EXHIBIT 10.1
FORM OF
INDEMNITY AGREEMENT
This Indemnity Agreement ("Agreement") is made as of ________________,
by and between WebMD Corporation, a Delaware corporation (the "Company"),
and ______________ ("Indemnitee").
RECITALS
WHEREAS, highly competent persons have become more reluctant to serve
publicly-held corporations as directors or in other capacities unless they are
provided with adequate protection through insurance or adequate indemnification
against inordinate risks of claims and actions against them arising out of their
service to and activities on behalf of the corporation.
WHEREAS, the Board of Directors of the Company (the "Board") has
determined that, in order to attract and retain qualified individuals, the
Company will attempt to maintain on an ongoing basis, at its sole expense,
liability insurance to protect persons serving the Company and its subsidiaries
from certain liabilities. Although the furnishing of such insurance has been a
customary and widespread practice among United States-based corporations and
other business enterprises, the Company believes that, given current market
conditions and trends, such insurance may be available to it in the future only
at higher premiums and with more exclusions. At the same time, directors,
officers and other persons in service to corporations or business enterprises
are being increasingly subjected to expensive and time-consuming litigation
relating to, among other things, matters that traditionally would have been
brought only against the Company or business enterprise itself. The Certificate
of Incorporation (the "Charter") and the Bylaws of the Company require
indemnification of the officers and directors of the Company. Indemnitee may
also be entitled to indemnification pursuant to the Delaware General Corporation
Law ("DGCL"). The Charter, the Bylaws and the DGCL expressly provide that the
indemnification provisions set forth therein are not exclusive, and thereby
contemplate that contracts may be entered into between the Company and members
of the board of directors, officers and other persons with respect to
indemnification.
WHEREAS, the uncertainties relating to such insurance and to
indemnification have increased the difficulty of attracting and retaining such
persons.
WHEREAS, the Board has determined that the increased difficulty in
attracting and retaining such persons is detrimental to the best interests of
the Company's stockholders and that the Company should act to assure such
persons that there will be increased certainty of such protection in the future.
WHEREAS, it is reasonable, prudent and necessary for the Company
contractually to obligate itself to indemnify, and to advance expenses on behalf
of, such persons to the fullest extent permitted by applicable law so that they
will serve or continue to serve the Company free from undue concern that they
will not be so indemnified.
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WHEREAS, this Agreement is a supplement to and in furtherance of the
Charter, the Bylaws of the Company and any resolutions adopted pursuant thereto,
and shall not be deemed a substitute therefor, nor to diminish or abrogate any
rights of Indemnitee thereunder.
WHEREAS, Indemnitee does not regard the protection available under the
Company's Charter, Bylaws and insurance as adequate in the present
circumstances, and may not be willing to serve as an officer or director without
adequate protection, and the Company desires Indemnitee to serve in such
capacity. Indemnitee is willing to serve, continue to serve and to take on
additional service for or on behalf of the Company on the condition that he be
so indemnified.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, the Company and Indemnitee do hereby covenant and agree as
follows:
1. SERVICES TO THE COMPANY. Indemnitee will serve or continue to
serve as an officer, director or key employee of the Company for so long as
Indemnitee is duly elected or appointed or until Indemnitee tenders his
resignation.
2. DEFINITIONS. As used in this Agreement:
(a) References to "agent" shall mean any person who is or
was a director, officer, or employee of the Company or a subsidiary of the
Company or other person authorized by the Company to act for the Company, to
include such person serving in such capacity as a director, officer, employee,
fiduciary or other official of another corporation, partnership, limited
liability company, joint venture, trust or other enterprise at the request of,
for the convenience of, or to represent the interests of the Company or a
subsidiary of the Company.
(b) A "Change in Control" shall be deemed to occur upon
the earliest to occur after the date of this Agreement of any of the following
events:
(i) Acquisition of Stock by Third Party. Any
Person (as defined below) is or becomes the Beneficial Owner (as defined below),
directly or indirectly, of securities of the Company representing fifteen
percent (15%) or more of the combined voting power of the Company's then
outstanding securities entitled to vote generally in the election of directors,
unless (1) the change in the relative beneficial ownership of the Company's
securities by any person results solely from a reduction in the aggregate number
of outstanding shares of securities entitled to vote generally in the election
of directors, or (2) such acquisition was approved in advance by the Continuing
Directors (as defined below) and such acquisition would not constitute a Change
of Control under part (iii) of this definition;
(ii) Change in Board of Directors. Individuals
who, as of the date hereof, constitute the Board, and any new director whose
election by the Board or nomination for election by the Company's stockholders
was approved by a vote of at least two thirds of the directors then still in
office who were directors on the date hereof or whose election or
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nomination for election was previously so approved (collectively, the
"Continuing Directors"), cease for any reason to constitute at least a majority
of the members of the Board;
(iii) Corporate Transactions. The effective date
of a reorganization, merger or consolidation of the Company (a "Business
Combination"), in each case, unless, following such Business Combination, (1)
all or substantially all of the individuals and entities who were the Beneficial
Owners of securities entitled to vote generally in the election of directors
immediately prior to such Business Combination, beneficially own, directly or
indirectly, more than 51% of the combined voting power of the then outstanding
securities of the Company entitled to vote generally in the election of
directors 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) in substantially the same proportions as their
ownership, immediately prior to such Business Combination of the securities
entitled to vote generally in the election of directors, (2) no Person
(excluding any corporation resulting from such Business Combination) is the
Beneficial Owner, directly or indirectly, of 15% or more of the combined voting
power of the then outstanding securities entitled to vote generally in the
election of directors of such corporation except to the extent that such
ownership existed prior to the Business Combination and (3) at least a majority
of the Board of Directors of the corporation resulting from such Business
Combination were Continuing Directors at the time of the execution of the
initial agreement, or of the action of the Board of Directors, providing for
such Business Combination;
(iv) Liquidation. The approval by the
stockholders of the Company of a complete liquidation of the Company or an
agreement or series of agreements for the sale or disposition by the Company of
all or substantially all of the Company's assets (other than factoring the
Company's current receivables or escrows due), (or, if such approval is not
required, the decision by the Board to proceed with such a liquidation, sale, or
disposition in one transaction or a series of related transactions); or
(v) Other Events. There occurs any other event
of a nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A (or a response to any similar item on any similar
schedule or form) promulgated under the Exchange Act (as defined below), whether
or not the Company is then subject to such reporting requirement.
