EXHIBIT 10.10
NETZEE, INC.
INDEMNIFICATION AGREEMENT
THIS AGREEMENT is made on this ____ day of October, 1999, by and between
Netzee, Inc., a Georgia corporation ("Netzee"), and the undersigned
("Executive"),
WITNESSETH:
WHEREAS, Executive is currently serving or intends to serve as an officer
or director of Netzee and in such capacity performs a valuable service for
Netzee;
WHEREAS, the Georgia Business Corporation Code, as now in effect or
hereafter amended (the "GBCC") as well as Netzee's Bylaws (the "Bylaws")
specifically provide that the indemnification provided thereunder is not
exclusive of any other rights with respect to indemnification or otherwise to
which those seeking indemnification may be entitled under any resolution
approved by the affirmative vote of the holders of a majority of the shares
entitled to vote thereon;
WHEREAS, the GBCC and the Bylaws contemplate that contracts may be entered
into between Netzee and its officers and directors with respect to
indemnification of such persons;
WHEREAS, Netzee intends to purchase and maintain a policy of directors and
officers' liability insurance ("D&O Insurance") covering certain liabilities
that may be incurred by its officers and directors in the performance of their
services to Netzee;
WHEREAS, recent developments with respect to the terms and availability of
D&O Insurance have raised questions concerning the continuing availability of
such insurance to corporations generally and the reliability of the protection
such insurance affords to directors; and
WHEREAS, in order to resolve such questions and thereby encourage Executive
to continue his service or begin to serve as an officer or director of Netzee,
Netzee has determined and agreed to enter into this Agreement with Executive;
NOW, THEREFORE, in consideration of Executive's service or continued
service to Netzee as an officer or director from and after the date hereof, the
parties hereby agree as follows:
1. INDEMNITY OF EXECUTIVE. Netzee shall defend, hold harmless and
indemnify Executive to the full extent permitted by the provisions of the GBCC,
as currently in
effect or as it may hereafter be amended, or by the provisions of any other
applicable statute authorizing or permitting such indemnification, whether
currently in effect or hereafter adopted.
2. INSURANCE POLICIES.
(a) Netzee represents that it intends to obtain D&O Insurance with
_____________________ in the amount of $_____________. Subject to the
provisions of Section 2(b) hereof, for so long as Executive shall continue
in such capacity and thereafter if Executive shall then be subject to any
threatened, pending or completed action, suit or proceeding (whether civil,
criminal, administrative or investigative), by reason of the fact that
Executive was an officer or director of Netzee, Netzee will use reasonable
efforts to maintain in effect for the benefit of Executive one or more
policies of D&O Insurance providing coverage comparable to that presently
in effect.
(b) Netzee shall not be required to maintain said policy or policies
of D&O Insurance in effect if said insurance is not reasonably available or
if, in the reasonable business judgment of the then directors of Netzee,
the premium cost for such insurance is disproportionate to the amount or
extent of coverage.
3. ADDITIONAL INDEMNITY. Subject to the provisions of Section 4 hereof
and without limiting the effect of the Bylaws, Netzee shall defend, hold
harmless and indemnify Executive as follows:
(a) In any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of Netzee), by reason of the fact that he
is or was an officer or director of Netzee, or is or was serving at the
request of Netzee as a director, officer, partner, trustee, employee or
agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise, from and against
all costs, liabilities, obligations, expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding, if he
acted in a manner that he believed in good faith to be in or not opposed to
the best interests of Netzee, and, with respect to any criminal action or
proceeding, if he had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction or upon a plea of nolo contendere or its
equivalent shall not, of itself, create a presumption that Executive did
not act in a manner which he believed in good faith to be in or not opposed
to the best interests of Netzee and, with respect to any criminal action or
proceeding, that Executive had no reasonable cause to believe that his
conduct was unlawful.
(b) In any threatened, pending or completed action, suit or proceeding
by or in the right of Netzee to procure a judgment in its favor, by reason
of the fact he is or was an officer or director of Netzee or is or was
serving at the request of Netzee as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise, from and
against all costs, liabilities, obligations, expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or
proceeding, if he acted in a manner that he believed in good faith to be in
or not opposed to the best interests of Netzee. The termination of any
action, suit or proceeding by judgment, order or settlement shall not, of
itself, create a presumption that Executive did not act in a manner which
he believed in good faith to be in or not opposed to the best interests of
Netzee.
4. LIMITATIONS ON ADDITIONAL INDEMNITY. No indemnity pursuant to Section
3 hereof shall be paid by Netzee:
(a) to the extent it would reduce or eliminate any payments under any
D&O Insurance covering Executive;
(b) to the extent of any liability for which Executive is indemnified
pursuant to Sections 1 and 2 of this Agreement or pursuant to any D&O
Insurance carried by Netzee;
(c) on account of any claim against Executive for an accounting of
profits made from the purchase or sale of securities of Netzee pursuant to
the provisions of Section 16(b) of the Securities Exchange Act of 1934 and
amendments thereto or the similar provisions of any other applicable law;
(d) on account of any claim against Executive arising out of the
trading of Netzee stock while possessing material non-public information,
whether pursuant to the Xxxxxxx Xxxxxxx Sanctions Act of 1984 or otherwise;
(e) if a final judgment or other final adjudication by a court having
jurisdiction in the matter shall determine that such indemnity is not
lawful;
(f) in respect to remuneration paid to Executive if a final judgment
or other final adjudication by a court having jurisdiction in the matter
shall determine that such remuneration was not lawful;
(g) for any appropriation, in violation of his duties, of any business
opportunity of Netzee;
(h) for acts or omissions which involve fraud, intentional misconduct
or a knowing violation of law;
(i) for unlawful distributions as set forth in GBCC (S) 14-2-832 (or
any successor provision); or
(j) for any transaction from which he received an improper personal
benefit.
