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EXHIBIT 10.1
SAGE, INC.
FORM OF INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is made and entered into by
and between Sage, Inc., a Delaware corporation ("Company"), and
___________________ ___________________ ("Indemnitee") on this ______ day of
________________, ______.
Introduction
Indemnitee is a director and/or officer of the Company. The parties
intend for the Company to provide indemnification to the fullest extent
permitted by the Delaware General Corporation Law (the "Act") (including
advancement of expenses) to Indemnitee against any and all liabilities asserted
against Indemnitee, as the Act presently exists and may be expanded from time to
time. Based on such premise, and for certain good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. Continued Service. Indemnitee will serve at the will of the Company or
under separate contract, if such exists, as a director and/or officer of the
Company for so long as Indemnitee is duly elected and qualified in accordance
with the Bylaws of the Company or until Indemnitee tenders his or her
resignation to the Company.
2. Indemnification. The Company shall indemnify Indemnitee as follows:
2.1 The Company shall indemnify Indemnitee when Indemnitee was, is, or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative and
whether formal or informal (other than an action by or in the right of the
Company), by reason of the fact that Indemnitee is or was a director, officer,
employee or agent of the Company or is or was serving at the request of the
Company as a director, officer, employee, associate, fiduciary, manager, member,
partner, promoter, trustee or agent of another domestic or foreign corporation
or other person or of an employee benefit plan against reasonable expenses
(including counsel fees) incurred by Indemnitee in connection with such
proceeding if Indemnitee conducted himself or herself in good faith and
Indemnitee reasonably believed that his or her conduct was in or not opposed to
the best interests of the Company, and, with respect to any criminal proceeding,
had no reasonable cause to believe that his or her conduct was unlawful. The
termination of any proceeding by judgment, order, settlement, conviction or upon
a plea of nolo contendere or its equivalent is not, of itself, determinative
that Indemnitee did not meet the standard of conduct described in this Section
2.1.
2.2 The Company shall indemnify Indemnitee when Indemnitee was, is or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding by or in the right of the Company to procure a judgment in
its favor by reason of the fact that Indemnitee is or was a director, officer,
employee or agent of the Company, or is or was serving at
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the request of the Company as a director, officer, employee, associate,
fiduciary, manager, member, partner, promoter, trustee or agent of another
domestic or foreign corporation or other person or of an employee benefit plan
against reasonable expenses (including counsel fees) incurred by Indemnitee in
connection with such proceeding if Indemnitee conducted himself or herself in
good faith and Indemnitee reasonably believed that his or her conduct was in or
not opposed to the best interests of the Company and except that no
indemnification pursuant to this Agreement shall be made in connection with a
proceeding in which Indemnitee shall have been adjudged to be liable to the
Company or charging that Indemnitee derived an improper personal benefit,
whether or not involving action in an official capacity, in which proceeding
Indemnitee was adjudged liable on the basis that he or she derived an improper
personal benefit, unless and only to the extent that the court in which such
proceeding was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the
proceeding, Indemnitee is fairly and reasonably entitled to indemnity for such
reasonable expenses, which the court shall deem proper.
2.3 Any indemnification under Sections 2.1 and 2.2 (unless ordered by
a court) shall be made by the Company only as authorized in the specific
proceeding upon a determination, in accordance with the procedures set forth in
Section 3, that indemnification of Indemnitee is proper in the circumstances
because Indemnitee has met the applicable standard of conduct set forth in such
Sections 2.1 and 2.2.
2.4 Reasonable expenses (including counsel fees) incurred by
Indemnitee who is a party to any threatened, pending or completed civil,
criminal, administrative or investigative action, suit or proceeding shall be
paid by the Company in advance of the final disposition of such proceeding
within 14 days after the receipt by the Company from Indemnitee of a Statement
of Undertaking in substantially the form set forth in EXHIBIT A, by which
Indemnitee undertakes to repay such amount if it is ultimately determined that
Indemnitee did not meet the standard of conduct. Those people making the
determination must also determine that based upon the facts then known to them,
indemnification would not be precluded.
2.5 The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 2 shall not be deemed exclusive of any other
rights to which Indemnitee may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in
Indemnitee's official capacity and as to action in another capacity while
holding such official capacity, shall continue after Indemnitee has ceased to be
a director, officer, employee or agent of the Company, and shall inure to the
benefit of the heirs, executors and administrators of Indemnitee.
