EXHIBIT 10.1
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INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is made as of ____________ by
and among TSR., Inc., 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 and/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 Company has determined that the increased difficulty in
attracting and retaining such persons is detrimental to the best interests of
the Company and that the Company should act to assure such persons that there
will be increased certainty of such protection in the future.
WHEREAS, the Delaware General Corporation Law ("DGCL") expressly provides
that the indemnification provisions set forth therein are not exclusive, and
thereby contemplate that contracts may be entered into between companies and
members of the board of directors, officers and others with respect to
indemnification.
WHEREAS , it is reasonable, prudent and necessary for the Company to
contractually 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.
WHEREAS, Indemnitee may not be willing to serve as a director of the
Company without the additional protection provided for under this Agreement, and
the Company desires Indemnitee to serve in such capacity and Indemnitee is
willing to serve and continue to serve on the condition that he be so
indemnified;
NOW, THEREFORE, the Company and Indemnitee do hereby agree as follows:
1. SERVICES TO THE COMPANY. Indemnitee will serve, or continue to serve, at
the will of each Company in accordance with the Company's Bylaws, as a director
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) "Action" means 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, criminal, administrative or investigative nature.
(b) "Beneficial Owner" shall have the meaning given to such term in
Rule 13d-3 under the Exchange Act; provided, that Beneficial Owner shall exclude
any Person otherwise
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becoming a Beneficial Owner by reason of the stockholders of the Company
approving a merger of the Company with another entity.
(c) "Board" means the Board of Directors of the Company.
(d) 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) Change in Board of Directors. During any period of two
consecutive years (starting after the execution of this Agreement), individuals
who at the beginning of such period constitute the Board, and any new director
(other than a director designated by a person who has entered into an agreement
with the Company to effect a transaction described in Sections 2(d)(ii) or
2(d)(iii)) whose election by the Board or nomination for election by the
Company's stockholders was approved by a vote of at least 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 of the Board;
(ii) Corporate Transactions. The effective date of a merger or
consolidation of the Company with any other entity unless the voting securities
of the Company outstanding immediately prior to such transaction continue to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 51% of the combined voting power
of the voting securities of the surviving entity outstanding immediately after
such transaction that have the power to elect at least a majority of the board
of directors or other governing body of such surviving entity.
(iii) Liquidation. The approval by the stockholders of the
Company of a complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's assets.
(iv) 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, whether or not the Company is then
subject to such reporting requirement.
(e) "Corporate Status" describes a person who is or was serving as a
director, officer, employee or agent of the Company or, at the request of the
Company, as a director, officer, employee, agent or trustee of any other
Enterprise. References to "serving at the request of the Company" shall include,
without limitation, 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 an employee benefit plan, its
participants or beneficiaries.
(f) "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.
(g) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(h) "Enterprise" means the Company and any other corporation, limited
liability company, partnership, joint venture, trust, employee benefit plan or
other enterprise.
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(i) "Expenses" means all disbursements or expenses of the types
customarily 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, including (without limitation)
attorneys' fees and expenses, retainers, court costs, transcript costs, fees of
experts, witness fees, travel expenses, duplicating costs, printing and binding
costs, telephone charges, postage, and delivery service fees. Expenses also
include disbursements and 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, supersedes bond, or
other appeal bond or its equivalent.
(j) Reference to "fines" shall include any excise tax assessed with
respect to any employee benefit plan.
(k) A person who acted in good faith and in a manner he reasonably
believed to be in the best interests of the participants and beneficiaries of an
employee benefit plan shall be deemed to have acted in manner "not opposed to
the best interests of the Company".
(l) References "to the fullest extent permitted by applicable law"
shall include, but not be limited to:
(i) to the fullest extent permitted by the provision of the DGCL,
as applicable, that authorizes or contemplates additional indemnification by
agreement, or the corresponding provision of any amendment to or replacement of
the DGCL, as applicable; and
(ii) to the fullest extent authorized or permitted by any
amendments to or replacements of the DGCL, as applicable, adopted after the date
of this Agreement that increase the extent to which a corporation may indemnify
its directors
(m) "Proceeding" means any Action in which Indemnitee was, is or will
be involved (as a party or otherwise) by reason of Indemnitee's Corporate
Status, or any action taken by him or of any action on his part while acting in
his Corporate Status, 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) "Independent Counsel" means a law firm, or a member of a law firm,
that is experienced in matters of corporation law and neither is, nor in the
past five years has been, retained to represent: (i) the Company or Indemnitee
in any matter material to any 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. "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 any
of the Company or Indemnitee in an action to determine Indemnitee's rights under
this Agreement. The Company agrees to pay the reasonable fees and expenses of
the Independent Counsel and to fully indemnify such counsel against any and all
Expenses, claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto.
