KBS TECHNOLOGIES, INC.
OFFICER/DIRECTOR INDEMNIFICATION AGREEMENT
THIS AGREEMENT ("Agreement") is entered into and effective this 11th
day of February, 2000, by and between KBS TECHNOLOGIES, INC., an Oklahoma KBS
("KBS"), and Xxxx Xxxxxxx ("Indemnified Party").
WHEREAS, the Board of Directors has determined that it is in the best
interest of the KBS and its shareholders to agree to indemnify Indemnified Party
(who is a Director and/or Officer of KBS) from and against certain liabilities
for actions taken by the Indemnified Party during the performance of tasks for
KBS.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Indemnification. KBS hereby agrees to indemnify and hold harmless
Indemnified Party to the maximum extent possible under all applicable laws
against any and all claims, demands, debts, duties, liabilities, judgments,
fines and amounts paid in settlement and expenses (including attorneys' fees and
expenses) actually and reasonably incurred by Indemnified Party in connection
with the investigation, defense, negotiation and settlement of any such claim or
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (including an action by or in the
right of KBS) to which Indemnified Party is or becomes a party, or is threatened
to be made a party, by reason of the fact that Indemnified Party is an officer
or a director of KBS or any of its subsidiaries.
2. Limitations on Indemnity. No indemnity pursuant to this
Agreement shall be made by KBS:
(a) For the amount of such losses for which the
Indemnified Party is indemnified pursuant to any insurance purchased and
maintained by KBS; or
(b) In respect to remuneration paid to Indemnified Party if it
shall be determined by a final judgment or other final adjudication that such
remuneration was in violation of law; or
(c) On account of any suit in which judgment is rendered
against Indemnified Party for an accounting of profits made (i) for an improper
personal profit without full and fair disclosure to KBS of all material
conflicts of interest and not approved thereof by a majority of the
disinterested members of the Board of Directors of KBS; or (ii) from the
purchase or sale by Indemnified Party of securities of KBS pursuant to the
provisions of Section 16(b) of the Securities Exchange Act of 1934 and
amendments thereto or similar provisions of any federal, state or local law; or
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(d) On account of Indemnified Party's conduct which is finally
determined to have been knowingly fraudulent, deliberately dishonest or
willfully in violation of applicable law for which KBS suffered actual financial
damages; or
(e) If a final decision by a court having jurisdiction in the
matter shall determine that such indemnification is not lawful.
3. Continuation of Indemnity. All agreements and obligations of KBS
contained herein shall continue during the period Indemnified Party is an
officer or director of KBS or a subsidiary and thereafter so long as Indemnified
Party shall be subject to any possible claim or threatened, pending or completed
action, suit or proceeding, whether civil, criminal or investigative, by reason
of the fact that Indemnified Party was an officer or a director of KBS or any
subsidiary.
4. Notification and Defense of Claim. Within 30 days after receipt by
Indemnified Party of notice of any claim or any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, in which Indemnified Party has a right to Indemnification
hereunder, Indemnified Party will notify KBS of the commencement thereof. With
respect to any such action, suit or proceeding as to which Indemnified Party
notifies KBS of the commencement thereof:
(a) KBS will be entitled to participate therein at its
own expense; and
(b) Except as otherwise provided below, to the extent that it
may wish, KBS jointly with any other indemnifying party will be entitled to
assume the defense thereof, with counsel satisfactory to Indemnified Party.
After notice from KBS to Indemnified Party of its election to assume the defense
thereof, KBS will not be liable to Indemnified Party under this Agreement for
any legal or other expenses subsequently incurred by Indemnified Party in
connection with the defense thereof other than reasonable costs of investigation
or as otherwise provided below. Indemnified Party shall have the right to employ
counsel in such action, suit or proceeding, but the fees and expenses of such
counsel incurred after notice from KBS of its assumption of the defense thereof
shall be at the expense of Indemnified Party, unless (i) the employment of
counsel by Indemnified Party has been authorized by KBS, (ii) Indemnified Party
shall have reasonably concluded that there may be a conflict of interest between
KBS and Indemnified Party in the conduct of the defense of such action, (iii)
KBS shall not in fact have employed counsel to assume the defense of such
action, in each of which cases the fees and expenses of counsel shall be at the
expense of KBS, or (iv) unless the Indemnified Party reasonably and in good
faith asserts defenses and theories of defense not asserted by KBS. KBS shall
not be entitled to assume the defense of any action, suit or proceeding brought
by or on behalf
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of KBS or as to which Indemnified Party shall have made the conclusion
provided for in (ii) or (iv) above.
(c) Either party may settle any matter, without the consent of
the other, but in such event, the indemnification provided for herein shall be
of no force or effect with respect to such settlement. KBS shall not be liable
to indemnify Indemnified Party under this Agreement for any amounts paid in
settlement of any action or claim effected without the KBS's written consent.
KBS shall not settle any action or claim in any manner which would impose any
penalty or limitation on Indemnified Party without Indemnified Party's written
consent. Neither KBS or Indemnified Party will unreasonably withhold their
consent to any proposed settlement.
5. Repayment of Expenses. Indemnified Party agrees that Indemnified
Party will reimburse KBS for all reasonable expenses paid by KBS in defending
any civil or criminal action, suit or proceeding against Indemnified Party in
the event and only to the extent that Indemnified Party is finally determined
that Indemnified Party is not entitled to be indemnified by KBS for such
expenses under the KBS's charter or bylaws, this Agreement or under applicable
law.
6. Enforcement.
(a) KBS expressly confirms and agrees that it has entered
into this Agreement and assumed the obligations
imposed on KBS hereby in order to induce Indemnified
Party to serve as an officer and/or director of KBS
or any subsidiary thereof, and acknowledges that
Indemnified Party is relying upon this Agreement as
part of the consideration for so acting.
(b) In the event Indemnified Party is required to bring
any action to enforce rights or to collect moneys due
under this Agreement and is successful in such
action, KBS shall reimburse Indemnified Party for all
of Indemnified Party's reasonable attorneys' and
other fees and expenses in bringing and pursing such
action.
7. Severability. Each of the provisions of this Agreement is a
separate and distinct agreement and independent of the others, so that if any
provision hereof shall be held to be invalid or unenforceable for any reason,
such invalidity or unenforceability shall not affect the validity or
enforceability of the other provisions hereof.
8. Governing Law; Binding Effect; Amendment and Termination.
(a) This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Oklahoma.
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(b) This Agreement shall be binding upon Indemnified Party and
upon the KBS, its successors and assigns, and shall inure to the benefit of
Indemnified Party, his heirs, personal representatives and assigns and to the
benefit of the KBS, its successors and assigns.
(c) No amendment, modification, termination or change of this
Agreement shall be effective unless it is signed by both parties hereto.
9. Additional Rights. This Agreement is in addition to, and not
in lieu of, any other right to indemnification under the KBS's corporate
charter, bylaws, insurance contracts or otherwise at law or in equity.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
and as of the day and year first above written.
KBS TECHNOLOGIES, INC.
By: /s/ Xxxx Xxxxxxx
Xxxx Xxxxxxx, President
Indemnified Party:
/s/ Xxxx Xxxxxxx
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