INDEMNIFICATION AGREEMENT
This
Indemnification Agreement (this “Agreement”),
effective as of January 13, 2011 (the “Effective Date”), by
and between ECOtality, Inc. (the “Company”) and
[ ] (the “Indemnitee”).
RECITALS
A. It
is reasonable, prudent and in the best interests of the Company and its
stockholders for the Company contractually to obligate itself to indemnify
persons serving as officers and/or directors of the Company to the fullest
extent permitted by applicable law so that they will serve or continue to serve
as officers and/or directors of the Company free from undue concern that they
will not be so indemnified.
B. The
Indemnitee is currently serving or has agreed to serve as an officer and/or on
the board of directors of the Company (the “Board of Directors”)
and in such capacity has rendered or will render valuable services to the
Company.
C. Section
78.7502 of the Nevada Revised Statutes empowers Nevada corporations to indemnify
their officers and directors and further states that the indemnification
provided by Section 78.7502 shall not be deemed exclusive of any other rights to
which those seeking indemnification may be entitled under the articles of
incorporation or any bylaw, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in an official capacity and as to
action in another capacity while holding such office; thus, Section 78.7502 does
not by itself limit the extent to which the Company may indemnify persons
serving as its officers and directors.
D. To
the extent permitted by law, this Agreement is a supplement to and in
furtherance of the articles of incorporation of the Company and provisions of
the bylaws or resolutions adopted pursuant thereto, and shall not be deemed a
substitute therefor, nor to diminish or abrogate any rights of the Indemnitee
thereunder.
NOW, THEREFORE, in
consideration of the premises and the covenants contained herein, the Company
and the Indemnitee do hereby covenant and agree as follows:
Section
1. Definitions.
As used
in the foregoing Recitals and in this Agreement, the following terms will have
those meanings set forth in this Section 1 unless the context dictates
otherwise.
(a) “Affiliate” and “Associate” shall have
the respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations promulgated under the Securities Exchange Act of 1934 (the
“Exchange
Act”), and the term “person” as used therein shall mean any person or
entity.
(b) a
“Change of
Control” shall mean the happening after the Effective Date of any of the
following events:
(i) if
any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act, or any successor provisions to either of the preceding),
including any individual, entity or group agreeing to act together for the
purpose of acquiring, holding, voting or disposing of securities (as defined in
Rule l3d-5(b)(1) under the Exchange Act), becomes the “beneficial owner” (as
such term is defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of 50% or more of either (A) the then outstanding shares of common
stock of the Company (the “Outstanding Company Common
Stock”), or (B) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting
Power”); provided, however, that for
purposes of this subsection (i) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation
controlled by the Company shall not constitute a Change of Control;
or
(ii) individuals
who, as of the date of this Agreement, constitute the Board of Directors (the
“Incumbent
Board”) cease for any reason not to constitute at least a majority of the
Board of Directors; provided, however, that any
individual becoming a director subsequent to the date hereof whose election, or
nomination for election by the Company’s stockholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board of Directors; and provided, further, that any
change in the composition of the Board of Directors instituted or approved by
the holder, either directly or indirectly, of a majority of the Outstanding
Company Voting Power on the date hereof shall not constitute a Change of
Control; or
(iii) consummation
of a reorganization, merger or consolidation or sale or other disposition of all
or substantially all of the assets of the Company (a “Business
Combination”), in each case, unless, following such Business Combination
all or substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Power immediately prior to such Business Combination, or their
respective Affiliates, beneficially own, directly or indirectly, more than 50%
of, respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or more
subsidiaries); or
(iv) approval
by the stockholders of the Company of a liquidation or dissolution of the
Company.
(c) “Corporate Status”
describes the status of a person who is or was an officer or director of the
Company or is or was serving in such capacity or as an officer, employee or
agent, at the request of the Company, of another corporation, partnership, joint
venture, trust or other enterprise.
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(d) “Disinterested
Director” means a director of the Company who is not and was not a party
to, or otherwise involved in, the Proceeding for which indemnification is sought
by the Indemnitee.
