INDEMNIFICATION AGREEMENT
Exhibit
99.4
This
Indemnification Agreement (this “Agreement”)
dated the 27th day of February, 2009, by and between PhotoMedex, Inc., a
Delaware corporation (the “Company”),
and Xxxx X. Xxxxxx, an individual (“Indemnitee”).
RECITALS
A. Competent
and experienced persons are reluctant to serve or to continue to serve as
directors and officers of corporations or in other capacities unless they are
provided with adequate protection through insurance or indemnification (or both)
against claims against them arising out of their service and activities on
behalf of the corporation.
B. The
current uncertainties relating to the availability of adequate insurance have
increased the difficulty for corporations of attracting and retaining competent
and experienced persons to serve in such capacities.
C. The
Board of Directors of the Company (the “Board of
Directors”) has determined that the continuation of present trends in
litigation will make it more difficult to attract and retain competent and
experienced persons to serve as directors and officers of the Company, that this
situation 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 adequate protection.
D. As
a supplement to and in the furtherance of the Company’s Restated Certificate of
Incorporation, as may be amended (the “Certificate”),
and Amended and Restated By-laws, as may be amended (the “By-laws”),
it is reasonable, prudent, desirable and necessary for the Company contractually
to obligate itself to indemnify, and to pay in advance expenses on behalf of,
officers and directors to the fullest extent permitted by law so that they will
serve or continue to serve the Company free from concern that they will not be
so indemnified and that their expenses will not be so paid in
advance.
E. This
Agreement is not a substitute for, nor does it diminish or abrogate any rights
of Indemnitee under, the Certificate and the By-laws or any resolutions adopted
pursuant thereto (including any contractual rights of Indemnitee that may
exist).
F. Indemnitee
is a director and/or officer of the Company and his or her willingness to
continue to serve in such capacity is predicated, in substantial part, upon the
Company’s willingness to indemnify him or her to the fullest extent permitted by
the laws of the State of Delaware and upon the other undertakings set forth in
this Agreement.
NOW, THEREFORE, in
consideration of the premises and covenants contained herein, the Company and
Indemnitee hereby agree as follows:
ARTICLE
1
CERTAIN
DEFINITIONS
Capitalized terms used but not
otherwise defined in this Agreement have the meanings set forth
below:
“Beneficial
Owner” shall have the meaning given to such term in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended; provided, however, that “Beneficial
Owner” shall exclude any Person otherwise becoming a Beneficial Owner by reason
of (i) the stockholders of the Company approving a merger of the Company
with another entity or (ii) the Board of Directors approving a sale of
securities by the Company to such Person.
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 twenty percent (20%) 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 Incumbent Directors (as defined below) and such
acquisition would not constitute a Change in Control under part (iii) of this
definition;
(ii) Change in Board Composition.
During any period of two (2) consecutive years (not including any period
prior to the execution of this Agreement), individuals who at the beginning of
such period constitute the Board of Directors, and any new directors (other than
a director designated by a person who has entered into an agreement with the
Company to effect a transaction described in paragraphs (i), (iii) or (iv))
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 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
(collectively, the “Incumbent
Directors”), cease for any reason to constitute at least a majority of
the members of the Board of Directors;
(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:
(a) 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 and with the power to
elect at least a majority of the Board of Directors or other governing body of
the surviving entity; (b) no Person (excluding any corporation resulting from
such Business Combination) is the Beneficial Owner, directly or indirectly, of
20% 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 (c) at least a majority of the Board of Directors of the
corporation resulting from such Business Combination were Incumbent 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;
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(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; and
(v) Other Events. 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 in response to any similar item on any
similar schedule or form) promulgated under the Securities Exchange Act of 1934,
as amended, whether or not the Company is then subject to such reporting
requirement.
“Controlled
Affiliate” means any corporation, limited liability company, partnership,
joint venture, trust or other Enterprise, whether or not for profit, that is
directly or indirectly controlled by the Company. For purposes of this
definition, the term “control” means the possession, directly or indirectly, of
the power to direct, or cause the direction of, the management or policies of an
Enterprise, whether through the ownership of voting securities, through other
voting rights, by contract or otherwise; provided, however, that direct or
indirect beneficial ownership of capital stock or other interests in an
Enterprise entitling the holder to cast 30% or more of the total number of votes
generally entitled to be cast in the election of directors (or persons
performing comparable functions) of such Enterprise will be deemed to constitute
“control” for purposes of this definition.
“Corporate
Status” means the status of a person who is or was a director, officer,
employee, partner, member, manager, trustee, fiduciary or agent of the Company
or of any other Enterprise which such person is or was serving at the request of
the Company. In addition to any service at the actual request of the Company,
Indemnitee will be deemed, for purposes of this Agreement, to be serving or to
have served at the request of the Company as a director, officer, employee,
partner, member, manager, trustee, fiduciary or agent of another Enterprise if
Indemnitee is or was serving as a director, officer, employee, partner, member,
manager, fiduciary, trustee or agent of such Enterprise and (i) such
Enterprise is or at the time of such service was a Controlled Affiliate,
(ii) such Enterprise is or at the time of such service was an employee
benefit plan (or related trust) sponsored on maintained by the Company or a
Controlled Affiliate or (iii) the Company or a Controlled Affiliate
directly or indirectly caused Indemnitee to be nominated, elected, appointed,
designated, employed, engaged or selected to serve in such
capacity.
“Disinterested
Director” means 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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“Enterprise”
means the Company and any other corporation, partnership, limited liability
company, joint venture, employee benefit plan, trust or other entity or other
enterprise.
“Expenses”
shall be broadly construed and shall include, without limitation, all attorney’s
fees, disbursements and retainers, court costs, transcript costs, fees of
experts, witness fees, travel expenses, food and lodging expenses, duplicating
costs, printing and binding costs, telephone charges, postage, fax transmission
charges, secretarial services, delivery service fees and all other disbursements
or expenses paid or incurred 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, or in connection with
seeking indemnification under this Agreement. Expenses will also include
Expenses paid or incurred in connection with any appeal resulting from any
Proceeding, including the premium, security for, and other costs relating to any
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.
“Independent
Counsel” means an attorney or firm of attorneys that is experienced in
matters of corporation law and neither currently is, nor in the past three
(3) 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 and/or the
indemnification provisions of the Certificate or By-laws, 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” does 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.