(c) The term "Beneficial Owner" shall have the meaning
set forth in Rule 13d-3 promulgated under the Exchange Act.
(d) "Corporate Status" describes the status of a person
who is or was a director, officer, trustee, general partner, managing member,
fiduciary, employee or agent of the Company or of any other Enterprise (as
defined below) which such person is or was serving at the request of the
Company.
(e) "Disinterested Director" shall mean a director of the
Company who is not and was not a party to the Proceeding in respect of which
indemnification is sought by Indemnitee.
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(f) "Enterprise" shall mean the Company and any other
corporation, constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger to which the Company (or any
of its wholly owned subsidiaries) is a party, limited liability company,
partnership, joint venture, trust, employee benefit plan or other enterprise of
which Indemnitee is or was serving at the request of the Company as a director,
officer, trustee, general partner, managing member, fiduciary, employee or
agent.
(g) "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
(h) "Expenses" shall include attorneys' fees and costs,
retainers, court costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees, and all other disbursements or expenses in
connection with prosecuting, defending, preparing to prosecute or defend,
investigating, being or preparing to be a witness in, or otherwise participating
in, a Proceeding. Expenses also shall include Expenses incurred in connection
with any appeal resulting from any Proceeding, including without limitation the
premium, security for, and other costs relating to any cost bond, supersedeas
bond, or other appeal bond or its equivalent. Expenses, however, shall not
include amounts paid in settlement by Indemnitee or the amount of judgments or
fines against Indemnitee.
(i) "Independent Counsel" shall mean 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 years has been, retained to
represent: (i) the Company or Indemnitee in any matter material to either such
party (other than with respect to matters concerning the Indemnitee under this
Agreement, or of other indemnitees under similar indemnification agreements), 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 Indemnitee in an action to determine
Indemnitee's rights under this Agreement.
(j) References to "fines" shall include any excise tax
assessed on Indemnitee with respect to any employee benefit plan; references to
"serving at the request of the Company" shall include any service as a director,
officer, employee, agent or fiduciary of the Company which imposes duties on, or
involves services by, such director, officer, employee, agent or fiduciary with
respect to an employee benefit plan, its participants or beneficiaries; and if
Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to
be in the best interests of the participants and beneficiaries of an employee
benefit plan, Indemnitee shall be deemed to have acted in a manner "not opposed
to the best interests of the Company" as referred to in this Agreement.
(k) The term "Person" shall have the meaning as set forth
in Sections 13(d) and 14(d) of the Exchange Act; provided, however, that Person
shall exclude (i) the Company, (ii) any Subsidiaries of the Company (as defined
below), (iii) any employment benefit plan of the
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Company or of a Subsidiary of the Company or of any corporation owned, directly
or indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company, and (iv) any trustee or
other fiduciary holding securities under an employee benefit plan of the Company
or of a Subsidiary of the Company or of a corporation owned directly or
indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company.
(l) A "Potential Change in Control" shall be deemed to
have occurred if (i) the Company enters into an agreement or arrangement, the
consummation of which would result in the occurrence of a Change in Control;
(ii) any Person or the Company publicly announces an intention to take or
consider taking actions which if consummated would constitute a Change in
Control; (iii) any Person who becomes the Beneficial Owner, directly or
indirectly, of securities of the Company representing 5% or more of the combined
voting power of the Company's then outstanding securities entitled to vote
generally in the election of directors increases his beneficial ownership of
such securities by 5% or more over the percentage so owned by such Person on the
date hereof; or (iv) the Board adopts a resolution to the effect that, for
purposes of this Agreement, a Potential Change in Control has occurred.