(e) “Expenses” shall
include, without limitation, all attorneys’ fees, retainers, court costs,
transcript costs, fees of experts (including, without limitation, auditors’ and
accountants’), witness fees, travel expenses, duplicating costs and printing and
binding costs, telephone charges, postage, delivery service fees, and all other
disbursements or expenses actually and reasonably incurred in connection with
prosecuting, defending, preparing to prosecute or defend, investigating, or
being or preparing to be a witness in a Proceeding. Should any
payments by the Company to or for the account of the Indemnitee under this
Agreement be determined to be subject to any federal, state or local income or
excise tax, Expenses shall also include such amounts as are necessary to place
the Indemnitee in the same after-tax position after giving effect to all
applicable taxes, the Indemnitee would have been in had no such tax been
determined to apply to those payments.
(f) “Independent Counsel”
means a law firm, or a member of a law firm, that is experienced in matters of
corporation law and neither presently is, nor in the past five (5) years has
been, retained to represent: (i) the Company or the Indemnitee in any matter
material to either such party, or (ii) any other party to the Proceeding giving
rise to a claim for indemnification hereunder. Notwithstanding the foregoing,
the term “Independent
Counsel” shall not include any person who, under the applicable standards
of professional conduct then prevailing, would have a conflict of interest in
representing either the Company or the Indemnitee in an action to determine the
Indemnitee’s rights under this Agreement.
(g) “Proceeding” includes
any action, suit, arbitration, alternate dispute resolution mechanism,
investigation, administrative hearing or any other proceeding whether civil,
criminal, administrative or investigative.
Section
2. Indemnification
(General).
The
Company shall indemnify and advance Expenses to the Indemnitee as provided in
this Agreement and to the fullest extent permitted by applicable law in effect
on the date hereof and to such greater extent as applicable law may thereafter
from time to time permit. The rights of the Indemnitee provided under
the preceding sentence shall include, but shall not be limited to, the rights
set forth in other sections of this Agreement.
Section
3. Proceedings
Other Than Proceeding by or in the Right of the Company.
The
Indemnitee shall be entitled to the right of indemnification provided in this
Section 3 if, by reason of the associated Corporate Status from and after the
Effective Date, the Indemnitee is, or is threatened to be made, a party to or
participant in any threatened, pending or completed Proceeding, other than a
Proceeding by or in the right of the Company. Under this Section 3,
the Company will indemnify the Indemnitee to the fullest extent permitted by
applicable law against Expenses, judgments, penalties, fines and amounts paid in
anticipation of settlement or in settlement (as and to the extent permitted
hereunder) actually incurred by or on behalf of the Indemnitee in connection
with such Proceeding or any claim, issue or matter therein, if the Indemnitee
acted in good faith and in a manner the Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company and, with respect to any
criminal Proceeding, had no reasonable cause to believe such conduct was
unlawful.
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Section
4. Proceedings
by or in the Right of the Company.
The
Indemnitee shall be entitled to the rights of indemnification provided in this
Section 4 if, by reason of the associated Corporate Status from and after the
Effective Date, the Indemnitee is, or is threatened to be made, party to or
participant in any threatened, pending or completed Proceeding brought by or in
the right of the Company to procure a judgment in its favor. Pursuant
to this Section 4, the Indemnitee shall be indemnified against Expenses actually
incurred by or on behalf of the Indemnitee in anticipation of or in connection
with such Proceeding if the Indemnitee acted in good faith and in a manner the
Indemnitee reasonably believed to be in or not opposed to the best interests of
the Company. Notwithstanding the foregoing, no indemnification
against such Expenses shall be made in respect of any claim, issue or matter in
such Proceeding as to which the Indemnitee shall have been adjudged to be liable
to the Company, or if applicable law prohibits such indemnification; provided, however, that if
applicable law so permits, indemnification against Expenses shall nevertheless
be made by the Company in such event if and to the extent that the court in
which such Proceeding shall have been brought or is pending, shall determine
upon application that, despite the adjudication of liability, but in view of all
the circumstances of the case, the Indemnitee is fairly and reasonably entitled
to indemnity for such expenses which such court shall deem proper.
Section
5. Indemnification
for Expenses of a Party Who is Wholly or Partly Successful.
(a) To
the extent that the Indemnitee is, by reason of the associated Corporate Status
from and after the Effective Date, a party to and is successful on the merits in
any Proceeding, the Company will indemnify the Indemnitee against all Expenses
incurred by or on behalf of the Indemnitee in connection
therewith. If the Indemnitee is not wholly successful in defense of
any Proceeding but is successful on the merits, as to one or more but less than
all claims, issues or matters in such Proceeding, the Company shall indemnify
the Indemnitee against all Expenses incurred by or on behalf of the Indemnitee
in connection with each such successfully resolved claim, issue or
matter. For purposes of this Section 5(a) and without limitation, the
termination of any claim, issue or matter in such a Proceeding by dismissal,
with or without prejudice, shall be deemed to be a successful result as to such
claim, issue or matter. The provisions of this Section 5(a) are
subject to Section 5(b) hereof.
