NEURO-HITECH, INC. DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT
This
Director and Officer Indemnification Agreement, dated as of August 22, 2007
(this “AGREEMENT”), is made by and between Neuro-Hitech, Inc., a Delaware
corporation (the “COMPANY”), and Xxxx Xxxxxxxx (the “INDEMNITEE”).
RECITALS:
A. Section
141 of the Delaware General Corporation Law provides that the business and
affairs of a corporation shall be managed by or under the direction of its
board
of directors.
B. By
virtue
of the managerial prerogatives vested in the directors and officers of a
Delaware corporation, directors and officers act as fiduciaries of the
corporation and its stockholders.
C. Thus,
it
is critically important to the Company and its stockholders that the Company
be
able to attract and retain the most capable persons reasonably available to
serve as directors and officers of the Company.
D. In
recognition of the need for corporations to be able to induce capable and
responsible persons to accept positions in corporate management, Delaware law
authorizes (and in some instances requires) corporations to indemnify their
directors and officers, and further authorizes corporations to purchase and
maintain insurance for the benefit of their directors and officers.
E. The
Delaware courts have recognized that indemnification by a corporation serves
the
dual policies of (1) allowing corporate officials to resist unjustified
lawsuits, secure in the knowledge that, if vindicated, the corporation will
bear
the expense of litigation, and (2) encouraging capable women and men to
serve as corporate directors and officers, secure in the knowledge that the
corporation will absorb the costs of defending their honesty and integrity.
F. The
number of lawsuits challenging the judgment and actions of directors and
officers of Delaware corporations, the costs of defending those lawsuits and
the
threat to personal assets have all materially increased over the past several
years, chilling the willingness of capable women and men to undertake the
responsibilities imposed on corporate directors and officers.
G. Recent
federal legislation and rules adopted by the Securities and Exchange Commission
and the national securities exchanges have exposed such directors and officers
to new and substantially broadened civil liabilities.
H. Under
Delaware law, a director’s or officer’s right to be reimbursed for the costs of
defense of criminal actions, whether such claims are asserted under state or
federal law, does not depend upon the merits of the claims asserted against
the
director or officer and is separate and distinct from any right to
indemnification the director may be able to establish.
I. Indemnitee
is, or will be, a director and/or officer of the Company and his or her
willingness to serve in such capacity is predicated, in substantial part, upon
the Company’s willingness to indemnify him or her in accordance with the
principles reflected above, to the fullest extent permitted by the laws of
the
State of Delaware, and upon the other undertakings set forth in this Agreement.
J. Therefore,
in recognition of the need to provide Indemnitee with substantial protection
against personal liability, in order to procure Indemnitee’s continued service
as a director and/or officer of the Company and to enhance Indemnitee’s ability
to serve the Company in an effective manner, and in order to provide such
protection pursuant to express contract rights (intended to be enforceable
irrespective of, among other things, any amendment to the Company’s certificate
of incorporation or bylaws (collectively, the “CONSTITUENT DOCUMENTS”), any
change in the composition of the Company’s Board of Directors (the “BOARD”) or
any change−in−control or business combination transaction relating to the
Company), the Company wishes to provide in this Agreement for the
indemnification and advancement of Expenses to Indemnitee on the terms, and
subject to the conditions, set forth in this Agreement.
K. In
light
of the considerations referred to in the preceding recitals, it is the Company’s
intention and desire that the provisions of this Agreement be construed
liberally, subject to their express terms, to maximize the protections to be
provided to Indemnitee hereunder.
AGREEMENT:
NOW,
THEREFORE, the parties hereby agree as follows:
1. CERTAIN
DEFINITIONS. In addition to terms defined elsewhere herein, the following terms
have the following meanings when used in this Agreement with initial capital
letters:
(a) “CHANGE
IN CONTROL” shall have occurred at such time, if any, as Incumbent Directors
cease for any reason to constitute a majority of Directors. For purposes of
this
Section 1(a), “INCUMBENT DIRECTORS” means the individuals who, as of the date
hereof, are Directors of the Company and any individual becoming a Director
subsequent to the date hereof whose election, nomination for election by the
Company’s stockholders, or appointment, was approved by a vote of at least a
majority of the then Incumbent Directors (either by a specific vote or by
approval of the proxy statement of the Company in which such person is named
as
a nominee for director, without objection to such nomination); PROVIDED,
HOWEVER, that an individual shall not be an Incumbent Director if such
individual’s election or appointment to the Board occurs as a result of an
actual or threatened election contest (as described in Rule 14a−12(c) of the
Securities Exchange Act of 1934, as amended) with respect to the election or
removal of directors or other actual or threatened solicitation of proxies
or
consents by or on behalf of a Person other than the Board.