(m) The term "Proceeding" shall include any threatened,
pending or completed action, suit, arbitration, alternate dispute resolution
mechanism, investigation, inquiry, administrative hearing or any other actual,
threatened or completed proceeding, whether brought in the right of the Company
or otherwise and whether of a civil (including intentional or unintentional tort
claims), criminal, administrative or investigative nature, in which Indemnitee
was, is or will be involved as a party or otherwise by reason of the fact that
Indemnitee is or was a director or officer of the Company, by reason of any
action taken by him (or failure to act) by him or of any action (or failure to
act) on his part while acting as a director or officer of the Company, or by
reason of the fact that he is or was serving at the request of the Company as a
director, officer, trustee, general partner, managing member, fiduciary,
employee or agent of any other Enterprise, in each case whether or not serving
in such capacity at the time any liability or expense is incurred for which
indemnification, reimbursement, or advancement of expenses can be provided under
this Agreement.
(n) The term "Subsidiary," with respect to any Person,
shall mean any corporation or other entity of which a majority of the voting
power of the voting equity securities or equity interest is owned, directly or
indirectly, by that Person.
3. INDEMNITY IN THIRD-PARTY PROCEEDINGS. The Company shall
indemnify and hold harmless Indemnitee in accordance with the provisions of this
Section 3 if Indemnitee was, is, or is threatened to be made, a party to or a
participant (as a witness or otherwise) in any Proceeding, other than a
Proceeding by or in the right of the Company to procure a judgment in its favor.
Pursuant to this Section 3, Indemnitee shall be indemnified against all
Expenses, judgments, liabilities, fines, 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, judgments, fines,
penalties and amounts paid in settlement) actually and reasonably incurred by
Indemnitee or on his behalf in connection with such Proceeding or any claim,
issue or matter therein, if Indemnitee acted in good faith and in a manner he
reasonably believed to be in or not opposed to
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the best interests of the Company and, in the case of a criminal Proceeding, had
no reasonable cause to believe that his conduct was unlawful.
4. INDEMNITY IN PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY.
The Company shall indemnify and hold harmless Indemnitee in accordance with the
provisions of this Section 4 if Indemnitee was, is, or is threatened to be made,
a party to or a participant (as a witness or otherwise) in any Proceeding by or
in the right of the Company to procure a judgment in its favor. Pursuant to this
Section 4, Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by him or on his behalf in connection with such Proceeding
or any claim, issue or matter therein, if Indemnitee acted in good faith and in
a manner he reasonably believed to be in or not opposed to the best interests of
the Company. No indemnification for Expenses shall be made under this Section 4
in respect of any claim, issue or matter as to which Indemnitee shall have been
finally adjudged by a court to be liable to the Company, unless and only to the
extent that any court in which the Proceeding was brought or the Delaware Court
(as defined below) 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 indemnification.
5. INDEMNIFICATION FOR EXPENSES OF A PARTY WHO IS WHOLLY OR
PARTLY SUCCESSFUL. Notwithstanding any other provisions of this Agreement, to
the extent that Indemnitee is a party to (or a participant in) and is
successful, on the merits or otherwise, in any Proceeding or in defense of any
claim, issue or matter therein, in whole or in part, the Company shall indemnify
and hold harmless Indemnitee against all Expenses actually and reasonably
incurred by him in connection therewith. If Indemnitee is not wholly successful
in such Proceeding but is successful, on the merits or otherwise, as to one or
more but less than all claims, issues or matters in such Proceeding, the Company
shall indemnify and hold harmless Indemnitee against all Expenses actually and
reasonably incurred by him or on his behalf in connection with each successfully
resolved claim, issue or matter. If the Indemnitee is not wholly successful in
such Proceeding, the Company also shall indemnify and hold harmless Indemnitee
against all Expenses reasonably incurred in connection with a claim, issue or
matter related to any claim, issue, or matter on which the Indemnitee was
successful. For purposes of this Section 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.
6. INDEMNIFICATION FOR EXPENSES OF A WITNESS. Notwithstanding any
other provision of this Agreement, to the extent that Indemnitee is, by reason
of his Corporate Status, a witness in any Proceeding to which Indemnitee is not
a party, he shall be indemnified and held harmless against all Expenses actually
and reasonably incurred by him or on his behalf in connection therewith.
7. ADDITIONAL INDEMNIFICATION.
(a) Notwithstanding any limitation in Sections 3, 4, or
5, the Company shall indemnify and hold harmless Indemnitee if Indemnitee is a
party to or threatened to be made a party to any Proceeding (including a
Proceeding by or in the right of the Company to procure a
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judgment in its favor) against all Expenses, judgments, fines, 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,
judgments, fines, penalties and amounts paid in settlement) actually and
reasonably incurred by Indemnitee in connection with the Proceeding. No
indemnity shall be made under this Section 7(a) on account of Indemnitee's
conduct which constitutes a breach of Indemnitee's duty of loyalty to the
Company or its stockholders or is an act or omission not in good faith or which
involves intentional misconduct or a knowing violation of the law.
(b) Notwithstanding any limitation in Sections 3, 4, 5 or
7(a), the Company shall indemnify and hold harmless Indemnitee if Indemnitee is
a party to or threatened to be made a party to any Proceeding (including a
Proceeding by or in the right of the Company to procure a judgment in its favor)
against all Expenses, judgments, fines, 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, judgments, fines, penalties and
amounts paid in settlement) actually and reasonably incurred by Indemnitee in
connection with the Proceeding.
