EXHIBIT 10.53
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT ("Agreement") is entered into
as of the ____ day of March, 2003, by and among T. Xxxxxxx Xxxx ("Xxxx") and
XXXXX Data Security International, Inc., a Delaware corporation ("VASCO").
R E C I T A L S :
A. As required by that certain Convertible Loan Agreement,
dated August 4, 1997, by and among VASCO and Banque Paribas Belgique ("Banque
Paribas") (as amended and restated as of August 7, 2001, the "Loan Agreement"),
Xxxx entered into that certain Pledge Agreement, dated July 15, 1997 (the
"Pledge Agreement").
B. Pursuant to the Pledge Agreement, Xxxx granted to Banque
Paribas a first lien on and a first and prior security interest in and right of
set off against 1,416,666 shares of VASCO common stock (the "Original Pledged
Shares") as security for the payment to Banque Paribas by VASCO of its
obligations under the Loan Agreement.
C. The rights granted to Banque Paribas under the Pledge
Agreement are only effective in the event of a default by VASCO under its Loan
Agreement with Banque Paribas.
D. The Pledge Agreement requires that, throughout the duration
of the Loan Agreement, the market value of the shares of VASCO common stock
pledged thereunder be equal to at least 125% of $3,400,000.
E. As successor to Banque Paribas, Dexia Banque Belgique S.A.
(the "Lender") has notified Xxxx that the current value of the Original Pledged
Shares is insufficient to meet the requirements of the Pledge Agreement and that
Xxxx is required to pledge an additional 5,120,000 shares of VASCO common stock
(the "Additional Pledged Shares" and, with the Original Pledged Shares, the
"Pledged Shares") under the terms of the Pledge Agreement.
X. Xxxx desires to pledge the Additional Pledged Shares to
Lender on the condition that VASCO provide Xxxx with certain indemnification
obligations as more specifically set forth herein.
G. VASCO acknowledges its responsibility to comply with the
terms of the Loan Agreement and desires to provide Xxxx with certain
indemnification obligations, that would only be effective in the event of a
default by VASCO under the terms of the Loan Agreement, as more specifically set
forth herein.
NOW, THEREFORE, in consideration of foregoing recitals, which
are incorporated herein by this reference, and of the premises and mutual
covenants herein contained, and intending to be legally bound, the parties
hereto agree as follows:
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1. Indemnification.
a. VASCO shall indemnify Xxxx from and against any claim,
demand, controversy, dispute, cost, loss, damage, expense, judgment and/or
liability incurred by or imposed upon Xxxx as a result of any action by the
Lender with respect to the Pledged Shares, including, without limitation,
Lender's sale or other disposition of the Pledged Shares (the
"Indemnification").
b. VASCO and Xxxx agree that the Indemnification shall be
satisfied, if at all, by means of a payment schedule commercially reasonable to
VASCO and mutually agreeable to both VASCO and Xxxx after good faith negotiation
between the parties.
2. Governing Law. THIS AGREEMENT IS INTENDED TO TAKE EFFECT AS
A SEALED INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO CONFLICTS-OF-LAW
PRINCIPLES.
3. Notice. Except as otherwise provided herein, all notices,
requests and demands to or upon a party hereto, to be effective, shall be in
writing and sent in the manner and to the addresses set forth on the signature
page of this Agreement.
4. Counterparts. This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts and by
means of facsimile, each of which when so executed shall be deemed to be an
original and shall be binding upon all parties, their successors and assigns,
and all of which taken together shall constitute on and the same agreement.
5. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the successors or assigns of VASCO and
Xxxx and shall constitute a continuing agreement, applying to all future as well
as existing transactions between VASCO and Xxxx, or their successors and
assigns.
6. Entire Agreement. This Agreement represents the entire
agreement between the parties with respect to the subject matter hereof. Any
amendment or other modification of this Agreement shall be effective only if in
a writing signed by both of the parties hereto.
7. Miscellaneous. The headings of each section of this
Agreement are for convenience only and shall not define or limit the provisions
thereof. This Agreement and all rights and obligations hereunder shall be
binding upon VASCO and its successors and assigns, and shall inure to the
benefit of Xxxx and his successors and assigns. If any term of this Agreement
shall be held to be invalid, illegal or unenforceable, the validity of all other
terms hereof shall in no way be affected thereby, and this Agreement shall be
construed and be enforceable as if such invalid, illegal or unenforceable term
had not been included herein. VASCO acknowledges receipt of a copy of this
Agreement.
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IN WITNESS WHEREOF, the parties have executed this
Indemnification Agreement as of the date and year first above written.
VASCO DATA SECURITY INTERNATIONAL, INC.
By:_____________________________________
________________________ Name:
T. Xxxxxxx Xxxx Title:
[ADDRESS] 0000 Xxxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Fax:
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