3. THIRD-PARTY PROCEEDINGS. If Indemnitee is, or is threatened to be made,
a party to or a participant in any Proceeding, other than a Proceeding by or in
the right of the Company to procure a judgment in its favor against Indemnitee,
the Company shall indemnify Indemnitee to the fullest extent permitted by
applicable law against all Expenses, judgments, fines and amounts paid in
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settlement directly or indirectly incurred by or behalf of Indemnitee 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 and, in the case of a
criminal proceeding, had no reasonable cause to believe that his conduct was
unlawful.
4. PROCEEDINGS BY OR IN THE RIGHT OF A COMPANY. If Indemnitee is, or is
threatened to be made, a party to or a participant in any Proceeding by or in
the right of the Company to procure a judgment in its favor, the Company shall
indemnify Indemnitee to the fullest extent permitted by applicable law against
all Expenses directly or indirectly incurred by or on behalf of Indemnitee 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 of
matter as to which Indemnitee shall have been finally adjudged by a court to be
liable to the Company unless the Delaware Court of Chancery or any court in
which the Proceeding was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
Indemnitee is fairly and reasonably entitled to indemnification.
5. PARTY WHO IS WHOLLY OR PARTLY SUCCESSFUL.
(a) Notwithstanding any other provisions of this Agreement, to the
fullest extent permitted by applicable law:
(i) 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 Indemnitee against all Expenses directly or indirectly incurred
by or on behalf of Indemnitee in connection therewith.
(ii) If Indemnitee 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 Indemnitee against all Expenses directly or
indirectly incurred by or on behalf of Indemnitee in connection with (x) each
successfully resolved claim, issue or matter and (y) each claim, issue, or
matter related to any claim, issue or matter on which the Indemnitee was
successful.
(b) 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 fullest extent permitted by applicable law,
the Company shall indemnify Indemnitee against all Expenses directly or
indirectly incurred by or on behalf of Indemnitee if, by reason of his Corporate
Status, Indemnitee is a witness in any Action to which Indemnitee is not a
party.
7. ADDITIONAL INDEMNIFICATION. Notwithstanding any limitation in Sections
3, 4, or 5, the Company shall indemnify Indemnitee to the fullest extent
permitted by applicable law 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,
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fines and amounts paid in settlement in connection with the Proceeding;
provided, that the Company shall have the right to consent to any settlement,
which consent shall not be unreasonably withheld.
8. EXCLUSIONS. The Company shall not be obligated under this Agreement to
make any indemnity in connection with any claim made against Indemnitee:
(a) for an accounting of profits made from the purchase and sale (or
sale and purchase) by Indemnitee of securities of the Parent within the meaning
of Section 16(b) of the Exchange Act, or similar provisions of other federal or
state statutory law or common law; or
(b) in connection with any Proceeding (or any part of any Proceeding)
initiated by Indemnitee, unless (i) such indemnification is expressly required
to be made by applicable law; (ii) the Board authorized the Proceeding (or any
part of any Proceeding) prior to its initiation; or (iii) the Company provides
the indemnification, in its sole discretion, pursuant to the powers vested in
the Company to the fullest extent permitted by applicable law.
9. ADVANCES OF EXPENSES. Notwithstanding any provision of this Agreement,
to the fullest extent permitted by applicable law and not prohibited by Section
402 of the Xxxxxxxx-Xxxxx Act of 2002 or any successor provision of law, the
Company shall advance the Expenses incurred by or on behalf of Indemnitee in
connection with any Proceeding within 20 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, and made without regard to Indemnitee's ability to
repay the expenses or ultimate entitlement to indemnification under the other
provisions of this Agreement. Advances shall include all reasonable Expenses
incurred pursuing an Action 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 to repay the advance to
the extent that it is ultimately determined that Indemnitee is not entitled to
be indemnified by the Company. This Section 9 shall not apply to any claim made
by Indemnitee for which indemnity is excluded pursuant to Section 8.