“Losses”
means losses of any type whatsoever, and shall include, without limitation, any
liability, judgments, damages, amounts paid in settlement, fines (including
excise taxes and penalties assessed with respect to employee benefit plans),
penalties (whether civil, criminal or otherwise) and all interest, assessments
and other charges paid or payable in connection with or in respect of any of the
foregoing incurred by the Indemnitee in connection with a
Proceeding.
“Person”
shall have the meaning as set forth in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended; provided, however, that “Person”
shall exclude (i) the Company, (ii) any trustee or other fiduciary
holding securities under an employee benefit plan of the Company, and
(iii) 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.
“Proceeding”
means any threatened, pending or completed action, suit, claim, demand,
arbitration, alternate dispute resolution mechanism, investigation, inquiry,
administrative hearing or any other actual, threatened or completed proceeding,
whether formal or informal, including any and all appeals, whether brought by or
in the right of the Company or otherwise, whether civil, criminal,
administrative or investigative, whether formal or informal, and in each case
whether or not commenced prior to the date of this Agreement, in which
Indemnitee was, is or will be involved as a party or otherwise, by reason of or
relating to Indemnitee’s Corporate Status and by reason of or relating to either
(i) any action or alleged action taken by Indemnitee (or failure or alleged
failure to act) or of any action or alleged action (or failure or alleged
failure to act) on Indemnitee’s part, while acting in his or her Corporate
Status, or (ii) the fact of Indemnitee’s Corporate Status, whether or not
serving in such capacity at the time any Loss or Expense is paid or incurred for
which indemnification or advancement of Expenses can be provided under this
Agreement, except one initiated by Indemnitee to enforce his or her rights under
this Agreement. For purposes of this definition, the term
“threatened” will be deemed to include Indemnitee’s good faith belief that a
claim or other assertion may lead to institution of a
Proceeding.
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References
to “serving
at the request of the Company” include any service as a director,
officer, employee or agent of the Company which imposes duties on, or involves
services by, such director, officer, employee or agent with respect to any
employee benefit plan, its participants or beneficiaries; and a person who acted
in good faith and in a manner he or she reasonably believed to be in the best
interests of the participants and beneficiaries of an employee benefit plan will
be deemed to have acted in a manner “not opposed to
the best interests of the Company” as referred to under applicable law or
in this Agreement.
ARTICLE
2
SERVICES
TO THE COMPANY
2.1 Services to the Company.
Indemnitee agrees to serve as a director of the Company. Indemnitee may at any
time and for any reason resign from such position (subject to any other
contractual obligation or any obligation imposed by operation of law), in which
event the Company will have no obligation to continue to allow Indemnitee to
serve in such position either pursuant to this Agreement or otherwise, but such
resignation shall have no effect on the Company’s obligations hereunder. This
Agreement will not be construed as giving Indemnitee any right to be retained in
the employ of the Company (or any other Enterprise).
ARTICLE
3
INDEMNIFICATION
3.1 Company Indemnification.
Except as otherwise provided in Section 3.4, if
Indemnitee was, is or becomes a party to, or was or is threatened to be made a
party to, or was or is otherwise involved in, any Proceeding, the Company will
indemnify and hold harmless Indemnitee to the fullest extent permitted by
applicable law, as the same exists or may hereafter be amended, interpreted or
replaced (but in the case of any such amendment, interpretation or replacement,
only to the extent that such amendment, interpretation or replacement permits
the Company to provide broader indemnification rights than were permitted prior
thereto), against any and all Expenses and Losses, and any federal, state, local
or foreign taxes imposed as a result of the actual or deemed receipt of any
payments under this Agreement, that are paid or incurred by Indemnitee in
connection with such Proceeding. For purposes of this Agreement, the meaning of
the phrase “to the fullest
extent permitted by law” will include to the fullest extent permitted by
Section 145 of the Delaware General Corporation Law (“DGCL”) or
any section that replaces or succeeds Section 145 of the DGCL with respect
to such matters. For avoidance of doubt, such indemnification shall
apply with respect to any Proceeding that pertains to the Indemnitee’s Corporate
Status, whether or not the facts underlying any claim made in such Proceeding
occurred prior to, on or after the date of this Agreement.
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3.2
Mandatory Indemnification if
Indemnitee is Wholly or Partly Successful. Notwithstanding any other
provision of this Agreement (other than Section 6.9), to
the extent that Indemnitee has been successful, on the merits or otherwise, in
defense of any Proceeding or any part thereof, the Company will indemnify
Indemnitee against all Expenses that are paid or incurred by Indemnitee 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 fewer than
all claims, issues or matters in such Proceeding, the Company will indemnify and
hold harmless Indemnitee against all Expenses paid or incurred by Indemnitee in
connection with each successfully resolved claim, issue or matter on which
Indemnitee was successful. For purposes of this Section 3.2, the
termination of any Proceeding, or any claim, issue or matter in such Proceeding,
by dismissal, settlement or a plea of nolo contendere with or
without prejudice will be deemed to be a successful result as to such
Proceeding, claim, issue or matter.
3.3
Indemnification for Expenses of
a Witness. Notwithstanding any other provision of this Agreement, to the
extent that Indemnitee is, by reason of his or her Corporate Status, a witness
in any Proceeding to which Indemnitee is not a party, the Company will indemnify
Indemnitee against all Expenses paid or incurred by Indemnitee on his or her
behalf in connection therewith.
3.4
Exclusions.
Notwithstanding any other provision of this Agreement, the Company will not be
obligated under this Agreement to provide indemnification in connection with the
following:
(a) Any
Proceeding (or part of any Proceeding) initiated or brought voluntarily by
Indemnitee against the Company or its directors, officers, employees or other
indemnities, unless the Board of Directors has authorized or consented to the
initiation of the Proceeding (or such part of any Proceeding) or the Proceeding
was commenced following a Change in Control; provided, however, that nothing in this
Section 3.4(a)
shall limit the right of Indemnitee to be indemnified under Section 8.4.