3. Determination of Right to Indemnification. For the purpose of making the
determination of whether to indemnify Indemnitee in a specific as provided for
by Section 2.3, the board of directors of the Company, board committee,
independent legal counsel or stockholders, as the case may be, shall make the
determination in accordance with the following procedures:
3.1 Such determination shall be made (a) by the board of directors of
the Company by a majority vote of those present at a meeting at which a quorum
consisting of directors
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who were not parties to such proceeding are present, (b) if a quorum cannot be
obtained, by a majority vote of a committee of the board of directors designated
by the board of directors, which committee shall consist of two or more
directors not parties to the proceeding, (c) if a quorum of the board cannot be
obtained nor a board committee established, or if a majority of the directors
constituting such quorum or such board committee so directs, by (d) independent
legal counsel selected by a vote of the board or the board committee, or if a
quorum of the full board cannot be obtained or a board committee cannot be
established, by independent legal counsel selected by a majority vote of the
full Board, or (b) by the stockholders of the Company.
3.2 Indemnitee shall submit to the board of directors a Statement of
Request for Indemnification in substantially the form set forth in EXHIBIT B, in
which Indemnitee states that Indemnitee has met the applicable standard of
conduct set forth in Sections 2.1 and 2.2.
3.3 Indemnitee's submission of a Statement of Request for
Indemnification to the board of directors shall create a rebuttable presumption
that Indemnitee has met the applicable standard of conduct set forth in sections
2.1 and 2.2 and, therefore, is entitled to indemnification under Section 2. The
board of directors, board committee, independent legal counsel or stockholders,
as the case may be, shall determine, within 30 days after submission of the
Statement of Request for Indemnification, specifically, that Indemnitee is so
entitled, unless it or they shall possess clear and convincing evidence to rebut
the foregoing presumption, which evidence shall be disclosed to Indemnitee with
particularity in a sworn written statement signed by all persons who
participated in the determination and voted to deny indemnification.
4. Merger, Consolidation or Change in Control. If the Company is a
constituent corporation in a merger or consolidation, whether the Company is the
resulting or surviving corporation or is absorbed as a result thereof, or if
there is a change in control of the Company, Indemnitee shall stand in the same
position under this agreement with respect to the resulting, surviving or
changed corporation as Indemnitee would have with respect to the Company if its
separate existence had continued or if there had been no change in control of
the Company.
5. Certain Definitions. For the purposes of this Agreement, the following
terms shall have the indicated meanings and understandings:
5.1 The term "change in control" shall include any change in the
ownership of a majority of the outstanding voting securities of the Company or
in the composition of a majority of the members of the board of directors of the
Company.
5.2 The term "corporation" shall include any domestic or foreign
entity that is a predecessor of a corporation by reason of a merger or other
transaction in which the predecessor's existence leased upon consummation of the
transaction.
5.3 The term "director" means an individual who is or was a director
of the Company or an individual who, while a director of the Company, is or was
surviving at the Company's request as a director, an officer, an agent, an
associate, an employee, a fiduciary, a
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manager, a member, a partner, a promoter or a trustee of, or to hold any similar
position with, another domestic or foreign corporation or other person or of an
employee benefit plan. A director is considered to be serving an employee
benefit plan at the Company's request if the director's duties to the Company
also impose duties on, or otherwise involve services by, the director to the
plan or to participants in or beneficiaries of the plan. "Director" includes,
unless the context requires otherwise, the estate or personal representative of
a director.
5.4 The term "liability" means the obligation incurred with respect to
a proceeding to pay a judgment, settlement, penalty, fine, including an excise
tax assessed with respect to an employee benefit plan, or reasonable expenses.
5.5 The term "official capacity" means, when used with respect to a
director, the office of director in the Company and, when used with respect to a
person other than a director, the office in the Company held by the officer or
the employment, fiduciary or agency relationship undertaken by the employee,
fiduciary or agent on behalf of the Company. "Official capacity" does not
include service for any other domestic or foreign corporation or other person or
employee benefit plan.
5.6 The term "party" includes a person who was, is, or is threatened
to be made a named defendant or respondent in a proceeding.
5.7 The term "proceeding" means any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative and whether formal or informal.
