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EXHIBIT 10.15
FORM OF INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this "Agreement") is made as of this
___ day of ___________, ____, by and between SEAMED CORPORATION, a Washington
corporation (the "Company"), and _______________ ("Indemnified Party").
RECITALS
A. As of the date hereof, the Company has provisions for
indemnification of its directors and officers in Article 10 of its Articles of
Incorporation (the "Articles of Incorporation") and Article VII of its Bylaws
(the "Bylaws") which provide for indemnification of the Company's directors and
officers to the fullest extent permitted by law.
B. The indemnification provisions in the Articles of
Incorporation and the Bylaws provide that the right of indemnification is a
contract right of the covered parties.
C. The Bylaws provide that the Company may maintain, at its
expense, insurance to protect itself and any of its directors and officers
against liability asserted against such persons incurred in such capacity
whether or not the Company has the power to indemnify such persons against the
same liability under Section 23B.08.510 or .520 of the Act (as defined below)
or a successor statute.
D. The Company and the Indemnified Party recognize that the
officers and directors of publicly owned companies are frequently joined as
parties to Proceedings (as defined below) against their respective companies as
a result of their serving in such capacity.
E. In order to induce Indemnified Party to serve or continue to
serve the Company, the Company wishes to confirm the contract indemnification
rights provided in the Bylaws and agrees to provide Indemnified Party with the
benefits contemplated by this Agreement and to supplement the provisions of
this Agreement with directors' and officers' liability insurance maintained by
the Company.
AGREEMENT
NOW, THEREFORE, in consideration of the promises, conditions,
representations and warranties set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Company and Indemnified Party hereby agree as follows:
1. Definitions. The following terms, as used herein, shall have
the following respective meanings; other capitalized terms used and not
specifically defined in this Section 1 shall have the meanings provided
elsewhere in the Agreement and in the Bylaws:
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"Act" means the Washington Business Corporation Act, RCW Title
23B, as amended from time to time.
"Adjudication" shall refer to a final, non-appealable decision
by a court of competent jurisdiction. "Adjudged" shall have a correlative
meaning.
"Covered Amount" means any Loss, Fine and Expense, to the
extent such Loss, Fine or Expense, in type or amount, is not insured under the
D&O Insurance maintained by the Company from time to time.
"Covered Act" means any act or omission of the Indemnified
Party in, or any officer, director, shareholder, agent, employee, fiduciary or
consultant of the Company for which there is alleged by any claimant any claim
against the Indemnified Party by reason of, his or her capacity as a director,
officer, shareholder, employee, agent, fiduciary or consultant of the Company
alleged by any claimant or any claim against Indemnified Party by reason of him
or her serving in such a capacity, or by reason of Indemnified Party serving,
at the request of the Company, in such capacity with another corporation,
partnership, employee benefit plan, trust or other enterprise, in all cases,
whether such alleged act or omission occurred before or after the date of this
Agreement.
"D&O Insurance" means the liability insurance which the
Company may purchase on behalf of Indemnified Party against liability asserted
against or incurred by Indemnified Party in connection with claims arising from
Covered Acts, whether or not the Company would have the power to indemnify the
individual against the same liability under Section 23B.08.510 or 23B.08.520 of
the Act.
"Determination" means a determination, based on the facts
known at the time, made:
(a) by the Board of Directors by majority vote of a
quorum consisting of directors not at the time parties to the Proceeding;
(b) if a quorum cannot be obtained under clause (i), by
majority vote of a duly designated committee of the Board of Directors, in the
manner provided by Section 23B.08.550(2)(b) of the Act;
(c) by special legal counsel, selected in the manner
provided by Section 23B.08.550(2)(c) of the Act, in a written opinion; or
(d) by a majority of the shareholders of the Company,
excluding shares owned or voted under the control of directors who are at the
time parties to the Proceeding.
"Determined" shall have a correlative meaning.
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"Excluded Claim" means any payment for Losses or Expenses in
connection with any claim relating to or arising out of:
(a) acts or omissions of the Indemnified Party Adjudged
to be intentional misconduct or a knowing violation of law;
(b) conduct of the Indemnified Party Adjudged to be in
violation of Section 23B.08.310 of the Act; or
(c) any transaction with respect to which it was Adjudged
that such Indemnified Party personally received a benefit in money, property,
or services to which the Indemnified Party was not legally entitled.
"Expenses" means any reasonable expenses incurred by
Indemnified Party as a result of a claim or claims made against Indemnified
Party from Covered Acts, including, without limitation, reasonable counsel fees
and costs of investigative, judicial or administrative proceedings or appeals.
"Fines" means any fine or penalty including, with respect to
an employee benefit plan, any excise tax assessed with respect thereto.
"Losses" means amounts, as determined by an Adjudication,
which the Indemnified Party is legally obligated to pay as a result of a claim
or claims arising from Covered Acts, including, without limitation, Fines,
damages and judgments and sums paid in settlement of such claim or claims.