10. PROCEDURE FOR NOTIFICATION AND DEFENSE OF CLAIM.
(a) Within 30 days after service of process of Indemnitee relating to
notice of the commencement of any Proceeding, Indemnitee shall submit to the
Company a written request, including such documentation and information as is
reasonably available to Indemnitee and is reasonably necessary to determine
whether and to what extent Indemnitee is entitled to indemnification. The
failure to notify the Company within such period will not relieve the Company
from any liability that it may have to Indemnitee (i) under this Agreement
except to the extent the failure adversely affects the Company's rights, legal
position, ability to defend or ability to obtain insurance coverage with respect
to such Proceeding or (ii) otherwise than under this Agreement. The Secretary of
the Company shall advise the Board in writing promptly upon receipt of such a
request for indemnification.
(b) If the Company shall be obligated to pay the Expenses in
connection with any Proceeding against the Indemnitee, the Company shall be
entitled to assume and control the defense of such Proceeding (with counsel
consented to by the Indemnitee, which consent shall not be unreasonably
withheld), upon the delivery to the Indemnitee of written notice of its election
so to do. After delivery of such notice, consent to such counsel by the
Indemnitee and the retention of such counsel by the Company, the Company will
not be liable to the Indemnitee under this Agreement for
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any fees of separate counsel subsequently incurred by the Indemnitee with
respect to the same Proceeding, provided that the reasonable fees and expenses
of Indemnitee's counsel shall be at the expense of the Company if:
(i) the employment of separate counsel by the Indemnitee has been
previously authorized by the Company;
(ii) the Indemnitee or counsel selected by the Company shall have
concluded that there may be a conflict of interest between the Company and the
Indemnitee or among Indemnitees jointly represented in the conduct of any such
defense; or
(iii) the Company shall not, in fact, have employed counsel, to
which Indemnitee has consented as aforesaid, to assume the defense of such
Proceeding.
(c) The Company may participate in the Proceeding at its own expense.
The Company will not, without prior written consent of the Indemnitee, effect
any settlement of a claim in any threatened or pending Proceeding unless such
settlement solely involves the payment of money and includes an unconditional
release of the Indemnitee from all liability on any claims that are or were
threatened to be made against the Indemnitee in the Proceeding.
11. PROCEDURE UPON APPLICATION FOR INDEMNIFICATION.
(a) Upon written request by Indemnitee for indemnification pursuant to
the first sentence of Section 10(a), a determination, if required by applicable
law, with respect to Indemnitee's entitlement thereto shall be made in the
specific case:
(i) if a Change in Control has occurred, by Independent Counsel
in a written opinion to the Board, a copy of which shall be delivered to
Indemnitee; or
(ii) if a Change in Control has not occurred,
(A) by a majority vote of the Disinterested Directors, even
though less than a quorum of the Board,
(B) by a committee of Disinterested Directors designated by
a majority vote of the Disinterested Directors, even though less than a quorum
of the Board,
(C) if there are no such Disinterested Directors or, if such
Disinterested Directors so direct, by Independent Counsel in a written opinion
to the Board, a copy of which shall be delivered to Indemnitee, or
(D) if so directed by the Board, by the stockholders of the
Company.
If it is so determined that Indemnitee is entitled to indemnification, payment
to Indemnitee shall be made within 10 days after such determination.
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Indemnitee shall 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 that is not privileged or otherwise
protected from disclosure and 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 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) If the determination of entitlement to indemnification is to be
made by Independent Counsel, the Independent Counsel shall be selected as
follows.
(i) If a Change in Control shall not have occurred, the
Independent Counsel shall be selected by the Board, and the Company shall give
written notice to Indemnitee advising him of the identity of the Independent
Counsel so selected.
(ii) If a Change in Control shall have occurred, the Independent
Counsel shall be selected by Indemnitee (unless he shall request that such
selection be made by the Board, in which event the preceding sentence shall
apply), and Indemnitee shall 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 10
days after such written notice of selection shall have been given, deliver to
the Company or to Indemnitee, as the case may be, a written objection to such
selection; provided, 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 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 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 10(a)
hereof, no Independent Counsel shall have been selected and not objected to,
either the Company or Indemnitee may petition a court of competent jurisdiction
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 Court or by such
other person as the Court shall designate, and the person with respect to whom
all objections are so resolved or the person so appointed shall act as
Independent Counsel under Section 11(a) hereof. Upon the due commencement of any
judicial proceeding or arbitration pursuant to Section 13(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).
12. 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 10(a) 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.
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(b) Neither the failure of the Company (including by its directors or
independent legal 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 legal 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.
