WARNING: THE XXXXX SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
Loan Agreement dated as of March 28, 1996 between CHYRON
CORPORATION, a New York corporation with its chief place of business
at 0 Xxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000 (the "Borrower") and
NATWEST BANK N.A., a national banking association with an office at
000 Xxxxxxx Xxxxxxxxxx, Xxxxxxx, Xxx Xxxx 00000 (the "Bank").
The parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used herein the following terms shall have
the following meanings:
"Accounts" shall mean those accounts arising out of the sales or
lease of goods or the rendition of services by the Borrower.
"Account Debtor" shall mean the person who is obligated on or under
an Account.
"Acquisition Documents" shall mean the agreement with the Borrower
for the sale and purchase of the entire issued share capital of Pro-
Bel and all exhibits annexed thereto.
"Adjusted Libor Rate" means with respect to an Eurodollar Loan
Interest Period, the rate per annum at which the U.S. dollar
deposits are offered by a Reference Bank (as selected by the Bank)
in the London interbank market for Eurodollars at approximately
11:00 a.m. (London time) two Business Days before the first day of
such Interest Period in an amount approximately equal to the
principal amount of the Eurodollar Loan to which such Interest
Period is to apply and for a period of time comparable to such
Interest Period divided by one minus the Eurodollar Reserve
Percentage.
"Affiliate" as applied to any Person, means any other Person
directly or indirectly through one or more intermediaries
controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, "control" (including
with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as applied to any Persons, means
the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of that Person,
whether through the ownership of voting securities or by contract or
otherwise.
"Agreement" shall mean this Loan Agreement, as the same from time to
time may be amended, supplemented or modified.
"Borrowing Base" shall mean the sum of: (a) 80% of the Borrower's
Eligible Domestic Accounts Receivable from time to time outstanding
less reserves with respect to such Accounts which the Bank may deem
necessary in its sole discretion; (b) 80% of the Borrower's Eligible
Foreign Accounts Receivable from time to time outstanding less
reserves with respect to such Accounts which the Bank may deem
necessary in its sole discretion; and (c) the lesser of (i)
$3,750,000 or (ii) the sum of (v) 50% of the value of the Borrower's
Eligible Inventory (excluding Demo Inventory) from time to time on
hand and (z) 30% of the Borrower's Demo Inventory, minus the
principal amount outstanding under the Term Loan.
"Borrowing Base Certificate" shall mean a certificate substantially
in the form of Exhibit C hereto.
"Business Day" shall mean a day other than a Saturday, Sunday or
other day on which commercial banks in New York, New York are
required or permitted by law to remain closed.
"Capital Expenditures" shall mean for any period, the aggregate
amount of all payments made by any Person directly or indirectly for
the purpose of acquiring, constructing or maintaining fixed assets,
real property or equipment which, in accordance with GAAP, would be
added as a debit to the fixed asset account of such Person,
including, without limitation, all amounts paid or payable with
respect to Capitalized Lease Obligations and interest which are
required to be capitalized in accordance with GAAP.
"Capitalized Lease" shall mean any lease the obligations to pay rent
or other amounts under which constitute Capitalized Lease
Obligations.
"Capitalized Lease Obligations" shall mean as to any Person, the
obligations of such Person to pay rent or other amounts under a
lease of (or other agreement conveying the right to use) real and/or
personal property which obligations are required to be classified
and accounted for as a capital lease on a balance sheet of such
Person under GAAP and, for purposes of this Agreement, the amount of
such obligations shall be the capitalized amount thereof, determined
in accordance GAAP.
"Collateral" shall mean the collateral described in Section 9 of
this Agreement.
"Commitment" shall mean the obligation of the Bank to make Revolving
Credit Loans to the Borrower during the Commitment Period pursuant
to the terms hereof as such Commitment is described in Section 2.1
hereof and as subject to reduction in accordance with the terms
hereof.
"Commitment Letter" shall mean the letter agreement between the
Borrower and the Bank dated February 1, 1996.
"Commitment Period" shall mean the period from and including the
date hereof to and including the Termination Date or such earlier
date as the Commitment shall terminate as provided herein.
"Contractual Obligations" shall mean as to any Person, any provision
of any security issued by such Person or of any agreement,
instrument or undertaking to which such Person is a party or by
which it or any of its property is bound.
"Controlled" and "Control" shall mean any partnership, corporation
or other entity of which the Borrower, alone, or the Borrower and/or
one or more of its Subsidiaries, either has the power to direct the
management thereof or the power to direct at least a majority of the
voting interests.
"Default" shall mean any of the events specified in this Agreement
under "Events of Default", whether or not any requirement for the
giving of notice, the lapse of time, or both, has been satisfied.
"Demo Inventory" shall mean Eligible Inventory of the Borrower for
trial use by a customer of the located at a place other than the
Borrower's lease or owned Real Property.
"Dollars" and "$" shall mean dollars in lawful currency of the
United States of America.
"Domestic Tangible Net Worth" shall have the meaning ascribed in
Section 6.1(d).
"Eligible Domestic Accounts Receivable" shall mean those Accounts
arising in the ordinary course of business to Persons other than
Subsidiaries or Affiliates domiciled in the United States of America
which have been outstanding for not more than 120 days from invoice
date in which the Bank has a first priority security interest and
which are otherwise satisfactory to the Bank in its reasonable
discretion, provided, that, if fifty percent (50%) or more of the
Accounts due from an Account Debtor are deemed by the Bank to be
ineligible then all Accounts from such Account Debtor shall be
deemed ineligible.
"Eligible Foreign Accounts Receivable" shall mean those Accounts
arising in the ordinary course of business to Persons other than
Subsidiaries or Affiliates domiciled outside of the United States of
America which have been outstanding for not more than 120 days from
invoice date in which the Bank has a first priority security
interest, which are covered by insurance protecting the Bank against
political and commercial risks on terms reasonably acceptable to the
Bank and which are otherwise satisfactory to the Bank in its
reasonable discretion, provided, that, if fifty (50%) percent or
more of the Accounts due from an Account Debtor are deemed by the
Bank to be ineligible then all Accounts from such Account Debtor
shall be deemed ineligible.
"Eligible Inventory" shall mean all unencumbered inventory of work
in process and finished goods from time to time on hand satisfactory
to the Bank in its sole discretion in which the Bank has a first
priority security interest, valued at the lower of (a) cost, (b)
market value, or (c) the valuation consistent with that employed in
the preparation of the financial statements of the Borrower referred
to in this Agreement.
"Environmental Laws" shall mean any federal, state or local statute
or regulation relating to hazardous or toxic wastes or substances or
the removal thereof.
"Eurodollar Loans" shall mean Loans hereunder that bear interest for
the Interest Period applicable thereto at a rate of interest based
upon the Adjusted Libor Rate.
"Eurodollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System
(or any successor) for determining the maximum reserve for
requirement for a member bank of the Federal Reserve System in New
York City with deposits exceeding one billion dollars in respect of
"Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the
interest rate on Eurodollar Loans is determined or any category of
extensions of credit or other assets which includes loans by a non-
United States office of the Bank to United States residents). With
respect to increases in the Eurodollar Reserve Percentage, the
Adjusted Libor Rate shall be adjusted automatically on and as of the
effective date of any such increase.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.
"Event of Default" shall mean any of the events specified in this
Agreement under "Events of Default", provided that any requirement
for the giving of notice, the lapse of time, or both, or any other
condition, has been satisfied.
"Fluctuating Rate Loans" shall mean Loans hereunder that bear
interest at a rate of interest based upon the Prime Rate.
"GAAP" shall mean generally accepted accounting principles applied
in a manner consistent with that employed in the preparation of the
financial statements described in Section 3.1.
"General Security Agreement" shall have the meaning assigned thereto
in Section 4.1(b) and any UCC-1 financing statements executed in
connection therewith.
"Governmental Authority" shall mean any nation or government, any
state or other political subdivision thereof, any entity exercising
executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, and any corporation or
other entity owned or controlled (through stock or capital ownership
or otherwise) by any of the foregoing.
"Guarantees" shall mean the guarantees to be executed by the
Guarantors on the Bank's standard form.
"Guarantors" shall mean, collectively, the entities required to
guarantee pursuant to Section 5.9 hereof.
"Indebtedness" shall mean, with respect to any Person, (a) all
obligations of such Person for borrowed money or with respect to
deposits or advances of any kind, (b) all obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments,
(c) all obligations of such Person for the deferred purchase price
of property or services, except current accounts payable arising in
the ordinary course of business and not overdue beyond such period
as is commercially reasonable for such Person's business, (d) all
obligations of such Person conditional sale or other title
retention agreements relating to property purchased by such Person,
(e) all payment obligations of such Person with respect to interest
rate of currency protection agreements, (f) all obligations of such
Persons as an account party under any letter of credit or in respect
of bankers' acceptances (g) all obligations of any third party
secured by property or assets of such Person (regardless of whether
or not such Person is liable for repayment of such obligations) and
(h) the redemption price of all redeemable preferred stock of such
Person, but only to the extent that such stock is redeemable at the
option of the holder or requires sinking fund or similar payments at
any time prior to the Termination Date.
"Installment Payment Date" shall mean any date on which all or any
portion of the principal amount of the Term Loan is due and payable.
"Interest Period" shall mean any period during which a Loan bears
interest at an Adjusted Libor Rate as elected by the Borrower in
accordance with the terms of this Agreement.
(a) If any Interest Period would otherwise end on a day which is not
a Business Day, that Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be
to extend such Interest Period into another calendar month, in which
event such Interest Period shall end on the immediately preceding
Business Day.
(b) No Interest Period shall extend beyond a stated Maturity Date.
(c) No portion of the term Loan shall be continued as or converted
into a Eurodollar Loan with an Interest Period which extends beyond
an Installment Payment Date if, after giving effect to the
continuation or conversion of such Eurodollar Loan, the amount
payable on any Installment Payment Date would exceed the sum of (i)
the aggregate principal amount of the outstanding portion of the
Term Loan constituting Eurodollar Loans with Interest Periods ending
prior to such Installment Payment Date and (ii) the aggregate
outstanding portion of the Term Loan constituting Fluctuating Rate
Loans.
"Letters of Credit" shall mean, collectively, all standby letters of
credit issued for the account of the Borrower pursuant to Section
2.2 hereof.
"Lien" shall mean any mortgage, pledge, security interest,
hypothecation, assignment, deposit arrangement, encumbrance, or
preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without
limitation, any financing lease having substantially the same
economic effect as any of the foregoing, and the filing of any
financing statement under the Uniform Commercial Code or comparable
law of any jurisdiction).
"Loan" or "Loans" shall mean any loan made by the Bank to the
Borrower hereunder whether a Revolving Credit Loan or the Term Loan.
"Loan Documents" shall mean this Agreement, the Notes, the Security
Agreements, the Pledge Agreement and each document, agreement and
instrument executed in connection herewith or pursuant hereto
together with each document, agreement and instrument made by the
Borrower or any Guarantor with or in favor of or owing to the Bank
further evidencing or securing the Loans.
"Material Adverse Effect" shall mean (a) a materially adverse effect
on the business, asset, operations, prospects or condition,
financial or otherwise, of the Borrower and it s Subsidiaries taken
as a whole, (b) material impairment of the ability of the Borrower
or any Subsidiary to perform any of its obligations under any Loan
Document to which it is or will be a party or (c) material
impairment of the rights of or benefits available to the Bank under
any Loan Document.
"Maturity Date" shall mean the date that all or a portion of the
outstanding principal balance of a Loan is due and payable pursuant
to the terms hereof which shall include without limitation (i) with
respect to Revolving Credit Loans, the Termination Date, and (ii)
with respect to the Term Loan, each Installment Payment Date and the
final Maturity Date of the Term Loan.
"Non-Restricted Subsidiary" shall mean any Subsidiary other than a
Restricted Subsidiary.
"Notes" shall mean collectively the Revolving Credit Note referred
to in Section 2.3 hereof and the Term Note referred to in Section
2.9 hereof.
"Obligations" shall mean any and all sums owing under the Loan
Document and all other obligations, direct or contingent, joint,
several or independent, or the Borrower now or hereafter existing
due or to become due to, or held or to be held by the Bank, whether
created directly or acquired by assignment or otherwise.
"Over-Advance Amount" shall mean the additional amount of Revolving
Credit Loans made available to the Borrower above the Borrowing Base
provided such amount does not exceed $3,000,000 and shall not be
outstanding for more than 18 months.
"Patent Security Agreement" shall have the meaning assigned thereto
in Section 4.1(d) hereof.
"Person" shall mean any individual corporation, partnership, joint
venture, trust, unincorporated organization or any other juridical
entity, or a government or state or any agency or political
subdivision thereof.
"Plan" shall mean any plan of a type described in Section 4021(a) of
ERISA in respect of which the Borrower is an "employer" as defined
in Section 3(5) of ERISA.
"Pledge Agreement" shall have the meaning assigned thereto in
Section 4.2(c) hereof.
"Post Default Rate" shall mean any time a rate of interest equal to
4% per annum in excess of the rate that would then be applicable to
Fluctuating Rate Loans.
"Prime Rate" shall mean the rate of interest established from time
to time by the Bank as its "prime rate".
"Pro-Bel" shall mean Pro-Bel Limited, a corporation formed under the
laws of the United Kingdom.
"Real Property" shall mean any real property owned or leased by the
Borrower or any of its Subsidiaries or any Guarantor or any of its
Subsidiaries.
"Reference Bank" shall mean a bank appearing on the display
designated as page "LIBOR" on the Xxxxxx Monitor Money Rates Service
(or such other page as may replace the LIBOR page on that service
for the purpose of displaying London interbank offered rates of
major banks); provided that if no such offered rate shall appear on
such display, "Reference Bank" shall mean a bank in the London
interbank market as reasonably selected by the Bank.
"Reportable Event" shall mean any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder.
"Requirements of Law" shall mean as to any Person, the certificate
of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation,
or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or
any of f its property or to which such Person or any of its property
is subject.
"Restricted Subsidiary" shall mean any subsidiary of the Borrower
incorporated under the laws of any state of the United States.
"Revolving Credit Loan" shall mean a Loan made pursuant to Section
2.3 hereof.
"Revolving Credit Note" shall mean the Note referred to in Section
2.2 hereof.
"Security Agreement" or "Security Agreements" shall mean,
collectively, the General Security Agreement, the Trademark Security
Agreement and the Patent Security Agreement and, the case of any
Guarantor, shall mean any agreement substantially in the same form
as the General Security Agreement.
"Subsidiary" or "Subsidiaries" of any Person shall mean any
corporation or corporations of which the Person alone, or the Person
and/or one or more of its Subsidiaries, owns, directly or
indirectly, at least a majority of the Securities having ordinary
voting power for the election of directors.
"Tangible Net Worth" shall mean the sum of capital surplus, earned
surplus and capital stock minus deferred charges, intangibles and
treasury stock, all determined in accordance with GAAP.
"Termination Date" shall mean March 28, 1999 or, if such date is not
a Business Day, the Business Day, next succeeding such date.
"Term Loan" shall mean the Loan made pursuant to Section 2.8 hereof.
"Term Note" shall mean the Note referred to in Section 2.9 hereof.
"Trademark Security Agreement" shall have the meaning assigned
thereto in Section 4.1(c) hereof.
1.2 Accounting Terms. As used herein and in any certificate or
other document made or delivered pursuant hereto, accounting terms
not specifically defined herein shall have the respective meanings
given to them under generally accepted accounting principles.
SECTION 2. AMOUNT AND TERMS OF REVOLVING CREDIT COMMITMENT AND
TERM NOTE.
2.1 Revolving Credit Commitment. Subject to the terms and
conditions hereof, the Bank agrees to extend credit to or on behalf
of the Borrower (a) by making revolving credit loans (the "Revolving
Credit Loans") from time to time during the Commitment Period and
(b) by issuing Letters of Credit for the account of the Company up
to an aggregate stated amount at any one time outstanding of (y)
Five Million and 00/100 ($5,000,000.00) Dollars in connection with
the acquisition of Pro-Bel and (z) Five Hundred Thousand 00/100
($500,000.00) Dollars for all other purposes, pursuant to Section
2.2 hereof during the Commitment Period, provided that at any time
the sum of the aggregate of the principal amount of the Revolving
Credit Loan and the Aggregate stated amount of the Letters of Credit
shall not exceed the lesser of (i) $10,000,000 or (ii) the sum of
(y) the Borrowing Base and (zz) the Over-Advanced Amount, as such
amounts may be reduced as provided in this Agreement (the
"Commitment"). During the Commitment Period the Borrower may use
the Commitment of (i) obtaining Revolving Credit Loans by borrowing,
paying, prepaying in whole or in part and reborrowing on a revolving
basis, all in accordance with the terms and conditions hereof and
(ii) for the issuance of Letters of Credit in accordance with the
provisions of Section 2.2 hereof.
2.2 Letters of Credit.
(a) Subject to the limitations of Section 2.1 hereof, the Borrower
may from time to time during the Commitment Period request the
issuance by the Bank of Letters of Credit. Each Letter of Credit
shall be issued by the Bank upon receipt and processing of the
Bank's normal letter of credit application provided that the Bank
need not issue any Letter of Credit that would extend beyond the
Termination Date. The Borrower shall pay the Bank, upon issuance of
the Letter of Credit, the Bank's standard letter of credit and
processing fees.
(b) Notwithstanding anything to the contrary herein, if any
restriction is imposed on the Bank (including without limitation any
change in or limitation upon letters of credit) which would prevent
the Bank from issuing Letters of Credit or maintaining its
obligation to issue Letters of Credit then the Bank may, by notice
to the Borrower in writing, terminate such obligations hereunder.