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(b) “CLAIM”
means (i) any threatened, asserted, pending or completed claim, demand, action,
suit or proceeding, whether civil, criminal, administrative, arbitrative,
investigative or other, and whether made pursuant to federal, state or other
law; and (ii) any inquiry or investigation, whether made, instituted or
conducted by the Company or any other Person, including, without limitation,
any
federal, state or other governmental entity, that Indemnitee reasonably
determines might lead to the institution of any such claim, demand, action,
suit
or proceeding. For the avoidance of doubt, the Company intends indemnity to
be
provided hereunder in respect of acts or failure to act prior to, on or after
the date hereof.
(c) “CONTROLLED
AFFILIATE” means any corporation, limited liability company, partnership, joint
venture, trust or other entity or enterprise, whether or not for profit, that
is
directly or indirectly controlled by the Company. For purposes of this
definition, “CONTROL” means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of an entity
or
enterprise, whether through the ownership of voting securities, through other
voting rights, by contract or otherwise; PROVIDED that direct or indirect
beneficial ownership of capital stock or other interests in an entity or
enterprise entitling the holder to cast 15% 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 entity or enterprise shall be deemed
to
constitute control for purposes of this definition.
(d) “DISINTERESTED
DIRECTOR” means a director of the Company who is not and was not a party to the
Claim in respect of which indemnification is sought by Indemnitee.
(e) “EXPENSES”
means attorneys’ and experts’ fees and expenses and all other costs and expenses
paid or payable in connection with investigating, defending, being a witness
in
or participating in (including on appeal), or preparing to investigate, defend,
be a witness in or participate in (including on appeal), any Claim.
(f) “INDEMNIFIABLE
CLAIM” means any Claim based upon, arising out of or resulting from (i) any
actual, alleged or suspected act or failure to act by Indemnitee in his or
her
capacity as a director, officer, employee or agent of the Company or as a
director, officer, employee, member, manager, trustee or agent of any other
corporation, limited liability company, partnership, joint venture, trust or
other entity or enterprise, whether or not for profit, as to which Indemnitee
is
or was serving at the request of the Company, (ii) any actual, alleged or
suspected act or failure to act by Indemnitee in respect of any business,
transaction, communication, filing, disclosure or other activity of the Company
or any other entity or enterprise referred to in clause (i) of this sentence,
or
(iii) Indemnitee’s status as a current or former director, officer, employee or
agent of the Company or as a current or former director, officer, employee,
member, manager, trustee or agent of the Company or any other entity or
enterprise referred to in clause (i) of this sentence or any actual, alleged
or
suspected act or failure to act by Indemnitee in connection with any obligation
or restriction imposed upon Indemnitee by reason of such status. In addition
to
any service at the actual request of the Company, for purposes of this
Agreement, Indemnitee shall be deemed to be serving or to have served at the
request of the Company as a director, officer, employee, member, manager,
trustee or agent of another entity or enterprise if Indemnitee is or was serving
as a director, officer, employee, member, manager, agent, trustee or other
fiduciary of such entity or enterprise and (i) such entity or enterprise is
or
at the time of such service was a Controlled Affiliate, (ii) such entity or
enterprise is or at the time of such service was an employee benefit plan (or
related trust) sponsored or maintained by the Company or a Controlled Affiliate,
or (iii) the Company or a Controlled Affiliate (by action of the Board, any
committee thereof or the Company’s Chief Executive Officer (“CEO”) (other than
as the CEO him or herself)) caused or authorized Indemnitee to be nominated,
elected, appointed, designated, employed, engaged or selected to serve in such
capacity.
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(g) “INDEMNIFIABLE
LOSSES” means any and all Losses relating to, arising out of or resulting from
any Indemnifiable Claim; PROVIDED, HOWEVER, that Indemnifiable Losses shall
not
include Losses incurred by Indemnitee in respect of any Indemnifiable Claim
(or
any matter or issue therein) as to which Indemnitee shall have been adjudged
liable to the Company, unless and only to the extent that the Delaware Court
of
Chancery or the court in which such Indemnifiable Claim was brought shall have
determined 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 for such Expenses as the court shall deem proper.