(b) In
no event shall the Indemnitee be entitled to indemnification under Section 5(a)
hereof with respect to a claim, issue or matter to the extent:
(i) applicable
law prohibits such indemnification, or
(ii) an
admission is made by the Indemnitee in writing to the Company or in such
Proceeding or a determination is made in such Proceeding that the standard of
conduct required for Indemnification under this Agreement has not been met with
respect to such claim, issue or matter.
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Section
6. Indemnification
for Expenses as a Witness.
Notwithstanding
any provisions herein to the contrary, to the extent that the Indemnitee is, by
reason of the associated Corporate Status from and after the Effective Date, a
witness in any Proceeding, the Indemnitee shall be indemnified against all
Expenses incurred by or on behalf of the Indemnitee in connection
therewith.
Section
7. Advancement
of Expenses.
(a) Subject
to Section 8, the Company shall advance all Expenses incurred by or on behalf of
the Indemnitee in connection with any Proceeding within twenty (20) days after
the receipt by the Company of a statement or statements from the Indemnitee
requesting such advance or advances from time to time, whether prior to or after
the final disposition of such Proceeding. Such statement or
statements shall reasonably evidence the Expenses incurred by or on behalf of
the Indemnitee and shall include or be preceded or accompanied by an undertaking
by or on behalf of the Indemnitee to repay any Expenses advanced within twenty
(20) days if it shall ultimately be determined that the Indemnitee is not
entitled to be indemnified against such Expenses. The Company shall
accept any such undertaking without reference to the financial ability of the
Indemnitee to make repayment and without regard to the prospect of whether the
Indemnitee may ultimately be found to be entitled to indemnification under the
provisions of this Agreement.
(b) The
Company’s obligation to advance Expenses pursuant to Section 7(a) hereof shall
be subject to the condition that, if, when and to the extent that if it is
ultimately determined that the Indemnitee would not be permitted to be so
indemnified under applicable law, the Company shall be entitled to be reimbursed
by the Indemnitee (who agrees to reimburse the Company) for all such amounts
theretofore paid. Any required reimbursement of Expenses by the
Indemnitee shall be made by the Indemnitee to the Company within ten (10) days
following the determination that the Indemnitee would not be entitled to
indemnification.
Section
8. Procedure
for Determination of Entitlement to Indemnification.
(a) Whenever
Indemnitee believes that he or she is entitled to indemnification or advancement
of Expenses pursuant to this Agreement, Indemnitee shall submit a written
request for indemnification (the “Indemnification
Request”) to the Company to the attention of the Chief Executive Officer
with a copy to the Secretary. This request shall include
documentation or information which is necessary for the determination of
entitlement to indemnification and which is reasonably available to
Indemnitee. Determination of Indemnitee’s entitlement to
indemnification shall be made no later than forty-five (45) days after receipt
of the Indemnification Request. The Chief Executive Officer or the
Secretary shall, promptly upon receipt of Indemnitee’s Indemnification Request,
advise the Board of Directors in writing that Indemnitee has made such request
for indemnification.
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(b) Following
receipt by the Company of an Indemnification Request, an initial determination,
if required by applicable law, with respect to Indemnitee’s entitlement thereto
shall be made in the specific case by one of the following four methods, which
shall be at the election of the Board of Directors: (1) by a majority vote of
the stockholders of the Company; (2) by a majority vote of a quorum of the Board
of Directors consisting only of Disinterested Directors; (3) if a quorum of the
Board of Directors consisting only of Disinterested Directors so orders, by
Independent Counsel in a written opinion; or (4) if a quorum of the Board of
Directors consisting only of Disinterested Directors cannot be obtained, by
Independent Counsel in a written opinion. Notwithstanding the
foregoing, following a Change of Control, the determination shall be made by
Independent Counsel pursuant to clause (4) above. The Company agrees
to bear any and all Expenses reasonably incurred by Indemnitee or the Company in
connection with the determination of Indemnitee’s entitlement to indemnification
by any of the above methods.