2.3 Revolving Credit Note. The Revolving Credit Loans made by the
Bank to the Borrower pursuant to Section 2.1 hereof shall be
evidenced by a promissory note of the Borrower substantially in the
form of Exhibit A hereto with appropriate insertions (the "Revolving
Credit Note"), payable to the order of the Bank and representing the
obligation of the Borrower to pay the lesser of (a) the amount of
the Commitment or, (b) the aggregate unpaid principal amount of all
Revolving Credit Loans made by the Bank to the Borrower, with
interest thereof as hereinafter prescribed. The Revolving Credit
Note shall (i) be dated the date of the first Revolving Credit Loan
evidenced thereby, (ii) be stated to mature on the Termination Date
and (iii) bear interest with respect to the unpaid principal balance
thereof from time to time outstanding at a rate per annum to be
elected by the Borrower in accordance with the notice provisions set
forth in Section 2.4 hereof, and in the case of Eurodollar Loans for
the Interest Period therein specified, equal to either (1) 1.75% in
excess of the Adjusted Libor Rate or (2) the Prime Rate (which
interest rate will change when and as the Prime Rate changes). In
all cases interest shall be computed on the basis of a 360-day year
for actual days elapsed and shall be payable as provided in this
Agreement. After any stated or accelerated maturity, the Revolving
Credit Note shall bear interest at the rate set forth in this
Agreement.
2.4 Procedure for Borrowings. The Borrower may borrow under the
Commitment during the Commitment Period on any Business Day by
giving the Bank irrevocable notice of a request for a Loan hereunder
(a) in the case of Eurodollar Loans three Business Days before a
proposed borrowing or continuation or conversation and (b) i n the
case of Fluctuating Rate Loans not less than one nor more than five
Business Days before a proposed borrowing or continuation or
conversation, setting forth (i) the amount of the Loan requested,
which shall not be less than $100,000, (ii) the requested borrowing
date or Interest Period commencement date, as the case may be, (iii)
whether the borrowing or interest Period is to be for a Eurodollar
Loan, Fluctuating Rate Loan or a combination thereof, and (iv) if
entirely or partially a Eurodollar Loan, the length of the Interest
Period therefore, which shall be one, two, three or six months. As
used in this Section 2.4, "conversion" shall mean the conversion
from one interest rate to another interest rate as more fully
described in this Agreement. Such notice hall be written
(including, without limitation, via facsimile transmission) and
shall be sufficient if received by 1 p.m. on the date on which such
notice is to be given. If any such request is sent by facsimile it
shall be confirmed in writing sent by the Borrower to the Bank
within two Business Days thereafter. Unless notification is
otherwise furnished by the Borrower to the Bank (in a manner
consistent with the requirements of this Section), Loans will be
made by credits to the Borrower's demand deposit account maintained
with the Bank. If the Borrower furnishes such notice but no
election is made as to the type of Loan or the Interest Period to be
applicable thereto, the Loan will automatically then be made as a
Fluctuating Rate Loan until such required information is furnished
pursuant to the terms hereof.
2.5 Commitment Fee. As additional compensation for the Commitment
on the Revolving basis provided for herein, the Borrower agrees to
pay the Bank a commitment fee for the Commitment Period at the rate
of 1/4 of 1% per annum on the average daily unused portion of the
Commitment hereunder. Such commitment fee shall be payable
quarterly, on the last day of each march, June, September and
December during the Commitment Period, commencing June 30, 1996, and
on the Termination Date. If the Borrower so fails to pay any such
amount to the Bank the obligations to make such payment shall bear
interest from such date not paid when due at the Post Default Rate.
The obligation to so pay interest shall not be construed so as to
waive the requirement to pay the commitment fees as hereinabove set
forth.
2.6 Regulatory Changes in Capital Requirements. If any existing or
future law, regulation or guideline or the interpretation thereof by
any court or administrative or governmental authority charge with
the administration thereof or compliance by the Bank with any
request or directive (whether or not having the force of law) of any
such authority, imposes, modifies, deems applicable or results in
the application of, any capital maintenance, capital ratio or
similar requirement against loan commitments made by the Bank (or
participation therein) or the Bank in anticipation of the
effectiveness of any capital maintenance, capital ratio or similar
requirement takes reasonable action to enable itself to comply
therewith, an the result thereof is to impose upon the Bank or
increase any capital requirement applicable as a result of the
making or maintenance of the Commitment or participation therein
(which imposition of or increase in capital requirements may be
determined by the Bank's reasonable allocation of the aggregate of
such capital impositions or increases) then, upon demand by the
Bank, the Borrower shall immediately pay to the Bank from time to
time as specified by the Bank additional commitment fees which shall
be sufficient to compensate the Bank for such impositions of or
increases in capital requirements, together with interest on each
such amount from the date demanded until payment in full thereof at
the Post Default Rate. A certificate setting forth in reasonable
detail the amounts necessary to compensate the Bank as a result of
an imposition of or increase in capital requirements submitted by
the Bank to the Borrower shall be conclusive, absent manifest error
or bad faith, as to the amount thereof. For purposes of this
Section, (a) in calculating the amount necessary to compensate the
Bank for any imposition of or increase in capital requirements, the
Bank shall be deemed to be entitled to a rate of return on capital
(after federal, state and local taxes) of fifteen per cent per
annum, and (b) all references to the "Bank" shall be deemed to
include any participant in the Commitment.
2.7 Termination or Reduction of Commitment. The Borrower shall have
the right, upon not less than three Business Days' irrevocable
written notice, to terminate the Commitment or, from time to time,
to reduce the amount of the Commitment, provided that (a) any such
reduction (i) shall be in the minimum amount of $100,000 or a
multiple thereof, (ii) shall reduce permanently the amount of the
Commitment then in effect, and (iii) shall be accompanied by
prepayment of the Revolving Credit Loans outstanding to the extent,
if any, that the Loans then outstanding exceed the amount of the
Commitment as then reduced, together with accrued interest on the
amount so prepaid to and including the dates of each such prepayment
and any amounts payable pursuant to Section 2.15 in connection
therewith and the payment of any unpaid commitment fee then accrued
hereunder, and (b) any such termination of the Commitment shall be
accompanied by prepayment in full of the Revolving Credit Loans
outstanding and together with accrued interest thereon to and
including the date of prepayment and any amounts payable pursuant to
Section 2.15 in connection therewith and the payment of any unpaid
commitment fee then accrued hereunder.
2.8 Term Loan. Subject to the terms and conditions hereof, the Bank
agrees to make a term loan to the Borrower (the "Term Loan") in the
principal amount of $8,000,000.
2.9 Term Note. The Term Loan made by the Bank to the Borrower
pursuant to Section 2.8 hereof shall be evidenced by a promissory
note of the Borrower substantially in the form of Exhibit B hereto
with appropriate insertions (the "Term Note") and dated the date of
the Term Loan. The principal amount of the Term Note shall be
payable in sixteen (16) consecutive quarterly installments of
$500,000 each payable on the first day of each calendar quarter
following the date of the making of the Term Loan and the final
installment equal to the then unpaid principal balance of the Term
Note together with all interest accrued and unpaid shall be paid in
full four years from the date of the making of the Term Loan. The
Term note shall bear interest on the unpaid principal amount thereof
from time to time outstanding at a rate per annum, to be elected
pursuant to the provisions of this Agreement equal to either (i)
2.0% in excess of the Adjusted Libor Rate or (ii) the prime Rate
(which interest rate shall change when and as the Prime Rate
changes). In all cases interest shall be computed on the basis of a
360 day year for actual days elapsed and shall be payable as
provided in this Agreement. After any stated or accelerated
maturity thereof, the Term Note shall bear interest at the rate set
forth in this Agreement.
2.10 Continuation and Conversion of Loans. The Borrower shall have
the right at any time on prior irrevocable written or telex notice
to the Bank as specified in this Agreement (i) to continue any Loan
into a subsequent Interest Period, (ii) to convert any Eurodollar
Loan into a Fluctuating Rate Loan and (iii) to convert any
Fluctuating Rate Loan into a Eurodollar Loan (specifying the
Interest Period to be applicable thereto), subject to the following:
(a) in the case of a conversion of less than all of the outstanding
Loans, the aggregate principal amount of Loans converted shall not
be less than $100,000 and shall be an integral multiple thereof;
(b) no Loan (other than a Fluctuating Rate Loan) shall be converted
at any time other than at the end of an Interest Period applicable
thereto; and
(c) any portion of a Loan maturing or required to be prepaid in less
than one month may not be converted into or continued as a
Eurodollar Loan.
In the event that the Borrower shall not give notice to continue any
Eurodollar Loan into a subsequent Interest Period or convert any
such Loan into a Loan of another type, on the last day of the
Interest Period thereof, such Loan (unless prepaid) shall
automatically be converted into a Fluctuating Rate Loan. The
Interest Period applicable to any Eurodollar Loan resulting from a
conversation or continuation shall be specified by the Borrower in
the irrevocable notice delivered by the Borrower pursuant to this
Agreement; provided, however, that, if such notice does not specify
either the type of Loan or the Interest Period to be applicable
thereto, the Loan shall automatically be converted into, or
continued as, as the case may be, a Fluctuating Rate Loan until such
required information is furnished pursuant to the terms hereof.
Notwithstanding anything to the contrary contained above, if an
Event of Default shall have occurred and is continuing, no
Eurodollar Loan may be construed into a subsequent Interest Period
and no Fluctuating Rate Loan may be converted into a Eurodollar
Loan.
2.11 Prepayment.
(a) Voluntary. The Borrower may prepay any Fluctuating Rate Loan in
whole or in part without premium or penalty; provided, however, that
each partial prepayment on account of any Fluctuating Rate Loan
shall be in an amount not less than $100,000. Except as provided
otherwise in Section 2.15 hereof, the Borrower may not prepay any
Eurodollar Loan prior to the last day of the Interest Period
therefor. Any amount prepaid on account of a Revolving Credit Loan
may be borrowed in accordance with the provisions of Section 2.1
hereof. Any partial prepayment of the Term Loan shall be applied to
the last maturing installments in inverse order or their respective
maturities.
(b) Mandatory. If, at any time, the aggregate outstanding principal
balance of Loans exceeds the Borrowing Base, within ten Business
Days of the first day there exists such excess the Borrower shall
make payment to the bank in an amount equal to such excess together
with any amounts payable pursuant to Section 2.15 in connection
therewith. Such payment shall be applied to reduce the aggregate
unpaid principal balance of Loans then outstanding. Any partial
prepayment of the Term Loan shall b e applied to the last maturing
installments in inverse order of their respective maturities.
Each prepayment shall be made together with payment of accrued
interest on the amount prepaid to an including the date of
prepayment.
2.12 Interest Payments; Manner of Payments; Rate After Default;
Schedule to Note.
(a) Interest accrued on each Loan shall be payable, without
application, on:
(i) the Maturing Date of such Loan (excluding any Installment
Payment Date unless interest would otherwise be payable on such
Installment Payment Date pursuant to subsections (ii) - (vi) below);
(ii) with respect to any portion of any Loan repaid or prepaid
pursuant to this Agreement, the date of such repayment or
prepayment, as the case may be;
(iii) with respect to that portion of the outstanding principal
amount of all Loans maintained as Fluctuating Rate Loans, the first
day of each month, commencing with the first such date following the
date of the making of such Loans;
(iv) with respect tot that portion of the outstanding principal
amount maintained as Eurodollar Loans, the last day of each
applicable Interest Period (and, if such Interest Period shall
exceed three months, o on the last day of each three-month period
occurring during such Interest Period), but in no event more
frequently than monthly;
(v) with respect to tht portion of the outstanding principal amount
converted into Fluctuating Rate Loans or Eurodollar Loans on a day
when interest would not otherwise have been payable pursuant to
Subsections (a) (iii) or (a) (iv), the date of such conversion.
(b) All payments (including prepayments) to be made by the Borrower
on account of principal or interest with respect to any Loan or on
account of fees or any other obligations of the Borrower to the Bank
hereunder shall be made to the Bank at the office of the Bank set
forth in Section 10.1 hereof or at such other place as the Bank may
from time to time designate in writing in lawful money of the United
States of America in immediately available funds. The Borrower
hereby authorizes and directs the Bank to charge any account of the
Borrower maintained at any office of the Bank for any such payments.
Subject to the provisions of subparagraph (a) in the definition of
Interest Period set forth in Section 1.1 hereof, if any payment to
be so made hereunder, or under either Note, becomes due and payable
on a day other than a Business Day, such payment shall be extended
to the next succeeding Business Day and, to the extent permitted by
applicable law, interest thereon shall be payable at the then
applicable rate during such extension.
(c) Upon the following an Event of Default, all Loans, and any and
all accrued and unpaid interest, fee or amount due hereunder, to the
extent permitted by applicable law, shall bear interest (payable on
demand, and in any event on the last day of each month, and computed
daily on the basis of a 360-day year for actual days elapsed) (i) in
the case of Fluctuating Rate Loans at the Post Default Rate until
paid and (ii) in the case of Eurodollar loans at a rate which shall
be the greater of the Post Default Rate or 4% per annum in excess of
the rate applicable to such Eurodollar Loan until the expiration of
the Interest Period applicable to such Loan, at which time the Loan
will automatically be converted into a Fluctuating Rate Loan and
until paid shall bear interest at the Post Default Rate. In no
event, however, shall interest payable hereunder be in excess of the
maximum rate of interest permitted under applicable law. The
obligation to so pay interest upon any obligation of the Borrower to
the Bank shall not be construed so as to waive the requirement for
payment on the same date that payment is to be made to the Bank as
set forth in this Agreement.
(d) The Borrower hereby expressly authorizes the Bank to record on
the schedule attached to the Revolving Credit Note the amount and
date of each Revolving Credit Loan, the rate of interest thereon,
the date and amount of each payment of principal and the unpaid
principal balance; provided, however, that the failure of the Bank
to make any such notation shall not in any manner affect the
obligation of the Borrower to repay any Loan in accordance with the
terms hereof. All such notations shall be presumed to be correct
absent manifest error.
2.13 Use of Proceeds. Proceeds of the Revolving Credit Loans shall
be used for working capital purposes and for acquisitions approved
by the Bank including the acquisition of Pro-Bel. Al or a portion
of the proceeds of the initial Revolving Credit loan shall be used
to repay in full all indebtedness owing to the CIT Group. Proceeds
of the Term Loan shall be used as partial payment of the acquisition
price of Pro-Bel and for working capital purposes.
2.14 Increased Costs. If the Bank reasonably determines that the
effect of any applicable law or government regulation, guideline or
order or the interpretation thereof by any Governmental Authority
charged with the administration thereof (such as, for example, a
change in official reserve requirements which the Bank is required
to maintain in respect of loans or deposits or other funds procured
for funding such loans) is to increase the cost to the Bank of
making or continuing Eurodollar Loans hereunder or to reduce the
amount of any payment of principal or interest receivable by the
Bank thereon, then the Borrower will pay to the Bank on demand such
additional amounts as the Bank may reasonable determined to be
required to compensate the Bank for such additional costs or
reduction. Any additional payment under this section will be
computed from the effective date at which such additional costs have
to be borne by the Bank. A certificate as to any additional amounts
payable pursuant to this Section setting forth the basis and method
of determining such amounts shall be conclusive, absent manifest
error, as to the determination by the Bank set forth therein if made
reasonable and in good faith. The Borrower shall pay any amounts so
certified to it by the Bank within 10 days of receipt of any such
certificate. For purposes of this Section, all references to the
"Bank" shall be deemed to include any participant in the Commitment
and/or Loans.
2.15 Indemnities. The Borrower hereby indemnifies the Bank against
an and all loss and reasonable expenses which the Bank may sustain
or incur as a consequence of any of the following:
(a) default in payment of the principal amount of any Eurodollar
Loan or any part thereof or interest accrued thereon, or any other
amount due in connection with the Loan Documents;
(b) the occurrence of any other Default under this Agreement;
(c) the failure of the Borrower to borrow a Eurodollar Loan after
sending notice of the amount and requested interest rate with
respect to the making of any such Loans;
(d) the receipt or recovery by the Bank of all or any part of a
Eurodollar Loan on any Installment Payment Date or prior to the
maturity or the last day of the Interest Period thereof (whether by
prepayment, acceleration or otherwise); or
(e) the conversation prior to the last day of an applicable Interest
Period, or a Eurodollar Loan into a Fluctuating Rate Loan.
Without limiting the effect of the foregoing, the amount to be paid
by the Borrower to the Bank in order to so indemnify the Bank for
any loss occasioned by any of the events described in the preceding
paragraph, and as liquidated damages therefor, shall be equal to the
excess, discounted to its present value as of the date paid to the
Bank, of (i) the amount of interest which otherwise would have
accrued on the principal amount so received, recovered, converted or
not borrowed during the period (the "Indemnity Period') commencing
with the date of such receipt, recovery, conversion, or failure to
borrow to the last day of the applicable Interest Period for such
Eurodollar Loan at the rate of interest applicable to such Loan (or
the rate of interest agreed to in the case of a failure to borrow)
provided for herein (prior to a Default) over (ii) the amount of
interest which would be earned by the Bank during the Indemnity
Period if it invested the principal amount so received, recovered,
converted or not borrowed at the rate per annum determined by the
Bank as the rate it would bid in the London interbank market for a
deposit of Eurodollar in an amount approximately equal to such
principal amount for a period of time comparable to the Indemnity
Period.
A certificate as to any additional amounts payable pursuant to this
Section setting forth the basis and method of determining such
amounts shall be conclusive, absent manifest error, as to the
determination by the Bank set forth therein if made reasonably and
in good faith. The Borrower shall pay any amounts so certified to
it by the Bank within 10 days of receipt of any such certificate.
For purposes of this Section, all references to the "Bank" shall be
deemed to include any participant in the Commitment and/or Loans.