(h) “INDEPENDENT
COUNSEL” means a nationally recognized law firm, or a member of a nationally
recognized law firm, that is experienced in matters of Delaware corporate law
and neither presently is, nor in the past five years has been, retained to
represent: (i) the Company (or any subsidiary) or Indemnitee in any matter
material to either such party (other than with respect to matters concerning
the
Indemnitee under this Agreement, or of other indemnitees under similar
indemnification agreements) or (ii) any other named (or, as to a threatened
matter, reasonably likely to be named) party to the Indemnifiable Claim giving
rise to a claim for indemnification hereunder. Notwithstanding the foregoing,
the term “Independent Counsel” shall not include any person who, under the
applicable standards of professional conduct then prevailing, would have a
conflict of interest in representing either the Company or Indemnitee in an
action to determine Indemnitee’s rights under this Agreement.
(i) “LOSSES”
means any and all Expenses, damages, losses, liabilities, judgments, fines,
penalties (whether civil, criminal or other) and amounts paid or payable in
settlement, including, without limitation, all interest, assessments and other
charges paid or payable in connection with or in respect of any of the
foregoing.
(j) “PERSON”
means any individual, entity or group, within the meaning of Section 13(d)(3)
or
14(d)(2) of the Securities Exchange Act of 1934, as amended.
(k) “STANDARD
OF CONDUCT” means the standard for conduct by Indemnitee that is a condition
precedent to indemnification of Indemnitee hereunder against Indemnifiable
Losses relating to, arising out of or resulting from an Indemnifiable Claim.
The
Standard of Conduct is (i) good faith and reasonable belief by Indemnitee that
his action was in or not opposed to the best interests of the Company and,
with
respect to any criminal action or proceeding, that Indemnitee had no reasonable
cause to believe that his conduct was unlawful, or (ii) any other applicable
standard of conduct that may hereafter be substituted under Section 145(a)
or
(b) of the Delaware General Corporation Law or any successor to such
provision(s).
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2. INDEMNIFICATION
OBLIGATION. Subject only to Section 7 and to the proviso in this Section, the
Company shall indemnify, defend and hold harmless Indemnitee, to the fullest
extent permitted or required by the laws of the State of Delaware in effect
on
the date hereof or as such laws may from time to time hereafter be amended
to
increase the scope of such permitted indemnification, against any and all
Indemnifiable Claims and Indemnifiable Losses; PROVIDED, HOWEVER, that, except
as provided in Section 5, Indemnitee shall not be entitled to indemnification
pursuant to this Agreement in connection with (i) any Claim initiated by
Indemnitee against the Company or any director or officer of the Company unless
the Company has joined in or consented to the initiation of such Claim, or
(ii)
the purchase and sale by Indemnitee of securities in violation of Section 16(b)
of the Securities Exchange Act of 1934, as amended. The Company acknowledges
that the foregoing obligation may be broader than that now provided by
applicable law and the Company’s Constituent Documents and intends that it be
interpreted consistently with this Section and the recitals to this Agreement.
3. ADVANCEMENT
OF EXPENSES. Indemnitee shall have the right to advancement by the Company
prior
to the final disposition of any Indemnifiable Claim of any and all actual and
reasonable Expenses relating to, arising out of or resulting from any
Indemnifiable Claim paid or incurred by Indemnitee. Without limiting the
generality or effect of any other provision hereof, Indemnitee’s right to such
advancement is not subject to the satisfaction of any Standard of Conduct.
Without limiting the generality or effect of the foregoing, within five business
days after any request by Indemnitee that is accompanied by supporting
documentation for specific reasonable Expenses to be reimbursed or advanced,
the
Company shall, in accordance with such request (but without duplication), (a)
pay such Expenses on behalf of Indemnitee, (b) advance to Indemnitee funds
in an
amount sufficient to pay such Expenses, or (c) reimburse Indemnitee for such
Expenses; PROVIDED that Indemnitee shall repay, without interest, any amounts
actually advanced to Indemnitee that, at the final disposition of the
Indemnifiable Claim to which the advance related, were in excess of amounts
paid
or payable by Indemnitee in respect of Expenses relating to, arising out of
or
resulting from such Indemnifiable Claim. In connection with any such payment,
advancement or reimbursement, at the request of the Company, Indemnitee shall
execute and deliver to the Company an undertaking, which need not be secured
and
shall be accepted without reference to Indemnitee’s ability to repay the
Expenses, by or on behalf of the Indemnitee, to repay any amounts paid, advanced
or reimbursed by the Company in respect of Expenses relating to, arising out
of
or resulting from any Indemnifiable Claim in respect of which it shall have
been
determined, following the final disposition of such Indemnifiable Claim and
in
accordance with Section 7, that Indemnitee is not entitled to indemnification
hereunder.