8. CONTRIBUTION IN THE EVENT OF JOINT LIABILITY.
(a) To the fullest extent permissible under applicable
law, if the indemnification and hold harmless rights provided for in this
Agreement are unavailable to Indemnitee in whole or in part for any reason
whatsoever, the Company, in lieu of indemnifying and holding harmless
Indemnitee, shall pay, in the first instance, the entire amount incurred by
Indemnitee, whether for judgments, liabilities, fines, penalties, amounts paid
or to be paid in settlement and/or for Expenses, in connection with any
Proceeding without requiring Indemnitee to contribute to such payment, and the
Company hereby waives and relinquishes any right of contribution it may have at
any time against Indemnitee.
(b) The Company shall not enter into any settlement of
any Proceeding in which the Company is jointly liable with Indemnitee (or would
be if joined in such Proceeding) unless such settlement provides for a full and
final release of all claims asserted against Indemnitee.
(c) The Company hereby agrees to fully indemnify and hold
harmless Indemnitee from any claims for contribution which may be brought by
officers, directors or employees of the Company other than Indemnitee who may be
jointly liable with Indemnitee.
9. EXCLUSIONS. Notwithstanding any provision in this Agreement,
the Company shall not be obligated under this Agreement to make any indemnity in
connection with any claim made against Indemnitee:
(a) for which payment has actually been received by or on
behalf of Indemnitee under any insurance policy or other indemnity provision,
except with respect to any excess beyond the amount actually received under any
insurance policy, contract, agreement, other indemnity provision or otherwise;
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(b) for an accounting of profits made from the purchase
and sale (or sale and purchase) by Indemnitee of securities of the Company
within the meaning of Section 16(b) of the Exchange Act or similar provisions of
state statutory law or common law; or
(c) except as otherwise provided in Sections 14(e)-(f)
hereof, prior to a Change in Control, in connection with any Proceeding (or any
part of any Proceeding) initiated by Indemnitee, including any Proceeding (or
any part of any Proceeding) initiated by Indemnitee against the Company or its
directors, officers, employees or other indemnitees, unless (i) the Board
authorized the Proceeding (or any part of any Proceeding) prior to its
initiation or (ii) the Company provides the indemnification, in its sole
discretion, pursuant to the powers vested in the Company under applicable law.
10. ADVANCES OF EXPENSES; DEFENSE OF CLAIM.
(a) Notwithstanding any provision of this Agreement to
the contrary, the Company shall advance the Expenses incurred by Indemnitee (or
reasonably expected by Indemnitee to be incurred by Indemnitee within three
months) in connection with any Proceeding within ten (10) days after the receipt
by the Company of a statement or statements requesting such advances from time
to time, whether prior to or after final disposition of any Proceeding. Advances
shall be unsecured and interest free. Advances shall be made without regard to
Indemnitee's ability to repay the Expenses and without regard to Indemnitee's
ultimate entitlement to indemnification under the other provisions of this
Agreement. Advances shall include any and all reasonable Expenses incurred
pursuing a Proceeding to enforce this right of advancement, including Expenses
incurred preparing and forwarding statements to the Company to support the
advances claimed. The Indemnitee shall qualify for advances solely upon the
execution and delivery to the Company of an undertaking providing that the
Indemnitee undertakes to repay the advance to the extent that it is ultimately
determined that Indemnitee is not entitled to be indemnified by the Company
under the provisions of this Agreement, the Charter, the Bylaws of the Company,
the DGCL or otherwise. This Section 10(a) shall not apply to any claim made by
Indemnitee for which indemnity is excluded pursuant to Section 9.
(b) The Company will be entitled to participate in the
Proceeding at its own expense.
(c) The Company shall not settle any action, claim or
Proceeding (in whole or in part) which would impose any Expense, judgment, fine,
penalty or limitation on the Indemnitee without the Indemnitee's prior written
consent.
11. PROCEDURE FOR NOTIFICATION AND APPLICATION FOR
INDEMNIFICATION.
(a) Indemnitee agrees to notify promptly 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. The failure of Indemnitee to so notify the Company shall not relieve
the Company of any obligation which it may have to the Indemnitee under this
Agreement, or otherwise.
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(b) Indemnitee may deliver to the Company a written
application to indemnify and hold harmless Indemnitee in accordance with this
Agreement. Such application(s) may be delivered from time to time and at such
time(s) as Indemnitee deems appropriate in his or her sole discretion. Following
such a written application for indemnification by Indemnitee, the Indemnitee's
entitlement to indemnification shall be determined according to Section 12(a) of
this Agreement.
12. PROCEDURE UPON APPLICATION FOR INDEMNIFICATION.
(a) A determination, if required by applicable law, with
respect to Indemnitee's entitlement to indemnification shall be made in the
specific case by one of the following methods, which shall be at the election of
Indemnitee: (i) by a majority vote of the Disinterested Directors, even though
less than a quorum of the Board or (ii) by Independent Counsel in a written
opinion to the Board, a copy of which shall be delivered to Indemnitee. If it is
so determined that Indemnitee is entitled to indemnification, payment to
Indemnitee shall be made within ten (10) days after such determination.
