EXECUTIVE AND DIRECTOR INDEMNITY AGREEMENT
THIS INDEMNITY AGREEMENT is made and entered into as of
this _____ day of May, 2000 between Xxxxxxxxx.xxx, Inc., a Delaware
corporation (the "CORPORATION"), and (Employee) ("INDEMNITEE").
I N T R O D U C T I O N:
A. Indemnitee is an executive officer, director and/or
agent of the Corporation (or a subsidiary of the Corporation), as the case
may be from time to time, and performs a valuable service for the Corporation
in such capacity (or capacities); and
B. The Certificate of Incorporation (the "CERTIFICATE") and
the Bylaws (the "BYLAWs") of the Corporation contain provisions providing for
the indemnification of the officers, directors and agents of the Corporation
to the maximum extent authorized by Section 145 of the Delaware General
Corporation Law, as amended ("DGCL"); and
C. The Certificate, the Bylaws and the DGCL, by their
non-exclusive nature, permit contracts between the Corporation and the
members of its Board of Directors and officers with respect to
indemnification of such directors and officers; and
D. In accordance with the authorization as provided by the
DGCL, the Corporation has purchased and presently maintains a policy or
policies of Directors and Officers Liability Insurance ("D & O INSURANCE"),
covering certain liabilities which may be incurred by its directors and
officers in the performance of their duties as directors or officers of the
Corporation; and
E. As a result of developments affecting the terms, scope
and availability of D & O Insurance there exists general uncertainty as to
the extent of protection afforded members of the Board of Directors and
executive officers of the Corporation by such D & O Insurance and by
statutory and bylaw indemnification provisions; and
F. In order to induce Indemnitee to continue to serve as an
executive officer, director or agent of the Corporation, the Corporation has
determined and agreed to enter into this contract with Indemnitee.
A G R E E M E N T:
NOW, THEREFORE, in consideration of Indemnitee's continued
service as an executive officer and a member of the Board of Directors after
the date hereof, the parties hereto agree as follows:
1. INDEMNIFICATION OF INDEMNITEE. Subject only to the
exclusions set forth in Section 3 hereof, the Corporation hereby agrees to
hold harmless and indemnify Indemnitee to
the fullest extent authorized or permitted by the provisions of the DGCL, as
may be amended from time to time.
2. ADDITIONAL INDEMNITY. Subject only to the exclusions set
forth in Section 3 hereof, the Corporation hereby further agrees to defend,
hold harmless and indemnify Indemnitee:
(a) against any and all expenses (including attorney's
fees), witness fees, judgments, fines and amounts paid in settlement
actually and reasonably incurred by Indemnitee in connection with
any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (including
an action by or in the right of the Corporation) to which Indemnitee
is, was or at any time becomes a party, or is threatened to be made
a party, by reason of the fact that Indemnitee is, was or at any
time becomes a director, officer, employee or agent of the
Corporation or any subsidiary of the Corporation, or is or was
serving or at any time serves at the request of the Corporation or
any subsidiary of the Corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, if Indemnitee acted in
good faith and in a manner Indemnitee reasonably believed to be in
or not opposed to the best interests of the Corporation, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe Indemnitee's conduct was unlawful; and
(b) otherwise to the fullest extent as may be provided
to Indemnitee by the Corporation under the non-exclusivity
provisions of Article XI of the Corporation's Bylaws (as the same,
including such article, may be amended, modified or restated from
time to time) and the DGCL.
