INDEMNIFICATION
AGREEMENT
AGREEMENT, effective as of March 26, 1999, between NEW PLANET RESOURCES,
INC., a Delaware corporation (the "Company"), and Xxxxxxx Xxxxxxxxxxx
("Indemnitee").
WHEREAS, Indemnitee is a director (or officer) of the Company;
WHEREAS,
both the Company and Indemnitee recognize the increased risk of litigation and
other claims being asserted against directors and officers of public companies
at a time when it has become increasingly difficult to obtain adequate insurance
coverage at reasonable costs;
WHEREAS,
in recognition of Indemnities need for substantial protection against personal
liability in order to enhance Indemnitees continued service to the Company in an
effective manner, the Company wishes to provide in this Agreement for the
identification of and the advancing of expenses to Indemnitee to the full extent
(whether partial or complete) permitted by law and as set forth in this
Agreement, and, to the extent insurance is maintained, for the continued
coverage of Indemnitee under the Company's directors' and
officers' liability insurance policies, regardless of any future change in
the Certificate of Incorporation, By-Laws, composition of the Board of
Directors, or structure of the Company.;
NOW,
THEREFORE, in consideration of the premises and of Indemnitee's service
to the Company, directly or indirectly, and intending to be legally bound
hereby, the parties hereto agree as follows:
1. In the event Indemnitee was, is, or becomes a party to or a witness or
other participant in, or is threatened to be made a party to or a witness or
other participant in, any threatened, pending or completed action, suit
or proceeding, or any inquiry or investigation, whether conducted by the
Company or any other party, that Indemnitee in good faith believes might
lead to any such action, suit or proceeding, whether civil, criminal,
administrative, investigative or otherwise (a "Claim") by reason of
(or arising in part out of) the fact that Indemnitee is or was a director,
officer, employee, agent or fiduciary of the Company, or is or was serving
at the request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise, or by reason of anything
done or not done by Indemnitee in any such capacity (an "Indemnifiable
Event"), the Company shall indemnify Indemnitee to the full extent permitted
by law (the determination of which shall be made by the Reviewing
Party referred to below) as soon as practicable but in any event no later
than thirty days after written demand is presented to the Company, against
any and all expenses (including attorneys' fees and all other costs, expenses,
and obligations paid or incurred in connection with investigating,
preparing for and defending or participating in the defense of (including on
appeal) any Claim relating to any Indemnifiable Event) (collectively
"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 judgments, fines, penalties or
amounts paid in settlement) of such Claim and, if so requested by
Indemnitee, the Company shall advance (within two business days of such request)
any and all such Expenses to Indemnitee; provided, however, that (i) the
foregoing obligation of the Company shall not apply to a Claim that was
commenced by the Indemnitee without the prior approval of the Board of
Directors of the Company unless the Claim was commenced after a Change in
Control (as defined in Section 5 herein); (ii) the foregoing obligation
of the Company shall be subject to the condition that an appropriate person
or body (the "Reviewing Party") shall not have determined (in a written
opinion in any case in which the special, independent counsel referred to in
Section 4 hereof is involved) that Indemnitee would not be permitted to
be indemnified for such Expenses under applicable law; and (iii) if, when
and to the extent that the Reviewing Party determines that Indemnitee
would not be permitted to be indemnified for such Expenses under applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees to reimburse the Company) for all such amounts theretofore
paid (unless Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, in which event Indemnitee shall not be
required to so reimburse the Company until a final judicial determination
requiring such reimbursement is made with respect thereto as to which all
rights of appeal therefrom have been exhausted or lapsed) and the Company
shall not be obligated to indemnify or advance any additional amounts to
Indemnitee under this Agreement (unless there has been a determination by a
court of competent jurisdiction that the Indemnitee would be permitted
to be so indemnified or entitled to such expense advances under applicable
law).
2. If there has not been a Change in Control of the Company (as hereinafter
defined), the Reviewing Party shall be (1) quorum of the Board of Directors
consisting of directors who are not parties to the action, suit or
proceeding acting by majority vote, or, (2) if such a quorum is not obtainable,
or, even if obtainable, a quorum of disinterested directors so
directs, independent legal counsel by the use of a written opinion or
(3) the stockholders. If there has been a Change in Control of the Company,
the Reviewing Party shall be the special, independent counsel referred to in
Section 4 hereof.
3. If Indemnitee has not been indemnified by the expiration of the
foregoing thirty-day period or received expense advances or if the
Reviewing Party
determines that Indemnitee would not be permitted to be indemnified
or be entitled to receive expense advances within two days of the request
therefor in whole or in part under applicable law, Indemnitee
shall have the right to commence litigation seeking from the court a
finding that
Indemnitee is entitled to indemnification and expense advances or
enforcement of Indemnitee's entitlement to indemnification and expense
advances or
challenging any determination by the Reviewing Party or any aspect
thereof that Indemnitee is not entitled to be indemnified or receive expense
advances and the burden of proving that indemnification or advancement
of expenses is not appropriate shall be on the Company; any determination by
the Reviewing Party in favor of Indemnitee shall be conclusive and binding
on the Company, unless facts supplied by Indemnitee which form the basis
for the determination are subsequently determined to have been
materially incorrect at the time supplied. Indemnitee agrees to bring any
such litigation in any court in the States of Delaware having subject matter
jurisdiction thereof and in which venue is proper, and the Company hereby
consents to service of process and to appear in any such proceeding.