(b) Any
claim made against Indemnitee for (i) 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 (ii) any reimbursement of
the Company by the Indemnitee of any bonus or other incentive based or
equity-based compensation or of any profits realized by the Indemnitee from the
sale of securities of the Company, as required in each case under the Exchange
Act (including any such reimbursements that arise from an accounting restatement
of the Company pursuant to Section 304 of the Xxxxxxxx-Xxxxx Act of 2002 (the
“Xxxxxxxx-Xxxxx
Act”), or the payment to the Company of profits arising from the purchase
and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes
Oxley Act).
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ARTICLE
4
ADVANCEMENT
OF EXPENSES
4.1 Expense Advances. Except as
set forth in Section 4.2, the
Company will, if requested by Indemnitee, advance, to the fullest extent
permitted by law, to Indemnitee (hereinafter an “Expense
Advance”) any and all Expenses paid or incurred by Indemnitee in
connection with any Proceeding (whether prior to or after its final
disposition). Indemnitee’s right to each Expense Advance will not be subject to
the satisfaction of any standard of conduct and will be made without regard to
Indemnitee’s ultimate entitlement to indemnification under the other provisions
of this Agreement, or under provisions of the Certificate or By-laws or
otherwise. Each Expense Advance will be unsecured and interest free and will be
made by the Company without regard to Indemnitee’s ability to repay the Expense
Advance. The Indemnitee shall qualify for Expense Advances upon the execution
and delivery to the Company of this Agreement, which shall constitute an
undertaking providing that the Indemnitee undertakes to the fullest extent
permitted by law, by or on behalf of Indemnitee, to repay such Expense Advance
if it is ultimately determined, by final decision by a court or arbitrator, as
applicable, from which there is no further right to appeal, that Indemnitee is
not entitled to be indemnified for such Expenses under the Certificate, By-laws,
the DGCL, this Agreement or otherwise. No other form of undertaking shall be
required other than the execution of this Agreement.
4.2 Exclusions. Indemnitee will
not be entitled to any Expense Advance in connection with any of the matters for
which indemnity is excluded pursuant to Section 3.4.
4.3 Timing. An Expense
Advance pursuant to Section 4.1 will
be made within 10 business days after the receipt by the Company of a written
statement or statements from Indemnitee requesting such Expense Advance (which
statement or statements will include, if requested by the Company, reasonable
detail underlying the Expenses for which the Expense Advance is requested),
whether such request is made prior to or after final disposition of such
Proceeding.
ARTICLE
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CONTRIBUTION
IN THE EVENT OF JOINT LIABILITY
5.1 Contribution by Company. To
the fullest extent permitted by law, if the indemnification provided for in this
Agreement is unavailable to Indemnitee for any reason whatsoever, the Company,
in lieu of indemnifying Indemnitee, will contribute to the amount of Expenses
and Losses incurred or paid by Indemnitee in connection with any Proceeding in
proportion to the relative benefits received by the Company and all officers,
directors and employees of the Company other than Indemnitee who are jointly
liable with Indemnitee (or would be if joined in such Proceeding), on the one
hand, and Indemnitee, on the other hand, from the transaction from which such
Proceeding arose; provided, however, that the proportion
determined on the basis of relative benefit may, to the extent necessary to
conform to law, be further adjusted by reference to the relative fault of the
Company and all officers, directors and employees of the Company other than
Indemnitee who are jointly liable with Indemnitee (or would be if joined in such
Proceeding), on the one hand, and Indemnitee, on the other hand, in connection
with the events that resulted in such Expenses and Losses, as well as any other
equitable considerations which applicable law may require to be considered. The
relative fault of the Company and all officers, directors and employees of the
Company other than Indemnitee who are jointly liable with Indemnitee (or would
be if joined in such Proceeding), on the one hand, and Indemnitee, on the other
hand, will be determined by reference to, among other things, the degree to
which their actions were motivated by intent to gain personal profit or
advantage, the degree to which their liability is primary or secondary, and the
degree to which their conduct was active or passive; provided that in the case of
an Indemnitee who is a director of the Company, the amount of Losses paid by
such Indemnitee shall not exceed the amount of fees paid to such Indemnitee for
serving as a director during the 12 months preceding the commencement of the
Proceeding.
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5.2 Indemnification for Contribution
Claims by Others. To the fullest extent permitted by law, the Company
will fully indemnify and hold Indemnitee harmless from any claims of
contribution which may be brought by other officers, directors or employees of
the Company who may be jointly liable with Indemnitee for any Loss or Expense
arising from a Proceeding.
ARTICLE
6
PROCEDURES
AND PRESUMPTIONS FOR THE
DETERMINATION
OF ENTITLEMENT TO INDEMNIFICATION
6.1 Notification of Claims; Request for
Indemnification. Indemnitee agrees to notify promptly the Company in
writing of any claim made against Indemnitee for which indemnification will or
could be sought under this Agreement; provided, however, that a delay in
giving such notice will not deprive Indemnitee of any right to be indemnified
under this Agreement unless the Company did not otherwise learn of the
Proceeding and such delay is materially prejudicial to the Company’s ability to
defend such Proceeding, and, if such omission does materially prejudice such
Corporation’s rights, it will relieve such Corporation from liability only to
the extent of such prejudice; and, provided, further, that notice will be
deemed to have been given without any action on the part of Indemnitee in the
event the Company is a party to the same Proceeding. The omission to notify the
Company will not relieve the Company from any liability for indemnification
which it may have to Indemnitee otherwise than under this Agreement. Indemnitee
may deliver to the Company a written request to have the Company indemnify and
hold harmless Indemnitee in accordance with this Agreement. Subject to Section 6.9,
such request 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 request for indemnification, Indemnitee’s entitlement to indemnification
shall be determined according to Section 6.2. The
Secretary of the Company will, promptly upon receipt of such a request for
indemnification, advise the Board of Directors in writing that Indemnitee has
requested indemnification. The Company will be entitled to participate in any
Proceeding at its own expense.