Section
9. Presumptions
and Effect of Certain Proceedings.
(a) In
making a determination with respect to whether the Indemnitee is entitled to
indemnification hereunder, the Company shall presume that the Indemnitee is
entitled to indemnification under this Agreement if the Indemnitee has submitted
a request for indemnification in accordance with Section 8 hereof, and anyone
seeking to overcome this presumption shall have the burden of proof and the
burden of persuasion, by clear and convincing evidence.
(b) Subject
to the terms of Section 15.4 hereof, the termination of any Proceeding or of any
claim, issue or matter therein, by judgment, order, settlement or conviction, or
upon a plea of nolo
contendere or its equivalent, shall not (except as otherwise expressly
provided in this Agreement) of itself adversely affect the right of the
Indemnitee to indemnification or create a presumption that the Indemnitee did
not act in good faith and in a manner which the Indemnitee reasonably believed
to be in or not opposed to the best interests of the Company and, with respect
to any criminal Proceeding, had reasonable cause to believe that his or her
conduct was unlawful.
(c) For
purposes of any determination of good faith, the Indemnitee shall be deemed to
have acted in good faith, if the Indemnitee’s action is based on:
(i) the
records or books of account of the Company, including financial
statements;
(ii) information
supplied to the Indemnitee by the officers of the Company in the course of their
duties;
(iii) the
advice of legal or financial counsel for the Company or the Board of Directors
(or any committee thereof); or
(iv) information
or records given or reports made by an independent certified public accountant
or by an appraiser or other expert selected by the Company or the Board of
Directors (or any committee thereof).
The
provisions of this Section 9(c) shall not be deemed to be exclusive or to limit
in any way the other circumstances in which the Indemnitee may be deemed or
found to have met the applicable standard of conduct set forth in this
Agreement. In addition, the knowledge and/or actions, or failure to
act, of any other director, trustee, partner, managing member, fiduciary,
officer, agent or employee of the Company shall not be imputed to the Indemnitee
for purposes of determining the right to indemnification under this
Agreement.
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Section
10. Remedies
of the Indemnitee.
(a) In
the event:
(i) a
determination is made pursuant to Section 8 hereof that the Indemnitee is not
entitled to indemnification under this Agreement;
(ii) advancement
of Expenses is not timely made pursuant to Section 7 hereof;
(iii) the
determination of entitlement to indemnification has not been made by the Company
and delivered to the Indemnitee within sixty (60) days after receipt by the
Company of the Indemnification Request;
(iv) payment
of indemnification is not made pursuant hereto within twenty (20) days after
receipt by the Company of an Indemnification Request; or
(v) payment
of indemnification is not made within ten (10) business days after a
determination has been made that the Indemnitee is entitled to indemnification
or such determination is deemed to have been made pursuant to this
Agreement;
the
Indemnitee may seek an award in arbitration to be conducted by a single
arbitrator pursuant to the rules of the American Arbitration
Association. The Indemnitee shall commence such proceeding seeking an
adjudication or an award in arbitration within ninety (90) days following the
date on which the Indemnitee first has the right to commence such proceeding
pursuant to this Section 10(a); provided, however, that the
foregoing clause shall not apply in respect of a proceeding brought by the
Indemnitee to enforce the Indemnitee’s rights hereunder.
(b) In
the event that a determination is made that the Indemnitee is not entitled to
indemnification hereunder, any judicial proceeding or arbitration commenced
pursuant to this Section 10 shall be conducted in all respects as a de novo
trial, or arbitration, on the merits and the Indemnitee shall not be prejudiced
by reason of that adverse determination. In any judicial proceeding
or arbitration commenced pursuant to this Section 10, the Company shall have the
burden of proving that the Indemnitee is not entitled to indemnification or
advancement of Expenses, as the case may be, and the Company shall be precluded
from referring to or offering into evidence a determination made pursuant to
Section 8 hereof that is adverse to the Indemnitee’s right to indemnification or
advancement of Expenses, as the case may be. If the Indemnitee
commences a judicial proceeding or arbitration pursuant to this Section 10, the
Indemnitee shall not be required to reimburse the Company for any advances
hereunder until a final unfavorable determination is made with respect to the
Indemnitee’s entitlement to indemnification (as to which rights of appeal have
been exhausted or lapsed).