2.16 Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the
commencement of any Interest Period for a Eurodollar Loan, the Bank
shall have determined (i) that dollar deposits in the amount of the
requested principal amount of such Eurodollar Loan are not generally
available in the London Interbank Market, (ii) that the rate at
which such dollar deposits are being offered will not adequately and
fairly reflect the cost to the Bank of making or maintaining such
Eurodollar Loan during such Interest Period, or (iii) that
reasonable means do not exist for ascertaining the Adjusted Libor
Rate, the Bank shall, as soon as practicable thereafter, give
written or telex notice of such determination to the Borrower. In
the event of any such determination, until the circumstances giving
rise to such notice no longer exist, no Eurodollar Loans will be
made hereunder. Each determination by the Bank hereunder shall be
conclusive absent manifest error.
2.17 Change in Legality.
(a) Notwithstanding anything to the contrary herein contained, if
any change in any law or regulation or in the interpretation thereof
by any governmental authority charge with the administration or
interpretation thereof shall make it unlawful for the Bank to make
or maintain any Eurodollar Loan, then, by written notice to the
Borrower, the Bank may:
(i) declare that Eurodollar Loans will not thereafter be made by the
Bank hereunder, whereupon the Borrower shall prohibited from the
requesting Eurodollar Loans from the Bank hereunder unless such
declaration is subsequently withdrawn; and
(ii) require that all outstanding Eurodollar Loans made by it be
converted to Fluctuating Rate Loans, in which event (x) all such
Eurodollar Loans shall be automatically converted to Fluctuating
Rate Loans a of the effective date of such notice a provided in
paragraph (b) below and 9y) all payments and prepayments of
principal which would otherwise have been applied to repay the
converted Eurodollar Loans shall instead be applied to repay the
Fluctuating Rate Loans resulting from the conversion of such
Eurodollar Loans.
(b) For purposes of this Section, (i) a notice to the Borrower by
the Bank pursuant to paragraph (a) above shall be effective, if
lawful, on the last day of the then current Interest Period; in all
other cases, such notice shall be effective on the day of receipt of
the Borrower and (ii) all references to the "Bank" shall be deemed
to include any participants in the Commitment and/or the loans.
SECTION 2. REPRESENTATIONS AND WARRANTIES.
In order to induce the Bank to enter into this Agreement and to make
the financial accommodations herein provided for, the Borrower
hereby covenants, represents and warrants to the Bank that:
3.1 Financial Condition. The consolidated balance sheet of the
Borrower and its consolidated Subsidiary as at December 31, 1994 and
the related consolidated statement of operations, shareholders'
equity and cash flows for the fiscal year ended on such date,
certified by Ernst & Young, LLP, copies of which certified
statements have heretofore been furnished to the Bank, are complete
and correct and present fairly the financial condition of the
Borrower and its consolidated Subsidiary as at such date, and the
results of its operations for the fiscal year then ended and the
interim financial statements of the Borrower and its consolidated
Subsidiary s at September 30, 1995 and the related consolidated
statements of operations, shareholders' equity and cash flows for
the fiscal quarter then ended on such date prepared by management of
the Borrower and certified as true and correct by the chief
financial officer of the Borrower, copies of which statements have
heretofore been furnished to the Bank, are complete and correct and
present fairly the financial condition of the Borrower and its
consolidated Subsidiary as at such date, and the results of its
operations for the fiscal quarter then ended. Such financial
statements, including schedules and notes thereto, have been
prepared in accordance with GAAP. neither the Borrower nor its
consolidated Subsidiary has any material contingent obligations,
contingent liabilities or liabilities for taxes, long-term leases or
unusual forward or long-term commitments, which are not reflected in
the foregoing certified statements or in the notes thereto. Since
the date of the aforementioned financial statements, there has been
no material adverse change in the business, operations, assets or
financial or other condition of the Borrower or its consolidated
Subsidiary.
3.2 Corporate Existence; Compliance with Law. Each of the active
Subsidiaries of the Borrower is indicated on Schedule A attached
hereto. The Borrower and each of its Subsidiaries (a) is duly
organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation, (b) has the corporate power
and authority and the legal right to own and operate its property,
and to conduct the business in which it is currently engaged, (c) is
duly qualified as a foreign corporation and in good standing under
the laws of each jurisdiction where its ownership or operation of
property or the conduct of its business require such qualification,
and (d) is in compliance with all Requirements of Law; except to the
extent that the failure to so qualify as a foreign corporation as
required by clause (c) of this Section or to comply with all
Requirements of Law as required by clause (d) of this Section could
not, in the aggregate, have a material adverse effect on the
business, operations, property or financial or other condition of
any such Person, and could not materially adversely affect the
ability of the Borrower or any Guarantor to perform its obligations
under any Loan Document to which it is a party.
3.3 Corporate Power; Authorization; Enforceable Obligations. The
Borrower has the corporate power and authority and the legal right
to make, execute, deliver and perform its obligations under the Loan
Documents to which it is a party and to borrow hereunder and has
taken all necessary corporate action to authorize the borrowings on
the terms and conditions of the Loan Documents and to authorize the
execution, delivery and performance of the Loan Documents. No
consent or authorization of, filing with, or other act by or in
respect of any other Person (including stockholders and creditors of
the Borrower) or any Governmental Authority, is required in
connection with the borrowings hereunder or with the execution,
connection with the borrowings hereunder or with the execution,
delivery, performance, validity or enforceability of the Loan
Documents. The Loan Documents will be duly executed the delivery on
behalf of the Borrower and, the executed and delivered, will each
constitute a legal, valid and binding obligation of the Borrower
enforceable against the Borrower in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally.
3.4 Power, Authorization, Enforceable Obligations of Guarantors.
Each Guarantor, if any, has the power and authority and the legal
right to make, deliver and perform its Guarantee and Security
Agreement and the transactions contemplated thereby and has taken
all necessary corporate action to authorize the execution, delivery
and performance of its Guarantee and Security Agreement. No consent
or authorization of, filing with, or other act by or in respect of
any other Person (including stockholders and creditors of the
Guarantors) or any Governmental Authority is required in connection
with the execution, delivery, performance, validity or
enforceability of such Guarantee or Security Agreement. Each
Guarantee and each Security Agreement have been duly executed and
delivered by the respective parties thereto, and each such document
constitutes a legal, valid and binding obligation of the respective
Guarantor enforceable against such Guarantor in accordance with its
terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditor's rights generally.
3.5 No Legal Bar. The execution, delivery and performance of the
Loan Documents and the Borrowings hereunder and the use of the
proceeds thereof by the Borrower and the execution, delivery and
performance of the Guarantees and Security Agreements by the
Guarantors, if any, will not violate any Requirements of Law or any
Contractual Obligation of the Borrower or the Guarantors, and will
not result in, or require, the creation or imposition of any Lien on
any of its properties or revenues pursuant to any Requirements of
Law or Contractual Obligation except those in favor of the Bank
provided herein.
3.6 No Material Litigation. No litigation, investigation or
proceedings of or before any arbitrator or Governmental Authority is
pending by or against the Borrower or any Subsidiary or against any
of their properties or revenues with respect to the Loan Documents
or any of the transactions contemplated hereby or thereby, which
would have a Material Adverse Effect.
3.7 No Default. Neither the Borrower no any Subsidiary is in default
under or with respect to any Contractual Obligation in any respect
which could have a Material Adverse Effect. No Default or Event of
Default has occurred and is continuing.
3.8 No Burdensome Restrictions. No Contractual Obligation of the
Borrower or any Subsidiary and no Requirement of Law would have a
Material Adverse Effect.
3.9 Taxes. The Borrower and its Subsidiaries have filed or caused
to be filed all tax returns which to the knowledge of the Borrower
are required to filed, and have paid all taxes shown to be due and
payable on said returns or on any assessments made against them or
any of their property except such taxes, if any, as are being
contested in good faith and by property proceedings and as to which
adequate reserves have been maintained.
3.10 Federal Regulations. The Borrower is not engaged nor will it
engage, principally or as one of its important activities, in the
business of extending credit for the purpose of "purchasing" or
"carrying" any "margin stock" within the respective meanings of each
of the quoted terms under Regulation U of the Board of Governors of
the Federal Reserve System as now and from time to time hereafter in
effect. No part of the proceeds of any Loans hereunder will be used
for "purchasing" or "carrying" "margin stock" as so defined or for
any purpose which violates, or which would be inconsistent with the
provisions of the Regulations of such Board of Governors.
3.11 Environmental Matters.
(a) To the knowledge of the Borrower, none of the Real Property
contains, or has previously contained, any hazardous or toxic waste
or substances or undergrounds storage tanks except in compliance
with all applicable Environmental Laws.
(b) The Borrower's and each Subsidiary's use of the Real Property is
in compliance with all applicable Environmental Laws affecting such
Real Property, and, to the knowledge of the Borrower and each
Subsidiary, there are no environmental conditions which could
interfere with the continued use of the Real Property.
(c) Neither the Borrower nor any of its Subsidiaries has received
any notice of violations or advisory action by regulatory agencies
regarding environmental control matters or permit compliance which
would have a Material Adverse Effect.
(d) To the knowledge of the Borrower and each Subsidiary, hazardous
waste has not been transferred from any of the Real Property to any
other locations which is not in compliance with all applicable
Environmental Laws or permit requirements.
(e) With respect to the Real Property, to the knowledge of the
Borrower, there are no proceedings, governmental administrative
actions or judicial proceedings pending or, to the best knowledge of
the Borrower, contemplated under any federal, state or local law
regulating the discharge of hazardous or toxic materials or
substances into the environment, to which the Borrower or any of its
Subsidiaries is named as a party.
3.12 Representations and Warranties Related to the Acquisition
Documents.
Upon the making of the Term Loan, the Borrower represents and
warrants to the Bank that:
(a) The Borrower has delivered to the Bank a complete and correct
copy of the Acquisition Documents.
(b) Each of the representations and warranties given by the
Borrower in the Acquisition documents is true and correct in all
material respects as of the date of the making of the Term Loan.
SECTION 4. CONDITIONS PRECEDENT.
4.1 Conditions to Initial Revolving Credit Loan. The obligation of
the Bank to make the initial Revolving Credit Loan to the Borrower
hereunder is subject to the satisfaction of the following conditions
precedent:
(a) Revolving Credit Note. The Bank shall have received the
Revolving Credit Note conforming to the requirements hereof and duly
executed by the Borrower.
(b) General Security Agreement. The Bank shall have received a
general security agreement (the "General Security Agreement") duly
executed by the Borrower together with
- UCC-1 financing statements
- security agreement questionnaire
- UCC-11 searches
- UCC-3 termination statements from the CIT Group
- insurance certificate naming the Bank as loss payee
- an assignment to the Bank of the Ex-Im Bank insurance policy
(c) Trademark Security Agreement. The Bank shall have received a
trademark collateral security agreement (the "Trademark Security
Agreement") duly executed by the Borrower together with a trademark
registration form and same shall have been submitted for filing with
the U.S. Commissioner of Patents and Trademarks together with
- trademark searches
- evidence of termination of any security interests in the
trademarks
(d) Patent Security Agreement. The Bank shall have received a
patent collateral security agreement (the "patent Security
Agreement") duly executed by the Borrower together with a patent
registration form and same shall have been submitted for filing with
the U.S. Commissioner of Patents and Trademarks together with
- patents searches
- evidence of termination of any security interests in the patents
(e) Landlord Waivers. The Bank shall have received executed
landlord waivers from all landlords of premises leased by the
Borrower where equipment or inventory of the Borrower is located.
(f) Borrowing Base Certificate. The Bank shall have received and
satisfactorily reviewed a Borrowing Base Certificate as set forth in
Section 5.2 (c) hereof.
(g) Legal Opinion. The Bank shall have received a favorable opinion
of counsel to the Borrower substantially in the form of Exhibit D
hereto. Such opinion shall also cover such other matter incident to
the transactions contemplated by this Agreement as the Bank shall
reasonable require.
(h) Certified Copies and Other Documents: The Bank shall have
received such certificates and other documents relating to the
Borrower with respect to the matters herein contemplated as the Bank
may request, including but not limited to:
(1) Certificate of good standing from the New York Secretary of
State and certificates of authority to do business from each other
jurisdiction in which the Borrower conducts business;
(2) Certificate of incorporation certified by the New York Secretary
of State;
(3) An Officers' Certificate dated the date of this Agreement
certifying, (x) true and correct copies of the by-laws of the
Borrower as in effect on the date of adoption of the resolutions
referred to in (y) of this subsection (3), (y) true and correct
copies of the resolutions adopted by the board of directors of the
Borrower (i) authorizing the borrowings from the Bank hereunder, the
execution and delivery by the Borrower of the Loan Documents to
which it is a party and the performance by the Borrower of its
obligations under the Loan Documents and the granting of the lien
and security interest contemplated thereby, (ii) approving forms in
substantially execution form of the Loan Documents, and (iii)
authorizing officers of the Borrowers to execute and deliver the
Loan Documents and any related documents, and (z) the incumbency and
specimen of the officers of the Borrower executing any documents
delivered to the Bank by the Borrower in connection with the Loans.
(i) Field Audit. The Bank shall have conducted a field audit of the
Borrower's assets which shall be satisfactory in all respects to the
Bank.
(j) Commitment Letter. The Borrower shall have satisfied all the
terms and conditions of the Commitment Letter.
(k) Fees. There shall have been delivered to the Bank evidence of
payment of the Bank's commitment fee in the amount of $75,000 and of
the Bank's attorney's fees and disbursements.
(l) Additional Matters. All other documents and legal matters in
connection with the transactions contemplated by this Agreement
shall be satisfactory in form and substance to the Bank and its
counsel.
4.2 Conditions on the Term Loan. The obligation of the Bank to make
the Term Loan to the Borrower hereunder is subject to the
satisfaction of the following conditions precedent:
(a) Section 4.1 Conditions. Each of the conditions set forth in
Section 4.1 shall have b been satisfied.
(b) Term Note. The Bank shall have received the Term note
conforming to the requirements hereof and duly executed by the
Borrower.
(c) Pledge Agreement. The Bank shall have received a pledge
agreement (the "Pledge Agreement") duly executed by the Borrower
pledging all of the shares of stock of Pro-Bel together with
- the original share certificates of Pro-Bel
- Form U-1
- Stock powers
(d) Borrowing Base Certificate. The Bank shall have received a
Borrowing Base Certificate as set forth in Section 5.2(c) hereof:
(e) Legal Opinion. The Bank shall have received a favorable opinion
of counsel to the Borrower substantially in the form of Exhibit D
hereto as it pertains to the Term Loan. Such transactions
contemplated by this Agreement as the Bank shall reasonably require.
(f) Certified Copies and Other Documents. The Bank shall have
received such certificates and other documents relating to Pro-Bel
with respect to the matters herein contemplated as the Bank may
request, including, but not limited to:
(1)certificate of good standing (or equivalent) from the applicable
United Kingdom authority; (2) certificate of incorporation (or
equivalent) certified by the applicable United Kingdom authority;
(3) an Officers' Certificate dated the date of Agreement certifying,
true and correct copies of the by-laws of Pro-Bel as in effect on
the date of this Agreement; (4) an opinion of counsel to pro-Bel as
to its corporate existence.
(g) Pro-Bel Acquisition Documents. The Bank shall have received
executed copies of the Acquisition Documents which shall be
satisfactory in all respects to the Bank.
(h) Pro-Bel Financial Statements. The Bank shall have received
audited financial statements of Pro-Bel for fiscal years 1993-1995.
4.3 Conditions to All Loans. The obligation of the Bank to make any
Loan (including the initial Revolving Credit Loan and the Term Loan)
to be made by it hereunder is subject to the satisfaction of the
following conditions precedent.
(a) Representation and Warranties. The representations and
warranties made by the Borrower herein or which are contained in by
the Borrower or any Subsidiary at any time under or
in connection herewith, shall be correct in all material respects on
and as of the borrowing date for such extension of credit as if made
on and as of such date.
(b) No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing on the date an extension of
credit is to be made or after giving effect to the extension of
credit to be made on such date.
(c) Compliance with Borrowing Base. After taking into account the
Loan or extension of credit to be made, all outstanding extensions
of credit together with the requested extension of credit shall not
exceed the Borrowing Base, except to the extent of the Over-Advance
Amount.
Each borrowing by the Borrower hereunder shall constitute a
representation and warranty by the Borrower as of the date of each
such borrowing that the conditions in clauses (a), (b), and (c) of
this Section have been satisfied.
SECTION 5. AFFIRMATIVE COVENANTS.
The Borrower hereby agrees that, so long as the Commitment remains
in effect, any Note remains unpaid, or any other amount is owing to
the Bank hereunder, the Borrower will and will cause each Subsidiary
to and, with respect to Sections 5.1, 5.3, 5.4, 5.5, 5.7, 5.8, and
5.10, each Non-Restricted Subsidiary to:
5.1 Corporate Existence and Qualification. Take the necessary steps
to preserve its corporate existence and its right to conduct
business in all states in which the failure to so preserve its
corporate existence or right to conduct business could have a
Material Adverse Effect.
5.2 Financial Information and Compliance Certificates.
(a) Keep its books of account in accordance with good accounting
practices and furnish to the Bank;
(1) As soon as available, but not more than one hundred twenty (120)
days after the closing of each fiscal year, the consolidated
financial statements of the Borrower and its consolidated
subsidiaries, including a consolidated balance sheet with related
consolidated statements of income, retained earnings and cash flows
for such fiscal year, setting forth in each case in comparative form
the figures for the previous fiscal year, all prepared in accordance
with GGAP consistently applied and certified by Price Waterhouse,
CPAs or another firm of independent certified public accountants
reasonably to the a Bank.