Indemnitee shall reasonably cooperate with the person, persons or entity making
such determination with respect to Indemnitee's entitlement to indemnification,
including providing to such person, persons or entity upon reasonable advance
request any documentation or information which is not privileged or otherwise
protected from disclosure and which is reasonably available to Indemnitee and
reasonably necessary to such determination. Any costs or Expenses (including
attorneys' fees and disbursements) incurred by Indemnitee in so cooperating with
the person, persons or entity making such determination shall be borne by the
Company (irrespective of the determination as to Indemnitee's entitlement to
indemnification) and the Company hereby indemnifies and agrees to hold
Indemnitee harmless therefrom.
(b) In the event the determination of entitlement to
indemnification is to be made by Independent Counsel pursuant to Section 12(a)
hereof, the Independent Counsel shall be selected as provided in this Section
12(b). The Independent Counsel shall be selected by Indemnitee (unless
Indemnitee shall request that such selection be made by the Board), and
Indemnitee shall give written notice to the Company advising it of the identity
of the Independent Counsel so selected and certifying that the Independent
Counsel so selected meets the requirements of "Independent Counsel" as defined
in Section 2 of this Agreement. If the Independent Counsel is selected by the
Board, the Company shall give written notice to Indemnitee advising him of the
identity of the Independent Counsel so selected and certifying that the
Independent Counsel so selected meets the requirements of "Independent Counsel"
as defined in Section 2 of this Agreement. In either event, Indemnitee or the
Company, as the case may be, may, within 10 days after such written notice of
selection shall have been received, deliver to the Company or to Indemnitee, as
the case may be, a written objection to such selection; provided, however, that
such objection may be asserted only on the ground that the Independent Counsel
so selected does not meet the requirements of "Independent Counsel" as defined
in Section 2 of this Agreement, and the objection shall set forth with
particularity the
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factual basis of such assertion. Absent a proper and timely objection, the
person so selected shall act as Independent Counsel. If such written objection
is so made and substantiated, the Independent Counsel so selected may not serve
as Independent Counsel unless and until such objection is withdrawn or a court
of competent jurisdiction has determined that such objection is without merit.
If, within 20 days after submission by Indemnitee of a written request for
indemnification pursuant to Section 11(a) hereof, no Independent Counsel shall
have been selected and not objected to, either the Company or Indemnitee may
petition the Delaware Court (as defined below) for resolution of any objection
which shall have been made by the Company or Indemnitee to the other's selection
of Independent Counsel and/or for the appointment as Independent Counsel of a
person selected by the Delaware Court, and the person with respect to whom all
objections are so resolved or the person so appointed shall act as Independent
Counsel under Section 12(a) hereof. Upon the due commencement of any judicial
proceeding or arbitration pursuant to Section 14(a) of this Agreement,
Independent Counsel shall be discharged and relieved of any further
responsibility in such capacity (subject to the applicable standards of
professional conduct then prevailing).
(c) The Company agrees to pay the reasonable fees and
expenses of Independent Counsel and to fully indemnify and hold harmless such
Independent Counsel against any and all Expenses, claims, liabilities and
damages arising out of or relating to this Agreement or its engagement pursuant
hereto.
13. PRESUMPTIONS AND EFFECT OF CERTAIN PROCEEDINGS.
(a) In making a determination with respect to entitlement
to indemnification hereunder, the person or persons or entity making such
determination shall presume that Indemnitee is entitled to indemnification under
this Agreement if Indemnitee has submitted a request for indemnification in
accordance with Section 11(b) of this Agreement, and the Company shall have the
burden of proof to overcome that presumption in connection with the making by
any person, persons or entity of any determination contrary to that presumption.
Neither the failure of the Company (including by its directors or Independent
Counsel) to have made a determination prior to the commencement of any action
pursuant to this Agreement that indemnification is proper in the circumstances
because Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Company (including by its directors or Independent Counsel)
that Indemnitee has not met such applicable standard of conduct, shall be a
defense to the action or create a presumption that Indemnitee has not met the
applicable standard of conduct.
(b) If the person, persons or entity empowered or
selected under Section 12 of this Agreement to determine whether Indemnitee is
entitled to indemnification shall not have made a determination within thirty
(30) days after receipt by the Company of the request therefor, the requisite
determination of entitlement to indemnification shall be deemed to have been
made and Indemnitee shall be entitled to such indemnification, absent (i) a
misstatement by Indemnitee of a material fact, or an omission of a material fact
necessary to make Indemnitee's statement not materially misleading, in
connection with the request for indemnification, or (ii) a final judicial
determination that any or all such indemnification is expressly prohibited under
applicable law; provided, however, that such 30-day period may be extended for a
reasonable time, not to exceed
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an additional fifteen (15) days, if the person, persons or entity making the
determination with respect to entitlement to indemnification in good faith
requires such additional time for the obtaining or evaluating of documentation
and/or information relating thereto.
(c) 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
Indemnitee to indemnification or create a presumption that Indemnitee did not
act in good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Company or, with respect to any criminal
Proceeding, that Indemnitee had reasonable cause to believe that his conduct was
unlawful.
(d) For purposes of any determination of good faith,
Indemnitee shall be deemed to have acted in good faith if Indemnitee's action is
based on the records or books of account of the Enterprise, including financial
statements, or on information supplied to Indemnitee by the officers of the
Enterprise in the course of their duties, or on the advice of legal counsel for
the Enterprise or on information or records given or reports made to the
Enterprise by an independent certified public accountant or by an appraiser or
other expert selected by the Enterprise. The provisions of this Section 13(d)
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.