(c) If the person, persons or entity empowered or selected to
determine whether Indemnitee is entitled to indemnification shall not have made
a determination within 60 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 a prohibition of such indemnification under applicable
law; provided, that
(i) such 60-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 or evaluating of documentation
and/or information relating thereto; and
(ii) the provisions of this Section 12(c) shall not apply (1) if
the determination of entitlement to indemnification is to be made by the
stockholders pursuant to Section 11(a) of this Agreement and if (A) within 15
days after receipt by the Company of the request for such determination the
Board 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, or (2) if
the determination of entitlement to indemnification is made by Independent
Counsel pursuant to Section 11(a) of this Agreement.
(d) The termination of a 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 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.
(e) 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 with the reasonable care
by the Enterprise. The provisions of this Section 12(e) shall not be deemed to
be exclusive or to limit in any way the other circumstances in which the
Indemnitee may be deemed to have met the applicable standard of conduct set
forth in this Agreement.
(f) The knowledge and/or actions, or failure to act, of any director,
officer, agent or employee of any Enterprise shall not be imputed to Indemnitee
for purposes of determining the right to indemnification under this Agreement.
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13. REMEDIES OF INDEMNITEE.
(a) If
(i) a determination is made pursuant to Section 11 of this
Agreement that Indemnitee is not entitled to indemnification under this
Agreement,
(ii) advancement of Expenses is not timely made pursuant to
Section 9 of this Agreement,
(iii) no determination of entitlement to indemnification shall
have been made pursuant to Section 11(a) of this Agreement within 45 days after
receipt by the Company of the request for indemnification,
(iv) payment of indemnification is not made pursuant to Section 5
or 6 or the last sentence of Section 11(a) of this Agreement within 10 days
after receipt by-the Company of a written request therefor, or
(v) payment of indemnification pursuant to Section 3, 4 or 7 of
this Agreement is not made within 10 days after a determination has been made
that Indemnitee is entitled to indemnification,
Indemnitee shall be entitled to an adjudication by a court of his entitlement to
such indemnification 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. The Company shall not oppose Indemnitee's right to seek
any such adjudication or award in arbitration.
(b) If a determination shall have been made pursuant to Section 11(a)
of this Agreement that Indemnitee is not entitled to indemnification, any
judicial proceeding or arbitration commenced pursuant to this Section 13 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 13,
the Company shall have the burden of proving Indemnitee is not entitled to
indemnification or advancement of Expenses, as the case may be.
(c) If a determination shall have been made pursuant to Section 11(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 13, absent 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 13 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. The Company
shall indemnify Indemnitee against any and all Expenses and, if requested by
Indemnitee, shall (within 10 days after receipt by the Company of a written
request therefor) advance, to the extent not prohibited by Section 402 of the
Xxxxxxxx-Xxxxx Act of 2002 or other applicable law, such expenses to Indemnitee,
which are incurred by Indemnitee in connection with any Action brought by
Indemnitee for indemnification or advance of Expenses from the Company under
this Agreement or under any
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directors' and officers' liability insurance policies maintained by the Company,
regardless of whether Indemnitee ultimately is determined to be entitled to such
indemnification, advancement of Expenses or insurance recovery.
14. NON-EXCLUSIVITY; SURVIVAL OF RIGHTS; SUBROGATION.
(a) The rights 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 Certificate of Incorporation of the Company, the
Bylaws of the Company, 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 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
Delaware law, whether by statute or judicial decision, permits greater
indemnification or advancement of Expenses than would be afforded currently
under the Company's Bylaws and 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, employees, or
agents of the Company or of any other corporation, partnership , joint venture,
trust, employee benefit plan or other enterprise which such person serves at the
request of the Company, Indemnitee shall be an insured under such policy or
policies in accordance with its or their terms to the maximum extent of the
coverage available for any such director, officer, employee or agent under such
policy or policies. The Company agrees to promptly notify Indemnitee of any
material change in any such policy. The Company may, but will not be required
to, create a trust fund, grant a security interest or use other means,
including, without limitation, a letter of credit, to ensure the payment of such
amounts as may be necessary to satisfy the obligations to indemnify and advance
Expenses pursuant to this Agreement. If, at the time of the receipt of a notice
of a claim pursuant to the terms hereof, the Company has director and officer
liability insurance in effect, the Company shall give prompt notice of the
commencement of such proceeding to the insurers in accordance with the
procedures set forth in the policies. The Company and Indemnitee shall mutually
cooperate and take all reasonable actions to cause such insurers to pay on
behalf of the insureds, all amounts payable as a result of such proceeding in
accordance with the terms of all applicable policies.