4. INDEMNIFICATION
FOR ADDITIONAL EXPENSES. Without limiting the generality or effect of the
foregoing, the Company shall indemnify and hold harmless Indemnitee against
and,
if requested by Indemnitee, shall reimburse Indemnitee for, or advance to
Indemnitee, within five business days of such request accompanied by supporting
documentation for specific Expenses to be reimbursed or advanced, any and all
actual and reasonable Expenses paid or incurred by Indemnitee in connection
with
any Claim made, instituted or conducted by Indemnitee for (a) indemnification
or
reimbursement or advance payment of Expenses by the Company under any provision
of this Agreement, or under any other agreement or provision of the Constituent
Documents now or hereafter in effect relating to Indemnifiable Claims, and/or
(b) recovery under any directors’ and officers’ liability insurance policies
maintained by the Company; PROVIDED, HOWEVER, if it is ultimately determined
that the Indemnitee is not entitled to such indemnification, reimbursement,
advance or insurance recovery, as the case may be, then the Indemnitee shall
be
obligated to repay any such Expenses to the Company; PROVIDED FURTHER, that,
regardless in each case of whether Indemnitee ultimately is determined to be
entitled to such indemnification, reimbursement, advance or insurance recovery,
as the case may be, Indemnitee shall return, without interest, any such advance
of Expenses (or portion thereof) which remains unspent at the final disposition
of the Claim to which the advance related.
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5. PARTIAL
INDEMNITY. If Indemnitee is entitled under any provision of this Agreement
to
indemnification by the Company for some or a portion of any Indemnifiable Loss
but not for all of the total amount thereof, the Company shall nevertheless
indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
6. PROCEDURE
FOR NOTIFICATION. To obtain indemnification under this Agreement in respect
of
an Indemnifiable Claim or Indemnifiable Loss, Indemnitee shall submit to the
Company a written request therefore, including a brief description (based upon
information then available to Indemnitee) of such Indemnifiable Claim or
Indemnifiable Loss. If, at the time of the receipt of such request, the Company
has directors’ and officers’ liability insurance in effect under which coverage
for such Indemnifiable Claim or Indemnifiable Loss is potentially available,
the
Company shall give prompt written notice of such Indemnifiable Claim or
Indemnifiable Loss to the applicable insurers in accordance with the procedures
set forth in the applicable policies. The Company shall thereafter take all
necessary or desirable action to cause such insurers to pay, on behalf of the
Indemnitee, all Indemnifiable Claims and Indemnifiable Losses in accordance
with
the terms of such policies. The Company shall provide to Indemnitee a copy
of
such notice delivered to the applicable insurers, substantially concurrently
with the delivery thereof by the Company. The failure by Indemnitee to timely
notify the Company of any Indemnifiable Claim or Indemnifiable Loss shall not
relieve the Company from any liability hereunder unless, and only to the extent
that, the Company did not otherwise learn of such Indemnifiable Claim or
Indemnifiable Loss and to the extent that such failure results in forfeiture
by
the Company of substantial defenses, rights or insurance coverage.
7. DETERMINATION
OF RIGHT TO INDEMNIFICATION.
(a) To
the
extent that Indemnitee shall have been successful on the merits or otherwise
in
defense of any Indemnifiable Claim or any portion thereof or in defense of
any
issue or matter therein, including, without limitation, dismissal without
prejudice, Indemnitee shall be indemnified against all Indemnifiable Losses
relating to, arising out of or resulting from such Indemnifiable Claim in
accordance with Section 2 and no Standard of Conduct Determination (as defined
in Section 7(b)) shall be required.