(c) If
a determination is made or deemed to have been made hereunder that the
Indemnitee is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration commenced pursuant to
this Section 10, absent
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(i) a
misstatement by the Indemnitee of a material fact, or an omission by the
Indemnitee of a material fact necessary to make the Indemnitee’s statement not
materially misleading, in connection with the request for indemnification,
or
(ii) a
prohibition of such indemnification under applicable law.
(d) The
Company shall be precluded from asserting in any judicial proceeding or
arbitration commenced pursuant to this Section 10 that the procedures and
presumptions of this Agreement are not valid, binding and enforceable and shall
stipulate in any such court or before any such arbitrator that the Company is
bound by all the provisions of this Agreement.
(e) In
the event that the Indemnitee, pursuant to this Section 10, seeks a judicial
adjudication or an award in arbitration to enforce the Indemnitee’s rights
under, or to recover damages for breach of, this Agreement, the Indemnitee shall
be entitled to recover from the Company, and shall be indemnified by the Company
against, any and all Expenses actually incurred by the Indemnitee in such
judicial adjudication or arbitration; provided, however, if the court
or arbitrator confirms the decision that the Indemnitee is not entitled to
recover from the Company, then the Expenses incurred by the Indemnitee in the
judicial adjudication or arbitration shall be borne by the
Indemnitee.
(f) Any
judicial adjudication or arbitration determined under this Section 10 shall be
final and binding on the parties.
Section
11. Non-Disclosure
of Payments.
Except as
expressly required by the securities laws of the United States of America,
neither party shall disclose any payments under this Agreement unless prior
approval of the other party is obtained. If any payment information
must be disclosed, the Company shall afford the Indemnitee an opportunity to
review all such disclosures and, if requested, to explain in such statement any
mitigating circumstances regarding the events to be reported.
Section
12. Duration
of Agreement.
This
Agreement shall continue for so long as the Indemnitee may have any liability or
potential liability by virtue of serving as a director of the Company,
including, without limitation, the final termination of all pending Proceedings
in respect of which the Indemnitee is granted rights of indemnification or
advancement of Expenses hereunder and of any Proceeding commenced by the
Indemnitee pursuant to Section 10 hereof relating thereto. This
Agreement shall be binding upon and 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 or assets of the Company), assigns, spouses,
heirs, executors and personal and legal representatives.
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Section
13. Maintenance
of Insurance.
The
Company shall obtain and maintain in effect during the entire period for which
the Company is obligated to indemnify the Indemnitee under this Agreement, one
or more policies of insurance with reputable insurance companies to provide the
directors and officers of the Company with coverage for losses from wrongful
acts and omissions and to ensure the Company’s performance of its
indemnification obligations under this Agreement. The 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 such director or
officer under such policy or policies, with such coverage primary to any other
coverage the Indemnitee may have for the Company’s obligations to the Indemnitee
under this Agreement. In all such insurance policies, the Indemnitee
shall be named as an additional insured in such a manner as to provide the
Indemnitee with the same rights and benefits as are accorded to the most
favorably insured of the Company’s directors and officers. At the
time of the receipt of a notice of a claim pursuant to the terms hereof, the
Company shall give prompt notice of the commencement of such proceeding to the
insurers in accordance with the procedures set forth in the respective
policies. The Company shall thereafter take all commercially
reasonable actions to cause such insurers to pay, on behalf of Indemnitee, all
amounts payable as a result of such proceeding in accordance with the terms of
such policies.
Section
14. Limitations
on Indemnification.
No
indemnification pursuant to Sections 2, 3, 4, 5 or 6 shall be paid by the
Company nor shall Expenses be advanced pursuant to Section 7:
(a) To
the extent that Indemnitee is reimbursed pursuant to such insurance as may exist
for Indemnitee’s benefit. Notwithstanding the availability of such
insurance, Indemnitee also may claim indemnification from the Company pursuant
to this Agreement by assigning to the Company any claims under such insurance to
the extent Indemnitee is paid by the Company. To the extent that the
Indemnitee receives payments as indemnification and/or reimbursement of Expenses
for a particular matter both pursuant to insurance policies held by the Company
and by the Company pursuant to this Agreement, which payments and reimbursements
are, in the aggregate, in excess of the amounts actually incurred or Expenses
actually paid by the Indemnitee in respect of such matter, then the Indemnitee
shall reimburse the Company for any sums he or she receives as indemnification
pursuant to such insurance policies in an amount equal to the lesser of (i) such
excess, or (ii) the aggregate amount actually paid to the Indemnitee as
indemnification and reimbursement of Expenses in respect of such matter;
or
(b) On
account and to the extent of any wholly or partially successful claim against
Indemnitee for an accounting of profits made from the purchase or sale by
Indemnitee of securities of the Company pursuant to the provisions of Section
16(b) or the Securities Exchange Act of 1934, as amended, and amendments thereto
or similar provisions of any federal, state or local statutory law.