6.2 Determination of Right to
Indemnification. Upon written request by Indemnitee for indemnification
pursuant to Section 6.1
hereof with respect to any Proceeding, a determination, if, but only if,
required by applicable law, with respect to Indemnitee’s entitlement thereto
will be made by one of the following: (a) if a Change in Control
shall have occurred, by Independent Counsel in a written opinion to the Board of
Directors, a copy of which shall be delivered to Indemnitee; or (b) if a Change
in Control shall not have occurred, (i) by a majority vote of the Disinterested
Directors, even though less than a quorum of the Board of Directors, (ii) by a
committee of Disinterested Directors designated by a majority vote of the
Disinterested Directors, even though less than a quorum of the Board of
Directors, (iii) if there are no such Disinterested Directors or, if such
Disinterested Directors so direct, by Independent Counsel in a written opinion
to the Board of Directors, a copy of which shall be delivered to Indemnitee or
(iv) if so directed by the Board of Directors, by the stockholders of the
Company. The Company promptly will advise Indemnitee in writing with respect to
any determination that Indemnitee is or is not entitled to indemnification,
including a description of any reason or basis for which indemnification has
been denied. .
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6.3 Selection of Independent
Counsel. If the determination of entitlement to indemnification pursuant
to Section 6.2 will
be made by an Independent Counsel, the Independent Counsel will be selected as
provided in this Section 6.3. If
a Change in Control shall not have occurred, the Independent Counsel shall be
selected by the Board of Directors and the Company will give written notice to
Indemnitee advising him or her of the identity of the Independent Counsel so
selected. If a Change in Control shall have occurred, the Independent
Counsel will be selected by Indemnitee and Indemnitee will give written notice
to the Company advising it of the identity of the Independent Counsel so
selected. In either event, Indemnitee or the Company, as the case may be, may,
within ten days after such written notice of selection is given, 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
this Agreement, and the objection will set forth with particularity the factual
basis of such assertion. Absent a proper and timely objection, the person so
selected will act as Independent Counsel. If a written objection is made and
substantiated, the Independent Counsel selected may not serve as Independent
Counsel unless and until such objection is withdrawn or a court has determined
that such objection is without merit. If, within 30 days after submission by
Indemnitee of a written request for indemnification pursuant to Section 6.1, no
Independent Counsel is selected, or an Independent Counsel for which an
objection thereto has been properly made remains unresolved, either the Company
or Indemnitee may petition the Court of Chancery of the State of Delaware or
other court of competent jurisdiction for resolution of any objection which has
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 court or by such other person as the court may designate, and the person
with respect to whom all objections are so resolved or the person so appointed
will act as Independent Counsel under Section 6.2. The
Company will pay any and all fees and expenses incurred by such Independent
Counsel in connection with acting pursuant to Section 6.2
hereof, and the Company will pay all fees and expenses incident to the
procedures of this Section 6.3,
regardless of the manner in which such Independent Counsel was selected or
appointed.
6.4 Burden of Proof. In making a
determination with respect to entitlement to indemnification hereunder, the
person, persons or entity making such determination will presume that Indemnitee
is entitled to indemnification under this Agreement. Anyone seeking to overcome
this presumption will have the burden of proof and the burden of persuasion, by
clear and convincing evidence. In making a determination with respect to
entitlement to indemnification hereunder which under this Agreement or
applicable law requires a determination of Indemnitee’s good faith and/or
whether Indemnitee acted in a manner which he or she reasonably believed to be
in or not opposed to the best interests of the Company, the person, persons or
entity making such determination will presume that Indemnitee has at all times
acted in good faith and in a manner he or she reasonably believed to be in or
not opposed to the best interests of the Company. Anyone seeking to overcome
this presumption will have the burden of proof and the burden of persuasion, by
clear and convincing evidence. Indemnitee will be deemed to have acted in good
faith if Indemnitee’s action with respect to a particular Enterprise is based on
the records or books of account of such Enterprise, including financial
statements, or on information supplied to Indemnitee by the officers of such
Enterprise in the course of their duties, or on the advice of legal counsel for
such Enterprise or on information or records given or reports made to such
Enterprise by an independent certified public accountant or by an appraiser or
other expert selected by such Enterprise; provided, however this sentence will
not be deemed to limit in any way the other circumstances in which Indemnitee
may be deemed to have met such standard of conduct. In addition, the knowledge
and/or actions, or failure to act, of any other director, officer, agent or
employee of such Enterprise will not be imputed to Indemnitee for purposes of
determining the right to indemnification under this Agreement.
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6.5 No Presumption in Absence of a
Determination or As Result of an Adverse Determination; Presumption Regarding
Success. Neither the failure of any person, persons or entity chosen to
make a determination as to whether Indemnitee has met any particular standard of
conduct or had any particular belief to make such determination, nor an actual
determination by such person, persons or entity that Indemnitee has not met such
standard of conduct or did not have such belief, prior to or after the
commencement of legal proceedings by Indemnitee to secure a judicial
determination that Indemnitee should be indemnified under this Agreement under
applicable law, will be a defense to Indemnitee’s claim or create a presumption
that Indemnitee has not met any particular standard of conduct or did not have
any particular belief. In addition, the termination of any Proceeding by
judgment, order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere, or its equivalent, will 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
indemnification is not permitted by this Agreement or applicable law. In the
event that any Proceeding to which Indemnitee is a party is resolved in any
manner other than by final adverse judgment (as to which all rights of appeal
therefrom have been exhausted or lapsed) against Indemnitee (including, without
limitation, settlement of such Proceeding with or without payment of money or
other consideration) it will be presumed that Indemnitee has been successful on
the merits or otherwise in such Proceeding. Anyone seeking to overcome this
presumption will have the burden of proof and the burden of persuasion, by clear
and convincing evidence.
6.6 Timing of Determination. The
Company will use its reasonable best efforts to cause any determination required
to be made pursuant to Section 6.2 to
be made as promptly as practicable after Indemnitee has submitted a written
request for indemnification pursuant to Section 6.1. If
the person, persons or entity chosen to make a determination does not make such
determination within 30 days after the later of the date (a) the Company
receives Indemnitee’s request for indemnification pursuant to Section 6.1 and
(b) on which an Independent Counsel is selected pursuant to Section 6.3, if
applicable (and all objections to such person, if any, have been resolved), the
requisite determination of entitlement to indemnification will be deemed to have
been made and Indemnitee will be entitled to such indemnification, so long as
(i) Indemnitee has fulfilled his or her obligations pursuant to Section 6.8 and
(ii) such indemnification is not prohibited under applicable law; provided, however, that such 30 day
period may be extended for a reasonable time, not to exceed an additional 30
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 of or evaluating of documentation and/or information relating
thereto; and provided,
further, that the
foregoing provisions of this Section 6.6 shall not
apply if the determination of entitlement to indemnification is to be made by
the stockholders pursuant to Section 6.2 of this
Agreement and if (A) within fifteen (15) days after receipt by the Company of
the request for such determination the Board of Directors has resolved to submit
such determination to the stockholders for their consideration at an annual
meeting thereof to be held within 75 days after such receipt and such
determination is made thereat, or (B) a special meeting of stockholders is
called within 15 days after such receipt for the purpose of making such
determination, such meeting is held for such purpose within 60 days after having
been so called and such determination is made thereat.