(c) The Company shall be subrogated to the extent of any payment under
this Agreement 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 shall not be liable under this Agreement to make any
payment of amounts otherwise indemnifiable (or for which advancement is provided
hereunder) hereunder if and to the extent that Indemnitee has otherwise actually
received such payment under any insurance policy, the Certificate of
Incorporation, the Bylaws, contract, agreement or otherwise.
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(e) 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, employee or agent of any Enterprise shall be reduced by any
amount Indemnitee has actually received as indemnification or advancement of
expenses from such other Enterprise.
15. DURATION OF AGREEMENT, SUCCESSORS AND ASSIGNS. This Agreement shall
continue until and terminate upon the later of: (a) ten years after Indemnitee
has ceased to occupy any positions or have any relationships described in
Section 1 of this Agreement; and (b) the final termination of all Actions
pending or threatened during such period to which Indemnitee may be subject by
reason of Indemnitee's Corporate Status or by reason of anything done or not
done by Indemnitee in any such capacity. This Agreement shall be binding upon
each of the Company, and its successors and assigns and shall inure to the
benefit of and be enforceable by Indemnitee and his personal and legal
representatives, heirs, executors, administrators, distributees, legatees and
other successors.
16. SEVERABILITY. If any provision or provisions of this Agreement or any
application of any provision hereof shall be held to be invalid, illegal or
unenforceable for any reason whatsoever: (a) the validity, legality and
enforceability of the remaining provisions of this Agreement (including without
limitation, each portion of any Section of this Agreement containing any such
provision held to be invalid, illegal or unenforceable, 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 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.
17. ENFORCEMENT.
(a) The Company expressly confirms and agrees that it has entered into
this Agreement and assumed the obligations imposed on it hereby to induce
Indemnitee to serve as a director of the Company, and the Company acknowledges
that Indemnitee is relying upon this Agreement in serving as a director of the
Company.
(b) 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; provided, that this
Agreement is a supplement to and in furtherance of the Certificate of
Incorporation of the Company, the Bylaws of the Company and applicable law, and
shall not be deemed a substitute therefor, nor to diminish or abrogate any
rights of Indemnitee thereunder.
18. MODIFICATION AND WAIVER. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by the parties
thereto. 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.
19. NOTICE BY INDEMNITEE. Indemnitee agrees promptly to notify the Company
in writing upon being served with any summons, citation, subpoena, complaint,
indictment, information or other document relating to any Proceeding or matter
which may be subject to indemnification or
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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.
20. NOTICES. Any notices or other communications required or permitted
under, or otherwise in connection with this Agreement, shall be in writing and
shall be deemed to have been duly given when delivered in person or upon
confirmation of receipt when transmitted by facsimile transmission (but only if
followed by transmittal by national overnight courier or hand for delivery on
the next business day) or on receipt after dispatch by registered or certified
mail, postage prepaid, addressed, or on the next business day if transmitted by
national overnight courier, in each case as follows: (i) if to the Company,
directed to the Chief Executive Officer at its principal place of business; and
(ii) if to the Indemnitee, to such address as set forth below his name on the
signature page to this Agreement; or such other persons or addresses as shall be
furnished in writing by the Indemnitee to the Company.
21. CONTRIBUTION. To the fullest extent permissible by applicable law, if
the indemnification provided for in this Agreement is unavailable to Indemnitee
for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee,
shall contribute to the amount incurred by Indemnitee, whether for judgments,
fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or
for Expenses, in connection with any claim relating to an indemnifiable event
under this Agreement, in such proportion as is deemed fair and reasonable in
light of all of the circumstances of such Proceeding in order to reflect (i) the
relative benefits received by the Company and Indemnitee as a result of the
event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the
relative fault of the Company (and its directors, officers, employees and
agents) and Indemnitee in connection with such event(s) and/or transaction(s).
22. 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 13 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 Chancery Court 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 otherwise subject to service of process in the State of Delaware,
irrevocably Corporation Service Company, 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000,
Xxxxxxxxxx, Xxxxxxxx 00000 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.
23. 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.
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24. 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.
TSR, INC. INDEMNITEE
By: Name:
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Xxxxxx X. Xxxxxx
Chief Executive Officer Address:
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