(e) The knowledge and/or actions, or failure to act, of
any other director, officer, trustee, partner, managing member, fiduciary, agent
or employee of the Enterprise shall not be imputed to Indemnitee for purposes of
determining the right to indemnification under this Agreement.
14. REMEDIES OF INDEMNITEE.
(a) In the event that (i) a determination is made
pursuant to Section 12 of this Agreement that Indemnitee is not entitled to
indemnification under this Agreement, (ii) advancement of Expenses is not timely
made pursuant to Section 10 of this Agreement, (iii) no determination of
entitlement to indemnification shall have been made pursuant to Section 12(a) of
this Agreement within thirty 30 days after receipt by the Company of the request
for indemnification, (iv) payment of indemnification is not made pursuant to
Section 5, 6, 7 or the last sentence of Section 12(a) of this Agreement within
ten (10) days after receipt by the Company of a written request therefor, (v) a
contribution payment is not made in a timely manner pursuant to Section 8 of
this Agreement, or (vi) payment of indemnification pursuant to Section 3 or 4 of
this Agreement is not made within ten (10) days after a determination has been
made that Indemnitee is entitled to indemnification, Indemnitee shall be
entitled to an adjudication by the Delaware Court (as defined below) to such
indemnification, contribution or advancement of Expenses. Alternatively,
Indemnitee, at his option, may seek an award in arbitration to be conducted by a
single arbitrator pursuant to the Commercial Arbitration Rules of the American
Arbitration Association. Except as set forth herein, the provisions of Delaware
law (without regard to its conflict of laws rules) shall apply to any such
arbitration. The Company shall not oppose Indemnitee's right to seek any such
adjudication or award in arbitration.
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(b) In the event that a determination shall have been
made pursuant to Section 12(a) of this Agreement that Indemnitee is not entitled
to indemnification, any judicial proceeding or arbitration commenced pursuant to
this Section 14 shall be conducted in all respects as a de novo trial, or
arbitration, on the merits and Indemnitee shall not be prejudiced by reason of
that adverse determination. In any judicial proceeding or arbitration commenced
pursuant to this Section 14, Indemnitee shall be presumed to be entitled to
indemnification under this Agreement and the Company shall have the burden of
proving Indemnitee is not entitled to indemnification or advancement of
Expenses, as the case may be, and the Company may not refer to or introduce into
evidence any determination pursuant to Section 12(a) of this Agreement adverse
to Indemnitee for any purpose. If Indemnitee commences a judicial proceeding or
arbitration pursuant to this Section 14, Indemnitee shall not be required to
reimburse the Company for any advances pursuant to Section 10 until a final
determination is made with respect to Indemnitee's entitlement to
indemnification (as to which all rights of appeal have been exhausted or
lapsed).
(c) If a determination shall have been made pursuant to
Section 12(a) of this Agreement that Indemnitee is entitled to indemnification,
the Company shall be bound by such determination in any judicial proceeding or
arbitration commenced pursuant to this Section 14, absent (i) a misstatement by
Indemnitee of a material fact, or an omission of a material fact necessary to
make 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 14 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) The Company shall indemnify and hold harmless
Indemnitee to the fullest extent permitted by law against all Expenses and, if
requested by Indemnitee, shall (within ten (10) days after the Company's receipt
of such written request) advance such Expenses to Indemnitee, which are incurred
by Indemnitee in connection with any judicial proceeding or arbitration brought
by Indemnitee (i) to enforce his rights under, or to recover damages for breach
of, this Agreement or any other indemnification, advancement or contribution
agreement or provision of the Charter, or the Company's Bylaws now or hereafter
in effect; or (ii) for recovery or advances under any insurance policy
maintained by any person for the benefit of Indemnitee, regardless of whether
Indemnitee ultimately is determined to be entitled to such indemnification,
advance, contribution or insurance recovery, as the case may be.
(f) Interest shall be paid by the Company to Indemnitee
at the legal rate under Delaware law for amounts which the Company indemnifies
or is obliged to indemnify for the period commencing with the date on which
Indemnitee requests indemnification, contribution, reimbursement or advancement
of any Expenses and ending with the date on which such payment is made to
Indemnitee by the Company.
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15. ESTABLISHMENT OF TRUST. In the event of a Potential Change in
Control, the Company shall, upon written request by Indemnitee, create a "Trust"
for the benefit of Indemnitee and from time to time upon written request of
Indemnitee shall fund such Trust in an amount sufficient to satisfy any and all
Expenses reasonably anticipated at the time of each such request to be incurred
in connection with investigating, preparing for, participating in or defending
any Proceedings, and any and all judgments, fines, penalties and amounts paid in
settlement (including all interest, assessments and other charges paid or
payable in connection with or in respect of such judgments, fines penalties and
amounts paid in settlement) in connection with any and all Proceedings from time
to time actually paid or claimed, reasonably anticipated or proposed to be paid.