(2) As soon s available, but not more than forty-five 945) days
after the close of the first three fiscal quarters of each fiscal
year, the consolidated financial statements of the Borrower and its
consolidated subsidiaries including consolidated balance sheet with
related consolidated statements of income, related earnings and cash
flows as at the end of such quarter, all prepared in accordance with
GAAP consistently applied and prepared by management and certified
as true and correct by the chief financial officer of the Borrower.
(3) As soon as available, but not more than one hundred twenty (120)
days after the closing of each fiscal year, the consolidating
financial statements of the Borrower and its consolidated
subsidiaries, including a consolidating balance sheet with related
consolidating statements of income, retained earnings and cash flows
for such fiscal year, setting forth in each case in comparative form
the figures for the previous fiscal year, all prepared in accordance
with GAAP consistently applied and prepared by Price Waterhouse,
CPAs or another firm of independent certified public accountants
reasonable acceptable to the Bank.
(4) As soon as available, but not more than forty-five (45) days
after the close of the first three fiscal quarters of each fiscal
year, the consolidating financial statements of the Borrower and its
consolidated subsidiaries including a consolidating balance sheet
with related consolidating statement of income, retained earnings
and cash flows as at the end of such quarter, all prepared in
accordance with GAAP consistently applied and prepared by management
and certified as true and correct by the chief financial officer of
the Borrower.
(5) With reasonable promptness, such other data as may be reasonably
requested by the Bank including, but not limited to copies of the
annual reports, regular periodic and special reports, schedules or
other material which the Borrower may not or hereafter be required
to file with or deliver to any securities exchange or the Securities
and Exchange Commission or any domestic or non-domestic regulatory
body and will, during regular business hours and upon reasonable
notice, permit the Bank by or through any of its officers, agents,
employees, attorneys, or accountants to inspect and make extracts
from such Borrower's books and records.
(b) At the same time as it delivers the financial statements called
for by Section 5.2(a), deliver a certificate of the chief financial
officer of the Borrower evidencing a computation of compliance with
the provisions of Section 6 hereof and stating that in each case
except as disclosed in such certificate, the person making such
certificate has no knowledge of any Default or Event or Default.
(c) Deliver to the Bank an accounts receivable aging schedule
reflecting aging of receivables from invoice date accompanied by a
Borrowing Base Certificate indicating computation of the Borrowing
Base promptly upon request of the Bank and monthly (not later than
20 days after the last day of each month) covering the period ending
the last day of the immediately preceding month.
(d) Within 5 days of any officer of the Borrower obtaining knowledge
of any Default, if such Default is then continuing, Borrower shall
furnish to the Bank a certificate of the chief financial officer of
the Borrower setting forth the details thereof and the action which
the Borrower is taken or proposes to take with respect thereto.
5.3 Insurance. Maintain insurance with responsible and reputable
insurance companies or associations in such amounts and covering
such risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas
in which the Borrower operates and naming the Bank as an additional
insured and loss payee thereon as its interest may appear and
maintain an Export Credit Insurance Policy from Em-Im Bank in
amounts and coverage acceptable to the Bank and name the Bank as
assignee thereunder.
5.4 Preservation of Properties; Compliance with Law. Maintain and
preserve all of its properties which hare used or which hare useful
in the judgment of the Borrower in the conduct of its business in
good working order and condition, ordinary wear and tear excepted;
comply with all Requirements of Law except where contested in good
faith and by proper proceedings if appropriate reserves are
maintained with respect thereto.
5.5 Taxes. Duly pay and discharge all taxes or other claims which
might become a lien upon any of its property except to the extent
that any thereof are being in good faith appropriately contested
with adequate reserves provided therefore.
5.6 Maintain Operating Accounts. Maintain all of its primary
operating accounts with the Bank.
5.7 Notice of Litigation. Promptly notify the Bank in writing of
any litigation, legal proceeding or dispute, other than disputes in
the ordinary course of business or, whether or not in the ordinary
course of business, involving amounts in excess of Three Hundred
Fifty Thousand and 00/100 ($350,000.00) Dollars, affecting the
Borrower or any Subsidiary whether or not fully covered by
insurance, and regardless of the subject matter thereof (excluding,
however, any actions relating to workers' compensation claims or
negligence claims relating to use of motor vehicles, if fully
covered by insurance, subject to deductibles).
5.8 Indemnity (Environmental Matters). Indemnify the Bank against
any liability, loss, cost, damage, or expense (including, without
limitation, reasonable attorney's fees) arising from (i) the
imposition or recording of a lien by any local, state, or federal
government or governmental agency or authority pursuant to any
Environmental Laws; (ii) claims of any private parties regarding
violations of Environmental Laws; and (iii) costs and expenses
(including, without limitation, reasonable attorneys' fee and fees
incidental to the securing of repayment of such costs and expenses)
incurred by the Borrower, any Subsidiary or the Bank in connection
with compliance by the Borrower, any Subsidiary or the Bank with any
statute, regulation or order issued pursuant to any Environmental
Laws by any local state or federal government or governmental agency
or authority.
5.9 New Subsidiaries: Cause any Restricted Subsidiary of the
Borrower formed after the date of this Agreement to become a
guarantor of all debts and obligations of the Borrower under this
Agreement and grant a security interest o the Bank in all of its
personal property to secure such guarantee pursuant to a security
agreement on the Bank's landlord form and cause such Restricted
Subsidiary to execute an agreement, in form satisfactory to the
Bank, subjecting it to the affirmative and negative covenants
contained in this Agreement.
5.10 Books and Records; Field Audit: Keep proper books of record
and account in accordance with GAAP and permit the Bank or its duly
authorized agents to examine the books and records of the Borrower,
such authorization to include, without limitation, the annual field
audit, test or examination of any or all of the assets of the
Borrower at the Borrower's expense (and, if more frequently than
annually, at the Bank's expense).
SECTION 6. FINANCIAL COVENANTS.
6.1 The Borrower hereby agrees that, so long as the Commitment
remains in effect, any Note remains outstanding and unpaid, or any
other amount is owing to the Bank hereunder, the Borrower and its
Restricted Subsidiaries on a consolidated basis will:
(a) Current Ratio. Maintain at all times during the periods set
forth below a ratio of current assets to current liabilities in a
portion not less than that designated opposite each such period:
Period Minimum
From Through Current Ratio
Date hereof - 12/30/97 1.4 to 1.0
12/31/97 and at all times thereafter 2.0 to 1.0
(current assets and current liabilities to be determined in
accordance with GAAP; provided, however, that solely for purposes of
calculating compliance with this covenant, principal amounts
outstanding under the Revolving Credit Loans and the Term Loan shall
be considered current liabilities).
(b) Minimum Quick Ratio. Maintain at all times during the periods
designated below a ratio of cash, cash equivalents and accounts
receivable to current liabilities in a proportion not less than that
designated opposite each such period:
Period Minimum
From Through Quick Ratio
Date hereof - 12/30/97 .85 to 1.0
12/31/97 and at all times thereafter 1.25 to 1.0
(current liabilities to be determined in accordance with GAAP;
provided, however, that solely for purposes of calculating
compliance with this covenant, principal amounts outstanding under
the Revolving Credit Loans and the Term Loan shall be considered
current liabilities).
(c) Minimum Debt Service Coverage Ratio. Maintain as at the last
day of each fiscal year a ratio of the sum of earnings before
interest and taxes plus depreciation and amortization for such
fiscal year divided by the sum of interest expense plus the current
portion of long term debt at such time plus capital expenditures and
additions to capitalized software development costs made in such
fiscal year of at least 2.0 to 1.0 ("long term debt" means
indebtedness for borrowed money which by its terms matures more than
12 months after the date incurred or if maturing sooner, the
maturity thereof may be extended at the option of the debtor beyond
such 12 month period).
(d) Domestic Tangible Net Worth. Maintain at all times during
fiscal year 1996 Domestic Tangible Net Worth of at least
$19,400,000, to increase by at least $2,000,000 at each fiscal year
end thereafter above the level attained as at the close of the
immediately preceding fiscal year (solely for purposes of
calculating compliance with this covenant, Domestic Tangible net
Worth shall be net of (i) any increases in common stock and
additional paid in capital resulting from or due to the acquisition
of any Person or joint venture with any Person or any similar
arrangement), (ii) any increase in common stock and additional paid
in capital due to a public offering and (iii) the accounting effect
of the consolidation of the liabilities or assets attributable to
the acquisition of or investment in any non-Restricted Subsidiaries.
(e) Leverage Ratio. Maintain at all times during the periods
designated below a ratio of total liabilities to Domestic Tangible
Net Worth in a proportion not more than that designated opposite
each such period:
Period Maximum
From Through Leverage Ratio
Date hereof - 12/30/97 1.5 to 1.0
12/31/97 and at all times thereafter 1.0 to 1.0
(total liabilities to be determined in accordance with GAAP).
6.2 The Borrower hereby agrees that, so long as the Commitment
remains in effect, any Note remains outstanding and unpaid, or any
other amount is owing to the Bank hereunder, the Borrower and its
consolidated Subsidiaries will maintain at all times during fiscal
year 1996 Tangible Net Worth on a consolidated basis of at least
$19,400,000, to increase by at least $2,000,000 in each fiscal year
thereafter above the level attained as at the closed of the
immediately preceding fiscal year (solely for purposes of
calculating compliance with this covenant, Tangible Net Worth shall
be net of (i) any increases in common stock and additional paid in
capital resulting from or due to the acquisition of any Person or
joint venture with an Person or any similar arrangement) and (ii)
the intangible attributable to the acquisition of the stock or Pro-
Bel.
SECTION 7. NEGATIVE COVENANTS.
The Borrower hereby agrees that, so long as the Commitment remains
in effect, any Note remains outstanding and unpaid, or any other
amount is owing to the Bank hereunder it will not, now will it
permit any of its Restricted Subsidiaries to and with respect to
Sections 7.2, 7.6, 7.7, 7.8, 7.9, 7.10, 7.2, 7.13 and 7.14, any of
its Non-Restricted Subsidiaries to:
7.1 Indebtedness for Borrowed Money. Incur, or permit to exist,
any Indebtedness for borrowed money except (i) Indebtedness incurred
pursuant to borrowings hereunder and under any other loans made by
the Bank in its discretion to the Borrower or any Subsidiary, (ii)
Indebtedness existing on the date hereof and reflected in the
financial statements referred to in Section 3.1 hereof and (iii)
purchase money Indebtedness incurred in the acquisition of fixed
assets within the limitations of Section 7.8 hereof.
7.2 Mergers, Acquisitions and Sales of Assets. Enter into any
merger or consolidation or liquidate, windup or dissolve itself or
sell, transfer or lease or otherwise dispose of al or substantially
all of its assets (other than sales of inventory and obsolescent
equipment in the ordinary course of business) or acquire by purchase
or otherwise the business or asset of, or stock of, another business
entity; except that any Subsidiary may merge into or consolidate
with any other Subsidiary which is wholly-owned by the Borrower and
any Subsidiary which his wholly-owned by the Borrower may merge with
or consolidate into the Borrower provided that the Borrower is the
surviving corporation.
7.3 Loans; Investments. Lend or advance money, credit or property
to or invest in (by capital contribution, loan, purchase or
otherwise) any firm, corporation, or other Person except (i)
investments in United States Government obligations, certificates of
deposit of any banking institution with combined capital and surplus
of at least $200,000,000, (ii) accounts receivable arising out of
sales of inventory in the ordinary course of business, (iii)
commercial paper of a domestic issuer rated at least "A-1" by
Standard & Poor's Rating Group or "P-1" by Xxxxx'x Investors
Service, Inc., (iv) investments in a Subsidiary and (v) in addition
to all other permitted investments and loans, investments in or
loans to any other Person, provided that the aggregate amount of
such investments., loans and guaranties permitted by Section 7.5
(ii) hereof, do not exceed in the aggregate Five Hundred Thousand
and 00/100 ($500,000.00) Dollars at any one time outstanding.
7.4 Liens. Create, assume or permit to exist, any Liens on any of
its property or assets now owned or hereafter acquired except (i)
Liens in favor of the Bank; (ii) other Liens incidental to the
conduct of its business or the ownership of its property and assets
which were not incurred in connection with the borrowing of money or
the obtaining of advances or credit and which do not materially
impair the use thereof in the operation of its business; (iii) Liens
for taxes or other governmental charges which are not delinquent or
which are being contested in good faith and for which a reserve
shall have been established in accordance with GAAP; and (iv)
purchase money Liens granted to secure the unpaid purchase price of
any fixed assets purchased within the limitations of Section 7.8
hereof.
7.5 Contingent Liabilities. Assume, endorse, be or become liable
for or guarantee the obligations of an Person except (i) the
endorsement of negotiable instruments for deposit or collection in
the ordinary course of business and (ii) guaranties of obligations
which when aggregated with the loans and investments permitted by
Section 7.3(v) hereof do not exceed Five Hundred Thousand and 00/100
($500,000.00) Dollars at any one time outstanding.
7.6 Dividends. Declare or pay any dividends on its capital stock
(other than dividends payable solely in shares of its own common
stock), or purchase, redeem, retire or otherwise acquire any of its
capital stock at any time outstanding, except (i) any Subsidiary
wholly owned by the Borrower may declare and pay dividends to the
Borrower and (ii) provided no Event of Default has occurred and is
continuing thereunder, the Borrower may do any of the foregoing in
any fiscal year not exceeding, i on the aggregate, twenty five (25%)
percent of the Borrower's net income in such fiscal year.
7.7 Sales of Receivables; Sale - Leasebacks. Sell, discount or
otherwise dispose of notes, accounts receivable or other obligations
owing to the Borrower, with or without recourse, except for the
purpose of collection in the ordinary course of business; or sell
any asset pursuant to an arrangement to thereafter lease such asset
from the purchase thereof.
7.8 Capital Expenditures; Capitalized Leases. Expend in the
aggregate for the Borrower and all Subsidiaries in excess of Three
Million and 00/100 ($3,000,000.00) Dollars in any fiscal year for
Capital Expenditures including payments made on account of
Capitalized Leases. For purposes of the foregoing, Capital
Expenditures shall include payments made on accounts of any deferred
purchase price or on account of any indebtedness incurred to finance
any such purchase price.
7.9 Lease Payments. Expend in the aggregate for the Borrower and
all Subsidiaries in excess of Seven Hundred Fifty Thousand and
00/100 ($750,000.00) Dollars in any fiscal year for the lease,
rental or hire of real or personal property pursuant to any rental
agreement therefore, whether an operating lease, capitalized lease
or otherwise.
7.10 Nature of Business. Materially alter the nature of its
business.
7.11 Stock of Subsidiaries. Sell or otherwise dispose of any
Subsidiary (except in connection with a merger or consolidation of
subsidiary into the Borrower or another Subsidiary) or permit a
Subsidiary to issue any additional shares of its capital stock
except pro rata to its stockholders.
7.12 ERISA. (i) Terminate any Plan so as to result in any material
liability to the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA (the "PBGC"), (ii)
engage in or permit any person to engage in any "prohibited
transaction" (as defined in Section 406 or ERISA or Section 4975 of
the Internal Revenue Code of 1954, as amended) involving any Plan
which would subject a Borrower to any material tax, penalty or other
liability, iii) incur or suffer to exist any material "accumulated
funding deficiency" (as defined in Section 302 of ERISA), whether
or not waived, involving any Plan, or (iv) allow or suffer to exist
any event or condition, which presents a material risk of incurring
a material liability to the PBGC by reason of termination of any
Plan.
7.13 Accounting Changes. Make, or permit any Subsidiary to make
any change in their account treatment or financial reporting
practices except as required or permitted by GAAP in effect from
time to time.
7.14 Transactions with Affiliates. Except as otherwise
specifically set forth in this Agreement, directly or indirectly
purchase, acquire or lease any property from, or sell, transfer or
lease any property to, or enter into any other transaction, with any
Affiliate except in the ordinary course of business and at prices
and on terms not less favorable to it than those which would have
been obtained in an arm's-length transaction with a non-affiliated
third party.
SECTION 8. EVENTS OF DEFAULT.