3. LIMITATIONS ON ADDITIONAL INDEMNITY. No indemnity pursuant
to Section 2 or 3 hereof shall be paid by the Corporation:
(a) except to the extent the losses, costs and
expenses to be indemnified thereunder exceeds the sum of such losses
for which the Indemnitee is indemnified pursuant to any D & O
Insurance purchased and maintained by the Corporation;
(b) in respect to remuneration paid to Indemnitee if it
shall be determined by a final judgment or other final adjudication
that such remuneration was in violation of law;
(c) on account of any suit in which judgment is rendered
against Indemnitee for an accounting of profits made from the
purchase or sale by Indemnitee of securities of the Corporation
pursuant to the provisions of Section 16(b) of the Securities
Exchange Act of 1934 and amendments thereto or similar provisions of
any federal, state or local statutory law;
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(d) on account of Indemnitee's conduct which is
finally adjudged to have been knowingly fraudulent or deliberately
dishonest, or to constitute willful misconduct;
(e) on account of Indemnitee's conduct which is the
subject of an action, suit or proceeding described in Section 7(c)(ii)
hereof;
(f) on account of any action, claim or proceeding
(other than a proceeding referred to in Section 8(b) hereof) initiated
by the Indemnitee unless such action, claim or proceeding was
authorized in the specific case by action of the Board of Directors;
and
(g) if a final decision by a Court having
jurisdiction in the matter shall determine that such indemnification is
not lawful (and, in this respect, both the Corporation and Indemnitee
have been advised that the Securities and Exchange Commission believes
that indemnification for liabilities arising under the federal
securities laws is against public policy and is, therefore,
unenforceable and that claims for indemnification should be submitted
to appropriate courts for adjudication).
4. CONTRIBUTION. If the indemnification provided in
Sections 1 and 2 hereof is unavailable by reason of a Court decision
described in Section 3(g) hereof based on grounds other than any of those set
forth in paragraphs (b) through (f) of Section 3 hereof, then in respect of
any threatened, pending or completed action, suit or proceeding in which the
Corporation is jointly liable with Indemnitee (or would be if joined in such
action, suit or proceeding), the Corporation shall contribute to the amount
of expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred and paid or payable by Indemnitee
in such proportion as is appropriate to reflect (a) the relative benefits
received by the Corporation on the one hand and Indemnitee on the other hand
from the transaction from which such action, suit or proceeding arose, and
(b) the relative fault of the Corporation on the one hand and of Indemnitee
on the other in connection with the events which resulted in such expenses,
judgments, fines or settlement amounts, as well as any other relevant
equitable considerations. The relative fault of the Corporation on the one
hand and of Indemnitee on the other shall be determined by reference to,
among other things, the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent the circumstances resulting
in such expenses, judgments, fines or settlement amounts. The Corporation
agrees that it would not be just and equitable if contribution pursuant to
this Section 4 were determined by pro rata allocation or any other method of
allocation that does not take account of the foregoing equitable
considerations.
5. CONTINUATION OF OBLIGATIONS. All agreements and
obligations of the Corporation contained herein shall continue during the
period Indemnitee is a director, officer or agent of the Corporation or any
subsidiary of the Corporation (or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise)
if Indemnitee acted in good faith and in a manner Indemnitee reasonably
believed to be in or not opposed to the best interests of the Corporation,
except that no indemnification shall be made in respect of any claim, issue
or
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matter as to which Indemnitee shall have been adjudged to be liable to the
Corporation unless and only to the extent that the Court of Chancery of the
State of Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, Indemnitee is fairly and
reasonably entitled to indemnity for such expenses which the Court of
Chancery of the State of Delaware or such other court shall deem proper and
shall continue thereafter so long as Indemnitee shall be subject to any
possible claim or threatened, pending or completed action, suit or
proceeding, whether civil, criminal or investigative, by reason of the fact
that Indemnitee was an officer of the Corporation or serving in any other
capacity referred to herein.