The trustee of the Trust (the "Trustee") shall be a bank or trust company or
other individual or entity chosen by the Indemnitee and reasonably acceptable to
the Company. Nothing in this Section 15 shall relieve the Company of any of its
obligations under this Agreement. The amount or amounts to be deposited in the
Trust pursuant to the foregoing funding obligation shall be determined by mutual
agreement of the Indemnitee and the Company or, if the Company and the
Indemnitee are unable to reach such an agreement, by Independent Counsel
selected in accordance with Section 12(b) of this Agreement. The terms of the
Trust shall provide that, except upon the consent of both the Indemnitee and the
Company, upon a Change in Control (i) the Trust shall not be revoked or the
principal thereof invaded, without the written consent of the Indemnitee, (ii)
the Trustee shall advance, within two business days of a request by the
Indemnitee and upon the execution and delivery to the Company of an undertaking
providing that the Indemnitee undertakes to repay the advance to the extent that
it is ultimately determined that Indemnitee is not entitled to be indemnified by
the Company, any and all Expenses to the Indemnitee, (iii) the Trust shall
continue to be funded by the Company in accordance with the funding obligations
set forth above, (iv) the Trustee shall promptly pay to the Indemnitee all
amounts for which the Indemnitee shall be entitled to indemnification pursuant
to this Agreement or otherwise, and (v) all unexpended funds in such Trust shall
revert to the Company upon mutual agreement by the Indemnitee and the Company
or, if the Indemnitee and the Company are unable to reach such an agreement, by
Independent Counsel selected in accordance with Section 12(b) of this Agreement,
that the Indemnitee has been fully indemnified under the terms of this
Agreement. The Trust shall be governed by Delaware law (without regard to its
conflicts of laws rules) and the Trustee shall consent to the exclusive
jurisdiction of the Delaware Court in accordance with Section 24 of this
Agreement.
16. SECURITY. Notwithstanding anything herein to the contrary, to
the extent requested by the Indemnitee and approved by the Board, the Company
may at any time and from time to time provide security to the Indemnitee for the
Company's obligations hereunder through an irrevocable bank line of credit,
funded trust or other collateral. Any such security, once provided to the
Indemnitee, may not be revoked or released without the prior written consent of
the Indemnitee.
17. NON-EXCLUSIVITY; SURVIVAL OF RIGHTS; INSURANCE; SUBROGATION.
(a) The rights of indemnification and to receive
advancement of Expenses as provided by this Agreement shall not be deemed
exclusive of any other rights to which Indemnitee may at any time be entitled
under applicable law, the Charter, the Company's Bylaws, any agreement, a vote
of stockholders or a resolution of directors, or otherwise. No amendment,
alteration or repeal of this Agreement or of any provision hereof shall limit or
restrict any right of
13
Indemnitee under this Agreement in respect of any action taken or omitted by
such Indemnitee in his Corporate Status prior to such amendment, alteration or
repeal. To the extent that a change in Delaware law, whether by statute or
judicial decision, permits greater indemnification or advancement of Expenses
than would be afforded currently under the Charter, the Company's Bylaws or 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. No right or
remedy herein conferred is intended to be exclusive of any other right or
remedy, and every other right and remedy shall be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other right or remedy.
(b) To the extent that the Company maintains an insurance
policy or policies providing liability insurance for directors, officers,
trustees, partners, managing members, fiduciaries, employees, or agents of the
Company or of any other Enterprise which such person serves at the request of
the Company, 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, officer, trustee, partner, managing member,
fiduciary, employee or agent under such policy or policies. If, at the time the
Company receives notice from any source of a Proceeding as to which Indemnitee
is a party or a participant (as a witness or otherwise), the Company has
director and officer liability insurance in effect, the Company shall give
prompt notice of such Proceeding to the insurers in accordance with the
procedures set forth in the respective policies. The Company shall thereafter
take all necessary or desirable action to cause such insurers to pay, on behalf
of the Indemnitee, all amounts payable as a result of such Proceeding in
accordance with the terms of such policies.
(c) 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 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.
(d) The Company's obligation to indemnify or advance
Expenses hereunder to Indemnitee who is or was serving at the request of the
Company as a director, officer, trustee, partner, managing member, fiduciary,
employee or agent of any other Enterprise shall be reduced by any amount
Indemnitee has actually received as indemnification or advancement of expenses
from such Enterprise.
18. DURATION OF AGREEMENT. This Agreement shall continue until and
terminate upon the later of: (a) ten (10) years after the date that Indemnitee
shall have ceased to serve as a director or officer of the Company or as a
director, officer, trustee, partner, managing member, fiduciary, employee or
agent of any other corporation, partnership, joint venture, trust, employee
benefit plan or other Enterprise which Indemnitee served at the request of the
Company; or (b) one (1) year after the final termination of any Proceeding
(including any rights of appeal thereto) in respect of which Indemnitee is
granted rights of indemnification or advancement of Expenses hereunder and of
any Proceeding commenced by Indemnitee pursuant to Section 14 of this Agreement
relating thereto (including any rights of appeal of any Section 14 Proceeding).
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19. 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,
paragraph or sentence of this Agreement containing any such provision held to be
invalid, illegal or unenforceable, that is not itself invalid, illegal or
unenforceable) shall not in any way be affected or impaired thereby and shall
remain enforceable to the fullest extent permitted by law; (b) such provision or
provisions shall be deemed reformed to the extent necessary to conform to
applicable law and to give the 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, paragraph or
sentence of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall be construed so as to give effect to the intent manifested thereby.
