Exhibit 10.5
INDEMNIFICATION AGREEMENT
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This INDEMNIFICATION AGREEMENT dated as of August 22, 1997, is entered into
between CENTOCOR, INC., a Pennsylvania corporation ("Centocor") and CENTOCOR
DIAGNOSTICS, INC., a Pennsylvania corporation ("Company").
WITNESSETH:
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WHEREAS, prior to August 22, 1997, the Company operated as the Diagnostics
Division of Centocor; and
WHEREAS, on August 22, 1997 (the "Transfer Date"), the Company was formed
as a separate corporate entity, and a subsidiary of Centocor, and the assets and
business of the Diagnostics Division of Centocor (the "Business"), subject to
the liabilities of the Business, were transferred to the Company (the
"Transfer"); and
WHEREAS, in connection with the Transfer, Centocor has agreed to indemnify
the Company with respect to the liabilities which may arise out of or result
from the conduct of the Business by Centocor on or before the Transfer Date;
NOW, THEREFORE, in consideration of the premises and mutual covenants and
obligations herein contained, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Centocor shall indemnify, defend and hold harmless the Company, its
affiliates and their respective officers, directors, employees, agents and
representatives or any of them (each, an "Indemnified Party" and collectively,
the "Indemnified Parties") from and against all suits, actions, claims,
judgments, demands, liabilities, losses, damages, costs and expenses (including,
but not limited to, court costs and experts' and attorneys' fees and expenses)
which arise out of or result from the activities of the Business as conducted by
Centocor on or before the Transfer Date; provided, however, that with regard to
any individual Indemnified Party, Centocor's obligations under this Section 1
shall not exceed the indemnification that Centocor is entitled to provide to its
own officers or directors under Centocor's Bylaws and the Pennsylvania Business
Corporation Law of 1988, each as amended from time to time.
2. Centocor shall not be liable to the Indemnified Parties for the
indemnity provided herein unless the applicable Indemnified Party, promptly and
in any event within 10 days after receipt of notice of a claim for which an
Indemnified Party is entitled to indemnification hereunder, shall notify
Centocor in writing of such claim, enclosing a copy of all papers served, if
any. However, the omission to so notify or delay in notifying Centocor of any
such claim shall not relieve Centocor from any liability that it may have under
Section 1 of this Agreement, except to the extent that the ability of Centocor
to defend against such claim is materially adversely affected by such omission
or delay. The foregoing notice requirement shall be deemed to have been
satisfied if Centocor shall have received actual notice of any such claim, from
any source whatsoever.
3. In case any such claim for which indemnity is payable hereunder shall
be made against any Indemnified Party, Centocor shall be entitled to participate
in, and to the extent that it shall wish, to assume the defense thereof, with
counsel reasonably satisfactory to such Indemnified Party, subject to the
provisions of this Section 3. After written notice from Centocor to such
Indemnified Party of its election to so assume the defense thereof, Centocor
shall not be liable to such Indemnified Party for any additional attorneys' fees
or other expenses of litigation, other than reasonable costs of investigation
subsequently incurred by such Indemnified Party in connection with the defense
thereof, unless:
(a) the employment of counsel by the Indemnified Party has been
authorized in writing by Centocor, such authorization not to be unreasonably
withheld or delayed;
(b) the Indemnified Party shall have obtained a written opinion of
counsel reasonably acceptable to Centocor that there exists a conflict of
interest between such Indemnified Party and Centocor in the conduct of the
defense of such action or that there are one or more defenses available to the
Indemnified Party that are unavailable to Centocor (in which case Centocor shall
not have the right to direct the defense of such claim on behalf of the
Indemnified Party); or
(c) Centocor shall not in fact have employed counsel reasonably
satisfactory to the Indemnified Party to assume the defense of such claim, in
each of which cases the reasonable fees and expenses of counsel utilized by the
Indemnified Party shall be at the expense of Centocor, it being understood,
however, that Centocor shall not, in connection with any one such action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys for all
of the Indemnified Parties. Notwithstanding the foregoing, under the
circumstances described in Section 3(b), an Indemnified Party shall be entitled
to retain an additional law firm, in any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, provided that the Indemnified
Party has obtained a written opinion of counsel reasonably acceptable to
Centocor that a conflict of interest exists that would preclude the use of a
single law firm, in which case Centocor shall be liable for the reasonable fees
and expenses of counsel designated by the Indemnified Party in writing. All such
fees and expenses which are at the expense of Centocor hereunder shall be
promptly paid by Centocor.
Nothing in this Section 3 shall be construed as limiting an Indemnified
Party's rights to employ counsel at its own expense. Centocor shall not settle
or compromise any claim, if such settlement or compromise provides for an
admission of liability on the part of an Indemnified Party without the written
consent of the Indemnified Party.
4. Centocor's obligations under this Agreement shall terminate on the
fifth anniversary of the date of this Agreement; provided, however, that
Centocor's obligations shall not so terminate with respect to any claim for
indemnification for which notice pursuant to Section 2 hereof has been
provided to Centocor prior to the fifth anniversary of the date of this
Agreement.
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5. This Agreement may not be altered, modified or amended except by
writing signed by duly authorized representatives of Centocor and the Company.
.
6. No failure or delay on the part of a party in exercising any right
hereunder shall operate as a waiver of, or impair, any such right. No single or
partial exercise of any such right shall preclude any other or further exercise
thereof or the exercise of any other right. No waiver of any such right shall
be deemed a waiver of any other right hereunder.
7. This Agreement shall be governed by and construed in accordance
with the internal laws of the Commonwealth of Pennsylvania without regard to
principles of conflicts of laws.
8. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same document.
9. This Agreement contains the entire understanding of the parties hereto
with respect of the subject matter hereof. This Agreement supersedes all prior
oral or written agreements or understandings between the parties with regard to
the subject matter hereof.
10. Nither party shall assign this Agreement or any part hereof or
any right or obligation hereunder to any third party without the prior written
consent of the other party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers.
CENTOCOR, INC.
BY: /s/ Xxxxx X. Holvack
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Name: Xxxxx X. Holvack
Title: President
CENTOCOR DIAGNOSTICS, INC.
By: /s/ R. Xxxxx Xxxxxx
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Name: R. Xxxxx Xxxxxx
Title: President
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