"Proceeding" means any threatened, pending or completed
action, suit, proceeding or investigation, whether civil, criminal or
administrative whether formal or informal.
2. Maintenance of D&O Insurance.
(a) The Company hereby covenants and agrees that, so long
as Indemnified Party shall continue to serve as a director or executive officer
of the Company and thereafter, for so long as Indemnified Party shall be
subject to any possible Proceeding arising from any Covered Act, the Company,
subject to Section 2(c), shall maintain in full force and effect D&O Insurance.
(b) In all policies of D&O Insurance, Indemnified Party
shall be named as an insured in such a manner as to provide Indemnified Party
the same rights and benefits, and the same limitations, as are accorded to the
Company's directors or executive officers most favorably insured by such
policy.
(c) The Company shall have no obligation to maintain D&O
Insurance if the Company, by majority vote of the Board of Directors,
determines in good faith that such insurance is not reasonably available, the
premium costs for such insurance are disproportionate to the amount of coverage
provided, or the coverage provided by such insurance is limited by
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exclusions so as to provide an insufficient benefit; provided, however, that
such decision shall not adversely affect coverage of D&O Insurance for periods
prior to such decision without the unanimous vote of all directors.
3. Indemnification. The Company shall indemnify Indemnified
Party up to the Covered Amount and shall advance or reimburse the Expenses
incurred by Indemnified Party in a Proceeding or in connection with any Covered
Acts, subject, in each case, to the further provisions of this Agreement. This
Agreement is made pursuant to and to effectuate the indemnification provisions
set forth in Article 10 of the Articles of Incorporation and Article VII of the
Bylaws. Notwithstanding any other provision of this Agreement, the Company
shall indemnify Indemnified Party to the extent Indemnified Party is
successful, on the merits or otherwise, in the defense of any Proceeding to
which Indemnified Party was a party because of being a director, officer,
employee, agent, fiduciary or consultant of the Company, against reasonable
Expenses incurred by Indemnified Party in connection with the Proceeding.
4. Excluded Coverage. The Company shall have no obligation to
indemnify Indemnified Party for any Losses or Expenses which arise from an
Excluded Claim.
5. Indemnification Procedures.
(a) Promptly after receipt by Indemnified Party of notice
of the commencement of or the threat of commencement of any Proceeding, if
indemnification or advancement or reimbursement of Expenses with respect
thereto may be sought from the Company under this Agreement, Indemnified Party
shall notify the Company of the commencement or the threat of commencement
thereof.
(b) If, at the time of the receipt of such notice, the
Company has D&O Insurance in effect, the Company shall give prompt notice of
the commencement or the threat of commencement of such Proceeding to the
appropriate insurers in accordance with the procedures set forth in the
respective policies in favor of Indemnified Party. The Company thereafter
shall take all necessary or desirable action to cause such insurers to pay, on
behalf of the Indemnified Party, all amounts (including, without limitation,
Losses and Expenses) payable as a result of such Proceeding in accordance with
the terms of such policies.
(c) To the extent that, at the time of the commencement
of or the threat of commencement of such Proceeding, the Company does not have
applicable D&O Insurance, or if a Determination is made that any Loss, Fine or
Expense of the Indemnified Party arising out of such Proceeding will not be
payable under the D&O Insurance then in effect, the Company shall be obligated
to pay the Covered Amount with respect to any Proceeding and provide counsel
satisfactory to Indemnified Party, upon the delivery to Indemnified Party of
written notice of the Company's election to do so. After delivery of such
notice, the Company will not be liable to Indemnified Party under this
Agreement for any legal or other Expenses subsequently incurred by the
Indemnified Party in connection with such defense other than the reasonable
Expenses of investigation of Indemnified Party; provided, however, that
Indemnified Party shall have the right to employ his or her own counsel in
connection with the defense of any such Proceeding, the fees
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and expenses of such counsel incurred after delivery of notice from the Company
of its assumption of such defense to be at the Indemnified Party's sole
expense. Notwithstanding the foregoing, if (i) the employment of counsel by
Indemnified Party has been previously authorized by the Company, (ii)
Indemnified Party shall have been advised by counsel that there may be a
conflict of interest between the Company and Indemnified Party in the conduct
of any such defense or (iii) the Company, in fact, shall not have employed
counsel to assume the defense of such Proceeding, in each such case, the fees
and expenses of such counsel retained by Indemnified Party shall be at the
expense of the Company.
(d) All payments on account of the Company's
indemnification, advancement and reimbursement obligations under this Agreement
shall be made within sixty (60) days of Indemnified Party's written request
therefor unless a Determination is made that the claims giving rise to
Indemnified Party's request are Excluded Claims or otherwise not payable under
this Agreement; provided, however, that all payments on account of the
Company's obligations under Paragraph 5(c) of this Agreement prior to the
Adjudication of any Proceeding shall be made within twenty (20) days of
Indemnified Party's written request therefor and such obligation shall not be
subject to any such Determination but shall be subject to Paragraph 5(e) of
this Agreement.
