other such assistance as may reasonably be requested in order to
insure the proper and adequate defense of any such claim or proceeding.
(c) If the indemnification provided for in this Section 1 is
unavailable or insufficient to hold harmless an Indemnified Party under this
Section 1, then the Company, in lieu of indemnifying such Indemnified Party,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of the Losses and Expenses referred to in this Section 1: (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Indemnified Party from the matter giving rise to indemnification
hereunder or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company and the Indemnified Party in connection with the matter
that resulted in such Losses and Expenses, as well as any other relevant
equitable considerations. Relative fault shall be determined by reference to,
among other things, the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent the matter giving rise to such
Losses and Expenses.
(d) The parties agree that it would not be just and equitable if
contributions pursuant to Section 1(c) were to be determined by pro rata
allocation or by any other method of allocation which does not take into account
the equitable considerations referred to in the first sentence of Section 1(c).
The amount paid by any Indemnified Party as a result of the losses, claims,
damages or liabilities, or actions in respect thereof, referred to in the first
sentence of Section 1(c) shall be deemed to include any legal or other expenses
reasonably incurred by such Indemnified Party in connection with investigation,
preparing to defend or defending against any claim which is the subject of this
Section 1.
(e) For purposes of this Agreement, "Affiliate" shall mean, with
respect to any person, any other person that directly or indirectly, through one
or more intermediaries, controls, or is controlled by, or is under common
control with, such person. For purposes of the foregoing sentence, "control"
(including, with correlative meanings, the terms "controlled by" and "under
common control with"), as used with respect to any person, means the direct or
indirect possession of the power to direct or cause the direction of the
management or policies of such person, whether through the ownership of voting
securities, by contract or otherwise.
(f) For purposes of this Agreement, "Liabilities" means, as to
any person or entity, all debts, liabilities and obligations, direct, indirect,
absolute or contingent of such person or entity, whether accrued, vested or
otherwise, whether known or unknown and whether or not actually reflected, or
required by generally accepted accounting principles to be reflected, in such
person or entity's balance sheets or other books and records.
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Section 2 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given, if delivered
personally, by telecopier or sent by overnight courier as follows:
(a) if to Company, to:
Western Multiplex Corporation
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
00 Xxxxxxxxx Xxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx
Fax No.: (000) 000-0000
(b) if to any of the Investors, to:
Ripplewood Holdings, L.L.C.
Xxx Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Fax No.: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Facsimile No.: (000) 000-0000
or to such other address or addresses as shall be designated in writing. All
notices shall be effective when received.
Section 3 Entire Agreement; Amendment. This Agreement sets forth
the entire agreement between the parties hereto with respect to the matters
subject to this Agreement. Any provision of this Agreement may be amended or
modified in whole or in part at any time by an agreement in writing between the
parties hereto executed in the same manner as this Agreement. No failure on the
part of any party to exercise, and no delay in exercising, any right shall
operate as a waiver thereof nor shall any single or partial exercise by any
party of any right preclude any other or future exercise thereof or the exercise
of any other right.
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Section 4 Severability. In the event that any one or more of the
provisions contained in this Agreement or in any other instrument referred to
herein, shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other provision of this Agreement or any other such instrument.
Section 5 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to constitute an original, but
all of which together shall constitute one and the same document.
Section 6 Governing Law; Jurisdiction; Waiver of Jury. This
Agreement shall be governed and construed in accordance with the laws of the
State of Delaware applicable to contracts made and to be performed in the State
of Delaware. Each party hereby submits to the exclusive jurisdiction of the
Court of Chancery or other courts of the State of Delaware in any matter based
upon or arising out of this Agreement or the matters contemplated herein. The
parties hereto waive all right to trial by jury in any action, suit or
proceeding brought to enforce or defend any rights or remedies under this
Agreement.
Section 7 Successors and Assigns; Third Party Beneficiaries. The
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors, and administrators of the parties hereto.
Each of the indemnified persons described in Section 1 hereto shall be deemed
third party beneficiaries of this Agreement and shall be entitled to the benefit
of, and to enforce, its terms.
Section 8 Headings and Captions. The section headings and
captions contained in this Agreement are for reference purposes only, are not
part of this Agreement and shall not affect the meaning or interpretation of
this Agreement.
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IN WITNESS WHEREOF, this Agreement has been executed by the parties
hereto, all as of the date first above written.
WESTERN MULTIPLEX CORPORATION
By: /s/ Xxxxxxxx Xxxxx
-----------------------------------------
Name: Xxxxxxxx Xxxxx
Title: Chairman & CEO
WMC HOLDING L.L.C.
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title:
RIPPLEWOOD PARTNERS, L.P.
By: Ripplewood Holdings, L.L.C., its general
partner
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title:
RIPPLEWOOD EMPLOYEE CO-INVESTMENT FUND, L.P.
By: Ripplewood Holdings, L.L.C., its general
partner
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title:
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