EXHIBIT 10.23.5 - Indemnification Agreement
THIS AGREEMENT is made as of this 18th day of February 1999 between XxXxxxxxx
Technologies, Inc., a Delaware corporation ("Corporation") and Xxxxx X. Xxxxxx
("Director").
WITNESSETH THAT:
WHEREAS, Director is a member of the Board of Directors of Corporation and in
such capacity is performing a valuable service for Corporation; and
WHEREAS, the Certificate of Incorporation ("Certificate") and By-laws
("By-laws") of the Corporation provide for the indemnification of the directors,
officers, employees and agents of the Corporation to the maximum extent
authorized by Section 145 of the Delaware General Corporation Law, as amended
(the "DGCL"); and
WHEREAS, such DGCL specifically provides that the indemnification provided in
the Certificate and By-laws is not exclusive, and thereby contemplate that
contracts may be entered into between Corporation and the members of its Board
of Directors with respect to indemnification of such directors; and
WHEREAS, in accordance with the authorization provided by the DGCL, Corporation
has purchased and presently maintains a policy or policies of Directors and
Officers Liability Insurance ("D & O Insurance"), covering certain liabilities
which may be incurred by its directors and officers in the performance of their
services for Corporation; and
WHEREAS, certain matters with respect to the terms and availability of D & O
Insurance and with respect to the application, amendment and enforcement of
statutory and by-law indemnification provisions generally have raised questions
concerning the adequacy and reliability of the protection afforded to directors
thereby; and
WHEREAS, in order to resolve such questions and thereby induce Director to
continue to serve as a member of the Board of Directors of Corporation,
Corporation has determined and agreed to enter into this contract with Director;
NOW, THEREFORE, in consideration of Director's continued service as a Director
after the date hereof the parties hereto agree as follows:
1. INDEMNITY OF DIRECTOR. Corporation hereby agrees to hold harmless and
indemnify Director to the full extent authorized or permitted by the
provisions of the DGCL, or by any amendment thereof or other statutory
provisions authorizing or permitting such indemnification which is
adopted after the date hereof.
2. MAINTENANCE OF INSURANCE AND SELF INSURANCE.
a) Corporation represents that it presently has in force and
effect policies of D & O Insurance with insurance companies
and in amounts as follows (the "Insurance Policies"):
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Federal Insurance Company - Policy No. 8141-46-37 providing
directors and officers liability coverage with limits of $15
million per loss and per policy period and fiduciary liability
coverage of $5 million per loss and per policy period.
b) In the event Corporation does not purchase and maintain in
effect for the benefit of Director one or more valid, binding
and enforceable policies of D & O Insurance providing, in all
respects, coverage at least comparable to that presently
provided pursuant to the Insurance Policies, Corporation
agrees to hold harmless and indemnify Director to the full
extent of the coverage which would otherwise have been
provided for the benefit of Director pursuant to the Insurance
Policies.
3. ADDITIONAL INDEMNITY. Subject only to the exclusions set forth in
Section 4 hereof, Corporation hereby further agrees to hold harmless
and indemnify Director:
a) Against any and all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and
reasonably incurred by Director in connection with any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative
(including an action by or in the right of the Corporation) to
which Director is, was or at any time becomes a party, or is
threatened to be made a party, by reason of the fact that
Director is, was or at any time becomes a director, officer,
employee or agent of Corporation, or is or was serving or at
any time serves at the request of Corporation as a director,
officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise; and
b) Otherwise to the fullest extent as may be provided to Director
by Corporation under DGCL.
4. LIMITATIONS ON ADDITIONAL INDEMNITY. No indemnity pursuant to Section 3
hereof shall be paid by Corporation:
a) except to the extent the aggregate of losses to be indemnified
thereunder exceed the sum of $1,000 plus the amount of such
losses for which the Director is indemnified either pursuant
to Sections 1 or 2 hereof or pursuant to any D & O Insurance
purchased and maintained by the Corporation;
b) on account of any suit in which judgment is rendered against a
Director for an accounting of profits made from the purchase
or sale by Director of securities of Corporation pursuant to
the provisions of Section 16(b) of the Securities Exchange Act
of 1934 and amendments thereto or similar provisions of any
federal, state or local statutory law;
c) on account of Director's conduct which is finally adjudged to
have been knowingly fraudulent, deliberately dishonest or
willful misconduct;
d) if a final decision by a Court having jurisdiction in the
matter shall determine that such indemnification is not
lawful.
5. CONTINUATION OF INDEMNITY. All agreements and obligations of
Corporation contained herein shall continue during the period Director
is a director, officer, employee or agent of Corporation (or is or was
serving at the request of Corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or
other enterprise) and shall continue thereafter so long as Director
shall be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether, civil, criminal or
investigative, by reason of the fact that Director was a director of
Corporation or serving in any other capacity referred to herein.
