INDEMNIFICATION AGREEMENT
DRAFT
This
Indemnification Agreement (this “Agreement”)
is
entered into as of ___________, 2008 between Velcera, Inc., a Delaware
corporation (the “Company”),
and
[_______________] (“Indemnitee”).
WHEREAS,
highly competent persons have become more reluctant to serve corporations as
directors, officers, or key employees unless they are provided with adequate
protection through insurance or adequate indemnification against inordinate
risks of claims and actions against them arising out of their service to and
activities on behalf of the corporation;
WHEREAS,
the Board of Directors of the Company (the “Board”)
has
determined that, in order to attract and retain qualified individuals, the
Company will attempt to maintain on an ongoing basis, at its sole expense,
liability insurance to protect persons serving the Company and its subsidiaries
from certain liabilities. Although the furnishing of such insurance has been
a
customary and widespread practice among United States-based corporations and
other business enterprises, the Company believes that, given current market
conditions and trends, such insurance may be available to it in the future
only
at higher premiums and with more exclusions. At the same time, directors,
officers, and other persons in service to corporations or business enterprises
are being increasingly subjected to expensive and time-consuming litigation
relating to, among other things, matters that traditionally would have been
brought only against the Company or business enterprise itself. The bylaws
of
the Company (the “Bylaws”)
require indemnification of the officers and directors of the Company. Indemnitee
may also be entitled to indemnification pursuant to the General Corporation
Law
of the State of Delaware (“DGCL”).
The
Bylaws and the DGCL expressly provide that the indemnification provisions set
forth therein are not exclusive, and thereby contemplate that contracts may
be
entered into between the Company and members of the Board, officers and other
persons with respect to indemnification;
WHEREAS,
the uncertainties relating to such insurance and to indemnification have
increased the difficulty of attracting and retaining such persons;
WHEREAS,
the Board has determined that the increased difficulty in attracting and
retaining 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;
WHEREAS,
it is reasonable, prudent and necessary for the Company contractually to
obligate itself to indemnify, and to advance expenses on behalf of, 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;
WHEREAS,
this Agreement is a supplement to and in furtherance of the Bylaws and any
resolutions adopted pursuant thereto, and shall not be deemed a substitute
therefor, nor to diminish or abrogate any rights of Indemnitee
thereunder;
NOW,
THEREFORE, the parties hereto agree as follows:
1. Indemnity
of Indemnitee.
The
Company hereby agrees to hold harmless and indemnify Indemnitee to the fullest
extent permitted by law, as such may be amended from time to time. In
furtherance of the foregoing indemnification, and without limiting the
generality thereof:
(a) Third
Party Proceedings.
Indemnitee shall be entitled to the rights of indemnification provided in this
Section
l(a)
if, by
reason of his Corporate Service (as hereinafter defined), the Indemnitee is,
or
is threatened to be made, a party to or participant in any Proceeding (as
hereinafter defined) other than a Proceeding by or in the right of the Company.
Pursuant to this Section
1(a),
Indemnitee shall be indemnified against all Expenses (as hereinafter defined),
judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by him, or on his behalf, in connection with such Proceeding
or any claim, issue or matter therein, 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 Proceeding,
had
no reasonable cause to believe the Indemnitee’s conduct was
unlawful.
(b) Proceedings
by or in the Right of the Company.
Indemnitee shall be entitled to the rights of indemnification provided in this
Section
1(b)
if, by
reason of his Corporate Service, the Indemnitee is, or is threatened to be
made,
a party to or participant in any Proceeding brought by or in the right of the
Company. Pursuant to this Section
1(b),
Indemnitee shall be indemnified against all Expenses actually and reasonably
incurred by the Indemnitee, or on the Indemnitee’s behalf, in connection with
such Proceeding 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, if applicable law so provides, no
indemnification against such Expenses shall be made in respect of any claim,
issue or matter in such Proceeding as to which Indemnitee shall have been
adjudged to be liable to the Company unless and to the extent that the Court
of
Chancery of the State of Delaware shall determine that such indemnification
may
be made.
(c) Indemnification
for Expenses of a Party Who is Wholly or Partly Successful.
Notwithstanding any other provision of this Agreement, to the extent that
Indemnitee is, by reason of his Corporate Service, a party to and is successful,
on the merits or otherwise, in any Proceeding, he shall be indemnified to the
maximum extent permitted by law, as such may be amended from time to time,
against all Expenses actually and reasonably incurred by him or on his behalf
in
connection therewith. If Indemnitee is not wholly successful in such Proceeding
but is successful, on the merits or otherwise, as to one or more but less than
all claims, issues or matters in such Proceeding, the Company shall indemnify
Indemnitee against all Expenses actually and reasonably incurred by him or
on
his behalf in connection with each successfully resolved claim, issue or matter.