Section
15. Miscellaneous.
Section
15.1 Non-Exclusivity; Survival of
Rights
(a) The
rights conferred on the Indemnitee by this Agreement shall not be deemed
exclusive of any other rights to which the Indemnitee may at any time be
entitled under applicable law, the articles of incorporation, the bylaws, any
agreement, a vote of stockholders or resolutions of directors, or
otherwise. No amendment, alteration or repeal of this Agreement or
any provision hereof shall be effective as to the Indemnitee with respect to any
action taken or omitted by the Indemnitee in the Indemnitee’s associated
Corporate Status prior to such amendment, alteration or repeal.
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(b) In
the event of any payment under this Agreement, the Company 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 take all action necessary
to secure such rights, including execution of such documents as are necessary to
enable the Company to bring suit to enforce such rights.
Section
15.2 [Intentionally Left
Blank].
Section
15.3 Severability. If
any provision or provisions of this Agreement shall be held to be invalid,
illegal or unenforceable for any reason whatsoever:
(a) the
validity, legality and enforceability of the remaining provisions of this
Agreement (including, without limitation, each portion of any section of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable) shall not in any way be affected or impaired
thereby;
(b) such
provision or provisions will be deemed reformed to the extent necessary to
conform to applicable law and to give maximum effect to the intent of the
parties hereto; and
(c) to
the fullest extent possible, the provisions of this Agreement (including,
without limitation, each portion of any section of this Agreement containing any
such provision held to be invalid, illegal or unenforceable, that is not itself
invalid, illegal or enforceable) shall be construed so as to give effect to the
intent manifested by the provision held invalid, illegal or
unenforceable.
Section
15.4 Exception to Right of
Indemnification or Advancement of Expenses. Notwithstanding
any other provision of this Agreement, the Indemnitee shall not be entitled to
indemnification or advancement of Expenses under this Agreement with respect to
any Proceeding, or any claim therein, brought or made by the Indemnitee against
the Company except for any claim or Proceeding in respect of this Agreement
and/or the Indemnitee’s rights hereunder.
Section
15.5 Settlement of
Claims. The
Company shall not be liable to indemnify the Indemnitee under this Agreement for
any amounts paid in settlement of any Proceeding effected without the Company’s
written consent, unless the Company’s failure to consent to any such proposed
settlement is unreasonable. The Company shall furthermore not be
liable to indemnify the Indemnitee under this Agreement with regard to any
judicial award if the Company was not given a reasonable and timely opportunity,
at its expense, to participate in the defense of such action. The
Company shall not settle any Proceeding in any manner that would impose any
penalty or limitation on Indemnitee without Indemnitee’s written
consent.
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Section
15.6 Counterparts. This
Agreement may be executed in one or more counterparts (whether by original,
photocopy or facsimile signature), each of which shall for all purposes be
deemed to be an original but all of which together shall constitute one and the
same agreement. Only one such counterpart executed by the party
against whom enforceability is sought needs to be produced to evidence the
existence of this Agreement.
Section
15.7 Headings. The
headings of the sections or paragraphs of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part of this Agreement
or to affect the construction thereof.
Section
15.8 Modification and
Waiver. 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.