20. ENFORCEMENT AND BINDING EFFECT.
(a) The Company expressly confirms and agrees that it has
entered into this Agreement and assumed the obligations imposed on it hereby in
order to induce Indemnitee to serve as a director, officer or key employee of
the Company, and the Company acknowledges that Indemnitee is relying upon this
Agreement in serving as a director, officer or key employee of the Company.
(b) Without limiting any of the rights of Indemnitee
under the Charter or Bylaws of the Company as they may be amended from time to
time, this Agreement constitutes the entire agreement between the parties hereto
with respect to the subject matter hereof and supersedes all prior agreements
and understandings, oral, written and implied, between the parties hereto with
respect to the subject matter hereof.
(c) The indemnification and advancement of expenses
provided by, or granted pursuant to this Agreement shall be binding upon and be
enforceable by the parties hereto and their respective successors and assigns
(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), shall continue as to an Indemnitee who has ceased to be a director,
officer, employee or agent of the Company or of any other Enterprise at the
Company's request, and shall inure to the benefit of Indemnitee and his or her
spouse, assigns, heirs, devisees, executors and administrators and other legal
representatives.
(d) The Company shall require and cause any successor
(whether direct or indirect by purchase, merger, consolidation or otherwise) to
all, substantially all or a substantial part, of the business and/or assets of
the Company, by written agreement in form and substance satisfactory to the
Indemnitee, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place.
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(e) The Company and Indemnitee agree herein that a
monetary remedy for breach of this Agreement, at some later date, may be
inadequate, impracticable and difficult of proof, and further agree that such
breach may cause Indemnitee irreparable harm. Accordingly, the parties hereto
agree that Indemnitee may enforce this Agreement by seeking injunctive relief
and/or specific performance hereof, without any necessity of showing actual
damage or irreparable harm and that by seeking injunctive relief and/or specific
performance, Indemnitee shall not be precluded from seeking or obtaining any
other relief to which he may be entitled. The Company and Indemnitee further
agree that Indemnitee shall be entitled to such specific performance and
injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions, without the necessity of posting bonds or
other undertaking in connection therewith. The Company acknowledges that in the
absence of a waiver, a bond or undertaking may be required of Indemnitee by the
Court, and the Company hereby waives any such requirement of such a bond or
undertaking.
21. MODIFICATION AND WAIVER. No supplement, modification or
amendment of this Agreement shall be binding unless executed in writing by 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 of this Agreement
nor shall any waiver constitute a continuing waiver.
22. NOTICES. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall be deemed to
have been duly given (a) if delivered by hand and receipted for by the party to
whom said notice or other communication shall have been directed, or (b) mailed
by certified or registered mail with postage prepaid, on the third business day
after the date on which it is so mailed:
(a) If to Indemnitee, at the address indicated on the
signature page of this Agreement, or such other address as Indemnitee shall
provide in writing to the Company.
(b) If to the Company to:
WebMD Corporation
River Drive Center Two
000 Xxxxx Xxxxx
Xxxxxxx Xxxx, XX 00000
Attention: General Counsel
or to any other address as may have been furnished to Indemnitee in writing by
the Company.
23. APPLICABLE LAW AND CONSENT TO JURISDICTION. This Agreement and
the legal relations among the parties shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware, without regard
to its conflict of laws rules. Except with respect to any arbitration commenced
by Indemnitee pursuant to Section 14(a) of this Agreement, the Company and
Indemnitee hereby irrevocably and unconditionally (i) agree that any action or
proceeding arising out of or in connection with this Agreement shall be brought
only in the
00
Xxxxxxxx Xxxxx of the State of Delaware (the "Delaware Court"), and not in any
other state or federal court in the United States of America or any court in any
other country, (ii) consent to submit to the exclusive jurisdiction of the
Delaware Court for purposes of any action or proceeding arising out of or in
connection with this Agreement, (iii) appoint, to the extent such party is not a
resident of the State of Delaware, irrevocably RL&F Service Corp., One Xxxxxx
Square, 10th Floor, 10th and King Streets, Wilmington, Delaware 19801 as its
agent in the State of Delaware as such party's agent for acceptance of legal
process in connection with any such action or proceeding against such party with
the same legal force and validity as if served upon such party personally within
the State of Delaware, (iv) waive any objection to the laying of venue of any
such action or proceeding in the Delaware Court, and (v) waive, and agree not to
plead or to make, any claim that any such action or proceeding brought in the
Delaware Court has been brought in an improper or inconvenient forum, or is
subject (in whole or in part) to a jury trial.
24. IDENTICAL COUNTERPARTS. This Agreement may be executed in one
or more counterparts, 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 signed by the party against whom enforceability is
sought needs to be produced to evidence the existence of this Agreement.
25. MISCELLANEOUS. Use of the masculine pronoun shall be deemed to
include usage of the feminine pronoun where appropriate. The headings of the
paragraphs of this Agreement are inserted for convenience only and shall not be
deemed to constitute part of this Agreement or to affect the construction
thereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
as of the day and year first above written.
WEBMD CORPORATION INDEMNITEE
By:
--------------------------------- ---------------------------------
Name: Name:
Title: Address:
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