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(b) To
the
extent that the provisions of Section 7(a) are inapplicable to an Indemnifiable
Claim that shall have been finally disposed of, any determination of whether
Indemnitee has satisfied the applicable Standard of Conduct (a “STANDARD OF
CONDUCT DETERMINATION”) shall be made as follows: (i) if a Change in Control
shall not have occurred, or if a Change in Control shall have occurred but
Indemnitee shall have requested that the Standard of Conduct Determination
be
made pursuant to this clause (i), (A) by a majority vote of the Disinterested
Directors, even if less than a quorum of the Board, (B) if such Disinterested
Directors so direct, by a majority vote of a committee of Disinterested
Directors designated by a majority vote of all Disinterested Directors, or
(C)
if there are no such Disinterested Directors, or if a majority of the
Disinterested Directors so direct, by Independent Counsel in a written opinion
addressed to the Board, a copy of which shall be delivered to Indemnitee; and
(ii) if a Change in Control shall have occurred and Indemnitee shall not have
requested that the Standard of Conduct Determination be made pursuant to clause
(i) above, by Independent Counsel in a written opinion addressed to the Board,
a
copy of which shall be delivered to Indemnitee.
(c) If
(i)
Indemnitee shall be entitled to indemnification hereunder against any
Indemnifiable Losses pursuant to Section 7(a), (ii) no determination of whether
Indemnitee has satisfied any applicable standard of conduct under Delaware
law
is a legally required condition precedent to indemnification of Indemnitee
hereunder against any Indemnifiable Losses, or (iii) Indemnitee has been
determined or deemed pursuant to Section 7(b) to have satisfied the applicable
Standard of Conduct, then the Company shall pay to Indemnitee, within five
business days after the later of (x) the Notification Date in respect of the
Indemnifiable Claim or portion thereof to which such Indemnifiable Losses are
related, out of which such Indemnifiable Losses arose or from which such
Indemnifiable Losses resulted, and (y) the earliest date on which the applicable
criterion specified in clause (i), (ii) or (iii) above shall have been
satisfied, an amount equal to the amount of such Indemnifiable Losses. Nothing
herein is intended to mean or imply that the Company is intending to use Section
145(f) of the Delaware General Corporation Law to dispense with a requirement
that Indemnitee meet the applicable Standard of Conduct where it is otherwise
required by such statute.
(d) If
a
Standard of Conduct Determination is required to be, but has not been, made
by
Independent Counsel pursuant to Section 7(b)(i), the Independent Counsel shall
be selected by the Board or a committee of the Board, and the Company shall
give
written notice to Indemnitee advising him or her of the identity of the
Independent Counsel so selected. If a Standard of Conduct Determination is
required to be, or to have been, made by Independent Counsel pursuant to Section
7(b)(ii), the Independent Counsel shall be selected by Indemnitee, and
Indemnitee shall give written notice to the Company advising it of the identity
of the Independent Counsel so selected. In either case, Indemnitee or the
Company, as applicable, may, within five business days after receiving written
notice of selection from the other, deliver to the other 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 satisfy the
criteria set forth in the definition of “Independent Counsel” in Section 1(h),
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 properly and timely
made and substantiated, (i) 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 and (ii) the non−objecting party
may, at its option, select an alternative Independent Counsel and give written
notice to the other party advising such other party of the identity of the
alternative Independent Counsel so selected, in which case the provisions of
the
two immediately preceding sentences and clause (i) of this sentence shall apply
to such subsequent selection and notice. If applicable, the provisions of clause
(ii) of the immediately preceding sentence shall apply to successive alternative
selections. If no Independent Counsel that is permitted under the foregoing
provisions of this Section 7(d) to make the Standard of Conduct Determination
shall have been selected within 30 calendar days after the Company gives its
initial notice pursuant to the first sentence of this Section 7(d) or Indemnitee
gives its initial notice pursuant to the second sentence of this Section 7(d),
as the case may be, either the Company or Indemnitee may petition the Court
of
Chancery of the State of Delaware 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 or firm selected by the Court or by such other person as the Court shall
designate, and the person or firm with respect to whom all objections are so
resolved or the person or firm so appointed will act as Independent Counsel.
In
all events, the Company shall pay all of the actual and reasonable fees and
expenses of the Independent Counsel incurred in connection with the Independent
Counsel’s determination pursuant to Section 7(b).
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8. COOPERATION.
