EXHIBIT 10.74
INDEMNITY AGREEMENT
This INDEMNITY AGREEMENT made and entered into as of this ____ day of February,
2003, by and between Syndicated Food Service International, Inc., a Florida
corporation (the "Company") and ________________________ (the "Indemnitee");
WHEREAS, highly competent persons are becoming more reluctant to serve
or to continue serving corporations as directors, officers, employees, agents or
in other capacities unless they are provided with adequate protection through
insurance and indemnification against inordinate risks of claims and actions
against them arising out of their service to and activities on behalf of such
corporations; and
WHEREAS, the current difficulties of obtaining adequate insurance have
increased the difficulty of attracting and retaining such persons; and
WHEREAS, the Board of Directors of the Company has determined that the
inability to attract and retain such persons is detrimental to the best
interests of the Company's stockholders and that the Company should act to
assure such persons that there will be increased certainty of such protection in
the future; and
WHEREAS, it is reasonable, prudent and necessary for the Company
contractually to obligate itself to indemnify 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; and
WHEREAS, the Indemnitee is willing to serve, continue to serve and take
on additional service for or on behalf of the Company on the condition that the
Indemnitee be so indemnified.
NOW, THEREFORE, in consideration of the premises and the covenants contained
herein, the Company and the Indemnitee do hereby covenant and agree as follows:
SECTION 1. Indemnification. The Company shall indemnify the Indemnitee to the
fullest extent permitted by applicable law in effect on the date hereof or as
such laws may from time to time be amended. Without diminishing the scope of the
indemnification provided by this Section 1, the rights of indemnification of the
Indemnitee provided hereunder shall include but shall not be limited to those
rights hereinafter set forth, except that no indemnification shall be paid to
the Indemnitee:
(a) on account of any suit in which judgment is rendered against
the Indemnitee for an accounting of profits made from the purchase or sale by
the Indemnitee of securities of the Company pursuant to the provisions of
Section 16(b) of the Securities and Exchange Act of 1934, as amended from time
to time, or similar provisions of any federal, state or local statutory law;
1
(b) on account of the Indemnitee's conduct which is finally
adjudged to have been knowingly fraudulent or deliberately dishonest, or to
constitute willful misconduct;
(c) to the extent expressly prohibited by applicable law;
(d) for which payment is actually made to the Indemnitee under a
valid and collectible insurance policy or under a valid and enforceable
indemnity clause, bylaw or agreement, except in respect of any excess beyond
payment under such insurance, clause, bylaw or agreement;
(e) if a final decision by a court having jurisdiction in the
matter shall determine that such indemnification is not lawful (and in this
respect, both the Company and the Indemnitee have been advised that the
Securities and Exchange Commission believes that indemnification for liabilities
arising under the federal securities laws is against public policy and is,
therefore, unenforceable and that claims for indemnification should be submitted
to the appropriate court for adjudication); or
(f) in connection with any proceeding (or part thereof) initiated
by the Indemnitee, or any proceeding by the Indemnitee against the Company or
its directors, officers, employees or other indemnitees, unless (i) such
indemnification is expressly required to be made by law, (ii) the proceeding was
authorized by the Board of Directors of the Company, (iii) such indemnification
is provided by the Company, in its sole discretion, pursuant to the powers
vested in the Company under applicable law, or (iv) except as provided in
Sections 10 and 11 hereof.
SECTION 2. Action or Proceeding Other Than an Action by or in the Right of the
Company. The Indemnitee shall be entitled to the indemnification rights provided
in this Section if the Indemnitee is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative in nature, other than an action
by or in the right of the Company, by reason of the fact that the Indemnitee is
or was a director, officer, employee, agent or fiduciary of the Company, or is
or was serving at the request of the Company as a director, officer, employee,
agent or fiduciary of any other entity or enterprise, including, but not limited
to, another corporation, partnership, joint venture or trust or service with
respect to employee benefit plans, or by reason of anything done or not done by
the Indemnitee in any such capacity. Pursuant to this Section, the Indemnitee
shall be indemnified against all expenses, (including attorney's fees and excise
taxes or penalties under the Employee Retirement Security Act of 1974, as
amended) costs, judgments, penalties, fines and amounts paid in settlement
actually and reasonably incurred by the Indemnitee in connection with such
action, suit or proceeding (including, but not limited to, the investigation,
defense or appeal thereof), if the Indemnitee acted in good faith and in a
manner the Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe the Indemnitee's conduct was
unlawful.
