FUND.COM INC. INDEMNIFICATION AGREEMENT
XXXX.XXX
INC.
This
Indemnification Agreement (“Agreement”) is made
as of this __ day of March, 2008 by and between Xxxx.xxx Inc., a Delaware
corporation (the “Company”), and
______________ (“Indemnitee”).
WHEREAS,
the Company and Indemnitee recognize the significant cost of directors’ and
officers’ liability insurance and the general reductions in the coverage of such
insurance;
WHEREAS,
the Company and Indemnitee further recognize the substantial increase in
corporate litigation in general, subjecting officers and directors to expensive
litigation risks at the same time as the coverage of liability insurance has
been severely limited; and
WHEREAS,
the Company desires to attract and retain the services of highly qualified
individuals, such as Indemnitee, to serve as officers and directors of the
Company and to indemnify its officers and directors so as to provide them with
the maximum protection permitted by law.
NOW,
THEREFORE, in consideration for Indemnitee’s services as an officer or director
of the Company, the Company and Indemnitee hereby agree as follows:
1. Indemnification.
(a) Third Party
Proceedings. The
Company shall indemnify Indemnitee if Indemnitee is or was a party or is
threatened to be made a party to any threatened, pending or completed action,
suit, proceeding or any alternative dispute resolution mechanism, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the Company) by reason of the fact that Indemnitee is or was a
director, officer, employee or agent of the Company, or any subsidiary of the
Company, or by reason of the fact that Indemnitee 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, against
expenses (including attorneys’ fees), judgments, fines and amounts paid in
settlement (if such settlement is approved in advance by the Company, which
approval shall not be unreasonably withheld) actually and reasonably incurred by
Indemnitee in connection with such action, suit or proceeding if Indemnitee
acted in good faith and in a manner Indemnitee reasonably believed to be in or
not opposed to the best interests of the Company, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe Indemnitee’s
conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
Indemnitee did not act in good faith and in a manner which Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that Indemnitee’s conduct was unlawful.
(b) Proceedings By or in the
Right of the Company. The
Company shall indemnify Indemnitee if Indemnitee was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Company or any subsidiary of the Company to
procure a judgment in its favor by reason of the fact that Indemnitee is or was
a director, officer, employee or agent of the Company, or any subsidiary of the
Company, or by reason of the fact that Indemnitee 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, against
expenses (including attorneys’ fees) and, to the fullest extent permitted by
law, amounts paid in settlement actually and reasonably incurred by Indemnitee
in connection with the defense or settlement of such action or suit if
Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to
be in or not opposed to the best interests of the Company, except that no
indemnification shall be made in respect of any claim, issue or matter as to
which Indemnitee shall have been adjudged to be liable to the Company unless and
only to the extent that the Court of Chancery of the State of Delaware or the
court in which such action or suit 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 the Court of Chancery of the State of Delaware or such other
court shall deem proper.
(c) Mandatory Payment of
Expenses. To
the extent that Indemnitee has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in Subsections (a) and (b)
of this Section 1, or in defense of any claim, issue or matter therein,
Indemnitee shall be indemnified against expenses (including attorneys’ fees)
actually and reasonably incurred by Indemnitee in connection
therewith.
2. Expenses; Indemnification
Procedure.
(a) Advancement of
Expenses. The
Company shall advance all expenses incurred by Indemnitee in connection with the
investigation, defense, settlement or appeal of any civil or criminal action,
suit or proceeding referenced in Section 1(a) or (b) hereof (but not amounts
actually paid in settlement of any such action, suit or
proceeding). Indemnitee hereby undertakes to repay such amounts
advanced only if, and to the extent that, it shall ultimately be determined that
Indemnitee is not entitled to be indemnified by the Company as authorized
hereby. The advances to be made hereunder shall be paid by the
Company to Indemnitee within thirty (30) days following delivery of a written
request therefor by Indemnitee to the Company.
(b) Notice/Cooperation by
Indemnitee. Indemnitee
shall, as a condition precedent to his right to be indemnified under this
Agreement, give the Company notice in writing as soon as practicable of any
claim made against Indemnitee for which indemnification will or could be sought
under this Agreement. Notice to the Company shall be directed to the
President of the Company at the address shown on the signature page of this
Agreement (or such other address as the Company shall designate in writing to
Indemnitee). Notice shall be deemed received three business days
after the date postmarked if sent by domestic certified or registered mail,
properly addressed, five business days if sent by airmail to a country outside
of North America; otherwise notice shall be deemed received when such notice
shall actually be received by the Company. In addition, Indemnitee
shall give the Company such information and cooperation as it may reasonably
require and as shall be within Indemnitee’s power.