6. NOTIFICATION AND DEFENSE OF CLAIM. Not later than
thirty days after receipt by Indemnitee of notice of the commencement of any
action, suit or proceeding, Indemnitee will, if a claim in respect thereof is
to be made against the Corporation under this Agreement, notify the
Corporation of the commencement thereof; but the omission so to notify the
Corporation will not relieve it from any liability which it may have to
Indemnitee otherwise than under this Agreement. With respect to any such
action, suit or proceeding as to which Indemnitee notifies the Corporation of
the commencement thereof:
(a) the Corporation will be entitled to participate
therein at its own expense;
(b) except as otherwise provided below, to the extent
that it may wish, the Corporation jointly with any other indemnifying
party similarly notified will be entitled to assume the defense
thereof, with counsel reasonably satisfactory to Indemnitee. After
notice from the Corporation to Indemnitee of its election so as to
assume the defense thereof, the Corporation will not be liable to
Indemnitee under this Agreement for any legal or other expenses
subsequently incurred by Indemnitee in connection with the defense
thereof other than reasonable costs of investigation or as otherwise
provided below. Indemnitee shall have the right to employ its counsel
in such action, suit or proceeding but the fees and expenses of such
counsel incurred after notice from the Corporation of its assumption of
the defense thereof shall be at the expense of Indemnitee unless (i)
the employment of counsel by Indemnitee has been authorized by the
Corporation, (ii) Indemnitee shall have reasonably concluded that there
may be a conflict of interest between the Corporation and Indemnitee in
the conduct of the defense of such action or (iii) the Corporation
shall not in fact have employed counsel to assume the defense of such
action, in each of which cases the fees and expenses of Indemnitee's
separate counsel shall be at the expense of the Corporation. The
Corporation shall not be entitled to assume the defense of any action,
suit or proceeding brought by or on behalf of the Corporation or as to
which Indemnitee shall have made the conclusion provided for in (ii)
above; and
(c) the Corporation shall not be liable to indemnify
Indemnitee under this Agreement for any amounts paid in settlement of
any action or claim effected without its written consent. The
Corporation shall be permitted to settle any action except that it
shall not settle any action or claim in any manner which would impose
any penalty or limitation on Indemnitee without Indemnitee's written
consent. Neither the
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Corporation nor Indemnitee will unreasonably withhold its consent to
any proposed settlement.
7. ADVANCEMENT AND REPAYMENT OF EXPENSES.
(a) In the event that Indemnitee employs his own
counsel pursuant to Section 6(b)(i) through (iii) above, the
Corporation shall advance to Indemnitee, prior to any final disposition
of any threatened or pending action, suit or proceeding, whether civil,
criminal, administrative or investigative, any and all reasonable
expenses (including legal fees and expenses) incurred in investigating
or defending any such action, suit or proceeding within ten days after
receiving copies of invoices presented to Indemnitee for such expenses;
(b) Indemnitee agrees that Indemnitee will reimburse
the Corporation for all reasonable expenses paid by the Corporation in
defending any civil or criminal action, suit or proceeding against
Indemnitee in the event and only to the extent it shall be ultimately
determined by a final judicial decision (from which there is no right
of appeal) that Indemnitee is not entitled, under the provisions of the
DGCL, the Certificate, the Bylaws, this Agreement or otherwise, to be
indemnified by the Corporation for such expenses; and
(c) Notwithstanding the foregoing, the Corporation
shall not be required to advance such expenses to Indemnitee if
Indemnitee (i) commences any action, suit or proceeding as a plaintiff
unless such advance is specifically approved by a majority of the Board
of Directors or (ii) is a party to an action, suit or proceeding
brought by the Corporation and approved by a majority of the Board
which alleges willful misappropriation of corporate assets by
Indemnitee, disclosure of confidential information in violation of
Indemnitee's fiduciary or contractual obligations to the Corporation,
or any other willful and deliberate breach in bad faith of Indemnitee's
duty to the Corporation or its shareholders.
8. PROCEDURE. Any indemnification and advances
provided for in Section 1 and Section 2 shall be made no later than 45 days
after receipt of the written request of Indemnitee. If a claim under this
Agreement, under any statute, or under any provision of the Corporation's
Certificate of Incorporation or Bylaws providing for indemnification, is not
paid in full by the Corporation within 45 days after a written request for
payment thereof has first been received by the Corporation, Indemnitee may,
but need not, at any time thereafter bring an action against the Corporation
to recover the unpaid amount of the claim and, subject to Section 12 of this
Agreement, Indemnitee shall also be entitled to be paid for the expenses
(including attorneys' fees) of bringing such action. It shall be a defense to
any such action (other than an action brought to enforce a claim for expenses
incurred in connection with any action, suit or proceeding in advance of its
final disposition) that Indemnitee has not met the standards of conduct which
make it permissible under applicable law for the Corporation to indemnify
Indemnitee for the amount claimed, but the burden of proving such defense
shall be on the Corporation and Indemnitee shall be entitled to receive
interim payments of expenses pursuant to Subsection 2(a) unless and until
such defense may be finally adjudicated by court order or
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judgment from which no further right of appeal exists. It is the parties'
intention that if the Corporation contests Indemnitee's right to
indemnification, the question of Indemnitee's right to indemnification shall
be for the court to decide, and neither the failure of the Corporation
(including its Board of Directors, any committee or subgroup of the Board of
Directors, independent legal counsel, or its stockholders) to have made a
determination that indemnification of Indemnitee is proper in the
circumstances because Indemnitee has met the applicable standard of conduct
required by applicable law, nor an actual determination by the Corporation
(including its Board of Directors, any committee or subgroup of the Board of
Directors, independent legal counsel, or its stockholders) that Indemnitee
has not met such applicable standard of conduct, shall create a presumption
that Indemnitee has or has not met the applicable standard of conduct.