Upon the occurrence and during the continuance of any of the
following events (each an Event of Default):
(a) Borrower shall fail to pay any interest on any of the Notes
within ten days of the due date therefore, or principal of any of
the Notes when due, or shall fail to pay any other amount payable
hereunder within ten days after written notice or the Borrower or
any Guarantor shall default under any other Loan Document after the
giving of notice or expiration of grace periods, if any, under such
Loan Document; or
(b) Any representation or warranty made or deemed made by the
Borrower herein or which his contained in any certificate, document
or financial or other statement furnished at any time under or in
connection with this Agreement shall prove to have been false in any
material respect on or as of the date made or deemed made; or
(c) Borrower shall default in the observance or performance of any
covenant or provision contained in Section 5, 6 or 7 hereof; or
(d) Borrower shall default in the observance or performance of any
other provision contained in this Agreement and such default shall
continue unremedied for a period of 30 days after written notice
thereof is given to the Borrower by the Bank; provided that if the
default is of such nature that it cannot reasonably be cured within
such 30 day period, no default shall be deemed to have occurred
hereunder so long as the Borrower commences to cure such default
within such 30 day period and thereafter diligently and
expeditiously proceeds to cure same, provided that no extension
shall be for a period beyond 60 days; or
(e) The Borrower or any Subsidiary shall (i) default in any payment
of any indebtedness for borrowed money in excess of Two Hundred
Thousand and 00/100 $200,000.00) Dollars (other than the Notes)
beyond the period of grace, if any, provided in the instrument or
agreement under which such indebtedness was created; or (ii) default
beyond the period of grace, if any, in the observance or performance
of any other agreement or condition relating to any such
indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto or any other event shall occur or
condition exist, in each case the effect of which default or other
event or condition is to cause or permit the holder or holders of
such indebtedness (or a trustee or agent on behalf of such holder or
holders) to cause such indebtedness to become due prior to its
stated maturity; or
(f) (i) The Borrower or any Subsidiary shall commence any case,
proceeding or other action (A) under any existing or future law of
any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian or other
similar official for it or for all or any substantial part of its
assets, or the Borrower or any Subsidiary shall make a general
assignment of the benefit of its creditors; or (ii) there shall be
commenced against the Borrower or any Subsidiary any case,
proceeding or other action of a nature referred to in clause (i)
above which (A) results in the entry of an order for relief or any
such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 75 days; or (iii) there
shall be commenced against the Borrower or any Subsidiary any case,
proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or
any substantial part of its assets which result in the entry of an
order for any such relief which shall have been vacated, discharged,
or stayed or bonded pending appear within 20 days from the entry
thereof; or (iv) the Borrower or any Subsidiary shall take any
action in furtherance of, or indicating its consent to, approval of,
or acquiescence in, any of the acts set forth in clause (i), (ii) or
(iii) of this Section 8(f); or (v) the Borrower or any Subsidiary
shall generally not, or shall be unable to, or shall admit in
writing its inability to, pay its debts as they become due; or
(g) (i) the Borrower or any Subsidiary shall engage in any
"prohibited transaction" (as defined in Section 406 of ERISA or
Section 4975 of the Code) involving any Plan, (ii) any "accumulated
funding deficiency" (as defined in Section 302 of ERISA), whether or
not waived, shall exist with respect to any Plan, (iii) a Report
Event shall occur with respect to, or proceedings shall commence to
have a trustee appointed, or a trustee shall be appointed, to
administer or to terminate, any Plan, which Reportable Event or
institution of proceedings is, in the reasonable option of the Bank,
likely to result in the termination of such Plan for purposes of
Title iV of ERISA, and, in the case of a Reportable Event, the
continuance of such Reportable Event unremedied for 20 days after
notice of such Reportable Event pursuant to Section 4043(a), (c) or
(d) of ERISA is given or the continuance of such proceedings for 20
days after commencement thereof, as the case may be, (iv) any Plan
shall terminate for purposes of Title IV of ERISA, and in each case
in clauses (i) through (iv) above, such event or condition could
subject the Borrower to any tax, penalty or other liabilities in the
aggregate material in relation to the business, operations or
property of the Borrower; or
(h) the rendition by any court of a final judgement in excess of
Two Hundred Thousand and 00/100 ($200,000.00) Dollars against the
Borrower or any Subsidiary which shall not be satisfactorily stayed,
discharged, vacated or set aside within 75 days of the making
thereof; or the attachment of any material property of the Borrower
or any Subsidiary which has not been released or provided for to the
reasonable satisfaction of the Bank within 75 days after the making
thereof; or
(i) any Guarantee or Security Agreement of any Guarantor shall
cease to be in full force and effect; or
(j) any of the Liens created and granted pursuant to the Security
Agreements or the Pledge Agreement shall fail to be valid, first,
perfected Liens subject to nor prior to equal Lien except as
permitted by this Agreement.
Then, in any such event, any or all of the following actions may be
taken: (i) the Bank may, at its option, declare the Commitment to be
terminated forthwith, whereupon the Commitment and all obligations
of the Bank to make Loans to the Borrower shall immediately
terminate; (ii) the Bank may, at its option, declare the Loans
hereunder (with accrued interest thereon) and all other amounts
owing under this Agreement and the Notes to be due and payable and
the same, and all interest accrued thereon, shall forthwith become
due and payable without presentment, demand, protest or notice of
any kind, all of which are hereby waived, anything contained herein
or in any instrument evidencing the Loans to the contrary
notwithstanding.
SECTION 9. COLLATERAL SECURITY
9.1 General Loan and Collateral Agreement. As collateral security
for the payment of the Obligations, the Borrower hereby grants to
the Bank a lien on and security interest in any and all deposits or
other sums at any time credited by or due from the Bank to the
Borrower, whether in regular or special depository accounts or
otherwise, and any and all monies, securities and other property of
the Borrower, and the proceeds thereof, now or hereafter held or
received by or in transit to the Bank from or for the Borrower,
whether for safekeeping, custody, pledge, transmission, collection
or otherwise, and any such deposits, sums, monies, securities and
other property, may at any time after the occurrence of any Event of
Default be set-off, appropriated and applied by the Bank against any
of the Obligations whether or not such Obligations are then due or
are secured by any collateral, or, if they are so secured, whether
or not such collateral held by the Bank is considered to be
adequate.
9.2 Additional Collateral Security. In addition to the collateral
described in Section 9.1 hereof, payment of the Obligation is also
secured by a first priority security interest in (i) all personal
property including trademarks and patents of the Borrower whether
now owned or hereafter acquired, and (ii) after the making of the
Term Loan, all outstanding shares of stock of Pro-Bel, as provided,
respectively, in the Security Agreements and Pledge Agreement
executed and delivered by the Borrower to the Bank.
SECTION 10. MISCELLANEOUS.
10.1 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing unless
otherwise expressly provided herein and shall be deemed to have been
duly given or made when delivered by hand, or by telegram or
telecopy, or when deposited in the mail addressed as follows, or to
such address as may be hereafter notified in writing by the
respective parties hereto and any future holders of any Note:
The Borrower:
Chyron Corporation
0 Xxx Xxxxx
Xxxxxxxx, Xxx Xxxx 00000
with a courtesy copy (which copy shall not constitute notice)
to:
Camhy, Karlinsky & Xxxxx LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxxxx XxXxxx, Esq.
The Bank:
NatWest Bank N.A.
000 Xxxxxxx Xxxxxxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxxxx
Vice President
10.2 No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Bank, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof
or the exercise of any other right.
10.3 Survival of Representations and Warranties. All
representations and warranties made hereunder and in any Loan
Document shall survive the execution and delivery of this Agreement
and the Notes.
10.4 Payment of Expenses; Examination.
(a) The Borrower agrees to pay or reimburse the Bank for all its
reasonable costs and expenses (including, without limitation, the
reasonable fees and expenses of attorneys for the Bank) incurred in
connection with (i) the enforcement or preservation of any rights
under any Loan Document or any other instrument or agreement entered
into in connection herewith or therewith including, without
limitation, the reasonable fees and disbursements of attorneys for
the Bank; (ii) any claim or action threatened, made or brought
against the Bank arising out of or relating to any extent to any
Loan Document or any instrument or agreement entered into in
connection with the transactions contemplated hereby or thereby;
(iii) the perfection of any security interest in the Collateral or
in the maintenance of the Collateral; (iv) any amendment or
modification of any Loan Document; (v) the payment of any tax,
assessment, recording fee or similar charge; (vi) any waiver of any
right of the Bank under any Loan Document and (vii) the reasonable
fees and disbursements of any counsel to the Bank incurred from time
to time in connection with the transactions contemplated by this
Agreement. The Borrower agrees to reimburse the Bank for any
payments made to the CIT Group/Credit Finance Inc. ("CIT") pursuant
to the indemnity letter of the Bank to CIT dated March 28, 1996.
(b) The Borrower agrees that at any time and from time to time upon
reasonable notice and during regular business hours the Bank may
conduct, at the Borrower's expense, an examination of the Borrower's
books and records (provided, if more frequently than annually, at
the Bank's expense). The obligations set forth in this Section 10.4
shall be in addition to any other obligations or liabilities of the
Borrower to the Bank hereunder or at common law or otherwise. The
provisions of this Section 10.4 shall survive the payment of the
Notes and the termination of this Agreement.
10.5 WAIVER OF JURY TRIAL, SET-OFF AND COUNTERCLAIM. THE BORROWER
AND THE BANK IN ANY LITIGATION (WHETHER OR NOT ARISING OUT OF OR
RELATING TO THIS AGREEMENT) IN WHICH THEY SHALL BE ADVERSE PARTIES
WAIVE THE RIGHT OF TRIAL BY JURY AND THE BORROWER WAIVES THE RIGHT
TO INTERPOSE ANY SET-OFF OR COUNTERCLAIM OF ANY KIND OR DESCRIPTION
IN ANY SUCH LITIGATION.
10.6 WAIVER OF AUTOMATIC STAY. THE BORROWER AGREES THAT, IN THE
EVENT THAT THE BORROWER, ANY GUARANTOR OR ANY OF THE PERSONS OR
PARTIES CONSTITUTING THE BORROWER OR ANY GUARANTOR SHALL (i) FILE
WITH ANY BANKRUPTCY COURT OF COMPETENT JURISDICTION OR BE THE
SUBJECT OF ANY PETITION UNDER TITLE 11 OF THE U.S. CODE, AS AMENDED
("BANKRUPTCY CODE"), (ii) BE THE SUBJECT OF ANY ORDER FOR RELIEF
ISSUED UNDER THE BANKRUPTCY CODE, (iii) FILE OR E THE SUBJECT OF ANY
PETITION SEEKING ANY REORGANIZATION, ARRANGEMENT, COMPOSITION,
READJUSTMENT, LIQUIDATION, DISSOLUTION, OR SIMILAR RELIEF UNDER ANY
PRESENT OR FUTURE FEDERAL OR STATE ACT OR LAW RELATING TO
BANKRUPTCY, INSOLVENCY, OR OTHER RELIEF FOR DEBTORS, (iv) HAVE
SOUGHT OR CONSENTED TO OR ACQUIESCED IN THE APPOINTMENT OF ANY
TRUSTEE, RECEIVER, CONSERVATOR, OR LIQUIDATOR, OR (v) BE THE SUBJECT
OF ANY ORDER, JUDGEMENT, OR DECREE ENTERED BY ANY COURT OF COMPETENT
JURISDICTION APPROVING A PETITION FILED AGAINST SUCH PARTY FOR ANY
REORGANIZATION, ARRANGEMENT, COMPOSITION, READJUSTMENT, LIQUIDATION,
DISSOLUTION, OR SIMILAR RELIEF UNDER ANY PRESENT OR FUTURE FEDERAL
OR STATE ACT OR LAW RELATING TO BANKRUPTCY, INSOLVENCY, OR RELIEF
FOR DEBTORS, THE BANK SHALL THEREUPON BE ENTITLED AND THE BORROWER
IRREVOCABLY CONSENTS TO IMMEDIATE AND UNCONDITIONAL RELIEF FROM ANY
AUTOMATIC STAY IMPOSED BY SECTION 362 OF THE BANKRUPTCY CODE, OR
OTHERWISE, ON OR AGAINST THE EXERCISE OF THE RIGHTS AND REMEDIES
OTHERWISE AVAILABLE TO THE BANK AS PROVIDED FOR HEREIN, IN ANY NOTE,
OTHER LOAN DOCUMENTS DELIVERED IN CONNECTION HEREWITH AND AS
OTHERWISE PROVIDED BY LAW, AND THE BORROWER HEREBY IRREVOCABLY
WAIVES ANY RIGHT TO OBJECT TO SUCH RELIEF AND WILL NOT CONTEST ANY
MOTION BY THE BANK SEEKING RELIEF FROM THE AUTOMATIC STAY AND THE
BORROWER WILL COOPERATE WITH THE BANK, IN ANY MANNER REQUESTED BY
THE BANK, IN ITS EFFORTS TO OBTAIN RELIEF FROM ANY SUCH STAY OR
OTHER PROHIBITION.
10.7 LIMITATION OF LIABILITY. NO CLAIM MAY BE MADE BY (i) THE
BORROWER, ANY GUARANTOR, ANY SUBSIDIARY, OR ANY OTHER PERSON AGAINST
THE BANK OR THE AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES,
ATTORNEYS OR AGENTS OF THE BANK (ii) THE BANK AGAINST THE BORROWER,
ANY GUARANTOR, ANY SUBSIDIARY OR THE AFFILIATES, DIRECTORS,
OFFICERS, EMPLOYEES, ATTORNEYS OR AGENTS OF ANY OF THE FOREGOING,
FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES OR, TO THE
FULLEST EXTENT PERMITTED BY LAW, FOR ANY PUNITIVE DAMAGES IN RESPECT
OF ANY CLAIM OR CAUSE OF ACTION (WHETHER BASED ON CONTRACT, TORT,
STATUTORY LIABILITY, OR ANY OTHER GROUND) BASED ON, ARISING OUT OF
OR RELATED TO ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY OR ANY ACT, OMISSION OR EVENT OCCURRING IN
CONNECTION THEREWITH, AND THE BORROWER (FOR ITSELF AND ON BEHALF OF
EACH GUARANTOR AND EACH SUBSIDIARY) AND THE BANK HEREBY WAIVE,
RELEASE AND AGREE NEVER TO XXX UPON ANY CLAIM FOR ANY SUCH DAMAGES,
WHETHER SUCH CLAIM NOW EXISTS OR HEREAFTER ARISING AND WHETHER OR
NOT IT IS NOW KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.
10.8 Modification and Waiver. No modification of waiver of, or
with respect to any provision of this Agreement or any document or
instrument delivered in connection therewith shall be effective
unless and until it shall be in writing and signed by the Bank, and
then such modification or waiver shall be effective only in the
specific instance and for the purpose for which given. No notice to
or demand on the Borrower in any case shall, of itself, entitle to
it any other or further notice or demand in similar or other
circumstances.
10.9 Successor and Assigns. This Agreement shall be binding upon
and inure to the benefit of the Borrower, the Bank, all future
holders of the Notes and their respective successors and assigns,
except that the Borrower may not assign or transfer any of its
rights under this Agreement without the prior written consent of the
Bank. The term "Bank" as used herein shall be deemed to include the
Bank and its successors, endorsees, and assigns.
10.10 Governing Law; Consent to Jurisdiction. This Agreement and
the other Loan Documents and any documents and instruments delivered
in connection hereunder and thereunder shall be governed by, and
construed and interpreted in accordance with, the law of the state
of New York and the Borrower consents to the jurisdiction of the
courts of the State of New York in any action brought to enforce any
rights of the Bank under this Agreement and any document or
instrument related hereto.
10.11 Entire Agreement. This Agreement and any other agreement,
documents and instruments executed and delivered pursuant to or in
connection with the Obligations contain the entire agreement between
the parties relating to the subject matter hereof and thereof. The
Borrower expressly acknowledges that the Bank has not made and the
Borrower is not relying on any oral representations, agreements or
commitments of the Bank or any officer, employee, agent or
representative thereof.
10.12 Interest Adjustment. Notwithstanding anything to the
contrary contained in this Agreement or any Note, the rate of
interest payable on either Note shall never exceed the maximum rate
of interest permitted under applicable law. If at any time the rate
of interest otherwise prescribed herein shall exceed such maximum
rate, and such prescribed rate is thereafter below such maximum
rate, the prescribed rate shall be e increased to the maximum rate
for such period of time as is required so that the total amount of
interest received by the Bank is that which would have been received
by the Bank except for the operation of the first sentence of this
Section 10.12.
10.13 Counterparts. This Agreement may be signed in any number of
counterparts with the same effect as if the signatures thereto and
hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered in Jericho, New York by their proper
and duly authorized officer as of the day and year first above
written.
CHYRON CORPORATION
By: /s/ Xxxxxxxx X. Xxxxx
Chief Financial Officer
NATWEST BANK N.A.
By: /s/ Xxxxxxx Xxxxx
Vice President
BARC LAYS BANK PLC
Oxford Corporate Banking Centre
X.X. Xxx 000, Xxxxxx XX0 0XX
PRIVATE AND CONFIDENTIAL
The Directors Your Ref:
H/JEF/SH
Pro-Bel Limited Our Ref: 01865
442139
Triology Broadcast Limited Fax No.: 01865
442570
Pro-Bel Software Limited
Xebec Electronic Production Services Ltd. 19th December
1996
Xxxxxxxx, Xxxxx Xxxxx
Xxxxxxx XX0 0XX
Dear Sirs
We are please to advise you that Barclays Bank PLC ("the Bank") has
agreed to provide an overdraft facility ("the Overdraft") of up to
3,000,000 pounds xxxxxxxx xxxxx (Three million pounds xxxxxxxx
xxxxx) and of up to $3,000,0000 pounds sterling (Three million
pounds sterling net) until 31st December 1997 to Pro-Bel Limited
("the Parent") and its subsidiary named below (the Parent and such
subsidiaries are referred to individually as a "borrower" and
collectively as the "Borrowers").
The Bank is also prepared to provide the Borrower with:
Ancillary facilities by way of negotiation of sterling/foreign
currency cheques and Bills of Exchange payable abroad, Company
Barclaycard, Bankers Automatic Clearing Services (BACS), Branch
Originated BACS Services (BOBS) and Spot and Forward Exchange
Transactions (known collectively a the "ancillaries") Utilisation
under the Ancillaries shall be in accordance with Schedule B.
The Schedules attached hereto from part of the terms and conditions
of this letter.
Following the completion of the acceptance formalities detailed
below the Overdraft will be available for drawing by the Borrowers,
subject to the following terms and conditions:
1. The Overdraft
The Overdraft will be available by way of a Composite Accounting
System ("CAS") in accordance with a Composite Accounting Agreement
made between the Parent and its subsidiaries named below an the
Bank, (subject to the sub limits detailed below - at the Oxford City
Office branch of the Bank ("the Branch") with interest charged at a
rate of 1.5% per annum over the Bank's Base Rate current from time
to time. Interest, together with other charges will be debited to
the Borrowers' current accounts at the Branch quarterly in arrears
in March, June, September and
December each year, or at such other times as may be determined by
the Bank, and such interest will be calculated on the basis of
actual days elapsed over a 365 day year.