For purposes of this Section and without limitation, the termination of any
claim, issue or matter in such a Proceeding by dismissal, with or without
prejudice, shall be deemed to be a successful result as to such claim, issue
or
matter.
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2. Additional
Indemnity.
In
addition to, and without regard to any limitations on, the indemnification
provided for in Section
1
of this
Agreement, the Company shall and hereby does indemnify and hold harmless
Indemnitee against all Expenses, judgments, penalties, fines and amounts paid
in
settlement actually and reasonably incurred by him or on his behalf if, by
reason of his Corporate Service, he is, or is threatened to be made, a party
to
or participant in any Proceeding (including a Proceeding by or in the right
of
the Company), including, without limitation, all liability arising out of the
negligence or active or passive wrongdoing of Indemnitee. The only limitation
that shall exist upon the Company’s obligations pursuant to this Agreement shall
be that the Company shall not be obligated to make any payment to Indemnitee
that is finally determined (under the procedures, and subject to the
presumptions, set forth in Sections
6
and
7
hereof)
to be unlawful.
3. Contribution.
(a) Whether
or not the indemnification provided in Sections
1
and
2
hereof
is available, in respect of any threatened, pending or completed action, suit
or
proceeding in which the Company is jointly liable with Indemnitee (or would
be
if joined in such action, suit or proceeding), the Company shall pay, in the
first instance, the entire amount of any judgment or settlement of such action,
suit or proceeding without requiring Indemnitee to contribute to such payment
and the Company hereby waives and relinquishes any right of contribution it
may
have against Indemnitee. The Company shall not enter into any settlement of
any
action, suit or proceeding in which the Company is jointly liable with
Indemnitee (or would be if joined in such action, suit or proceeding) unless
such settlement provides for a full and final release of all claims asserted
against Indemnitee.
(b) Without
diminishing or impairing the obligations of the Company set forth in the
preceding subparagraph, if, for any reason, Indemnitee shall elect or be
required to pay all or any portion of any judgment or settlement in any
threatened, pending or completed action, suit or proceeding in which the Company
is jointly liable with Indemnitee (or would be if joined in such action, suit
or
proceeding), the Company shall contribute to the amount of expenses (including
attorneys’ fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred and paid or payable by Indemnitee in proportion to the
relative benefits received by the Company and all officers, directors or
employees of the Company, other than Indemnitee, who are jointly liable with
Indemnitee (or would be if joined in such action, suit or proceeding), on the
one hand, and Indemnitee, on the other hand, from the transaction from which
such action, suit or proceeding arose; provided, however, that the proportion
determined on the basis of relative benefit may, to the extent necessary to
conform to law, be further adjusted by reference to the relative fault of the
Company and all officers, directors or employees of the Company other than
Indemnitee who are jointly liable with Indemnitee (or would be if joined in
such
action, suit or proceeding), on the one hand, and Indemnitee, on the other
hand,
in connection with the events that resulted in such expenses, judgments, fines
or settlement amounts, as well as any other equitable considerations which
the
Law may require to be considered. The relative fault of the Company and all
officers, directors or employees of the Company, other than Indemnitee, who
are
jointly liable with Indemnitee (or would be if joined in such action, suit
or
proceeding), on the one hand, and Indemnitee, on the other hand, shall be
determined by reference to, among other things, the degree to which their
actions were motivated by intent to gain personal profit or advantage, the
degree to which their liability is primary or secondary and the degree to which
their conduct is active or passive.
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(c) The
Company hereby agrees to fully indemnify and hold Indemnitee harmless from
any
claims of contribution which may be brought by officers, directors or employees
of the Company, other than Indemnitee, who may be jointly liable with
Indemnitee.
(d) To
the
fullest extent permissible under applicable law, if the indemnification provided
for in this Agreement is unavailable to Indemnitee for any reason whatsoever,
the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount
incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes,
amounts paid or to be paid in settlement and/or for Expenses, in connection
with
any claim relating to an indemnifiable event under this Agreement, in such
proportion as is deemed fair and reasonable in light of all of the circumstances
of such Proceeding in order to reflect (i) the relative benefits received by
the
Company and Indemnitee as a result of the event(s) and/or transaction(s) giving
cause to such Proceeding; and/or (ii) the relative fault of the Company (and
its
directors, officers, employees and agents) and Indemnitee in connection with
such event(s) and/or transaction(s).
4. Indemnification
for Expenses of a Witness.
Notwithstanding any other provision of this Agreement, to the extent that
Indemnitee is, by reason of his Corporate Service, a witness in any Proceeding
to which Indemnitee is not a party, he shall be indemnified against all Expenses
actually and reasonably incurred by him or on his behalf in connection
therewith.