10
6.7 Timing of Payments. All
payments of Expenses, other than Expense Advances which are governed by Section 4.3, and
other amounts by the Company to the Indemnitee pursuant to this Agreement will
be made as soon as practicable after a written request or demand therefor by
Indemnitee is presented to the Company, but in no event later than 30 days
after (i) such demand is presented or (ii) such later date as a
determination of entitlement to indemnification is made in accordance with
Section 6.6, if applicable. 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.
6.8 Cooperation. Indemnitee will
cooperate with the person, persons or entity making a 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 Expenses incurred by Indemnitee in so cooperating with the
person, persons or entity making such determination will be borne by the Company
(irrespective of the determination as to Indemnitee’s entitlement to
indemnification) and the Company will indemnify Indemnitee therefor and will
hold Indemnitee harmless therefrom.
6.9 Time for Submission of
Request. Indemnitee will be required to submit any request for
Indemnification pursuant to this Article 6 within
a reasonable time, not to exceed two years, after any judgment, order,
settlement, dismissal, arbitration award, conviction, acceptance of a plea of
nolo contendere (or its equivalent) or other full or partial final determination
or disposition of the Proceeding (with the latest date of the occurrence of any
such event to be considered the commencement of the two year
period).
11
6.10 Trust Deposit on a Change in
Control. In the event of a Change in Control, the Company shall, upon
written request by Indemnitee, create a trust for the benefit of the Indemnitee
and from time to time upon written request of Indemnitee shall fund the trust in
an amount sufficient to satisfy any and all Losses and Expenses reasonably
anticipated at the time of each such request to be incurred in connection with
investigating, preparing for, participating in, and/or defending any Proceeding
relating to an event giving rise to indemnification hereunder. The amount or
amounts to be deposited in the trust pursuant to the foregoing funding
obligation shall be determined by the Independent Counsel. The terms of the
trust shall provide that (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 ten (10) days of a request by
the Indemnitee, any and all Expenses to the Indemnitee (and the Indemnitee
hereby agrees to reimburse the trust under the same circumstances for which the
Indemnitee would be required to reimburse the Company under Section 4.1 of
this Agreement), (iii) the trust shall continue to be funded by the Company
in accordance with the funding obligation 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 and (v) all
unexpended funds in the trust shall revert to the Company upon a final
determination by the Independent Counsel or a court of competent jurisdiction,
as the case may be, that the Indemnitee has been fully indemnified under the
terms of this Agreement. The trustee shall be chosen by the Indemnitee. Nothing
in this Section 6.10
shall relieve the Company of any of its obligations under this Agreement. All
income earned on the assets held in the trust shall be reported as income by the
Company for federal, state, local and foreign tax purposes. The Company shall
pay all costs of establishing and maintaining the trust and shall indemnify the
trustee against any and all expenses (including attorneys’ fees), claims,
liabilities, loss and damages arising out of or relating to this Agreement or
the establishment and maintenance of the trust.
ARTICLE
7
LIABILITY
INSURANCE
7.1 Company Insurance. Subject to
Section 7.3, for
the duration of Indemnitee’s service as a director and/or officer of the
Company, and thereafter for so long as Indemnitee shall be subject to any
pending or possible Proceeding, the Company shall cause to be maintained in
effect policies of directors’ and officers’ liability insurance providing
coverage for directors and/or officers of the Company. The Indemnitee
shall be named as an insured in all directors’ and officers’ liability insurance
policies maintained by the Company in such manner as to provide the Indemnitee
the same rights and benefits, subject to the same limitations, as are accorded
each of the Company’s directors and officers most favored by such
policies.
7.2 Notice to Insurers. If, at the
time of receipt by the Company of a notice from any source of a Proceeding as to
which Indemnitee is a party or participant, the Company will give prompt written
notice of such Proceeding to the insurers in accordance with the procedures set
forth in the respective policies, and the Company will provide Indemnitee with a
copy of such notice and copies of all subsequent correspondence between the
Company and such insurers related thereto. The Company will thereafter take all
necessary or desirable actions to cause such insurers to pay, on behalf of
Indemnitee, all amounts payable as a result of such Proceeding in accordance
with the terms of such policies.
7.3 Insurance Not Required.
Notwithstanding Section 7.1, the
Company will have no obligation to obtain or maintain the insurance contemplated
by Section 7.1 if
the Board of Directors determines in good faith that such insurance is not
reasonably available, if the premium costs for such insurance are
disproportionately high compared to the amount of coverage provided, or if the
coverage provided by such insurance is limited by exclusions so as to provide an
insufficient benefit. The Company will promptly notify Indemnitee in writing of
any such determination not to provide insurance coverage. Notwithstanding the
foregoing, in the event of a Change in Control, the Company shall maintain in
force any and all insurance policies then maintained by the Company in providing
insurance—directors’ and officers’ liability, fiduciary, employment practices or
otherwise—in respect of Indemnitee, for a period of six years
thereafter.
12
ARTICLE
8
REMEDIES
OF INDEMNITEE
8.1 Action by Indemnitee. In the
event that (i) a determination is made pursuant to Article 6 of
this Agreement that Indemnitee is not entitled to indemnification under this
Agreement, (ii) an Expense Advance is not timely made pursuant to Section 4.3 of
this Agreement, (iii) no determination of entitlement to indemnification is
made within the applicable time periods specified in Section 6.6 or
(iv) payment of indemnified amounts is not made within the applicable time
periods specified in Section 6.7,
Indemnitee will be entitled to an adjudication in an appropriate court of the
State of Delaware, or in any other court of competent jurisdiction, of his or
her entitlement to such indemnification or payment of an Expense
Advance. Alternatively, Indemnitee, at Indemnitee’s 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. If any dispute is submitted to arbitration pursuant to
this Section
8.1, the Indemnitee and the Company shall cooperate in good faith to seek
the appointment of a mutually acceptable arbitrator. If the
Indemnitee and the Company are unable to agree on the appointment of a mutually
acceptable arbitrator within thirty (30) days after the Company’s receipt of the
applicable demand for arbitration, then each of the Company and the Indemnitee
shall appoint one arbitrator, and the two arbitrators shall appoint a third
arbitrator to conduct the arbitration. The provisions of Delaware law
(without regard to its conflict of laws rules) will apply to any such
arbitration. The Company will not oppose Indemnitee’s right to seek any such
adjudication or award in arbitration.