Sub Limits
Trilogy Broadcast Limited 300,000 pounds
sterling
Pro-Bel Software Limited 200,000 pounds
sterling
Xebec Electronic Production Services Limited 50,000 pounds
sterling
Options Available Within and Utilization of the Facility
The Facility may be utilized by way of the following options and in
accordance with the provisions of the Schedules related thereto:
Sterling Overdraft the terms and conditions of which are contained
in the Bank's Facility
Letter of even date, and/or
Foreign Currency Overdraft (see Schedule A)
Within the Facility the aggregate of the liabilities due, owing or
incurred thereunder shall not at any time exceed 3,000,000 until 31
December 1997 or its currency equivalent.
2. Availability
All monies owing under the Facility are repayable upon written
demand by the Bank and/or any undrawn portion of the Facility may be
cancelled by the Bank, at any time. Following demand and/or
cancellation, no further utilisation may be made under the Facility.
The Bank may at any time after such demand and/or cancellation call
for payment of full cash cover for all liabilities outstanding under
the Ancillary Facilities.
The Borrower shall indemnify the Bank on demand against any loss,
liability or expense which the Bank may reasonably sustain or incur
as a consequence of making such demand or as a consequence of non-
performance by the Borrower of any obligation under this letter.
Any monies not paid following a demand under this clause shall
continue to bear interest in respect of any outstanding interest
period, and in respect of the Sterling Overdraft and the Foreign
Currency Overdraft as calculated in the respective Schedules.
The amounts of any payments made by the Bank on behalf of the
Borrower under the Ancillary Facilities, will, except for those
amounts where cash cover has been made by the Borrower as provided
for above, continue to bear interest at 1.5% per annum over the
Bank's Base Rate current from time to time until payment is made.
Interest shall, if unpaid, be compounded in the Bank's usual
charging dates. Interest will continue to be charged and compounded
on this basis after as well as before demand or Judgement.
The Bank reserves the right, at any time following a demand under
this clause, to purchase with Sterling any currency necessary to
convert any amounts outstanding under the Facility, together with
interest accrued thereon, to Sterling, whereupon the Borrow shall
then become liable to pay the
Bank forthwith the relevant Sterling amounts, together with all
costs and expenses incurred by the Bank. Interest will continue to
be charged as detailed above.
In the absence of demand or cancellation by the Bank, the Facility
is available for utilisation until 31 December 1997. However, the
Bank will be pleased to discuss the Borrower's future requirements
shortly before that date.
3. Security and/or Guarantee(s)
The Borrower's obligations hereunder will be secured by any security
which is now held, or hereafter may be held, by the Bank to secure
all moneys and liabilities which shall from time to time be due,
owing or incurred to the Bank by the Borrower, whether actually or
contingently.
Specifically, in addition to the security currently held the Bank
will be provided with:
a) Cross Guarantee and Debenture from Xebec Electronic Production
Services Limited.
b) Assignment of current NCM Policies.
c) Acknowledgement in a form to be agreed from Chyron Corporation of
the agreed arrangement relating to reductions in the outstanding
inter company loan from that organisation.
The Bank reserves the right to require all subsidiary companies to
be taken into the CAS arrangement.
4. Information
The Parent undertakes to provide the Bank with:
a) copies of its audited consolidated Profit and Loss account and
Balance Sheet as soon as they are available and not later than 180
days from the end of each accounting reference period together with
any other information which the Bank may reasonably request from
time to time.
b) Monthly management accounts in a form acceptable to the Bank.
Such reports to be received by the Bank within 30 days of the
relevant month end.
c) Debenture monitoring Form 862 to be received by the Bank within
30 days of the relevant month end.
d) Schedule, in a format to be agreed detailing an overseas debtor
aged analysis together with appropriate buyer limits as established
by NCM.
The Bank reserves the right to arrange for an independent review of
the sales ledger at the Companies' reasonable expense. The Bank
will not seek these reviews at intervals of less than six months.
5. Change of Circumstances
In the event of any change in applicable law or regulation or the
existing requirements of, or any new requirements being imposed by,
the Bank of England or other regulatory authority the results of
which, in the sole opinion of the Bank, is to increase the cost to
it of funding, maintaining or making available the Overdraft (or any
undrawn amount thereof) or to reduce the effective return to the
Bank, then the Borrowers shall pay to the Bank such sum as may be
certified by the Bank to the Borrowers as shall compensate the Bank
for such increased cost or such reduction.
6. Authority of Parent to agree changes to the Composition of the
Borrowers and to the limit and terms applicable to the Overdraft.
By countersigning this letter, each Borrower (other than the parent)
irrevocably authorises the Parent (which is hereby appointed the
agent of the Borrowers for such purposes) from time to time (i) to
agree with the Bank in writing to add any further subsidiary or
subsidiaries as a Borrower or Borrowers, and/or (ii) to remove any
subsidiary as a Borrower, and/or (iii) to make such changes to the
limit and sub limits and other terms applicable to the Overdraft as
the Parent may deem appropriate, and/or (iv) to sign any document
and perform any act on behalf of the Borrowers (or any of them)
required to effect or implement any of the foregoing.
Each change so agreed by the Parent shall be binding on each
Borrower and the terms of this letter will continue in full force
and effect, save as expressly amended thereby.
7. Fees
A fee of 15,000 pounds sterling will be payable by the Borrowers to
the Bank in respect of the facility.
Legal and Valuation Costs
Any legal valuation fees and expenses and other out of pocket
expenses (including VAT) incurred by the Bank in connection with the
negotiation and granting of the Facility will be reimbursed by the
Borrower on demand by the Bank.
All fees will e ebited to the Current Account of Pro-Bel Limited.
8. Set-Off
Any sum of money at any time standing to the credit of the Borrower
with the Bank in any currency upon any account or otherwise (whether
or not any such account is held in the Borrower's name) r provided
to the Bank cash cover for any outstanding liabilities under the
Ancillary Facilities, may be applied by y the Bank at any time
(without notice to the Borrower) in or towards the discharge of any
money or liabilities now or hereafter due, owing or incurred to the
Bank by the Borrower hereunder (whether presently payable or not).
9. Currency Indemnity
If for any reason, any amount payable to the Bank is received or
recovered in a currency other than the contractual currency in which
it is due, then, to the extent that the amount actually received or
recovered by the Bank (when converted by the Bank into the
contractual currency at the applicable rate of exchange) falls short
of the amount due in the contractual currency, the Borrower shall,
as a separate and independent obligation, reimburse the Bank on
demand (on a full indemnity basis) for the amount of such shortfall.
10. Applicable Law
This letter shall be governed by and construed and take effect in
accordance with English Law.
11. Acceptance
Prior to the Overdraft being utilised, the Parent shall provide the
Branch with the following:
a) the enclosed duplicate of this letter duly signed on each
Borrower's behalf together with a CAS Agreement and CAS Guarantees,
and
b) a certificate true copy of a Resolution of each Borrower's Board
of Directors:
i) accepting the Overdraft on the terms and conditions stated herein
and approving the terms of the CAS Agreement and the CAS Guarantee
to be given by it,
ii) authorising a specified person, or persons, to sign and return
to the Bank the duplicate of this letter,
iii) authorising the Bank to accept instructions and confirmations
in connection with the operation of the Overdraft signed in
accordance with the Bank's signing mandate current from time to
time,
iv) appointing the Parent to act as agent of he Borrowers for the
purposes contemplated in Clause 6 above.
This offer will remain available for a period of one month from the
date of this letter after which it will lapse if not accepted.
Yours faithfully
for and on behalf of
BARCLAYS BANK PLC
/s/ X.X. Xxxxxx
X.X. XXXXXX
SENIOR CORPORATE MANAGER
Accepted on the terms and conditions stated herein pursuant to a
resolution of the Board of Directors (a certified true copy of which
is attached hereto).
For and on behalf of PRO BEL LIMITED
Director
Secretary/Director
Accepted on the terms and conditions stated herein pursuant to a
Resolution of the Board of Directors (a certified true copy of which
is attached hereto)
For and on behalf of Trilogy Broadcast Limited
Director
Secretary/Director
Accepted on the terms and conditions stated herein pursuant to a
Resolution of the Board of Directors (a certified true copy of which
is attached hereto)
For and on behalf of Pro-Bel Software Limited
Director
Secretary/Director
Accepted on the terms and conditions stated herein pursuant to a
Resolution of the Board of Directors (a certified true copy of which
is attached hereto)
For and on behalf of Xebec Electronic Production Services Limited
Director
Secretary/Director
SCHE DULE A
Foreign Currency Overdraft
The Foreign Currency Overdraft will be made available in any currency
(other than sterling) as previously agreed by and arranged with the
Bank, and which currency is freely transferable and available to the
Bank in the normal course of business.
The Foreign Currency Overdraft will be available on the Borrower's
foreign currency account at Reading International Services Branch with
interest charged at 1.5% per annum over the Bank's call loan rate
current from time to time. Interest together with other charges will
be debited to the Borrower's Foreign Currency Account at the Reading
International Services Branch quarterly in arrears in March, June,
September and December each year or at such other times as may be
determined by the Bank, and such interest will be calculated on the
basis of actual days elapsed over a 360 day a year.
SCHEDULE B
ANCILLARY FACILITIES
Negotiation of Sterling/Foreign Currency Cheques and Bills of Exchange
payable Abroad up to 50,000 Pounds Sterling
The Bank will purchase, with recourse, suitable foreign currency and
sterling cheques payable abroad and/or approved foreign currency or
sterling bills of exchange payable abroad. The suitability of those
cheques and bills of exchange which the Bank is prepared to purchase
is entirely at the discretion of the Bank, and is subject to the
Uniform Rules for the Collection of Commercial Paper (1978 Revision).
Pricing will be decided on a case by case basis.
A Spot & Forward Exchange Transaction Limit Up To 200,000 Pounds
Sterling
The SFET Facility covers the maximum liability of the Borrower to the
Bank outstanding at any time under contracts of not more t than twelve
months' duration for the forward purchase or sale of foreign
currencies, but excludes purchases or sales where the Bank is required
irrevocably to pay away funds prior to receiving firm confirmation of
incoming cover.
When wishing to utilise the SFET facility the Borrower should telephone
the Oxford City Office Branch of the Bank on (01865) 442156. All
payment and delivery instructions are to e advised to and processed by
the Branch and confirmed by letter at the earliest opportunity.
BOBS up to 200,000 pounds sterling
BACS up to 250,000 pounds sterling
To allow the Borrower(s) to make salary and/or credit payments
electronically.
Company Barclaycard up to 100,000 pounds sterling
To be used in accordance with the terms and conditions of use, current
from time to time, as detailed in the Agreement executed by the
Borrower(s).
PRO-BEL LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Xxxxx Xxxxxxxxx Xxxxxxx Xxxxxx Xxxxxx Xxxxxx
Ray Xxxxxxx Xxxxx Steal Xxxxxx Xxx
Xxxxx Over Xxxxx Stanwell
There was produced to the meeting a Facility Letter date 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office (Old Bank)
to the Company setting out the terms and conditions upon which the Bank
is prepared to lend to the Company the sum of 3,000,000 pounds sterling
until 31 December 1996 by way of a on demand overdraft facilities.
IT WAS RESOLVED
1. That the terms and conditions of the overdraft as set out in the
said Facility Letter be and they are hereby approved and accepted.
2. That Xxxxx Xxxxxxxxx and Xxx Xxxxxxx be and is hereby authorised
to sign on behalf of the Company the copy of the said Facility Letter
to indicate acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the overdraft upon instructions from the Company signed in
accordance with the Bank's Mandate for the Company's Account with the
Bank, current from time to time.
I hereby certify the above to be a true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxx Xxxxxxxxx
For and on behalf of
PRO-BEL LIMITED
XEBEC ELECTRONIC PRODUCTION SERVICES LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Xxx Xxxxxxx
Xxxxxx Xxxxxx
There was produced to the meeting a Facility Letter date 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office (Old Bank)
to the Company setting out the terms and conditions upon which the Bank
is prepared to lend to the Company the sum of 3,000,000 pounds sterling
until 31 December 1996 by way of a on demand overdraft facilities.
IT WAS RESOLVED
1. That the terms and conditions of the overdraft as set out in the
said Facility Letter be and they are hereby approved and accepted.
2. That Xxxxx Xxxxxxxxx and Xxxxxx Xxxxxx be and is hereby
authorised to sign on behalf of the Company the copy of the said
Facility Letter to indicate acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the overdraft upon instructions from the Company signed in
accordance with the Bank's Mandate for the Company's Account with the
Bank, current from time to time.
I hereby certify the above to be a true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxxxx Xxxxxxx
For and on behalf of
XEBEC ELECTRONIC PRODUCTION SERVICES LIMITED
TRILOGY BROADCAST LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Xxx Xxxxxxx Xxxx Xxxxx
Xxxxxx Xxxxxx Xxx Xxxxxxxx
Xxxxx Stanwell
There was produced to the meeting a Facility Letter date 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office (Old Bank)
to the Company setting out the terms and conditions upon which the Bank
is prepared to lend to the Company the sum of 3,000,000 pounds sterling
until 31 December 1996 by way of a on demand overdraft facilities.
IT WAS RESOLVED
1. That the terms and conditions of the overdraft as set out in the
said Facility Letter be and they are hereby approved and accepted.
2. That Xxxxxxx Xxxxxxx and Xxxxxx Xxxxxx be and is hereby
authorised to sign on behalf of the Company the copy of the said
Facility Letter to indicate acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the overdraft upon instructions from the Company signed in
accordance with the Bank's Mandate for the Company's Account with the
Bank, current from time to time.
I hereby certify the above to be a true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxxxx Xxxxxxx
For and on behalf of
TRILOGY BROADCAST LIMITED
PRO-BEL SOFTWARE LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Ray Xxxxxxx Xxxxx Meet
Xxxxx Xxxx Matca Xxxxxx
Xxxxx Xxxxxxxxx Xxxx Xxxxxxx
There was produced to the meeting a Facility Letter date 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office (Old Bank)
to the Company setting out the terms and conditions upon which the Bank
is prepared to lend to the Company the sum of 3,000,000 pounds sterling
until 31 December 1996 by way of a on demand overdraft facilities.
IT WAS RESOLVED
1. That the terms and conditions of the overdraft as set out in the
said Facility Letter be and they are hereby approved and accepted.
2. That Xxxxxxx Xxxxxxx and Xxxxx Xxxxxxxxx be and is hereby
authorised to sign on behalf of the Company the copy of the said
Facility Letter to indicate acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the overdraft upon instructions from the Company signed in
accordance with the Bank's Mandate for the Company's Account with the
Bank, current from time to time.
I hereby certify the above to be a true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxxxx Xxxxxxx
For and on behalf of
TRILOGY BROADCAST LIMITED
BARCLAYS BANK PLC
Oxford Corporate Banking Centre
X.X. Xxx 000, Xxxxxx XX0 0XX
PRIVATE AND CONFIDENTIAL
The Directors Your Ref:
H/JEF/SH
Pro-Bel Limited Our Ref: 01865 442139
Triology Broadcast Limited Fax No.: 01865
442570
Pro-Bel Software Limited
Xebec Electronic Production Services Ltd. 19th December
1996
Xxxxxxxx, Xxxxx Xxxxx
Xxxxxxx XX0 0XX
Dear Sirs
BANK FACILITY - PARENTAL COMPANY LOAN
I write to confirm the arrangement we have discussed with Xxxx Xxxxxx,
Financial Director relating to parental company Loan from Chyron Inc.
Pro-Bel Limited's Cash Flow Forecast for 1997 linked to the level of
Bank support we now propose suggest that Pro-Bel will be in a position
to effect a reduction of some 1 million pounds sterling in its Loan
from Chyron Corporation during the period at the rate of 250,000 pounds
sterling per quarter commencing the 31st March 1997.
In recognising that the Bank facility will be utilised for the above
purpose we seek your confirmation and that of Chyron Corporation that
these payments will not be made if cumulative cash or trading
performance is 15% worse than forecast on a cumulative basis measured
quarterly throughout the year unless the Bank consents to the
arrangement beforehand.
We should be grateful if you would confirm the agreement of both Pro-
bel Limited and Chyron Corporation to this arrangement by having
representatives of both parties sign and return to us a copy of this
letter.
Yours sincerely
/s/ X.X. Xxxxxx
X.X. XXXXXX
SENIOR CORPORATE MANAGER
BARCLAYS MERCANTILE
Mr. M Knight
Finance Director
Xxx-Xxx Xxxxxxx
Xxxxxxxx
Xxxxx Xxxxxx
Xxxxxxx
Xxxxxxxx
XX0 0XX
20 December 1996
Dear Xx. Xxxxxx,
Re: LEASE PURCHASE FACILITY OFFER
We are pleased to confirm our willingness to offer Lease Purchase
facilities in respect of various items of plan & machinery and computer
equipment.
This offer is made subject to the following conditions;
1. A maximum advance of 750,000 pounds sterling
2. A maximum lease term of 60 months in respect of surface mount
machinery and telephone
system only. All other assets to be subject to a maximum term of
36 months.
3. A minimum deposit equivalent to 10% of the capital cost (+ full VAT
where applicable)
4. Ongoing sight and satisfaction with quarterly management accounts.
5. Sight and satisfaction with 1996 audited accounts by 30 June 1997
6. Cross guarantees of all Pro-Bel Ltd subsidiary companies
7. All suppliers to be bona fide
8. These facilities are available for drawdown until 31 December 1997
In addition an agency purchase facility has been approved which I hope
will be of great benefit. This facility is designed to simplify
utilisation of the lease purchase facility and is especially beneficial
when there are a number of suppliers. The agency will allow Pro-Bel
to acquire assets (acting as our agents) thus controlling expenditure
and then to seek reimbursement from Barclays Mercantile under an hire
purchase agreement. In order to enact the agency I would be grateful
if you would sign the document attached and return it together with a
signed copy of this offer letter.