2
SECTION 3. Actions by or in the Right of the Company. The Indemnitee shall be
entitled to the indemnification rights provided in this Section if the
Indemnitee is a person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding brought by or
in the right of the Company to procure a judgment in its favor by reason of the
fact that the Indemnitee is or was a director, officer, employee, agent or
fiduciary of the Company, or is or was serving at the request of the Company as
a director, officer, employee, agent or fiduciary of another entity or
enterprise, including, but not limited to, another corporation, partnership,
joint venture or trust or service with respect to employee benefit plans, or by
reason of anything done or not done by the Indemnitee in any such capacity.
Pursuant to this Section, the Indemnitee shall be indemnified against all
expenses (including attorney's fees and excise taxes or penalties under the
Employee Retirement Security Act of 1974, as amended), costs and amounts paid in
settlement actually and reasonably incurred by the Indemnitee in connection with
such action, suit or proceeding (including, but not limited to, the
investigation, defense or appeal thereof) if the Indemnitee acted in good faith
and in a manner the Indemnitee reasonably believed to be in or not opposed to
the best interests of the Company; provided, however, that no such
indemnification shall be made in respect of any claim, issue, or matter as to
which applicable law expressly prohibits such indemnification by reason of any
adjudication of liability of the Indemnitee to the Company, unless and only to
the extent that the court of the State of Delaware or the court in which such
action or suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case, the
Indemnitee is fairly and reasonably entitled to indemnity for such expenses,
costs and amounts paid in settlement which such court shall deem proper.
SECTION 4. Indemnification for Costs, Charges and Expenses of Successful Party.
Notwithstanding the other provisions of this Agreement, to the extent that the
Indemnitee has served as a witness on behalf of the Company or has been
successful, on the merits or otherwise, in defense of any action, suit or
proceeding referred to in Sections 2 and 3 hereof, or in defense of any claim,
issue or matter therein, including, without limitation, the dismissal of any
action without prejudice, the Indemnitee shall be indemnified against all costs,
charges and expenses (including attorneys' fees) actually and reasonably
incurred by the Indemnitee in connection therewith.
SECTION 5. Partial Indemnification. If the Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of the expenses (including attorneys' fees), costs, judgments, fines and
amounts paid in settlement actually and reasonably incurred by the Indemnitee in
connection with the investigation, defense, appeal or settlement of such suit,
action, investigation or proceeding described in Section 2 or 3 hereof, but not,
however, for all of the total amount thereof, the Company shall nevertheless
indemnify the Indemnitee for the portion of such expenses (including attorneys'
fees), costs, judgments, penalties, fines and amounts paid in settlement
actually and reasonably incurred by the Indemnitee to which the Indemnitee is
entitled.
3
SECTION 6. Presumptions and Effect of Certain Proceedings. The Secretary of the
Company shall, promptly upon receipt of the Indemnitee's request for
indemnification, advise in writing the Board of Directors that the Indemnitee
has made such request for indemnification. Upon making such request for
indemnification, the Indemnitee shall be presumed to be entitled to
indemnification hereunder and the Company shall have the burden of proof in the
making of any determination contrary to such presumption. If the Board of
Directors shall have failed to make the requested indemnification within 45 days
after receipt by the Company of such request, the requisite determination of
entitlement to indemnification shall be deemed to have been made and the
Indemnitee shall be absolutely entitled to such indemnification, absent actual
and material fraud in the request for indemnification. The termination of any
action, suit, investigation or proceeding described in Section 2 or 3 hereof by
judgment, order, settlement or conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself: (a) create a presumption that the
Indemnitee did not act in good faith and in a manner which the Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, that the
Indemnitee had reasonable cause to believe that the Indemnitee's conduct was
unlawful; or (b) otherwise adversely affect the rights of the Indemnitee to
indemnification except as may be provided herein.