4. The Company agrees that if there is a Change in Control of the Company
(as hereinafter defined), then with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and expense
advances under this Agreement or any other agreement or By-laws now or
hereafter in effect relating to Claims for Indemnifiable Events, the
Company shall seek legal advice only from special, independent counsel selected
by Indemnitee who a majority of the disinterested Directors approves
(which approval shall not be unreasonably withheld), and who has not otherwise
performed services for the Company or Indemnitee. Such counsel,
among other things, shall determine whether and to what extent Indemnitee is
permitted to be indemnified or is entitled to expense advances
under applicable law and shall render its written opinion to the Company and
Indemnitee to such effect. The Company agrees to pay the reasonable
fees of the special, independent counsel referred to above and to fully
indemnify such counsel against any and all expenses (including attorney's
fees), claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto except for willful misconduct
or gross negligence.
5. For purposes of this Agreement, (a) "Change in Control of the Company"
shall be deemed to have occurred if (i) any "person" (as such term is used in
Sections 13(d)(3) and 14(d) of the Securities Exchange Act of 1934, as
amended), other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Company, is or becomes the beneficial
owner (as defined in Rule 13d-3 under said Act), directly or indirectly, of
securities of the Company representing 20% or more of the combined
voting power of the Company's then outstanding securities, or (ii) during any
period of two consecutive years, individuals who at the beginning
of such period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination
for election by the Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either
were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute a majority thereof, or (iii) the stockholders of the Company
approve a merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) at least 80% of the combined
voting power of the voting securities of the Company of such surviving entity
outstanding immediately after such merger or consolidation, or if the
stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of all
or substantially all the Company's assets.
6. To the extent Indemnitee is successful in such proceeding, the Company
shall indemnify Indemnitee against any and all expenses (including attorney's
fees) which are incurred by the Indemnitee in connection with any claim
asserted or action brought by Indemnitee for (i) indemnification or advance
payment of Expenses by the Company under this Agreement or any other
agreement or Company By-laws now or hereafter in effect relating to Claims for
Indemnifiable Events and/or (ii) recovery under any directors' and officers'
liability insurance policies maintained by the Company, regardless of
whether Indemnitee ultimately is determined to be entitled to such
indemnification, advance payment of Expenses or insurance recovery, as the
case may be.
7. If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the Expenses, judgments,
fines, penalties and amounts paid in settlement of any Claim but not,
however, for all of the total amount thereof, the Company shall nevertheless
indemnify Indemnitee for the portion thereof to which Indemnitee is
entitled. Notwithstanding any other provision of this Agreement, to the extent
that Indemnitee has been successful on the merits or otherwise in the
defense of any Claim relating in whole or in part to any Indemnifiable Event
or in defense of any issue or matter therein, including dismissal without
prejudice, Indemnitee shall be indemnified against all Expenses incurred
in connection therewith.
8. For purposes of this Agreement, the termination of any Claim by judgment,
order, settlement (whether with or without court approval) or conviction,
or upon a plea of nolo contendere, or its equivalent, shall not create a
presumption that Indemnitee did not meet any particular standard of conduct
or have any particular belief or that a court has determined that
Indemnitee is not entitled to indemnification or expense advance or that
indemnification or expense advance is not permitted by applicable law.
9. The Company hereby agrees that, so long as Indemnitee shall continue to
serve in a capacity referred to in Section 1 hereof, and thereafter so long
as Indemnitee shall be subject to any possible claim or threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that Indemnitee
served in any capacity referred to in Section 1 hereof, the Company shall
maintain in effect for the benefit of Indemnitee any Directors' and Officers'
Liability Insurance presently in force and effect, providing, in all
respects, coverage at least comparable to that presently provided; provided,
however, if, in the business judgment of the then Board, either (a) the
premium cost for such insurance is substantially disproportionate to the
amount of coverage, or (b) the coverage provided by such insurance is so
limited by exclusions that there is insufficient benefit from such insurance,
then and in that event the Company shall not be required to maintain
such insurance but shall and hereby agrees to the full extent permitted by
law to hold harmless and indemnify Indemnitee to the fullest extent of
the coverage which would otherwise have been provided for the benefit of
Indemnitee.
10. (a) In the event of any changes after the date of this Agreement in any
applicable law, statute, or rule which expands the right of the Company
to indemnify a person serving in a capacity referred to in Section 1
hereof, such change shall be within the purview of Indemnitee's
rights, and the Company's obligations, under this Agreement. In the
event of any changes in any applicable law, statute, or rule which
narrow the right of the Company to indemnify a person serving in a capacity
referred to in Section 1 hereof, such changes, to the extent
not otherwise required by such law, statute or rule to be applied to
this Agreement, shall have no effect on this Agreement or the parties'
rights and obligations hereunder.