8.2 De
Novo Review if Prior
Adverse Determination. In the event that a determination is made pursuant
to Article 6 that
Indemnitee is not entitled to indemnification, any judicial proceeding or
arbitration commenced pursuant to this Article 8 will
be conducted in all respects as a de novo trial or arbitration, as applicable,
on the merits and Indemnitee will not be prejudiced by reason of that adverse
determination. In any judicial proceeding or arbitration commenced pursuant to
this Article 8,
Indemnitee will be presumed to be entitled to indemnification under this
Agreement, the Company will have the burden of proving Indemnitee is not
entitled to indemnification and the Company may not refer to or introduce
evidence of any determination pursuant to Article 6
adverse to Indemnitee for any purpose. If Indemnitee commences a judicial
proceeding or arbitration pursuant to this Article 8,
Indemnitee will not be required to reimburse the Company for any Expense Advance
made pursuant to Article 4 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).
8.3 Company Bound by Favorable
Determination by Reviewing Party. If a determination is made that
Indemnitee is entitled to indemnification pursuant to Article 6, the
Company will be bound by such determination in any judicial proceeding or
arbitration commenced pursuant to this Article 8,
absent (i) a misstatement by Indemnitee of a material fact or an omission
of a material fact necessary to make Indemnitee’s statements in connection with
the request for indemnification not materially misleading or (ii) a
prohibition of such indemnification under law.
13
8.4 Company Bears Expenses if Indemnitee
Seeks Adjudication. In the event that Indemnitee, pursuant to this
Article 8, seeks a judicial adjudication or arbitration of his or her
rights under, or to recover damages for breach of, this Agreement, any other
agreement for indemnification, the indemnification or advancement of expenses
provisions in the Certificate or By-laws, payment of Expenses in advance or
contribution hereunder or to recover under any director and officer liability
insurance policies maintained by the Company, the Company will, to the fullest
extent permitted by law, indemnify and hold harmless Indemnitee against any and
all Expenses which are paid or incurred by Indemnitee in connection with such
judicial adjudication or arbitration, regardless of whether Indemnitee
ultimately is determined to be entitled to such indemnification, payment of
Expenses in advance or contribution or insurance recovery. In addition, if
requested by Indemnitee, the Company will (within five days after receipt by the
Company of the written request therefor), pay as an Expense Advance such
Expenses, to the fullest extent permitted by law.
8.5 Company Bound by Provisions of this
Agreement. The Company will be precluded from asserting in any judicial
or arbitration proceeding commenced pursuant to this Article 8 that
the procedures and presumptions of this Agreement are not valid, binding and
enforceable and will stipulate in any such judicial or arbitration proceeding
that the Company is bound by all the provisions of this Agreement.
ARTICLE
9
NON-EXCLUSIVITY,
SUBROGATION; NO DUPLICATIVE PAYMENTS;
PRIMACY
OF INDEMNIFICATION
9.1 Non-Exclusivity. The rights of
indemnification and to receive Expense Advances as provided by this Agreement
will not be deemed exclusive of any other rights to which Indemnitee may at any
time be entitled under applicable law, the Certificate, the By-laws, any
agreement or covenant in an agreement, a vote of stockholders, a resolution of
the directors or otherwise. No amendment, alteration or repeal of
this Agreement or of any provision hereof limits or restricts any right of
Indemnitee under this Agreement in respect of any action taken or omitted by
such Indemnitee prior to such amendment, alteration or repeal. To the extent
that a change in the DGCL, whether by statute or judicial decision, permits
greater indemnification than would be afforded currently under the Certificate,
By-laws, and this Agreement, it is the intent of the parties hereto that
Indemnitee 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 will 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, will not prevent the concurrent
assertion or employment of any other right or remedy.
9.2 Subrogation. In the event of
any payment by the Company under this Agreement, the Company will be subrogated
to the extent of such payment to all of the rights of recovery of Indemnitee
with respect thereto and Indemnitee will 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 (it being understood that all of Indemnitee’s reasonable Expenses related
thereto will be borne by the Company).
14
9.3 No Duplicative Payments.
Subject to Section
9.4, the Company will not be liable under this Agreement to make any
payment of amounts otherwise indemnifiable (or any Expense for which advancement
is provided) hereunder if and to the extent that Indemnitee has otherwise
actually received such payment under any insurance policy, contract, agreement
or otherwise. Subject to Section 9.4, the
Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee in
respect of Proceedings relating to Indemnitee’s service at the request of the
Company as a director, officer, employee, partner, member, manager, trustee,
fiduciary or agent of any other Enterprise will be reduced by any amount
Indemnitee has actually received as indemnification or advancement of Expenses
from such other Enterprise.