6. NOTIFICATION AND DEFENSE OF CLAIM. Promptly after receipt by Director
of notice of the commencement of any action, suit or proceeding,
Director will, if a claim in respect thereof is to be made against
Corporation under this Agreement, notify Corporation of the
commencement thereof; but the omission so to notify Corporation will
not
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relieve it from any liability which it may have to Director otherwise
than under this Agreement. With respect to any such action, suit or
proceeding as to which Director notifies Corporation of the
commencement thereof:
a) Corporation will be entitled to participate therein at its own
expense; and,
b) Except as otherwise provided below, to the extent that it may
wish, Corporation jointly with any other indemnifying party
similarly notified will be entitled to assume the defense
thereof, with counsel satisfactory to Director. After notice
from Corporation to Director of its election so to assume the
defense thereof, Corporation will not be liable to Director
under this Agreement for any legal or other expenses
subsequently incurred by Director in connection with the
defense thereof other than reasonable costs of investigation
or as otherwise provided below. Director shall have the right
to employ separate counsel in such action, suit or proceeding
but the fees and expenses of such counsel incurred after
notice from Corporation of its assumption of the defense
thereof shall be at the expense of Director unless (i) the
employment of counsel by Director has been authorized by
Corporation, (ii) Director shall have reasonably concluded
that there may be a conflict of interest between Corporation
and Director in the conduct of the defense of such action or
(iii) Corporation shall not in fact have employed counsel to
assume the defense of such action, in each of which cases the
fees and expenses of counsel shall be at the expense of
Corporation. Corporation shall not be entitled to assume the
defense of any action, suit or proceeding brought by or on
behalf of Corporation or as to which Director shall have made
the conclusion provided for in (ii) above.
c) Corporation shall not be liable to indemnify Director under
this Agreement for any amounts paid in settlement of any
action or claim effected without its written consent.
Corporation shall not settle any action or claim in any manner
which would impose any penalty or limitation on Director
without Director's written consent. Neither Corporation nor
Director will unreasonably withhold their consent to any
proposed settlement.
7. ADVANCEMENT AND REPAYMENT OF EXPENSES. Costs and expenses (including
attorneys' fees) incurred by Director in defending or investigating any
action, suit, or proceeding or investigation shall be paid by the
Corporation in advance of the final disposition of such matter. The
Director hereby undertakes to repay any such advances in the event that
it is ultimately determined that Director is not entitled to
indemnification under the terms of this Agreement. Director agrees that
Director will reimburse Corporation for all reasonable expenses paid by
Corporation in defending any civil or criminal action, suit or
proceeding against Director in the event and only to the extent that it
shall be ultimately determined that Director is not entitled to be
indemnified by Corporation for such expenses under the provisions of
the DGCL, the Certificate, the By-laws, this Agreement or otherwise.
8. DETERMINATION OF RIGHT TO INDEMNIFICATION. Anything contained elsewhere
herein to the contrary notwithstanding, the determination as to whether
or not Director has met the standard of conduct required to qualify and
entitle Director to indemnification under the provisions of this
Agreement may be made either by the Board of Directors by a majority
vote of a quorum consisting of directors who were not parties to such
action, suit or proceeding, by independent legal counsel (who may be
the outside counsel regularly employed by Corporation) or by the
stockholders of Corporation, provided that the manner in which (and, if
applicable, the counsel by which) the right to indemnification is to be
determined shall be approved in advance in writing by both the Board of
Directors and by Director. In the event that such parties are unable to
agree on the manner in which the determination of the right to
indemnity is to be made, such determination may be made by independent
legal counsel retained by Corporation especially for such purpose,
provided that such counsel be approved in advance in writing by both
the Board of Directors and Director and provided further, that such
counsel shall not be outside counsel employed by the Corporation. In
the event that the Parties hereto are unable to agree on the selection
of such outside counsel, such outside counsel shall be selected by lot
by the outside counsel regularly employed by Corporation from among the
Chicago law firms having more than one hundred attorneys and having a
rating of "av" or better in the then current Xxxxxxxxxx-Xxxxxxx Law
Directory. Such selection by lot shall be made in the presence of
Director (and his legal counsel or either of them, as Director may
elect). The outside counsel regularly employed by Corporation and
Director (and his legal counsel or either of them, as Director may
elect) shall contact, in the order of their selection by lot, such law
firms, requesting each such firm to accept engagement to make the
determination required hereunder until one of such firms
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accepts such engagement. The fees and expenses of counsel in connection
with making said determination contemplated hereunder shall be paid by
Corporation, and, if requested by such counsel, Corporation shall give
such counsel an appropriate written agreement with respect to the
payment of their fees and expenses and such other matters as may be
reasonably requested by counsel.
9. ENFORCEMENT.
a) Corporation expressly confirms and agrees that it has entered
into this Agreement and assumed the obligations imposed on
Corporation hereby in order to induce Director to continue as
a director of Corporation, and acknowledges that director is
relying upon this Agreement in continuing in such capacity.
b) In the event Director is required to bring any action to
enforce rights or to collect moneys due under this Agreement
and is successful in such action, Corporation shall reimburse
Director for all of Director's reasonable fees and expenses in
bringing and pursuing such action.
10. SEPARABILITY. Each of the provisions of this Agreement is a separate
and distinct agreement and independent of the others, so that if any
provision hereof shall be held to be valid or unenforceable for any
reason, such invalidity or unenforceability shall not affect the
validity or enforceability of the other provisions hereof.
11. MISCELLANEOUS.
a) This Agreement shall be interpreted and enforced in accordance
with the laws of the State of Delaware.
b) This Agreement shall be binding upon Director and upon
Corporation, its successors and assigns, and shall insure to
the benefit of Director, Director's heirs, personal
representatives and assigns and to the benefit of Corporation,
its successors and assigns.
c) No amendment, modification, termination or cancellation of
this Agreement shall be effective unless in writing signed by
both parties hereto.
d) The indemnification and advance payment of expenses provided
by this Agreement shall not be deemed exclusive of any other
rights to which Director may be entitled under any provision
of law, the Certificate, the By-laws, any other agreement, a
vote of stockholders or disinterested directors or otherwise.
IN WITNESS WHEREOF, the parties hereto executed this Agreement on and as of the
day and year first above written.
XxXXXXXXX TECHNOLOGIES, INC.
By /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx, President
and Chief Executive Officer
DIRECTOR
/s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
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