Section
15.9 Notice by Indemnitee and
Defense of Claims. The
Indemnitee agrees promptly to notify the Company in writing upon being served
with any summons, citation, subpoena, complaint, indictment, information or
other document relating to any Proceeding or matter which may be subject to
indemnification or advancement of Expenses covered hereunder, unless prohibited
by applicable law. With respect to any Proceeding in which the
Company is obligated to advance the Expenses of Indemnitee:
(a) In
the event that one or more officers or directors of the Company is a party to
such Proceeding in addition to Indemnitee (each, an “Other Indemnitee”
and, together with Indemnitee, the “Indemnitee Group”)
and the Company is also contractually obligated to advance the expenses of such
Other Indemnitee(s), the Company will only be obligated to advance the Expenses
of one law firm for the Indemnitee Group (as well as such additional specialist
counsel and local counsel as may be advisable in connection with such
Proceeding), which law firm (or firms) shall be chosen by a majority of the
Indemnitee Group or, in the absence of agreement by a majority of the Indemnitee
Group on such law firm, by a plurality of the Indemnitee Group; provided that if Indemnitee
believes, after consultation with counsel selected by Indemnitee, that (a) the
use of counsel chosen by the Indemnitee Group to represent Indemnitee would
present such counsel with an actual or potential conflict, (b) there may be one
or more legal defenses available to Indemnitee that are different from or in
addition to those available to other members of the Indemnitee Group, or (c) any
such representation by such counsel would be precluded under the applicable
standards of professional conduct then prevailing, then Indemnitee shall be
entitled to retain separate counsel (but not more than one law firm plus, if
applicable, local or special counsel in respect of any particular Proceeding),
for which the Company will be obligated to advance the Expenses thereof;
and
(b) Indemnitee
shall provide reasonable cooperation to the counsel selected pursuant to clause
(a) above in connection with the defense of any Proceeding, including providing
such counsel, upon reasonable advance request any documentation or information
which is not privileged or otherwise protected from disclosure to such counsel
and which is reasonably available to Indemnitee and reasonably necessary to such
defense. Any Expenses reasonably incurred by Indemnitee in so
cooperating shall be borne by the Company and the Company hereby indemnifies and
agrees to hold Indemnitee harmless therefrom.
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Section
15.10 Notices. All
notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given if:
(i) delivered
by hand and received for by the party to whom said notice or other communication
shall have been directed, or
(ii) mailed
by U.S. certified or registered mail with postage prepaid by overnight
courier:
(a) if
to the Company:
Four
Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxxxxxxx, XX 00000
Attn:
Chief Executive Officer
with a
copy to:
Xxxxxxx
Xxxxx + Xxxxxx LLP
Xxxx
Building
000
Xxxxxxxxxx Xxxxxx, 00xx
Xxxxx
Xxx
Xxxxxxxxx, XX 00000
Attn:
Xxxxxx Xxxxxx/Xxxxx Xxxxxxx
and
(b) if
to the Indemnitee, to the address set forth on the signature page hereof; or to
such other address as may have been furnished by any party to the other(s), in
accordance with this Section 15.10.
Section
15.11 Governing
Law.
(a) This
Agreement shall be interpreted and enforced in accordance with the laws of the
State of Nevada, without reference to its conflict of law principles. To
the extent permitted by applicable law, the parties hereby waive any provisions
of law that render any provision of this Agreement unenforceable in any
respect.
(b) The
Company acknowledges that the Indemnitee may, as a result of the Company’s
breach of its covenants and obligations under this Agreement, sustain immediate
and long-term substantial and irreparable injury and damage, which may not be
reasonably or adequately compensated by damages at law. Consequently,
the Company agrees that the Indemnitee may be entitled, in the event of the
Company’s breach or threatened breach of its covenants and obligations
hereunder, to obtain equitable relief from a court of competent jurisdiction,
including enforcement of each provision of this Agreement by specific
performance and/or temporary, preliminary and/or permanent injunctions enforcing
any of the Indemnitee’s rights, requiring performance by the Company, or
enjoining any breach by the Company, all without proof of any actual damages
that have been or may be caused by the Indemnitee by such breach or threatened
breach and without the posting of bond or other security in connection
therewith. The Company waives the claim or defense therein that the
Indemnitee has an adequate remedy at law, and the Company shall not allege or
otherwise assert the legal position that any such remedy at law
exists. The Company agrees and acknowledges that:
12
(i) the
terms of this Section 15.11(b) are fair, reasonable and necessary to protect the
legitimate interests of the Indemnitee;
(ii) this
waiver is a material inducement to the Indemnitee to enter into the transactions
contemplated hereby; and
(iii) the
Indemnitee relied upon this waiver in entering into this Agreement, and will
continue to rely on this waiver in its future dealings with the
Company.
The
Company warrants and represents that it has reviewed this provision with its
legal counsel, and that it has knowingly and voluntarily waived its rights
referenced in this Section 15.11(b) following consultation with such legal
counsel.
[Signatures
on Following Page]
13
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of
the day and year first above written.
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INDEMNITEE:
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By:
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By:
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Name:
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Name:
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Title:
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Address:
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