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(c) Procedure. Any
indemnification and advances provided for in Section 1 and this Section 2 shall
be made no later than thirty (30) days after receipt of the written request of
Indemnitee. If a claim under this Agreement, under any statute, or
under any provision of the Company’s Certificate of Incorporation or Bylaws
providing for indemnification, is not paid in full by the Company within thirty
(30) days after a written request for payment thereof has first been received by
the Company, Indemnitee may, but need not, at any time thereafter bring an
action against the Company to recover the unpaid amount of the claim and,
subject to Section 12 of this Agreement, Indemnitee shall also be entitled to be
paid for the expenses (including attorneys’ fees) of bringing such
action. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in connection with any
action, suit or proceeding in advance of its final disposition) that Indemnitee
has not met the standards of conduct which make it permissible under applicable
law for the Company to indemnify Indemnitee for the amount
claimed. However, Indemnitee shall be entitled to receive interim
payments of expenses pursuant to Subsection 2(a) unless and until such defense
may be finally adjudicated by court order or judgment from which no further
right of appeal exists. It is the parties’ intention that if the
Company contests Indemnitee’s right to indemnification, the question of
Indemnitee’s right to indemnification shall be for the court to decide, and
neither the failure of the Company (including its Board of Directors, any
committee or subgroup of the Board of Directors, independent legal counsel, or
its stockholders) to have made a determination that indemnification of
Indemnitee is proper in the circumstances because Indemnitee has met the
applicable standard of conduct required by applicable law, nor an actual
determination by the Company (including it Board of Directors, any committee or
subgroup of the Board of Directors, independent legal counsel, or its
stockholders) that Indemnitee has not met such applicable standard of conduct,
shall create a presumption that Indemnitee has or has not met the applicable
standard of conduct.
(d) Notice to
Insurers. If,
at the time of the receipt of a notice of a claim pursuant to Section 2(b)
hereof, the Company has director and officer liability insurance in effect, the
Company shall give prompt notice of the commencement of such proceeding to the
insurers in accordance with the procedures set forth in the respective
policies. The Company shall thereafter take all necessary or
desirable action to cause such insurers to pay, on behalf of the Indemnitee, all
amounts payable as a result of such proceeding in accordance with the terms of
such policies.
(e) Selection of
Counsel. In
the event the Company shall be obligated under Section 2(a) hereof to pay the
expenses of any proceeding against Indemnitee, the Company, if appropriate,
shall be entitled to assume the defense of such proceeding, with counsel
approved by Indemnitee, upon the delivery to Indemnitee of written notice of its
election to do so. After delivery of such notice, approval of such
counsel by Indemnitee and the retention of such counsel by the Company, the
Company will not be liable to Indemnitee under this Agreement for any fees of
counsel subsequently incurred by Indemnitee with respect to the same proceeding,
provided, that (i)
Indemnitee shall have the right to employ his counsel in any such proceeding at
Indemnitee’s expense; and (ii) if (A) the employment of counsel by Indemnitee
has been previously authorized by the Company, (B) Indemnitee shall have
reasonably concluded that there may be a conflict of interest between the
Company and Indemnitee in the conduct of any such defense, or (C) the Company
shall not, in fact, have employed counsel to assume the defense of such
proceeding, then the fees and expenses of Indemnitee’s counsel shall be at the
expense of the Company.
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3. Additional Indemnification
Rights; Nonexclusivity.
(a) Scope. Notwithstanding
any other provision of this Agreement, the Company hereby agrees to indemnify
the Indemnitee to the fullest extent permitted by law, notwithstanding that such
indemnification is not specifically authorized by the other provisions of this
Agreement, the Company’s Certificate of Incorporation, the Company’s Bylaws or
by statute. In the event of any change, after the date of this
Agreement, in any applicable law, statute, or rule which expands the right of a
Delaware corporation to indemnify a member of its board of directors or an
officer, such changes shall be, ipso facto, within the purview of Indemnitee’s
rights and Company’s obligations, under this Agreement. In the event
of any change in any applicable law, statute or rule which narrows the right of
a Delaware corporation to indemnify a member of its board of directors or an
officer, such changes, to the extent not otherwise required by such law, statute
or rule to be applied to this Agreement shall have no effect on this Agreement
or the parties’ rights and obligations hereunder.