SECTION 7. Advancement of Expenses and Costs. All reasonable expenses and costs
incurred by the Indemnitee (including attorneys' fees, retainers and advances of
disbursements required of the Indemnitee) shall be paid by the Company in
advance of the final disposition of such action, suit or proceeding at the
request of the Indemnitee within twenty days after the receipt by the Company of
a statement or statements from the Indemnitee requesting such advance or
advances from time to time. The Indemnitee's entitlement to such expenses shall
include those incurred in connection with any proceeding by the Indemnitee
seeking an adjudication pursuant to this Agreement. Such statement or statements
shall reasonably evidence the expenses and costs incurred by the Indemnitee in
connection therewith and shall include or be accompanied by an undertaking by or
on behalf of the Indemnitee to repay such amount if it is ultimately determined
that the Indemnitee is not entitled to be indemnified against such expenses and
costs by the Company as provided by this Agreement or otherwise.
SECTION 8. Remedies of the Indemnitee in Cases of Determination not to Indemnify
or to Advance Expenses. In the event that a determination is made that the
Indemnitee is not entitled to indemnification hereunder or if payment has not
been timely made following a determination of entitlement to indemnification
pursuant to Sections 6, or if expenses are not advanced pursuant to Section 7,
the Indemnitee shall be entitled to a final adjudication exclusively in the U.S.
District Court for the District of Delaware or, if such court lacks subject
matter jurisdiction, in the state court of general jurisdiction in Wilmington,
Delaware. Each of the parties waives any right to object to the venue or
jurisdiction of either such Courts or to claim that such Courts are an
inconvenient forum. Such judicial proceeding shall be made de novo and the
Indemnitee shall not be prejudiced by reason of a determination (if so made)
that the Indemnitee is not entitled to indemnification. If a determination is
made or deemed to have been made pursuant to the
4
terms of Section 6 hereof that the Indemnitee is entitled to indemnification,
the Company shall be bound by such determination and is precluded from asserting
that such determination has not been made or that the procedure by which such
determination was made is not valid, binding and enforceable. The Company
further agrees to stipulate in any such court that the Company is bound by all
the provisions of this Agreement and is precluded from making any assertions to
the contrary. If the court shall determine that the Indemnitee is entitled to
any indemnification hereunder, the Company shall pay all reasonable expenses
(including attorneys' fees) and costs actually incurred by the Indemnitee in
connection with such adjudication (including, but not limited to, any appellant
proceedings).
SECTION 9. Notification and Defense of Claim. Promptly after receipt by the
Indemnitee of notice of the commencement of any action, suit or proceeding, the
Indemnitee will, if a claim in respect thereof is to be made against the Company
under this Agreement, notify the Company in writing of the commencement thereof;
but the omission to so notify the Company will not relieve it from any liability
that it may have to the Indemnitee otherwise than under this Agreement.
Notwithstanding any other provision of this Agreement, with respect to any such
action, suit or proceeding as to which the Indemnitee notifies the Company of
the commencement thereof:
(a) The Company will be entitled to participate therein at its own
expense; and
(b) Except as otherwise provided in this Section 9(b), to the
extent that it may wish, the Company, jointly with any other indemnifying party
similarly notified, shall be entitled to assume the defense thereof, with
counsel satisfactory to the Indemnitee. After notice from the Company to the
Indemnitee of its election to so assume the defense thereof, the Company shall
not be liable to the Indemnitee under this Agreement for any legal or other
expenses subsequently incurred by the Indemnitee in connection with the defense
thereof other than reasonable costs of investigation or as otherwise provided
below. The Indemnitee shall have the right to employ the Indemnitee's own
counsel in such action, suit or proceeding, but the fees and expense of such
counsel incurred after notice from the Company of its assumption of the defense
thereof shall be at the expense of the Indemnitee unless (i) the employment of
counsel by the Indemnitee has been authorized by the Company, (ii) the
Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Company and the Indemnitee in the conduct of the defense of
such action or (iii) the Company shall not in fact have employed counsel to
assume the defense of the action, in each of which cases the fees and expenses
of counsel shall be at the expense of the Company. The Company shall not be
entitled to assume the defense of any action, suit or proceeding brought by or
on behalf of the Company or as to which the Indemnitee shall have made the
conclusion provided for in (ii) above.
(c) The Company shall not be liable to indemnify the Indemnitee
under this Agreement for any amounts paid in settlement of any action or claim
effected without its written consent. The Company shall not settle any action or
claim in any manner that
5
would impose any penalty or limitation on the Indemnitee without the
Indemnitee's written consent. Neither the Company nor the Indemnitee will
unreasonably withhold their consent to any proposed settlement.