Indemnitee shall cooperate with reasonable requests of the Company in connection
with any Indemnifiable Claim and any individual or firm making such Standard
of
Conduct Determination, including providing to such Person documentation or
information which is not privileged or otherwise protected from disclosure
and
which is reasonably available to Indemnitee and reasonably necessary to defend
the Indemnifiable Claim or make any Standard of Conduct Determination without
incurring any unreimbursed cost in connection therewith. The Company shall
indemnify and hold harmless Indemnitee against and, if requested by Indemnitee,
shall reimburse Indemnitee for, or advance to Indemnitee, within five business
days of such request accompanied by supporting documentation for specific costs
and expenses to be reimbursed or advanced, any and all costs and expenses
(including attorneys’ and experts’ fees and expenses) actually and reasonably
incurred by Indemnitee in so cooperating with the Person defending the
Indemnifiable Claim or making such Standard of Conduct Determination.
9. PRESUMPTION
OF ENTITLEMENT. Notwithstanding any other provision hereof, in making any
Standard of Conduct Determination, the Person making such determination shall
presume that Indemnitee has satisfied the applicable Standard of Conduct.
10. NO
OTHER
PRESUMPTION. For purposes of this Agreement, the termination of any Claim by
judgment, order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent, will not create
a presumption that Indemnitee did not meet any applicable Standard of Conduct
or
that indemnification hereunder is otherwise not permitted.
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11. NON−EXCLUSIVITY.
The rights of Indemnitee hereunder will be in addition to any other rights
Indemnitee may have under the Constituent Documents, or the substantive laws
of
the Company’s jurisdiction of incorporation, any other contract or otherwise
(collectively, “OTHER INDEMNITY PROVISIONS”); PROVIDED, HOWEVER, that (a) to the
extent that Indemnitee otherwise would have any greater right to indemnification
under any Other Indemnity Provision, Indemnitee will without further action
be
deemed to have such greater right hereunder, and (b) to the extent that any
change is made to any Other Indemnity Provision which permits any greater right
to indemnification than that provided under this Agreement as of the date
hereof, Indemnitee will be deemed to have such greater right hereunder. The
Company may not, without the consent of Indemnitee, adopt any amendment to
any
of the Constituent Documents the effect of which would be to deny, diminish
or
encumber Indemnitee’s right to indemnification under this Agreement.
12. LIABILITY
INSURANCE AND FUNDING. For the duration of Indemnitee’s service as a director
and/or officer of the Company and for a reasonable period of time thereafter,
which such period shall be determined by the Company in its sole discretion,
the
Company shall use commercially reasonable efforts (taking into account the
scope
and amount of coverage available relative to the cost thereof) to cause to
be
maintained in effect policies of directors’ and officers’ liability insurance
providing coverage for directors and/or officers of the Company, and, if
applicable, that is substantially comparable in scope and amount to that
provided by the Company’s current policies of directors’ and officers’ liability
insurance. Upon reasonable request, the Company shall provide Indemnitee or
his
or her counsel with a copy of all directors’ and officers’ liability insurance
applications, binders, policies, declarations, endorsements and other related
materials. In all policies of directors’ and officers’ liability insurance
obtained by the Company, Indemnitee shall be named as an insured in such a
manner as to provide Indemnitee the same rights and benefits, subject to the
same limitations, as are accorded to the Company’s directors and officers most
favorably insured by such policy. Notwithstanding the foregoing, (i) the Company
may, but shall 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 its
obligations to indemnify and advance expenses pursuant to this Agreement and
(ii) in renewing or seeking to renew any insurance hereunder, the Company will
not be required to expend more than 2.0 times the premium amount of the
immediately preceding policy period (equitably adjusted if necessary to reflect
differences in policy periods).
13. SUBROGATION.
In the event of payment under this Agreement, the Company shall be subrogated
to
the extent of such payment to all of the related rights of recovery of
Indemnitee against other Persons (other than Indemnitee’s successors), including
any entity or enterprise referred to in clause (i) of the definition of
“Indemnifiable Claim” in Section 1(f). Indemnitee shall execute all papers
reasonably required to evidence such rights (all of Indemnitee’s reasonable
Expenses, including attorneys’ fees and charges, related thereto to be
reimbursed by or, at the option of Indemnitee, advanced by the Company).
14. NO
DUPLICATION OF PAYMENTS. The Company shall not be liable under this Agreement
to
make any payment to Indemnitee in respect of any Indemnifiable Losses to the
extent Indemnitee has otherwise already actually received payment (net of
Expenses incurred in connection therewith) under any insurance policy, the
Constituent Documents and Other Indemnity Provisions or otherwise (including
from any entity or enterprise referred to in clause (i) of the definition of
“Indemnifiable Claim” in Section 1(f)) in respect of such Indemnifiable Losses
otherwise indemnifiable hereunder.