5. NOTIFICATION AND DEFENSE OF CLAIM.
(a) Promptly after receipt by Executive of notice of the commencement
of any action, suit or proceeding, Executive will, if a claim in respect
thereto is to be made against Netzee under this Agreement, notify Netzee of
the commencement thereof. The failure so to notify Netzee will not relieve
Netzee from any liability which it may have to Executive otherwise than
under this Agreement. With respect to any such action, suit or proceeding
as to which Executive so notifies Netzee:
(i) Netzee will be entitled to participate therein at its own
expense; and
(ii) except as otherwise provided below, to the extent that it
may wish, Netzee may assume the defense thereof.
(b) After notice from Netzee to Executive of its election to assume
the defense thereof, Netzee will not be liable to Executive under this
Agreement or otherwise for any legal or other expenses subsequently
incurred by Executive in connection with the defense thereof other than
reasonable costs of investigation or as otherwise provided below. Executive
shall have the right to employ counsel of his choosing in such action, suit
or proceeding but the fees and expenses of such counsel incurred after
notice from Netzee of its assumption of the defense thereof shall be at the
expense of Executive unless (i) the employment of counsel by Executive has
been authorized in writing by Netzee, (ii) Netzee and Executive shall have
reasonably concluded that there may be a conflict of interest between
Netzee and Executive in the conduct of the defense of such action, or (iii)
Netzee shall have failed or refused to employ counsel to assume the defense
of such action, in each of which cases the reasonable fees and expenses of
Executive's counsel shall be paid by Netzee.
(c) Netzee shall not be liable to Executive under this Agreement for
any amounts paid in settlement of any threatened or pending action, suit or
proceeding without its prior written consent. Netzee shall not settle any
such action, suit or
proceeding in any manner which would impose any penalty or limitation on
Executive without Executive's prior written consent. Neither Netzee nor
Executive will unreasonably withhold his or its consent to any proposed
settlement.
6. PREPAYMENT OF EXPENSES. Unless Executive otherwise elects, expenses
incurred in defending any civil or criminal action, suit or proceeding will be
paid by Netzee in advance of the final disposition of such action, suit or
proceeding upon receipt of a written agreement from Executive in form and
substance satisfactory to Netzee (i) affirming the Executive's good faith belief
that his conduct does not constitute behavior of the kind described in Sections
4(c) through (j) of this Agreement, and (ii) agreeing to repay any advances if
it shall be ultimately determined that he is not entitled to be indemnified by
Netzee under this Agreement.
7. CONTINUATION OF INDEMNITY. All agreements and obligations of Netzee
contained in this Agreement shall continue during the period Executive is a
member of the Board of Executives of Netzee and shall continue thereafter so
long as Executive shall be subject to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that Executive was a director of Netzee, or
is or was serving at the request of Netzee as a director, officer, partner,
trustee, employee or agent of another foreign or domestic corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise.
8. ALLOWANCE FOR COMPLIANCE WITH SEC REQUIREMENTS. Executive acknowledges
that the Securities and Exchange Commission ("SEC") has expressed the opinion
that indemnification of directors and officers from liabilities under the
Securities Act of 1933 (the "Act") is against public policy and therefore
unenforceable. Executive hereby agrees that it will not be a breach of this
Agreement for Netzee to agree with the SEC in connection with the registration
for sale of any stock or other securities of Netzee from time to time that, in
the event a claim for indemnification against such liabilities (other than the
payment by Netzee of expenses incurred or paid by a director or officer of
Netzee in the successful defense of any action, suit or proceeding) is asserted
in connection with such stock or other securities being registered, Netzee will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of competent jurisdiction the question of whether
or not such indemnification by it is against public policy as expressed in the
Act and will be governed by the final adjudication of such issue. Executive
further agrees that such submission to a court of competent jurisdiction shall
not be a breach of this Agreement.
9. RELIANCE. Netzee has entered into this Agreement in order to induce
Executive to serve or continue as a member of the Board of Executives of Netzee,
and acknowledges that Executive is relying upon this Agreement with respect
thereto.
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 invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.
11. GOVERNING LAW; ASSIGNMENT; BINDING EFFECT; AMENDMENT AND TERMINATION;
GENDER.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Georgia.
(b) Neither this Agreement nor any rights or obligations hereunder
shall be assigned or transferred by Executive.
(c) This Agreement shall be binding upon Executive and upon Netzee,
its successors and assigns, including successors by merger or
consolidation, and shall inure to the benefit of Executive, his heirs,
personal representatives and permitted assigns and to the benefit of
Netzee, its successors and assigns.
(d) No amendment, modification or termination of this Agreement shall
be effective unless in writing signed by both parties hereto.
(e) References herein to the male gender herein shall include
references to the female gender.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the day and year first above written.
NETZEE, INC.
By:
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Name:
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Title:
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EXECUTIVE
By:
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Name:
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Title:
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