(b) Nonexclusivity. The
indemnification provided by this Agreement shall not be deemed exclusive of any
rights to which Indemnitee may be entitled under the Company’s Certificate of
Incorporation, its Bylaws, any agreement, any vote of stockholders or
disinterested Directors, the General Corporation Law of the State of Delaware,
or otherwise, both as to action in Indemnitee’s official capacity and as to
action in another capacity while holding such office. The
indemnification provided under this Agreement shall continue as to Indemnitee
for any action taken or not taken while serving in an indemnified capacity even
though he may have ceased to serve in such capacity at the time of any action,
suit or other covered proceeding.
4. Partial
Indemnification. If
Indemnitee is entitled under any provision of this Agreement to indemnification
by the Company for some or a portion of the expenses, judgments, fines or
penalties actually or reasonably incurred by him in the investigation, defense,
appeal or settlement of any civil or criminal action, suit or proceeding, but
not, however, for the total amount thereof, the Company shall nevertheless
indemnify Indemnitee for the portion of such expenses, judgments, fines or
penalties to which Indemnitee is entitled.
5. Mutual
Acknowledgement. Both
the Company and Indemnitee acknowledge that in certain instances, Federal law or
applicable public policy may prohibit the Company from indemnifying its
directors and officers under this Agreement or otherwise. Indemnitee
understands and acknowledges that the Company has undertaken or may be required
in the future to undertake with the Securities and Exchange Commission to submit
the question of indemnification to a court in certain circumstances for a
determination of the Company’s right under public policy to indemnify
Indemnitee.
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6. Officer and Director
Liability Insurance. The
Company shall, from time to time, make the good faith determination whether or
not it is practicable for the Company to obtain and maintain a policy or
policies of insurance with reputable insurance companies providing the officers
and directors of the Company with coverage for losses from wrongful acts, or to
ensure the Company’s performance of its indemnification obligations under this
Agreement. Among other considerations, the Company will weigh the
costs of obtaining such insurance coverage against the protection afforded by
such coverage. In all policies of director and officer liability
insurance, Indemnitee shall be named as an insured in such a manner as to
provide Indemnitee the same rights and benefits as are accorded to the most
favorably insured of the Company’s directors, if Indemnitee is a director; or of
the Company’s officers, if Indemnitee is not a director of the Company but is an
officer. Notwithstanding the foregoing, the Company shall have no
obligation to obtain or maintain such insurance if the Company determines in
good faith that such insurance is not reasonably available, if the premium costs
for such insurance are disproportionate to the amount of coverage provided, if
the coverage provided by such insurance is limited by exclusions so as to
provide an insufficient benefit, or if Indemnitee is covered by similar
insurance maintained by a subsidiary or parent of the Company.
7. Severability. Nothing
in this Agreement is intended to require or shall be construed as requiring the
Company to do or fail to do any act in violation of applicable
law. The Company’s inability, pursuant to court order, to perform its
obligations under this Agreement shall not constitute a breach of this
Agreement. The provisions of this Agreement shall be severable as
provided in this Section 7. If this Agreement or any portion hereof
shall be invalidated on any ground by any court of competent jurisdiction, then
the Company shall nevertheless indemnify Indemnitee to the full extent permitted
by any applicable portion of this Agreement that shall not have been
invalidated, and the balance of this Agreement not so invalidated shall be
enforceable in accordance with its terms.
8. Exceptions. Any
other provision herein to the contrary notwithstanding, the Company shall not be
obligated pursuant to the terms of this Agreement:
(a) Claims Initiated by
Indemnitee. To
indemnify or advance expenses to Indemnitee with respect to proceedings or
claims 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 or any other statute or law or otherwise as
required under Section 145 of the Delaware General Corporation Law, but such
indemnification or advancement of expenses may be provided by the Company in
specific cases if the Board of Directors has approved the initiation or bringing
of such suit;
(b) Lack of Good
Faith. To
indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to
any proceeding instituted by Indemnitee to enforce or interpret this Agreement,
if a court of competent jurisdiction determines that each of the material
assertions made by the Indemnitee in such proceeding was not made in good faith
or was frivolous;
(c) Insured
Claims. To
indemnify Indemnitee for expenses or liabilities of any type whatsoever
(including, but not limited to, judgments, fines, ERISA excise taxes or
penalties, and amounts paid in settlement) which have been paid directly to
Indemnitee by an insurance carrier under a policy of officers’ and directors’
liability insurance maintained by the Company; or
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(d) Claims Under Section
16(b). To
indemnify Indemnitee for expenses and the payment of profits arising from the
purchase and sale by Indemnitee of securities in violation of Section 16(b) of
the Securities Exchange Act of 1934, as amended, or any similar successor
statute.
9. Construction of Certain
Phrases.