Our willingness to provide these facilities is upon the condition that,
in our opinion, there is no adverse change in your financial
circumstances before we purchase the equipment.
This offer is valid for a period of fourteen days from today;
nevertheless we reserve the right to revise our terms should monetary,
economic or taxation conditions change before we purchase the
equipment.
We welcome the opportunity to be of service to you. Please signify
your acceptance of the above terms by signing and returning the
enclosed additional copy of this letter.
Yours sincerely,
/s/ Xxxxx Xxx
Xxxxx Xxx
Branch Manager
For and on behalf of
Xxxxx Xxxxxxxxx
Pro-Bel Ltd.
Authorised to sign
BARCLAYS BANK PLC
Oxford Corporate Banking Centre
X.X. Xxx 000, Xxxxxx XX0 0XX
PRIVATE AND CONFIDENTIAL
The Directors Your Ref:
H/JEF/SH
Pro-Bel Limited Our Ref: 01865 442139
Triology Broadcast Limited Fax No.: 01865
442570
Pro-Bel Software Limited
Xebec Electronic Production Services Ltd. 19th December
1996
Xxxxxxxx, Xxxxx Xxxxx
Xxxxxxx XX0 0XX
Dear Sirs
Barclays Bank PLC (the "Bank") is pleased to offer to provide a Bonds,
Guarantees and/or Indemnities facility (the "Facility") of up to
300,000 pounds sterling (three hundred pounds sterling) or its currency
equivalent ("Facility Amount") to Pro-Bel Limited (the "Borrower")
subject to the terms and conditions set out below.
1. Interpretation
For the purpose of this Facility Letter:
a) "Indemnities" means the counter-indemnities from time to time held
by the Bank in relation to the Obligations and, unless the context
otherwise requires, includes each or any of them;
b) "Obligations" means the Bonds, Guarantees and/or Indemnities issued
by the Bank (or its correspondents) under the Facility and, unless the
context otherwise requires, includes each or any of them;
c) "Sterling Equivalent" means, in relation to an amount denominated
in foreign currency, the amount of Sterling which would be purchased
with such foreign currency amount at the Bank's spot rate for the
purchase of Sterling with such foreign currency on the date of which
conversion is required;
d) "Utilised Amount" means, on the date on which the calculation is
required, the maximum amount of all liabilities due, owing or incurred,
whether actually or contingently and whether presently payable or not,
by the Bank under or in connection with the Obligations including where
Obligations are denominated in foreign currencies the Sterling
Equivalent of the relevant liabilities of the Bank in relation to such
Obligations.
2. Utilisation
The Bank agrees to issue Obligations in Sterling and/or foreign
currencies when requested by the Borrower, provided that:
a) No Obligation may be issued if, as a result, the Utilised Amount
would exceed the Facility Amount;
b) No Obligation may be issued until the acceptance formalities
detailed in clause 8 have been completed;
c) No Obligation may be issued after 31 December 1997
d) The terms of the relevant Obligation have been approved by the
Bank;
e) The Borrower has provided all information in connection with the
relevant Obligation required by the Bank;
f) The Borrower has agreed to pay the fees required by the Bank in
relation to the relevant Obligation;
g) An Obligation will not be issued until the Bank has satisfied
itself that it holds an Indemnity in respect of such Obligation or, as
the case may be, such Obligation is covered by an existing Indemnity.
3. Availability
(a) The Bank may, in its sole discretion at any time:
(i) cancel its commitment to issue any further Obligation (if
unissued); and/or
(ii) demand from the Borrower the payment of all amounts (if any)
outstanding under this Facility Letter whereupon the same shall be
immediately due and payable; and/or
(iii) require the Borrower on demand to deposit and maintain with the
Bank an amount in Sterling sufficient to cover the Utilised Amount and
require the Borrower to give security over the money so deposited
(together with interest accruing thereon) in form and substance
satisfactory to the Bank to secure the Borrower's liabilities to the
Bank under this Facility Letter and/or the Indemnities.
(b) Any sum of money at any time standing to the credit of the
Borrower with the Bank in any currency upon any account or otherwise
may be applied by the Bank, at any time after exercising the Bank's
right under clause 3 (a) above (without notice to the Borrower), in or
towards the payment or discharge of any indebtedness now or
subsequently owing to the Bank by the Borrower hereunder and/or under
the Indemnities and the Bank may use any such money to purchase any
currency or currencies required to effect such application.
4. Security and/or Guarantee(s)
The Borrower's obligations hereunder will be secured by any security
which is now held, or hereafter may be held, by the Bank to secure all
moneys and liabilities which shall from item to time be due, owing or
incurred to the Bank by the borrower, whether actually or contingently.
5. Fees
All facilities are to be charged in accordance with published tariff.
6. Information
The Parent undertakes to provide the Bank with copies of its audited
consolidated Profit and Loss account and Balance Sheet as soon as they
are available and not later than 180 days from the end of each
accounting reference period together with any other information which
the Bank may reasonably request from time to time.
7. Governing Law
This Facility Letter shall be governed by and construed in accordance
with English law.
8. Acceptance
The Facility will become available to the Borrower for drawing only
upon receipt by the Bank not later than the close of business on 1st
March 1997 (or such later date as the Bank may agree) of the following
in form and substance satisfactory to the Bank:
a) the enclosed duplicate of this letter duly signed on the Borrower's
behalf as evidence ofacceptance of the terms and conditions stated
therein,
b) a certified true copy of a resolution of the Borrower's Board of
Directors:
(i) accepting the Facility and this offer on the terms and conditions
stated herein;
(ii) authorising a specified person, or persons, to countersign and
return to the Bank the enclosed duplicate of this Facility Letter; and
(iii) specifying the names of those officers of the Borrower whose
instruction (jointly or alone) the Bank is authorised to accept in all
matters concerning the Facility and this offer once accepted and
confirmed specimens of the signatures of those officers referred to in
(ii) and herein, if not already known to the Bank; and
Yours faithfully
for & on behalf of
Barclays Bank PLC
/s/ XX Xxxxxx
XX XXXXXX
SENIOR CORPORATE MANAGER
Accepted on the terms and conditions stated herein, pursuant to a
resolution of the Board of Directors (a certified copy of which is
attached hereto).
For & on behalf of
PRO-BEL LIMITED
DIRECTOR
Accepted on the terms and conditions stated herein, pursuant to a
resolution of the Board of Directors (a certified copy of which is
attached hereto).
For & on behalf of
XEBEC ELECTRONIC PRODUCTION SERVICES LIMITED
DIRECTOR
Accepted on the terms and conditions stated herein, pursuant to a
resolution of the Board of Directors (a certified copy of which is
attached hereto).
For & on behalf of
TRILOGY BROADCAST LIMITED
DIRECTOR
Accepted on the terms and conditions stated herein, pursuant to a
resolution of the Board of Directors (a certified copy of which is
attached hereto).
For & on behalf of
PRO-BEL SOFTWARE LIMITED
DIRECTOR
PRO-BEL LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Xxxxx Xxxxxxxxx Xxxxxxx Xxxxxx Xxxxxx Xxxxxx
Xxxxxx Xxxxxxx Xxxxx Xxxxx Xxxxxx Xxx
Xxxxx Xxxx Xxxxx Stanwell
There was produced to the meeting a Facility Letter dated 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office to the
Company setting out the terms and conditions upon which the Bank is
prepared to provide a Bond, Guarantees and Indemnities facility of
300,000 pounds sterling until 31st December 1997.
IT WAS RESOLVED
1. That the terms and conditions of the Bonds, Guarantees and
Indemnities facility as set out in the said Facility Letter be and they
are hereby approved and accepted.
2. That Xxxxx Xxxxxxxxx be and is hereby authorised to sign on behalf
of the Company the copy of the said Facility Letter to indicate
acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the facility upon instructions from the Company signed in
accordance with the Bank's mandate for the Company's account with the
Bank, current from time to time.
I hereby certify the above to be true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxx Xxxxxxxxx
FOR AND ON BEHALF OF
PRO-BEL LIMITED
XEBEC ELECTRONIC PRODUCTION SERVICES LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Xxxxx Xxxxxxxxx
Xxxxxx Xxxxxx
There was produced to the meeting a Facility Letter dated 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office to the
Company setting out the terms and conditions upon which the Bank is
prepared to provide a Bond, Guarantees and Indemnities facility of
300,000 pounds sterling until 31st December 1997.
IT WAS RESOLVED
1. That the terms and conditions of the Bonds, Guarantees and
Indemnities facility as set out in the said Facility Letter be and they
are hereby approved and accepted.
2. That Xxxxxx Xxxxxx be and is hereby authorised to sign on behalf
of the Company the copy of the said Facility Letter to indicate
acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the facility upon instructions from the Company signed in
accordance with the Bank's mandate for the Company's account with the
Bank, current from time to time.
I hereby certify the above to be true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxxx Xxxxxx
FOR AND ON BEHALF OF
PRO-BEL LIMITED
TRILOGY BROADCAST LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Xxxxxxx Xxxxxxx Xxxxx Stanwell
Xxxxxx Xxxxxx Xxxx Xxxxx
There was produced to the meeting a Facility Letter dated 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office to the
Company setting out the terms and conditions upon which the Bank is
prepared to provide a Bond, Guarantees and Indemnities facility of
300,000 pounds sterling until 31st December 1997.
IT WAS RESOLVED
1. That the terms and conditions of the Bonds, Guarantees and
Indemnities facility as set out in the said Facility Letter be and they
are hereby approved and accepted.
2. That Xxxxxxx Xxxxxxx be and is hereby authorised to sign on behalf
of the Company the copy of the said Facility Letter to indicate
acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the facility upon instructions from the Company signed in
accordance with the Bank's mandate for the Company's account with the
Bank, current from time to time.
I hereby certify the above to be true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxxxx Xxxxxxx
FOR AND ON BEHALF OF
PRO-BEL LIMITED
PRO-BEL SOFTWARE LIMITED
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS HELD ON
20 December 1996 at Danehill Lower Xxxxxx
Present: Xxxxxxx Xxxxxxx Xxxxx Xxxxx
Xxxxx Own Xxxxxxx Xxxxxx
Xxxxx Xxxxxxxxx Xxxx Xxxxxxx
There was produced to the meeting a Facility Letter dated 19th December
1996 from Barclays Bank PLC ("the Bank"), Oxford City Office to the
Company setting out the terms and conditions upon which the Bank is
prepared to provide a Bond, Guarantees and Indemnities facility of
300,000 pounds sterling until 31st December 1997.
IT WAS RESOLVED
1. That the terms and conditions of the Bonds, Guarantees and
Indemnities facility as set out in the said Facility Letter be and they
are hereby approved and accepted.
2. That Xxxxx Xxxxxxxxx be and is hereby authorised to sign on behalf
of the Company the copy of the said Facility Letter to indicate
acceptance of the terms and conditions.
3. That the Bank be and is hereby authorised to act in all matters
relating to the facility upon instructions from the Company signed in
accordance with the Bank's mandate for the Company's account with the
Bank, current from time to time.
I hereby certify the above to be true extract from the Minutes of a
Meeting of the Board of Directors held on the date shown above.
/s/ Xxxxx Xxxxxxxxx
FOR AND ON BEHALF OF
PRO-BEL LIMITED
BARCLAYS BANK PLC
Oxford Corporate Bank ing Centre
X.X. Xxx 000, Xxxxxx XX0 0XX
PRIVATE AND CONFIDENTIAL
The Directors Your Ref:
H/JEF/SH
Pro-Bel Limited Our Ref: 01865 442139
Triology Broadcast Limited Fax No.: 01865
442570
Pro-Bel Software Limited
Xebec Electronic Production Services Ltd. 19th December
1996
Xxxxxxxx, Xxxxx Xxxxx
Xxxxxxx XX0 0XX
Dear Sirs
FINANCIAL CRITERIA
I thought that it would be helpful to write to indicate the financial
criteria which the Bank expects Pro-bel Limited (and its subsidiary
companies) ("the Company") to observe in connection with the facilities
made available to it by the Bank under our letter dated 19th December
1996.
These criteria are not intended to create legally binding covenants on
the Company but to indicate the guidelines within which the Bank
expects the Company to operate. The contents of this letter are not
intended to affect the above facilities and each facility shall remain
repayable on demand by the Bank at any time, whether or not the Company
has failed to observe any of the financial criteria.
Financial Criteria
DEBTOR FORMULA
(BOOK DEBTS):
The Borrower shall ensure that the total amount of indebtedness (actual
and contingent) incurred by the Borrower to the Bank shall at all times
be covered at least one and a half times by the aggregate value of
unencumbered book debts receivable by the Borrower from debtors (except
its subsidiaries) which are not overdue by more than 30 days. Overseas
debtors will be covered by an appropriate N.C.M. Policy. The Borrower
shall, within 30 days of the last day of the month under review provide
to the Bank such information as the Bank may reasonably require to
enable it to monitor compliance with this formula. Notwithstanding
this provision, the facilities offered under this letter shall remain
repayable on demand by the Bank at any time, whether or not the
Borrower has complied with the above formula.
PRO-BEL INC.:
During the term of this Facility neither the Borrower nor any of its
subsidiaries will provide any further financial accommodation or make
any investments by way of shares or debentures (secured or unsecured)
or purchase fixed asset in Pro-bel Inc save for this which have already
been agreed by the Bank.
EVENT OF DEFAULT:
By its nature the facility is repayable upon demand and the Bank
retains the right, particularly in the event of a breach of the above
conditions. I would be grateful if you could please sign and return the
attached copy of this letter by way of acknowledgement.
Yours faithfully
/s/ XX Xxxxxx
XX XXXXXX
SENIOR CORPORATE MANAGER
Accepted on the terms and conditions contained herein.
For & on behalf of
PRO-BEL LIMITED
Accepted on the terms and conditions contained herein.
For & on behalf of
XEBEC ELECTRONIC PRODUCTION SERVICES LIMITED
Accepted on the terms and conditions contained herein.
For & on behalf of
TRILOGY BROADCAST LIMITED
Accepted on the terms and conditions contained herein.
For & on behalf of
PRO-BEL SOFTWARE LIMITED
Accepted on the terms and conditions contained herein.
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Roi Agneta
(the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term isused in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24- consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-
thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer,
employee, agent or fiduciary of the Company, or is or was serving at
the request of the Company as a director, officer, employee,
trustee, agent or fiduciary of another corporation of any type or
kind, domestic or foreign, partnership, joint venture, trust,
employee benefit plan or other enterprise, or by reason of anything
done or not done by Indemnitee in such capacity. Without limitation
of any indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii)(A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees and undertakes to the full extent required by
paragraph (a) of Section 725 of the BCL to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the
Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and
to what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by
judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere or its
equivalent, shall not create a presumption that Indemnitee did not
meet any particular standard of conduct or have any particular
belief or that a court has determined that indemnification is not
permitted by applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or on behalf of the Company or
any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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 papers
required and shall do everything that may be necessary to secure
such rights, including the execution of such documents necessary to
enable the Company effectively to bring suit to enforce such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdication to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Roi Agneta
Roi Agneta
Idemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxxx
Xxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liabiity in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shalll mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occured if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the Board
of Directors of the Company and any new director whose election by
the Board of Directors or nomination for election by the Company's
shareholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to
constitute a majority thereof, or (iii) the shareholders of the
Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Comany outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the survivng entry) at least 80 percent of the total voting power
repreented by the Voting Securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation,
or (iv) the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all the Company's
assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claimrelating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of
any indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnifiction is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the Indenitee
has met the applicable standard of conduct referred to in clause
(ii)(A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithhstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were comitted in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemniteewas not legally entitled and (ii)
prior to a Change in Control Indemnitee shall not be entitled to
indemnification pursuant to this Agreement in connection with any
Claim initiated by Indemnitee against the Company or any director or
officer of the Company unless the Company has jointed in or
consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to faciiate a
prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance ursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee
would not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdication thereof and in which venue is proper
sekking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been aproved by the Company, any Approved Law Firm shall
be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent coursel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2 of
the General Rules and Regulations under the Securities Exchange Act
of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim aserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by
judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere or its
equivalent, shall not create a presumption that Indemnitee did not
meet any particular standard of conduct or have any
particular belief or that a court has determined that
indemnification is not permitted by applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or on behalf of the Company or
any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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 papers
required and shall do everything that may be necessary to secure
such rights, including the execution of such documents necessary to
enable the Company effectively to bring suit to enforce such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxxxx Xxxxx
Xxxxxxx Xxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxx
Xxxxxxxxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-
thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in good
faith believes might lead to the institution of any such action,
suite or proceeding, whether civil, criminal, administrative,
investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by
judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere or its
equivalent, shall not create a presumption that Indemnitee did not
meet any particular standard of conduct or have any particular
belief or that a court has determined that indemnification is not
permitted by applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or on behalf of the Company or
any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxx Xxxxxxxxxxx
Xxxxx Xxxxxxxxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxx
XxXxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii)
rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request)
any and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to
the Indemnitee establishes that Indemnitee's acts were committed in
bad faith or were the result of active and deliberate dishonesty
and, in either case, were material to the cause of action so
adjudicated, or that Indemnitee personally gained in fact a
financial profit or other advantage to which Indemnitee was not
legally entitled and (ii) prior to a Change in Control
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement in connection with any Claim initiated by Indemnitee
against the Company or any director or officer of the Company unless
the Company has jointed in or consented to the initiation of such
Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and
to what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable
fees of the special, independent counsel referred to above and to
fully indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with suchIndemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by
judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere or its
equivalent, shall not create a presumption that Indemnitee did not
meet any particular standard of conduct or have any particular
belief or that a court has determined that indemnification is not
permitted by applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a
court of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxxx XxXxxx
Xxxxxx XxXxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxxx X.
Xxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such, person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in good
faith believes might lead to the institution of any such action,
suite or proceeding, whether civil, criminal, administrative,
investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxx X.
Xxxxxxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to
the Indemnitee establishes that Indemnitee's acts were committed in
bad faith or were the result of active and deliberate dishonesty
and, in either case, were material to the cause of action so
adjudicated, or that Indemnitee personally gained in fact a
financial profit or other advantage to which Indemnitee was not
legally entitled and (ii) prior to a Change in Control
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement in connection with any Claim initiated by Indemnitee
against the Company or any director or officer of the Company unless
the Company has jointed in or consented to the initiation of such
Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees and undertakes to the full extent required by
paragraph (a) of Section 725 of the BCL to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the
Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable
fees of the special, independent counsel referred to above and to
fully indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxx Xxxxxxx
(the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in good
faith believes might lead to the institution of any such action,
suite or proceeding, whether civil, criminal, administrative,
investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and
Indemnitee shall not be required to reimburse the Company for any
Expense Advance until a final judicial determination is made with
respect thereto (as to which all rights of appeal therefrom have
been exhausted or lapsed). If there has been no determination by
the Reviewing Party or if the Reviewing Party determines that
Indemnitee substantively would not be permitted to be indemnified in
whole or in part under applicable law, Indemnitee shall have the
right to commence litigation in any court in the State of New York
having subject matter jurisdiction thereof and in which venue is
proper seeking an initial determination by the court or challenging
any such determination by the Reviewing Party or any aspect thereof,
and the Company hereby consents to service of process and to appear
in any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless
of whether Indemnitee continues to serve as an officer or director
of the Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxx Xxxxxxx
Xxx Xxxxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxx
Xxxxxxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees and undertakes to the full extent required by
paragraph (a) of Section 725 of the BCL to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the
Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable
fees of the special, independent counsel referred to above and to
fully indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2 of
the General Rules and Regulations under the Securities Exchange Act
of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless
of whether Indemnitee continues to serve as an officer or director
of the Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxx Xxxxxxxxx
Xxxxx Xxxxxxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxx
Xxxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-
thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of
any indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2 of
the General Rules and Regulations under the Securities Exchange Act
of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxx Xxxxxx
Xxxxx Xxxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxx X.
Xxxxxxxxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-
thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in good
faith believes might lead to the institution of any such action,
suite or proceeding, whether civil, criminal, administrative,
investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer,
employee, agent or fiduciary of the Company, or is or was serving at
the request of the Company as a director, officer, employee,
trustee, agent or fiduciary of another corporation of any type or
kind, domestic or foreign, partnership, joint venture, trust,
employee benefit plan or other enterprise, or by reason of anything
done or not done by Indemnitee in such capacity. Without limitation
of any indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and
Indemnitee shall not be required to reimburse the Company for any
Expense Advance until a final judicial determination is made with
respect thereto (as to which all rights of appeal therefrom have
been exhausted or lapsed). If there has been no determination by
the Reviewing Party or if the Reviewing Party determines that
Indemnitee substantively would not be permitted to be indemnified in
whole or in part under applicable law, Indemnitee shall have the
right to commence litigation in any court in the State of New York
having subject matter jurisdiction thereof and in which venue is
proper seeking an initial determination by the court or challenging
any such determination by the Reviewing Party or any aspect thereof,
and the Company hereby consents to service of process and to appear
in any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable
fees of the special, independent counsel referred to above and to
fully indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2 of
the General Rules and Regulations under the Securities Exchange Act
of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or olicies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxx X. Xxxxxxxxxxx
Xxxx X. Xxxxxxxxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxxxx
Xxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii)(A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees and undertakes to the full extent required by
paragraph (a) of Section 725 of the BCL to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the
Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxx X.
Xxxx Xx. (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause
(i), in any capacity shall be deemed to be doing so at the request
of the Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees and undertakes to the full extent required by
paragraph (a) of Section 725 of the BCL to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the
Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable
fees of the special, independent counsel referred to above and to
fully indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal representatives.
This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the
Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxxx X. Xxxx, Xx.
Xxxxxx X. Xxxx, Xx.
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxx Xx.
Xxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-
thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees and undertakes to the full extent required by
paragraph (a) of Section 725 of the BCL to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the
Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be hereto and their respective
successors (including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of
the business and/or assets of the Company), assigns, spouses, heirs,
and personal and legal representatives. This Agreement shall
continue in effect regardless of whether Indemnitee continues to
serve as an officer or director of the Company or of any other
enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesley-Xxxxxx
Chief Executive Officer
/s/Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Indemnification Agreement: Chyron Corporation (New York)
AGREEMENT, effective as of November 19, 1996 between Chyron
Corporation, a New York corporation (the "Company"), and Xxxxxxx
Wellesley-Xxxxxx (the "Indemnitee").
WHEREAS, it is essential to the Company to remain and attract as
directors and officers the most capable persons available; and
WHEREAS, Indemnitee is a director or officer of the Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors
and officers of public companies in today's environment; and
WHEREAS, the By-Laws of the Company provide: "The Corporation shall
indemnify any person to the full extent permitted, and in the manner
provided, by the New York Business Corporation Law ["BCL"], as the
same now exists or may hereafter be amended" and
WHEREAS, this Agreement satisfies the provision of Section 721 of
the BCL: and
WHEREAS, in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company in part in reliance on
the aforesaid By-Laws and Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, and in part to provide Indemnitee with specific contractual
assurance that the protection promised by such By-Laws will be
available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such By-Laws or any change in the
composition of the Company's Board of Directors or any acquisition
transaction relating to the Company), and due to the potential
inadequacy of the Company's directors' and officers' liability
insurance coverage, the Company wishes to provide in this Agreement
for the indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company's directors' and officers' liability
insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to service the Company directly or, in its request, with
another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Approved Law Firm: shall mean any law firm (i) located in New
York City and (ii) rated "av" by Xxxxxxxxxx-Xxxxxx Law Directory.
(b) Board of Directors: shall mean the Board of Directors of the
Company.
(c) Change in Control: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than any
stockholder (and/or affiliate of such stockholder) on the date of
this Agreement or a trustee or other fiduciary holding securities
under an employee benefit plan of the Company in substantially the
same portions as their ownership of stock of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly of securities of the Company
representing 15 percent or more of the totaling voting power
represented by the Company's then outstanding Voting Securities
(such person being hereinafter referred to as an "Acquiring
Person"), or (ii) during any 24-consecutive-month period,
individuals who at the beginning of such period constitute the
Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the shareholders
of the Company approve a merger or consolidation of the Company with
any other corporation, other than a merger or consolidation which
would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities
of the surviving entry) at least 80 percent of the total voting
power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the shareholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the
Company's assets.
(d) Claim: shall mean any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether
conducted by the company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suite or proceeding, whether civil, criminal,
administrative, investigative or other.
(e) Expenses: shall include attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, being a witness in or
participate in, any Claim relating to any Indemnifiable Event,
together with interest, computed at the Company's average cost of
funds for short-term borrowings, accrued from the date of incurrence
of such expense to the date Indemnitee receives reimbursement
therefore.
(f) Indemnifiable Event: shall mean any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation of any type or kind,
domestic or foreign, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or
not done by Indemnitee in such capacity. Without limitation of any
indemnification provided hereunder, an Indemnitee serving (i)
another corporation, partnership, joint venture or trust of which 10
percent or more of the voting power or residual economic interest is
held, directly or indirectly, by the Company, or (ii) any employee
benefit plan of the Company or an entity referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
Company.
(g) Reviewing Party: shall be (i) the Board of Directors acting by
quorum consisting of directors who are not parties to the particular
Claim with respect to which Indemnitee is seeking indemnification,
or (ii) if such a quorum is not obtainable or, even if obtainable,
if a quorum of disinterested directors so directs, (A) the Board of
Directors upon the opinion in writing of independent legal counsel
that indemnification is proper in the circumstances because the
applicable standard of conduct set forth in Section 2 of this
Agreement and in Section 721 of the BCL has been met by the
Indemnitee or (B) the shareholders upon a finding that the
Indemnitee has met the applicable standard of conduct referred to in
clause (ii) (A) of this definition.
(h) Voting Securities: shall mean any securities of the Company
which vote generally in the election of the directors.
2. Basic Indemnification Arrangement.
If Indemnitee was, is or becomes at any time a party to, or witness
or other participant in, or is threatened to be made a party to, or
witness or other participant in, a Claim by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 30 days after written
demand is presented to the Company, against any and all Expenses,
judgements, fines (including excise taxes assessed on an Indemnitee
with respect to an employee benefit plan), penalties and amounts
paid in settlement (including all interest, assessments and other
charges paid or payable in connection with, or in respect of, such
Expenses, judgements, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request) any
and all Expenses to Indemnitee (an "Expense Advance").
Notwithstanding anything in this Agreement to the contrary; (i)
Indemnitee shall not be entitled to indemnification pursuant to this
Agreement if a judgement or other final adjudication adverse to the
Indemnitee establishes that Indemnitee's acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or
that Indemnitee personally gained in fact a financial profit or
other advantage to which Indemnitee was not legally entitled and
(ii) prior to a Change in Control Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection
with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has jointed in
or consented to the initiation of such Claim.
3. Payment.
Notwithstanding the provision of Section 2, the obligations of the
Company under Section 2 (which shall in no event be deemed to
preclude any right to indemnification to which Indemnitee may be
entitled under Section 723(a) of the BCL) shall be subject to the
condition that the Reviewing Party shall have authorized such
indemnification in the specific case by having determined that
Indemnitee is permitted to be indemnified under the applicable
standard of conduct set forth in Section 2 and applicable law. The
Company shall promptly call a meeting of the Board of Directors with
respect to a Claim and agrees to use its best efforts to facilitate
a prompt determination by the Receiving Party with respect to the
Claim. Indemnitee shall be afforded the opportunity to make
submissions to the Reviewing Party with respect to the Claim. The
obligation of the company to make an Expense Advance pursuant to
Section 2 shall be subject to the condition that, if, when and to
the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Section 2 and
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees and undertakes to the full extent
required by paragraph (a) of Section 725 of the BCL to reimburse the
Company) for all such amounts theretofore paid; provided, however,
that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee
should be indemnified under applicable law, any determination made
by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense
Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or
in part under applicable law, Indemnitee shall have the right to
commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper
seeking an initial determination by the court or challenging any
such determination by the Reviewing Party or any aspect thereof, and
the Company hereby consents to service of process and to appear in
any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and
Indemnitee.
4. Change in Control.
If there is a Change in Control of the Company (other than a Change
in Control which has been approved by a majority of the Board of
Directors who were directors immediately prior to such Change in
Control) then (i) all determinations by the Company pursuant to the
first sentence of Section 3 hereof and Section 723(b) of the BCL
shall be made pursuant to subparagraph (1) or (2)(A) of such Section
723(b) and (ii) with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or By-
law of the Company now or hereinafter in effect relating to Claims
for Indemnifiable Events (including, but not limited to, any option
to be rendered pursuant to subparagraph (2)(A) of Section 723(b) of
the BCL) the Company (including the Board of Directors) shall seek
legal advice from (and only from) special, independent counsel
selected by Indemnitee and approved by the Company (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (or any subsidiary of the
Company) or the Acquiring Person (or any affiliate or associate of
such Acquiring Person) within the last five years (other than in
connection with such matters) or indemnitee. Unless Indemnitee has
theretofore selected counsel pursuant to this Section 4 and such
counsel has been approved by the Company, any Approved Law Firm
shall be deemed to satisfy the requirements set forth above. Such
counsel, among otherthings, shall render its written opinion to the
Company, the Board of Directors and Indemnitee as to whether and to
what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees
of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including
attorneys' fees), claims, liabilities and damages arising our of or
relating to this Agreement or its engagement pursuant hereto. As
used in this Section 4, the terms "affiliate" and "associate" shall
have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended and in effect on the date of this Agreement.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses
(including attorneys' fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any claim asserted or action brought by Indemnitee for (i)
indemnification or advance payment of Expenses by the Company under
this Agreement or any other agreement or By-law of the Company now
or hereafter in effect relating to Claims for Indemnifiable Events
and/or (ii) recovery under any directors' and officers' liability
insurance policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such
indemnification, advance expenses payment or insurance recovery, as
the case may be.
6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the
Expenses, judgements, fines, penalties and amounts paid in
settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereto to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in
defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be
indemnified, to the extent permitted by law, against all Expenses
incurred in connection with such Indemnifiable Event. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall, to the extent permitted by law, be on the
Company to establish that Indemnitee is not so entitled.
7. Presumption.
For purposes of this Agreement, the termination of any claim,
action, suite or proceeding, whether civil or criminal, by judgment,
order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent,
shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by
applicable law.
8. Nonexclusivity, Etc.
The rights of the Indemnitee hereunder shall be in addition to any
other rights Indemnitee may have under the By-laws of the Company,
the BCL or otherwise. To the extent that a change in the BCL
(whether by statue or judicial decision) permits greater
indemnification by agreement than would be afforded currently under
the By-laws of the Company and this Agreement, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits so afforded by such change.
9. Liability Insurance
To the extent the Company maintains an insurance policy or policies
providing directors' and officers' liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage available for
any director or officer of the Company.
10. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company
or any affiliate of the Company against Indemnitee, Indemnitee's
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 or its
affiliate 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.
11. Amendments, Etc. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both
of 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.
12. 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
papers required and shall do everything that may be necessary to
secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce
such rights.
13. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any
claim made against Indemnitee to the extent Indemnitee has otherwise
actually received payment (under any insurance policy, By-law or
otherwise) of the amounts otherwise Indemnifiable hereunder.
14. Specific Performance. The parties recognize that if any
provision of this Agreement is violated by the Company, Indemnitee
may be without an adequate remedy at law. Accordingly, in the event
of any such violation, the Indemnitee shall be entitled, if
Indemnitee so elects, to institute proceedings, either at law or in
equity, to obtain damages, to enforce specific performance, to
enjoin such violation, or to obtain any relief or any
combination of the foregoing as Indemnitee may elect to pursue.
15. Binding Effect, Etc. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the parties hereto
and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company),
assigns, spouses, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless
of whether Indemnitee continues to serve as an officer or director
of the Company or of any other enterprise at the Company's request.
16. Severability. The provisions of this Agreement shall be
severable if any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court
of competent jurisdiction to be invalid, void or other wise
unenforceable, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
17. Governing Law. This Agreement shall be governed by, and be
construed and enforced in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in such
state without giving effect to the principles of conflicts of laws.
Executed this 19th day of November, 1996.
CHYRON CORPORATION
/s/Xxxxxx XxXxxx
Xxxxxx XxXxxx
Secretary
/s/Xxxxxxx Wellesley-Xxxxxx
Xxxxxxx Wellesely-Xxxxxx
CERTIFICATE OF AMENDMENT
OF THE CERTIFICATE OF INCORPORATION
OF CHYRON CORPORATION
UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW
THE UNDERSIGNED, being the President and the Secretary of Chyron
Corporation ("the Corporation") do hereby certify as follows:
1. The name of the Corporation is Chyron Corporation. The name under
which the Corporation was formed is The Computer Exchange, Inc.
2. The Certificate of Incorporation of the Corporation was filed by the
Department of State on April 8, 1966.
3. (a) The Certificate of Incorporation is amended to effect a reverse
stock split (the "Slit") of shares of common stock of the Corporation,
par value $.01 per share, (the "Common Stock") on the basis of issuing
one (1) share of Common Stock in exchange for each three (3) shares of
Common Stock.
(b) To effect the foregoing, Paragraph FOURTH (a) of the Certificate
of Incorporation is hereby amended to read as follows:
"(a) The aggregate number of shares which the Corporation
shall have authority to issue is 151,000,000 of which 1,000,000
shares shall be Preferred Stock issuable in series, of par value
of $1.00 per share, and 150,000,000 shares shall be Common
Stock of the par value of $.01 per share.
(b) Except as hereinafter set forth and subject to
limitations prescribed by law, including the provisions of
Section 1123(a)(6) of the United States Bankruptcy Code,
11 U.S.C. Section 101 et seq. the Board of Directors of the
Corporation is authorized to provide for the issuance of shares
of Preferred Stock in one or more series, to establish the
number of shares in each series, to fix the designation,
relative rights, preferences and limitations of the shares of
such series and to cause to be filed in the Department of
State of New York, such certificates as may be required in
connection therewith by the Business Corporation Law of
New York.
4. Prior to the Split, there are 97,147,241 shares of Common Stock
issued and 52,852,759 of unissued shares of Common Stock. Pursuant to
the Split, each three (3) previously outstanding issued shares of
Common Stock, par value $.01 per share, of the Corporation shall
thereby and thereupon be reclassified into one (1) validly issued,
fully paid, and nonassessable share of Common Stock, par value $.01 per
share, of the Corporation. In lieu of receiving fractional shares, a
shareholder shall receive cash. As result of the Split, there will be
33,382,413 shares of Common Stock issued and 116,617,587 unissued
shares of Common Stock.
5. This Amendment to the Certificate of Incorporation of the
Corporation was authorized by vote of the Board of Directors followed
by the affirmative vote of the holders of a majority of all outstanding
shares entitled to vote thereon at a special meeting of the
shareholders of the Corporation duly called and held on the 24th day
of January, 1997, a quorum being present.
IN WITNESS WHEREOF, we have signed this Certificate on the 7th day of
February, 1997 and we affirm the statements contained therein as true
under penalties of perjury.
/s/ Xxxxx Xxxxxx /s/ Xxxxxx X. XxXxxx
Xxxxx Xxxxxx Xxxxxx X. XxXxxx
President Secretary