(e) Indemnified Party agrees that he or she will
reimburse the Company for all Losses and Expenses paid by the Company in
connection with any Proceeding against Indemnified Party in the event and only
to the extent that it is Adjudged that the Indemnified Party is not entitled to
be indemnified by the Company for such Losses or Expenses under this Agreement,
the Articles of Incorporation, the Bylaws or the Act.
6. Settlement. The Company shall have no obligation to indemnify
Indemnified Party under this Agreement for any amounts paid in settlement of
any Proceeding effected without the Company's prior written consent. The
Company shall not settle any claim in any manner which would impose any loss or
expense on Indemnified Party without Indemnified Party's prior written consent,
unless the Company provides a written undertaking to the Indemnified Party to
pay for such loss or expense on behalf of the Indemnified Party. Neither the
Company nor Indemnified Party shall unreasonably withhold their consent to any
proposed settlement.
7. Rights Not Exclusive. The rights provided hereunder shall be
in addition to any other rights to which Indemnified Party may be entitled
under the Articles of Incorporation, the Bylaws, the Act, any agreement or vote
of shareholders or directors or otherwise, both as to action in Indemnified
Party's official capacity and as to action in any other capacity, and such
rights shall continue after Indemnified Party ceases to serve the Company as a
director or officer.
8. Enforcement.
(a) Indemnified Party's rights to indemnification or
reimbursement or advancement of Expenses hereunder shall be enforceable by
Indemnified Party notwithstanding any adverse Determination, other than a
Determination which has been made by Adjudication. In any such action, if a
prior adverse Determination has been made, the burden of proving that
indemnification or reimbursement or advancement of Expenses is required under
this Agreement,
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the Articles of Incorporation, the Bylaws or the Act shall be on the
Indemnified Party. The Company shall have the burden of proving that
indemnification or reimbursement or advancement of Expenses is not required
under this Agreement if no prior adverse Determination shall have been made.
(b) In the event that any action is instituted by
Indemnified Party under this Agreement, or to enforce or interpret any of the
terms of this Agreement, Indemnified Party shall be entitled to be paid all
court costs and expenses, including reasonable counsel fees, incurred by
Indemnified Party with respect to such action, unless the court determines that
each of the material assertions made by Indemnified Party as a basis for such
action were not made in good faith or were frivolous.
9. No Presumptions. For purposes of this Agreement, the
termination of any Proceeding by judgment, order, settlement (whether with or
without court approval) or conviction, or upon a plea of nolo contendre, or its
equivalent, shall not create a presumption that the Indemnified Party did not
meet any particular standard of conduct or have any particular belief or that a
court has determined that indemnification or reimbursement or advancement of
Expenses by the Company is not permitted hereunder or by applicable law. In
addition, neither the absence of a Determination as to whether Indemnified
Party has met any particular standard of conduct or had any particular belief
or the existence of a Determination that Indemnified Party has not met such
standard of conduct or did not have such belief, prior to the commencement of
legal proceedings by Indemnified Party to secure an Adjudication that
Indemnified Party should be indemnified or advanced or reimbursed Expenses
hereunder or under applicable law, shall be a defense to Indemnified Party's
claim or create a presumption that Indemnified Party has not met any particular
standard of conduct or did not have any particular belief.
10. Subrogation. In the event of payment under this Agreement,
the Company shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnified Party, who shall execute all papers required
and shall do everything that may be necessary to secure such rights, including
the execution of such documents necessary to enable the Company to effectively
bring suit to enforce such rights.
11. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any Proceeding
against Indemnified Party to the extent Indemnified Party has otherwise
actually received payment (under any D&O Insurance, the Articles of
Incorporation, the Bylaws, the Act or otherwise) of the amounts which may be
paid hereunder.
12. Severability. In the event that any provision of this
Agreement is determined by a court of competent jurisdiction to require the
Company to do or to fail to do an act which is in violation of the Articles of
Incorporation, the Bylaws or the Act or other applicable law, such provision
shall be limited or modified in its application to the minimum extent necessary
to avoid such violation, and, as so limited or modified, such provision and the
remainder of this Agreement shall be enforceable in accordance with the
respective terms.
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13. Choice of Law. This Agreement shall be governed by, construed
and enforced in accordance with the laws of the State of Washington.
14. Successors and Assigns. This Agreement shall be (a) binding
upon all successors and assigns of the Company (including any transferee of all
or substantially all of the Company's assets and any successor by merger or
otherwise by operation of law) and (b) binding on and inure to the benefit of
the heirs, personal representatives and estate of Indemnified Party.
Indemnified Party may not assign this Agreement or any of Indemnified Party's
rights hereunder without the prior written consent of the Company.
15. Amendment. No amendment, modification, termination or
cancellation of this Agreement shall be effective unless made in a writing
signed by each of the parties hereto.
IN WITNESS WHEREOF, the Company and Indemnified Party have executed
this Indemnification Agreement as of the date first above written.
SEAMED CORPORATION
By:___________________________
Name:_________________________
Title:________________________
______________________________
, Indemnified Party
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