(a) For
purposes of this Agreement, references to the “Company” shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, and employees or agents, so that
if Indemnitee is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, Indemnitee shall stand in
the same position under the provisions of this Agreement with respect to the
resulting or surviving corporation as Indemnitee would have with respect to such
constituent corporation if its separate existence had continued.
(b) For
purposes of this Agreement, references to “other enterprises” shall include
employee benefit plans; references to “fines” shall include any excise taxes
assessed on Indemnitee with respect to an employee benefit plan; and references
to “serving at the request of the Company” shall include any service as a
director, officer, employee or agent of the Company which imposes duties on, or
involves services by, such director, officer, employee or agent with respect to
an employee benefit plan, its participants, or beneficiaries; and if Indemnitee
acted in good faith and in a manner Indemnitee reasonably believed to be in the
interest of the participants and beneficiaries of an employee benefit plan,
Indemnitee shall be deemed to have acted in a manner “not opposed to the best
interests of the Company” as referred to in this Agreement.
10. Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall
constitute an original.
11. Successors and
Assigns. This
Agreement shall be binding upon the Company and its successors and assigns, and
shall inure to the benefit of Indemnitee and Indemnitee’s estate, heirs, legal
representatives and assigns.
12. Attorneys’
Fees. In
the event that any action is instituted by Indemnitee under this Agreement to
enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be
paid all court costs and expenses, including reasonable attorneys’ fees,
incurred by Indemnitee with respect to such action, unless as a part of such
action, the court of competent jurisdiction determines that each of the material
assertions made by Indemnitee as a basis for such action were not made in good
faith or were frivolous. In the event of an action instituted by or
in the name of the Company under this Agreement or to enforce or interpret any
of the terms of this Agreement, Indemnitee shall be entitled to be paid all
court costs and expenses, including attorneys’ fees, incurred by Indemnitee in
defense of such action (including with respect to Indemnitee’s counterclaims and
cross-claims made in such action), unless as a part of such action the court
determines that each of Indemnitee’s material defenses to such action were made
in bad faith or were frivolous.
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13. Notice. All
notices, requests, demands and other communications under this Agreement shall
be in writing and shall be deemed duly given (i) if delivered by hand and
receipted for by the party addressee, on the date of such receipt, or (ii) if
mailed by domestic certified or registered mail with postage prepaid, on the
third business day after the date postmarked. Addresses for notice to
either party are as shown on the signature page of this Agreement, or as
subsequently modified by written notice.
14. Consent to
Jurisdiction. The
Company and Indemnitee each hereby irrevocably consent to the jurisdiction of
the courts of the State of New York for all purposes in connection with any
action or proceeding which arises out of or relates to this Agreement and agree
that any action instituted under this Agreement shall be brought only in the
state courts of the State of New York.
15. Choice of
Law. This
Agreement shall be governed by and its provisions construed in accordance with
the laws of the State of New York, as applied to contracts between New York
residents entered into and to be performed entirely within New York without
regard to the conflict of law principles thereof.
16. Period of
Limitations. No
legal action shall be brought and no cause of action shall be asserted by or in
the right of the Company against Indemnitee, Indemnitee’s estate, spouse, heirs,
executors or personal or legal representatives after the expiration of two years
from the date of accrual of such cause of action, and any claim or cause of
action of the Company shall be extinguished and deemed released unless asserted
by the timely filing of a legal action within such two-year period; provided, however, that if
any shorter period of limitations is otherwise applicable to any such cause of
action, such shorter period shall govern.
17. Subrogation. In
the event of payment under this Agreement, the Company shall be subrogated to
the extent of such payment to all of the rights of recovery of Indemnitee, who
shall execute all documents required and shall do all acts that may be necessary
to secure such rights and to enable the Company effectively to bring suit to
enforce such rights.
18. Amendment and
Termination. No
amendment, modification, termination or cancellation of this Agreement shall be
effective unless it is in writing signed by both the parties
hereto. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provisions hereof (whether or
not similar) nor shall such waiver constitute a continuing waiver.
19. Integration and Entire
Agreement. This
Agreement sets forth the entire understanding between the parties hereto and
supersedes and merges all previous written and oral negotiations, commitments,
understandings and agreements relating to the subject matter hereof between the
parties hereto.
[Signature
page to follow]
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written.
XXXX.XXX
INC.
By:
_____________________________________
Name: Xxxxxxx
Xxxx
Title:
Chief
Executive Officer
Address:
______________________________
______________________________
______________________________
AGREED
TO AND ACCEPTED:
INDEMNITEE:
By:
_________________________________
Name:
Address:
______________________________
______________________________
______________________________