6. Counsel fees. If (a) Indemnitee institutes any legal action to enforce
Indemnitee's rights under this Agreement, or to recover damages for breach of
this Agreement, and (b) if Indemnitee prevails in whole or in part, then
Indemnities shall be entitled to recover from the Company all fees and expenses
(including counsel fees) incurred by Indemnitee in connection therewith.
7. Deposit of Funds in Trust. If the Company voluntarily decides to
dissolve or to file a petition for relief under the applicable bankruptcy,
moratorium or similar laws, then not later than 10 days prior to such
dissolution or filing, the Company shall deposit in trust for the sole and
exclusive benefit of Indemnitee a cash amount equal to all amounts previously
authorized to be paid to Indemnitee hereunder, such amounts to be used to
discharge the Company's obligations to Indemnitee hereunder. Any amounts in such
trust not required for such purpose shall be returned to the Company. This
Section 7 shall not apply to the dissolution of the Company in connection with a
transaction as to which Section 4 applies.
8. Amendments to Act. This Agreement is intended to provide indemnity to
Indemnitee to the fullest extent allowed under Delaware law. Accordingly, to the
extent permitted by law, if the Act permits greater indemnity than the indemnity
set forth herein, or if any amendment is made to the Act expanding the indemnity
permissible under Delaware law, the indemnity obligations
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contained herein automatically shall be expanded, without the necessity of
action on the part of any party, to the extent necessary to provide to
Indemnitee the fullest indemnity permissible under Delaware law.
9. Miscellaneous Provisions.
9.1 Survival. The provisions of this Agreement shall survive the
termination of Indemnitee's service as a director or officer of the Company.
9.2 Entire Agreement. This Agreement constitutes the full
understanding of the parties, comprises the complete and exclusive statement of
the terms and conditions of their agreement relating to the subject matter
hereof and supersedes all prior negotiations, understandings and agreements,
whether written or oral, between the parties, their affiliates, and their
respective principals, shareholders, directors, officers, employees, consultants
and agents with respect thereto.
INDEMNITEE:
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Name: ____________________________
Title: ___________________________
SAGE, INC.
-----------------------------------
Name: ____________________________
Title: ___________________________
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EXHIBIT A
STATEMENT OF UNDERTAKING
STATE OF _______________________ )
) ss:
COUNTY OF _____________________ )
I, _______________________, being first duly sworn, depose and say as
follows:
1. This Statement of Undertaking is submitted pursuant to the Indemnity
Agreement dated ___________, 1999, between Sage, Inc., a Delaware corporation
("Company"), and me and Section 2.4 of such agreement.
2. I am requesting the advancement of certain reasonable expenses which I
have incurred in defending a civil, criminal, investigative or administrative
action, suit or proceeding brought against me by reason of the fact that I am or
was a director and/or officer of the Company.
3. I hereby undertake to repay this advancement of expenses if it is
ultimately determined that I did not meet the applicable standard of conduct
required to be entitled to Indemnification by the Company.
4. I am requesting the advancement of reasonable expenses in connection
with the following proceeding:
I have executed this Statement of Undertaking on ________________________.
______________________________________________
Signature
______________________________________________
Print Name
Subscribed and sworn to before me on ______________________.
My commission expires: ________________________
______________________________________________
Notary Public in and for said state and county
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EXHIBIT B
STATEMENT OF REQUEST FOR INDEMNIFICATION
STATE OF _______________________ )
) ss:
COUNTY OF _____________________ )
I, _____________________________, being first duly sworn, depose and say as
follows:
1. This Statement of Request for Indemnification is submitted pursuant to
the Indemnity Agreement dated ________________, 1999, between Sage, Inc., a
Delaware corporation ("Company"), and me and Section 3 of such agreement.
2. I am requesting indemnification against reasonable expenses (including
counsel fees) incurred by me in connection with a certain proceeding to which I
am a party or am threatened to be made a party by reason of the fact that I am
or was a director and/or officer of the Company.
3. With respect to all matters related to any such proceeding, I conducted
myself in good faith, I reasonably believed that my conduct was in or not
opposed to the best interests of the Company and, with respect to any criminal
proceeding, I had no reasonable cause to believe that my conduct was unlawful.
4. I am requesting indemnification in connection with the following
proceeding:
I have executed this Statement of Request for Indemnification on
___________________.
___________________________________________
Signature
___________________________________________
Print Name
Subscribed and sworn to before me on ______________________.
My commission expires: ________________________
______________________________________________
Notary Public in and for said state and county
