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EXHIBIT (c) (2)
INDEMNIFICATION AGREEMENT
This Agreement is made as of the day of November, 1996, by and
between Milgray Electronics, Inc., a New York corporation (the "Corporation")
and (the "Indemnitee"), a director and/or officer of
the Corporation.
WHEREAS, Indemnitee has served and is serving as a director and/or
office of the Corporation,
NOW, THEREFORE, in consideration of Indemnitee's service as a director
and/or officer, and for other good and valuable consideration, the parties agree
as follows:
1. As used in this Agreement:
a. The term "Proceeding" shall include any threatened, pending
or completed action, suit or proceeding, whether brought by or in the right of
the Corporation and whether of a civil, criminal, administrative or
investigative nature.
b. The term "Expenses" shall include, but is not limited to,
expenses of investigations, judicial or administrative proceedings or appeals,
damages, judgments, fines, amounts paid in settlement by or on behalf of
Indemnitee, attorneys' fees and disbursements and any expenses of establishing a
right to indemnification under this Agreement.
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c. The terms "Director" and "Officer" shall include
Indemnitee's service at the request of the Corporation as a director, officer,
employee or agent of another corporation or other entity, as well as a Director
and/or Officer of the Corporation.
2. Subject only to the limitations set forth in Section 3, the
Corporation will pay on behalf of the Indemnitee all Expenses actually and
reasonably incurred by Indemnitee because of any claim or claims made against
him in a Proceeding by reason of the fact that he is or was a Director and/or
Officer, including, without limitation, any claim or claims arising from and
relating to the Agreement and Plan of Merger among Xxxx Industries, Inc., ME
Acquisition, Inc. and Milgray Electronics, Inc. and transactions contemplated by
said Agreement and Plan of Merger.
3. The Corporation shall not be obligated under this Agreement to
make any payment of Expenses to Indemnitee (a) which payment is prohibited by
applicable law from payment as indemnity; (b) for which payment is actually made
to Indemnitee under an insurance policy, except in respect of any excess beyond
the amount of payment under such insurance; (c) for which payment the Indemnitee
is indemnified by the Corporation otherwise than pursuant to this Agreement and
payment is actually made to the
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Indemnitee, except in respect of any excess beyond the amount of payment under
such Indemnification; (d) resulting from a claim under Section 16(b) or 16(c) of
the Securities Exchange Act of 1934 decided in a Proceeding adversely to the
Indemnitee; or (e) resulting from a claim decided in a proceeding adversely to
the Indemnitee based upon or attributable to the Indemnitee gaining in fact any
personal profit from the Corporation to which he was not legally entitled.
4. Expenses incurred by Indemnitee in defending a claim against him
in a Proceeding shall be paid by the Corporation as incurred and in advance of
the final disposition of such Proceeding except where such payment would be
contrary to applicable law. Indemnitee hereby agrees to repay any such amounts
advanced if it shall be decided in a Proceeding that Indemnitee is not entitled
to be indemnified by the Corporation pursuant to this Agreement or otherwise.
The phrase "decided in a Proceeding" as used herein shall mean a decision by a
court, arbitrator, hearing officer or other judicial agent having requisite
legal authority to make such a decision, which decision has become final or from
which no appeal or other review proceeding is permissible.
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5. In the event of payment under this Agreement, Corporation shall
be subrogated to the extent of such payment to all of the rights of recovery of
the 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 Corporation effectively to bring suit to enforce
such rights. Notwithstanding the foregoing, if any of the provisions hereof
would impair or jeopardize Indemnitee's coverage under the Corporation's
Directors' and Officers' Liability Policy, such provisions shall be ineffective
and shall be deemed deleted from this Agreement.
6. The Indemnitee, as a condition precedent to his right to be
indemnified under this Agreement, shall give to Corporation notice in writing as
soon as practicable of any claim made against him for which indemnity will or
could be sought under this Agreement. Notice to Corporation shall be given at
its principal office and shall be directed to the President (or such other
address as Corporation shall designate in writing to the Indemnitee); notice
shall be deemed received if sent by prepaid mail properly addressed, the date of
such notice being the date postmarked. In addition, the Indemnitee shall give
Corporation
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such information and cooperation as it may reasonably require.
7. If this Agreement or any portion thereof shall be invalidated on
any grounds by any court of competent jurisdiction, the Corporation shall
nevertheless indemnify the Indemnitee to the full extent permitted by any
applicable portion of this Agreement that shall not have been invalidated or by
any other applicable law.
8. Nothing herein shall be deemed to diminish or otherwise restrict
Indemnitee's right to indemnification under any provision of the Articles of
Incorporation or By-laws of the Corporation or under New York law or under any
other indemnification agreement between the Indemnitee and the Corporation.
9. This Agreement shall be governed by and construed in accordance
with New York law.
10. This Agreement may be executed in any number of counterparts, each
of which shall constitute the original.
11. This Agreement shall be binding upon the Corporation and its
successors and assigns.
12. The Indemnification under this Agreement shall continue as to
Indemnitee even though he shall have ceased to be a Director and/or Officer and
shall inure to the benefit of the
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heirs and personal representatives of the Indemnitee.
13. The Indemnification under this Agreement shall cover Indemnitee's
service as a Director and/or Officer prior to or after the date of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
MILGRAY ELECTRONICS, INC.
By:
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Name and Title
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(Indemnitee)
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