9.4 Primacy of
Indemnification. The Company hereby acknowledges and agrees
that the indemnification provided to the Indemnitee by the Company under this
Agreement, the Certificate or By-Laws, or any other agreements or covenants of
the Company to provide indemnification, or otherwise with respect to matters
arising by reason of the Indemnitee’s Corporate Status (collectively, the “Company’s
Indemnification Obligation”) is primary and shall not be affected by any
indemnification obligations of any other persons or entities that may apply to
such matters, which other indemnification obligations shall be secondary as to
such matters. Without limiting the generality of the foregoing, the
Company acknowledges and agrees that the Indemnitee is a representative of
Perseus Partners VII, L.P. (“Perseus”)
who, pursuant to a contractual right held by Perseus, is serving in some
capacity (e.g., director, officer, fiduciary) for the Company that results in
his or her Corporate Status. If the Indemnitee is provided
indemnification by Perseus or any of its Controlled Affiliates (other than
Company and any subsidiaries thereof) (collectively, the “Perseus
Entities”) in connection with any matters resulting from the Indemnitee’s
service to the Company or otherwise for which a claim for indemnification may be
made under the Company’s Indemnification Obligation, such other indemnification
by such Perseus Entity shall be secondary and shall have no effect on the
Company’s Indemnification Obligation, which shall be primary as to all matters
arising by reason of the Indemnitee’s Corporate Status. The
Indemnitee shall have the right to assign to any Perseus Entity its right to
receive indemnification payments (including without limitation Expense Advances)
from the Company whether under this Agreement or otherwise and the Company will
recognize and honor such assignment. If any Perseus Entity makes any
payment to the Indemnitee in connection with any matter for which
indemnification may be sought by the Indemnitee under this Agreement or
otherwise pursuant to the Company’s Indemnification Obligation, the Company will
promptly reimburse such Perseus Entity for the full amount of such payment
(subject, in the case of any payment that constitutes Expense Advances, to the
delivery by such Perseus Entity to the Company of an undertaking to repay such
amount if it shall ultimately be determined that the Indemnitee is not entitled
to be indemnified against such Expenses) and the Company hereby agrees that such
Perseus Entity shall be fully subrogated to the rights of the Indemnitee to the
extent of any such payment (including without limitation any rights of
contribution under Article 5
hereof).
15
ARTICLE
10
DEFENSE
OF PROCEEDINGS
10.1 Company Assuming the Defense.
Subject to Section 10.3
below, in the event the Company is obligated to pay in advance the Expenses of
any Proceeding pursuant to Article 4, the
Company will be entitled, by written notice to Indemnitee, to assume the defense
of such Proceeding, with counsel approved by Indemnitee, which approval will not
be unreasonably withheld. The Company will identify the counsel it proposes to
employ in connection with such defense as part of the written notice sent to
Indemnitee notifying Indemnitee of the Company’s election to assume such
defense, and Indemnitee will be required, within ten days following Indemnitee’s
receipt of such notice, to inform the Company of its approval of such counsel
or, if it has objections, the reasons therefor. If such objections cannot be
resolved by the parties, the Company will identify alternative counsel, which
counsel will also be subject to approval by Indemnitee in accordance with the
procedure described in the prior sentence.
10.2 Right of Indemnitee to Employ
Counsel. Following approval of counsel by Indemnitee pursuant to Section 10.1 and
retention of such counsel by the Company, the Company will not be liable to
Indemnitee under this Agreement for any fees and expenses of counsel
subsequently incurred by Indemnitee with respect to the same Proceeding; provided, however, that if
counsel to the Indemnitee shall have reasonably concluded that there exists a
potential, but not actual, conflict of interest between the Company (or any
other person or persons included in a joint defense) and Indemnitee in the
conduct of the defense or representation by such counsel retained by the Company
and Indemnitee, the Company’s indemnification and expense advancement
obligations to Indemnitee under this Agreement shall include reasonable legal
fees and reasonable costs incurred by Indemnitee for separate counsel retained
by Indemnitee to monitor the litigation; provided, further, that if such counsel
retained by Indemnitee reasonably concludes that there is an actual conflict
between the Company (or any other person or persons included in a joint defense)
and Indemnitee in the conduct of such defense or representation by such counsel
retained by the Company, such counsel may assume Indemnitee’s defense in such
proceeding. The existence of an actual or potential conflict, and whether any
such conflict may be waived, shall be determined pursuant to the rules of
attorney professional conduct and applicable law.
10.3 Company Not Entitled to Assume
Defense. Notwithstanding Section 10.1,
the Company will not be entitled to assume the defense of any Proceeding brought
by or on behalf of the Company or any Proceeding as to which Indemnitee has
reasonably made the conclusion that there exists such a conflict as described in
the proviso to the first sentence of Section
10.2.
ARTICLE
11
SETTLEMENT
11.1 Company Bound by Provisions of this
Agreement. Notwithstanding anything in this Agreement to the contrary,
the Company will have no obligation to indemnify Indemnitee under this Agreement
for any amounts paid in settlement of any Proceeding effected without the
Company’s prior written consent.
11.2 When Indemnitee’s Prior Consent
Required. The Company will not, without the prior written consent of
Indemnitee, consent to the entry of any judgment against Indemnitee or enter
into any settlement or compromise which (i) includes an admission of fault
of Indemnitee, any non-monetary remedy imposed on Indemnitee or a Loss for which
Indemnitee is not wholly and actually indemnified hereunder or (ii) with
respect to any Proceeding with respect to which Indemnitee may be or is made a
party or a participant or may be or is otherwise entitled to seek
indemnification hereunder, does not include, as an unconditional term thereof,
the full release of Indemnitee from all liability in respect of such Proceeding,
which release will be in form and substance reasonably satisfactory to
Indemnitee. Neither the Company nor Indemnitee will unreasonably withhold its
consent to any proposed settlement; provided, however, Indemnitee may
withhold consent to any settlement that does not provide a full and
unconditional release of Indemnitee from all liability in respect of such
Proceeding.
16
ARTICLE
12
MISCELLANEOUS
12.1 Entire Agreement. This
Agreement constitutes the entire agreement and understanding of the parties in
respect of the subject matter hereof and supersedes all prior understandings,
agreements or representations by or among the parties, written or oral, to the
extent they relate in any way to the subject matter hereof; provided, however, it is agreed that
the provisions contained in this Agreement are a supplement to, and not a
substitute for, any provisions regarding the same subject matter contained in
the Certificate, the By-laws, any employment or similar agreement between the
parties, and any other agreements or covenants to provide indemnification to
Indemnitee.
12.2 Assignment; Binding Effect; Third
Party Beneficiaries. No party may assign either this Agreement or any of
its rights, interests or obligations hereunder without the prior written
approval of the other party and any such assignment by a party without prior
written approval of the other parties will be deemed invalid and not binding on
such other parties; provided, however, that the Company may assign all (but not
less than all) of its rights, obligations and interests hereunder to any direct
or indirect successor to all or substantially all of the business or assets of
the Company by purchase, merger, consolidation or otherwise and will cause such
successor to be bound by and expressly assume the terms and provisions hereof.
All of the terms, agreements, covenants, representations, warranties and
conditions of this Agreement are binding upon, and inure to the benefit of and
are enforceable by, the parties and their respective successors, permitted
assigns, heirs, executors and personal and legal representatives. There are no
third party beneficiaries having rights under or with respect to this Agreement.