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15. DEFENSE
OF CLAIMS. Subject to the provisions of applicable policies of directors’ and
officers’ liability insurance, if any, the Company shall be entitled to
participate in the defense of any Indemnifiable Claim or to assume or lead
the
defense thereof with counsel reasonably satisfactory to the Indemnitee; PROVIDED
that if Indemnitee determines, after consultation with counsel selected by
Indemnitee, that (a) the use of counsel chosen by the Company to represent
Indemnitee would present such counsel with an actual or potential conflict,
(b)
the named parties in any such Indemnifiable Claim (including any impleaded
parties) include both the Company and Indemnitee and Indemnitee shall conclude
that there may be one or more legal defenses available to him or her that are
different from or in addition to those available to the Company, (c) any such
representation by such counsel would be precluded under the applicable standards
of professional conduct then prevailing, or (d) Indemnitee has interests in
the
claim or underlying subject matter that are different from or in addition to
those of other Persons against whom the Claim has been made or might reasonably
be expected to be made, then Indemnitee shall be entitled to retain separate
counsel (but not more than one law firm plus, if applicable, local counsel
in
respect of any particular Indemnifiable Claim for all indemnitees in
Indemnitee’s circumstances) at the Company’s expense. The Company shall not be
liable to Indemnitee under this Agreement for any amounts paid in settlement
of
any threatened or pending Indemnifiable Claim effected without the Company’s
prior written consent. The Company shall not, without the prior written consent
of the Indemnitee, effect any settlement of any threatened or pending
Indemnifiable Claim which the Indemnitee is or could have been a party unless
such settlement solely involves the payment of money and includes complete
and
unconditional release of the Indemnitee from all liability on any claims that
are the subject matter of such Indemnifiable Claim. Neither the Company nor
Indemnitee shall unreasonably withhold its consent to any proposed settlement;
PROVIDED that Indemnitee may withhold consent to any settlement that does not
provide a complete and unconditional release of Indemnitee.
16. MUTUAL
ACKNOWLEDGMENT. Both the Company and the Indemnitee acknowledge that in certain
instances, Federal law or applicable public policy may prohibit the Company
from
indemnifying its directors and officers under this Agreement or otherwise.
Indemnitee understands and acknowledges that the Company may be required in
the
future to undertake to the Securities and Exchange Commission to submit the
question of indemnification to a court in certain circumstances for
determination of the Company’s right under public policy to indemnify Indemnitee
and, in that event, the Indemnitee’s rights and the Company’s obligations
hereunder shall be subject to that determination.
17. SUCCESSORS
AND BINDING AGREEMENT.
(a) This
Agreement shall be binding upon and inure to the benefit of the Company and
any
successor to the Company, including, without limitation, any Person acquiring
directly or indirectly all or substantially all of the business or assets of
the
Company whether by purchase, merger, consolidation, reorganization or otherwise
(and such successor will thereafter be deemed the “Company” for purposes of this
Agreement), but shall not otherwise be assignable or delegatable by the Company.
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(b) This
Agreement shall inure to the benefit of and be enforceable by the Indemnitee’s
personal or legal representatives, executors, administrators, heirs,
distributees, legatees and other successors. (c) This Agreement is personal
in
nature and neither of the parties hereto shall, without the consent of the
other, assign or delegate this Agreement or any rights or obligations hereunder
except as expressly provided in Sections 17(a) and 17(b). Without limiting
the
generality or effect of the foregoing, Indemnitee’s right to receive payments
hereunder shall not be assignable, whether by pledge, creation of a security
interest or otherwise, other than by a transfer by the Indemnitee’s will or by
the laws of descent and distribution, and, in the event of any attempted
assignment or transfer contrary to this Section 17(c), the Company shall have
no
liability to pay any amount so attempted to be assigned or transferred.
18. NOTICES.
For all purposes of this Agreement, all communications, including without
limitation notices, consents, requests or approvals, required or permitted
to be
given hereunder must be in writing and shall be deemed to have been duly given
when hand delivered or dispatched by electronic facsimile transmission (with
receipt thereof orally confirmed), or one business day after having been sent
for next−day delivery by a nationally recognized overnight courier service,
addressed to the Company (to the attention of the Secretary of the Company)
and
to Indemnitee at the applicable address shown on the signature page hereto,
or
to such other address as any party may have furnished to the other in writing
and in accordance herewith, except that notices of changes of address will
be
effective only upon receipt.