9. ENFORCEMENT.
(a) The Corporation expressly confirms and agrees
that it has entered into this Agreement and assumed the obligations
imposed on the Corporation hereby in order to induce Indemnitee to
continue as an executive officer, director or agent of the Corporation,
and acknowledges that Indemnitee is relying upon this Agreement in
continuing in such capacity; and
(b) In the event Indemnitee is required to bring any
action to enforce rights or to collect moneys due under this Agreement
and is successful in such action, the Corporation shall reimburse
Indemnitee for all Indemnitee's reasonable fees and expenses in
bringing and pursuing such action.
10. SUBROGATION. In the event of payment under this agreement,
the Corporation shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee, who shall execute all documents required and
shall do all acts that may be necessary to secure such rights and to enable the
Corporation effectively to bring suit to enforce such rights.
11. NON-EXCLUSIVITY OF RIGHTS. The rights conferred on
Indemnitee by this Agreement shall not be exclusive of any other right which
Indemnitee may have or hereafter acquire under any statute, provisions of the
Corporation's Certificate of Incorporation or Bylaws, agreement, vote of
stockholders or directors, or otherwise, both as to action in his official
capacity and as to action in another capacity while holding office.
12. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under
any provision of this Agreement to indemnification by the Corporation for some
or a portion of the expenses, judgments, fines or penalties actually or
reasonably incurred by Indemnitee in the investigation, defense, appeal or
settlement of any civil or criminal action, suit or proceeding, but not,
however, for the total amount thereof, the Corporation shall nevertheless
indemnify Indemnitee for the portion of such expenses, judgments, fines or
penalties to which Indemnitee is entitled.
13. SURVIVAL OF RIGHTS. The rights conferred on Indemnitee by
this Agreement shall continue after Indemnitee has ceased to be a director,
officer, employee or other
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agent of the Corporation and shall inure to the benefit of Indemnitee's
heirs, executors and administrators.
14. SEPARABILITY. Each of the provisions of this Agreement is
a separate and distinct agreement and independent of the others, so that if any
or all of the provisions hereof shall be held to be invalid or unenforceable for
any reason, such invalidity or unenforceability shall not affect the validity or
enforceability of the other provisions hereof or the obligation of the
Corporation to indemnify the Indemnitee to the full extent provided by the
Certificate, Bylaws or the DGCL.
15. GOVERNING LAW; CONSENT TO JURISDICTION. This Agreement
shall be interpreted and enforced in accordance with the laws of the State of
Delaware. The Corporation and Indemnitee each hereby irrevocably consent to the
jurisdiction of the courts of the State of Delaware for all purposes in
connection with any action or proceeding which arises out of or relates to this
Agreement and agree that any action instituted under this Agreement shall be
brought only in the state courts of the State of Delaware.
16. BINDING EFFECT. This Agreement shall be binding upon
Indemnitee and upon the Corporation, its successors and assigns, and shall inure
to the benefit of Indemnitee, his heirs, personal representatives and assigns
and to the benefit of the Corporation, its successors and assigns.
17. AMENDMENT AND TERMINATION. No amendment, modification,
termination or cancellation of this Agreement shall be effective unless in
writing signed by both parties hereto.
18. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall constitute an original.
19. EFFECT OF ARBITRATION AGREEMENT. It is expressly agreed
that any dispute between the Corporation and the Indemnitee which relates in
whole or in part to this Agreement, shall not be subject to any arbitration
agreement which may be in existence between the Corporation and the Indemnitee.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have executed this
Indemnity Agreement on and as of the day and year first above written.
XXXXXXXXX.XXX, INC.
By:
----------------------------
Name:
--------------------------
Title:
-------------------------
INDEMNITEE
-------------------------------
Print Name: (Employee)
[Signature Page to Indemnity Agreement]
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