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 reasonably 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. The indemnification provided under this Agreement
shall continue as to Indemnitee for any action taken or not taken while serving
in an indemnified capacity pertaining to any indemnifiable event hereunder even
though Indemnitee may have ceased to serve in such capacity at the time of any
Proceeding.
12.3 Notices. All notices, requests
and other communications provided for or permitted to be given under this
Agreement must be in writing and be given by personal delivery, by certified or
registered United States mail (postage prepaid, return receipt requested), by a
nationally recognized overnight delivery service for next day delivery, or by
facsimile transmission, as follows (or to such other address as any party may
give in a notice given in accordance with the provisions
hereof):
17
If to Company:
PhotoMedex,
Inc.
000
Xxxxxxxx Xxxxx
Xxxxxxxxxxxxxxx,
Xxxxxxxxxxxx 00000
Attention:
Chief Executive Officer
Facsimile:
(000) 000-0000
If to
Indemnitee:
Perseus
Partners VII, L.P.
c/o
Perseus, L.L.C.
0000
Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxx 000
Xxxxxxxxxx,
XX 00000-0000
Attention: Xxxxxx
Xxxxxxxxx
Facsimile:
(000) 000-0000
and
to:
Perseus
Partners VII, L.P.
c/o
Perseus L.L.C.
1325
Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attention: Xxxx
X. Xxxxxx
Facsimile:
(000) 000-0000
All
notices, requests or other communications will be effective and deemed given
only as follows: (i) if given by personal delivery, upon such personal
delivery, (ii) if sent by certified or registered mail, on the fifth
business day after being deposited in the United States mail, (iii) if sent
for next day delivery by overnight delivery service, on the date of delivery as
confirmed by written confirmation of delivery, (iv) if sent by facsimile,
upon the transmitter’s confirmation of receipt of such facsimile transmission,
except that if such confirmation is received after 5:00 p.m. (in the recipient’s
time zone) on a business day, or is received on a day that is not a business
day, then such notice, request or communication will not be deemed effective or
given until the next succeeding business day. Notices, requests and other
communications sent in any other manner, including by electronic mail, will not
be effective.
12.4 Specific Performance;
Remedies. Each party acknowledges and agrees that the other party would
be damaged irreparably if any provision of this Agreement were not performed in
accordance with its specific terms or were otherwise breached. Accordingly, the
parties will be entitled to an injunction or injunctions to prevent breaches of
the provisions of this Agreement and to enforce specifically this Agreement and
its provisions in any action or proceeding instituted in any state or federal
court sitting in New York, New York having jurisdiction over the parties and the
matter, in addition to any other remedy to which they may be entitled, at law or
in equity. Except as expressly provided herein, the rights, obligations and
remedies created by this Agreement are cumulative and in addition to any other
rights, obligations or remedies otherwise available at law or in equity. Except
as expressly provided herein, nothing herein will be considered an election of
remedies.
18
12.5 Headings. The article and
section headings contained in this Agreement are inserted for convenience only
and will not affect in any way the meaning or interpretation of this
Agreement.
12.6 Governing Law. This Agreement
will be governed by and construed in accordance with the laws of the State of
Delaware, without giving effect to any choice of law principles.
12.7 Amendment. This Agreement may
not be amended or modified except by a writing signed by all of the
parties.
12.8 Extensions; Waivers. Any party
may, for itself only, (i) extend the time for the performance of any of the
obligations of any other party under this Agreement, (ii) waive any
inaccuracies in the representations and warranties of any other party contained
herein or in any document delivered pursuant hereto and (iii) waive
compliance with any of the agreements or conditions for the benefit of such
party contained herein. Any such extension or waiver will be valid only if set
forth in a writing signed by the party to be bound thereby. No waiver by any
party of any default, misrepresentation or breach of warranty or covenant
hereunder, whether intentional or not, may be deemed to extend to any prior or
subsequent default, misrepresentation or breach of warranty or covenant
hereunder or affect in any way any rights arising because of any prior or
subsequent such occurrence. Neither the failure nor any delay on the part of any
party to exercise any right or remedy under this Agreement will operate as a
waiver thereof, nor will any single or partial exercise of any right or remedy
preclude any other or further exercise of the same or of any other right or
remedy.
12.9 Severability. The provisions
of this Agreement will be deemed severable and the invalidity or
unenforceability of any provision will not affect the validity or enforceability
of the other provisions hereof; provided that if any provision of this
Agreement, as applied to any party or to any circumstance, is judicially
determined not to be enforceable in accordance with its terms, the parties agree
that the court judicially making such determination may modify the provision in
a manner consistent with its objectives such that it is enforceable, and/or to
delete specific words or phrases, and in its modified form, such provision will
then be enforceable and will be enforced.
12.10 Counterparts; Effectiveness.
This Agreement may be executed in two or more counterparts, each of which will
be deemed an original but all of which together will constitute one and the same
instrument. This Agreement will become effective when one or more counterparts
have been signed by each of the parties and delivered to the other parties,
which delivery may be made by exchange of copies of the signature page by
facsimile transmission.
19
12.11 Construction. The words
“include,” “includes,” and “including” will be deemed to be followed by “without
limitation.” Pronouns in masculine, feminine, and neuter genders will be
construed to include any other gender, and words in the singular form will be
construed to include the plural and vice versa, unless the context otherwise
requires. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,”
and words of similar import refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited. The parties intend that each
representation, warranty, and covenant contained herein will have independent
significance. If any party has breached any representation, warranty, or
covenant contained herein in any respect, the fact that there exists another
representation, warranty or covenant relating to the same subject matter
(regardless of the relative levels of specificity) which the party has not
breached will not detract from or mitigate the fact that the party is in breach
of the first representation, warranty, or covenant. Time is of the essence in
the performance of this Agreement.
20
IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the date first above written.
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PHOTOMEDEX,
INC.
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By:
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/s/
Xxxxxxx X. X’Xxxxxxx
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Name:
Xxxxxxx X. X’Xxxxxxx
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Title:
President & Chief Executive Officer
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INDEMNITEE:
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/s/
Xxxx X. Xxxxxx
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Print
Name: Xxxx X.
Xxxxxx
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