19. GOVERNING
LAW. The validity, interpretation, construction and performance of this
Agreement shall be governed by and construed in accordance with the substantive
laws of the State of Delaware, without giving effect to the principles of
conflict of laws of such State. The Company and Indemnitee each hereby
irrevocably consent to the jurisdiction of the Chancery Court of the State
of
Delaware for all purposes in connection with any action or proceeding which
arises out of or relates to this Agreement, waive all procedural objections
to
suit in that jurisdiction, including, without limitation, objections as to
venue
or inconvenience, agree that service in any such action may be made by notice
given in accordance with Section 18 and also agree that any action instituted
under this Agreement shall be brought only in the Chancery Court of the State
of
Delaware.
20. VALIDITY.
If any provision of this Agreement or the application of any provision hereof
to
any Person or circumstance is held invalid, unenforceable or otherwise illegal,
the remainder of this Agreement and the application of such provision to any
other Person or circumstance shall not be affected, and the provision so held
to
be invalid, unenforceable or otherwise illegal shall be reformed to the extent,
and only to the extent, necessary to make it enforceable, valid or legal. In
the
event that any court or other adjudicative body shall decline to reform any
provision of this Agreement held to be invalid, unenforceable or otherwise
illegal as contemplated by the immediately preceding sentence, the parties
thereto shall take all such action as may be necessary or appropriate to replace
the provision so held to be invalid, unenforceable or otherwise illegal with
one
or more alternative provisions that effectuate the purpose and intent of the
original provisions of this Agreement as fully as possible without being
invalid, unenforceable or otherwise illegal.
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21. MISCELLANEOUS.
No provision of this Agreement may be waived, modified or discharged unless
such
waiver, modification or discharge is agreed to in writing signed by Indemnitee
and the Company. No waiver by either party hereto at any time of any breach
by
the other party hereto or compliance with any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior
or
subsequent time. No agreements or representations, oral or otherwise, expressed
or implied with respect to the subject matter hereof have been made by either
party that are not set forth expressly in this Agreement.
22. CERTAIN
INTERPRETIVE MATTERS. Unless the context of this Agreement otherwise requires,
(1) “it” or “its” or words of any gender include each other gender, (2) words
using the singular or plural number also include the plural or singular number,
respectively, (3) the terms “hereof,” “herein,” “hereby” and derivative or
similar words refer to this entire Agreement, (4) the terms “Article,”
“Section,” “Annex” or “Exhibit” refer to the specified Article, Section, Annex
or Exhibit of or to this Agreement, (5) the terms “include,” “includes” and
“including” will be deemed to be followed by the words “without limitation”
(whether or not so expressed), and (6) the word “or” is disjunctive but not
exclusive. Whenever this Agreement refers to a number of days, such number
will
refer to calendar days unless business days are specified and whenever action
must be taken (including the giving of notice or the delivery of documents)
under this Agreement during a certain period of time or by a particular date
that ends or occurs on a non−business day, then such period or date will be
extended until the immediately following business day. As used herein, “BUSINESS
DAY” means any day other than Saturday, Sunday or a United States federal
holiday.
23. ENTIRE
AGREEMENT. This Agreement constitutes the entire agreement and supersedes all
prior agreements and understandings, both written and oral, between the parties
hereto with respect to the subject matter of this Agreement. Any prior
agreements or understandings between the parties hereto with respect to
indemnification are hereby terminated and of no further force or effect. This
Agreement is not the exclusive means of securing indemnification rights of
Indemnitee and is in addition to any rights Indemnitee may have under any
Constituent Documents.
24. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of which will
be deemed to be an original but all of which together shall constitute one
and
the same agreement.
[REMAINDER
OF PAGE INTENTIONALLY BLANK]
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IN
WITNESS WHEREOF, Indemnitee has executed and the Company has caused its duly
authorized representative to execute this Agreement as of the date first above
written.
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By:____________________________
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Name:__________________________
|
|
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Title:___________________________
|
|
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INDEMNITEE:
|
|
| ___________________________ | |
|
Xxxx
Xxxxxxxx
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Address:________________________
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| ___________________________ | |
| ___________________________ |
SIGNATURE
PAGE TO DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT
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