(b) The indemnification provided by this Agreement shall not be deemed
exclusive of any rights to which Indemnitee may be entitled under the
Company's Certificate of Incorporation, its By-laws, any agreement,
any vote of stockholders or disinterested directors, laws and
regulations in effect now or in the future, or otherwise, both as to
action in Indemnitee's official capacity and as to action in another
capacity while holding such office.
11. If the indemnification provided in Section 1 is unavailable and may not
be paid to Indemnitee because such indemnification is not permitted by law,
then in respect of any threatened, pending or completed action, suit or
proceeding in which the Company is jointly liable with Indemnitee (or would
be if joined in such action, suit or proceeding), the Company shall
contribute to the full extent permitted by law, to the amount of expenses,
judgments, fines (including excise taxes and penalties) and amounts paid
in settlement actually and reasonably incurred and paid or payable by
Indemnitee in such proportion as is appropriate to reflect (i) the relative
benefits received by the Company on the one hand and Indemnitee on the
other hand from the transaction from which such action, suit or proceeding
arose, and (ii) the relative fault of the Company 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 Company
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 Company agrees that it would not be just and equitable if
contribution pursuant to this paragraph were determined by pro rata
allocation or any other method of allocation which does not take account of
the foregoing equitable considerations.
12. All obligations of the Company contained herein shall continue during the
period Indemnitee serves in a capacity referred to in Section 1 hereof of
the Company and shall continue thereafter so long as Indemnitee shall be
subject to any possible Claim relating to an Indemnifiable Event.
13. (a) Promptly after receipt by Indemnitee of notice of the commencement
of any Claim relating to an Indemnifiable Event or proceeding in which
Indemnitee is made or is threatened to be made a party or a witness,
Indemnitee shall notify the Company of the commencement of such Claim;
but the omission so to notify the Company shall not relieve the Company
from any obligation it may have to indemnify or advance expenses to
Indemnitee otherwise than under this Agreement.
(b) Indemnitee shall not settle any claim or action in any manner which
would impose on the Company any penalty, constraint, or obligation to
hold harmless or indemnify Indemnitee pursuant to this Agreement
without the Company's prior written consent, which consent shall not be
unreasonably withheld.
14. If any Claim relating to an Indemnifiable Event, commenced against
Indemnitee is also commenced against the Company, the Company shall be entitled
to participate therein at its own expense, and, except as otherwise
provided hereinbelow, to the extent that it may wish, the Company shall be
entitled to assume the defense thereof. After notice from the Company to
Indemnitee of its election to assume the defense of any Claim, the Company
shall not be obligated 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, travel, and
lodging expenses arising out of Indemnitee's participation in such Claim.
Indemnitee shall have the right to employ Indemnitee's own counsel in such
Claim, but the fees and expenses of such counsel incurred after notice
from the Company to Indemnitee of its assumption of the defense thereof
shall be at the expense of Indemnitee unless (i) otherwise authorized by the
Company, (ii) Indemnitee shall have reasonably concluded, and so notified
the Company, that there may be a conflict of interest between the Company
and Indemnitee in the conduct of the defense of such Claim, or (iii) the
Company shall not in fact have employed counsel to assume the defense of
such Claim, in which cases the fees and expenses of Indemnitee's counsel
shall be at the expense of the Company. The Company shall not be entitled
to assume the defense of any Claim brought by or on behalf of the
Company or its stockholders or as to which Indemnitee shall have made the
conclusion set forth in (ii) of this Section 14.
15. 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.
16. In the event of payment under this Agreement, the Company shall be
subrogated to the extent of such payment to all of the rights of recovery of
Indemnitee, who shall execute all papers required and shall do everything
that may be necessary to secure such rights, including the execution of
such documents necessary to enable the Company effectively to bring suit to
enforce such rights.
17. The Company shall not be liable under this Agreement to make any
payment in connection with any claim made against Indemnitee to the extent
Indemnitee has otherwise actually received payment (under any insurance
policy, By-law or otherwise) of the amounts otherwise indemnifiable
hereunder.
18. This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the parties hereto and their respective successors, assigns,
including any direct or indirect successor by purchase, merger,
consolidation or otherwise to all or substantially all of the business and/or
assets
of the Company, spouses, heirs, executors, and personal and legal
representatives. This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the Company or of
any other enterprise at the Company's request.
19. The provisions of this Agreement shall be severable in the event that any
of the provisions hereof (including any provision within a single section,
paragraph or sentence) are held by a court of competent jurisdiction to be
invalid, void or otherwise unenforceable, and the remaining provisions
shall remain enforceable to the full extent permitted by law.
20. This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware applicable to contracts made and to be
performed in such state, but excluding any conflicts-of-law rule or
principle which might refer such governance, construction or enforcement to
thelaws of another state or country.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on and as
of the day and year first above written.
NEW PLANET
RESOURCES, INC.
By:/s/X.X. Xxxxx
------------------------
X.X. Xxxxx, President
INDEMNITEE
/s/Xxxxxxx Xxxxxxxxxxx
------------------------------------
Xxxxxxx Xxxxxxxxxxx