SECTION 10. Other Rights to Indemnification. The indemnification and advancement
of expenses (including attorneys' fees) and costs provided by this Agreement
shall not be deemed exclusive of any other rights to which the Indemnitee may
now or in the future be entitled under any provision of the bylaws or
Certificate of Incorporation of the Company, any agreement, any vote of
stockholders or Disinterested Directors, any provision of law or otherwise.
For purposes of this Section 10 "Disinterested Director" shall mean a director
of the Company who is not or was not a party to the action, suit, investigation
or proceeding in respect of which indemnification is being sought by the
Indemnitee.
SECTION 11. Attorneys' Fees and Other Expenses to Enforce Agreement. In the
event that the Indemnitee is subject to or intervenes in any proceeding in which
the validity or enforceability of this Agreement is at issue or seeks an
adjudication to enforce the Indemnitee's rights under, or to recover damages for
breach of, this Agreement, the Indemnitee, if the Indemnitee prevails in whole
or in part in such action, shall be entitled to recover from the Company and
shall be indemnified by the Company against any actual expenses for attorneys'
fees and disbursements reasonably incurred by the Indemnitee.
SECTION 12. Duration of Agreement. This Agreement shall continue until and
terminate upon the later of: (a) ten years after the Indemnitee has ceased to
occupy any of the positions or have any relationships described in Sections 2
and 3 of this Agreement; and (b) the final termination of all pending or
threatened actions, suits, proceedings or investigations to which the Indemnitee
may be subject by reason of the fact that the Indemnitee is or was a director,
officer, employee, agent or fiduciary of the Company or is or was serving at the
request of the Company as a director, officer, employee, agent or fiduciary of
any other entity or enterprise, including, but not limited to, another
corporation, partnership, joint venture or trust, or by reason of anything done
or not done by the Indemnitee in any such capacity. The indemnification provided
under this Agreement shall continue as to the Indemnitee even though the
Indemnitee may have ceased to be a director, officer, employee, agent or
fiduciary of the Company. This Agreement shall be binding upon the Company and
its successors and assigns and shall inure to the benefit of the Indemnitee and
the Indemnitee's spouse, assigns, heirs, devises, executors, administrators or
other legal representatives. Nothing in this Agreement shall confer upon the
Indemnitee the right to continue in the employment of the Company or affect the
right of the Company to terminate the Indemnitee's employment at any time in the
sole discretion of the Company, with or without cause.
SECTION 13. Severability. If any provision or provisions of this Agreement shall
be held invalid, illegal or unenforceable for any reason whatsoever, (a) the
validity, legality and enforceability of the remaining provisions of this
Agreement (including, without
6
limitation, all portions of any paragraphs of this Agreement containing any such
provision held to be invalid, illegal or unenforceable, that are not themselves
invalid, illegal or unenforceable) shall not in any way be affected or impaired
thereby, and (b) to the fullest extent possible, the provisions of this
Agreement (including, without limitation, all portions of any paragraph of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable) shall
be construed so as to give effect to the intent manifest by the provision held
invalid, illegal or unenforceable.
SECTION 14. 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.
SECTION 15. Headings. 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.
SECTION 16. Modification and Waiver. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall such waiver constitute a continuing waiver.
SECTION 17. Notices. All notices, requests, demands or other communications
hereunder, shall be in writing and shall be deemed to have been duly given if
(i) delivered by hand, courier, or personally, on the date of delivery, or (ii)
if mailed by certified or registered mail with postage prepaid, on the third
business day after the date on which it is so mailed:
(a) If to the Indemnitee, to:
______________________
______________________
______________________
(b) If to the Company, to:
Syndicated Food Service International, Inc.
Overlook III, Suite 750
0000 Xxxxx Xxxxx Xxxx\
Xxxxxxx, XX 00000
with a copy to:
7
Hill, Xxxxxxxxx & Xxxxxx, LLP
Overlook III, Suite 750
0000 Xxxxx Xxxxx Xxxx\
Xxxxxxx, XX 00000
Fax No: (000) 000-0000
or to such other address as may be furnished to the Indemnitee by the Company or
to the Company by the Indemnitee, as the case may be.
SECTION 18. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware, without regard to
any conflicts of law principles.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and year first above written.
SYNDICATED FOOD SERVICE INTERNATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxx, Xx.
---------------------------------------
CHIEF EXECUTIVE OFFICER
INDEMNITEE:
--------------------------------------------
8