5. Advancement
of Expenses.
Notwithstanding any other provision of this Agreement, the Company shall advance
all Expenses incurred by or on behalf of Indemnitee in connection with any
Proceeding by reason of Indemnitee’s Corporate Service within thirty (30) days
after the receipt by the Company of a statement or statements from Indemnitee
requesting such advance or advances from time to time, whether prior to or
after
final disposition of such Proceeding. Such statement or statements shall
reasonably evidence the Expenses incurred by Indemnitee and shall include or
be
preceded or accompanied by an undertaking by or on behalf of Indemnitee to
repay
any Expenses advanced if it shall ultimately be determined that Indemnitee
is
not entitled to be indemnified against such Expenses. Any advances and
undertakings to repay pursuant to this Section
5
shall be
unsecured and interest free.
6. Procedures
and Presumptions for Determination of Entitlement to
Indemnification.
It is
the intent of this Agreement to secure for Indemnitee rights of indemnity that
are as favorable as may be permitted under the DGCL and public policy of the
State of Delaware. Accordingly, the parties agree that the following procedures
and presumptions shall apply in the event of any question as to whether
Indemnitee is entitled to indemnification under this Agreement:
(a) To
obtain
indemnification under this Agreement, Indemnitee shall submit to the Company
a
written request, including therein or therewith such documentation and
information as is reasonably available to Indemnitee and is reasonably necessary
to determine whether and to what extent Indemnitee is entitled to
indemnification. The Secretary of the Company shall, promptly upon receipt
of
such a request for indemnification, advise the Board in writing that Indemnitee
has requested indemnification.
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(b) Upon
written request by Indemnitee for indemnification pursuant to the first sentence
of Section
6(a)
hereof,
a determination, if required by applicable law, with respect to Indemnitee’s
entitlement thereto shall be made in the specific case by one of the following
three methods, which shall be at the election of the Board: (1) by a majority
vote of the Disinterested Directors (as hereinafter defined), even though less
than a quorum, by a committee of Disinterested Directors designated by a
majority vote of the Disinterested Directors, even though less than a quorum,
(2) if there are no Disinterested Directors or if the Disinterested Directors
so
direct, by independent legal counsel in a written opinion to the Board, a copy
of which shall be delivered to the Indemnitee, or (3) if so directed by the
Board, by the stockholders of the Company.
(c) If
the
determination of entitlement to indemnification is to be made by Independent
Counsel pursuant to Section
6(b)
hereof,
the Independent Counsel shall be selected as provided in this Section
6(c).
The
Independent Counsel shall be selected by the Indemnitee, subject to the approval
of the Board, which shall not be unreasonably withheld. The Company shall,
within 10 days after receiving such written notice of selection from the
Indemnitee, deliver to the Indemnitee a written objection to such selection;
provided, however, that such objection may be asserted only on the ground that
the Independent Counsel so selected does not meet the requirements of
“Independent
Counsel”
as
defined in Section
13
of this
Agreement.. The objection shall set forth with particularity the factual basis
of such assertion. Absent a proper and timely objection, the person so selected
shall act as Independent Counsel. If a written objection is made and
substantiated, the Independent Counsel selected may not serve as Independent
Counsel unless and until such objection is withdrawn or a court has determined
that such objection is without merit. If, within 20 days after submission by
Indemnitee of a written request for indemnification pursuant to Section
6(a)
hereof,
no Independent Counsel shall have been selected and not objected to, either
the
Company or Indemnitee may petition the Court of Chancery of the State of
Delaware or other court of competent jurisdiction for resolution of any
objection which shall have been made by the Indemnitee to the Company’s
selection of Independent Counsel and/or for the appointment as Independent
Counsel of a person selected by the court or by such other person as the court
shall designate, and the person with respect to whom all objections are so
resolved or the person so appointed shall act as Independent Counsel under
Section
6(b)
hereof.
The Company shall pay any and all reasonable fees and expenses of Independent
Counsel incurred by such Independent Counsel in connection with acting pursuant
to Section
6(b)
hereof,
and the Company shall pay all reasonable fees and expenses incident to the
procedures of this Section
6(c),
regardless of the manner in which such Independent Counsel was selected or
appointed.
(d) In
making
a determination with respect to entitlement to indemnification hereunder, the
person or persons or entity making such determination shall presume that
Indemnitee is entitled to indemnification under this Agreement. Anyone seeking
to overcome this presumption shall have the burden of proof and the burden
of
persuasion by clear and convincing evidence. Neither the failure of the Company
(including by its directors or independent legal counsel) to have made a
determination prior to the commencement of any action pursuant to this Agreement
that indemnification is proper in the circumstances because Indemnitee has
met
the applicable standard of conduct, nor an actual determination by the Company
(including by its directors or independent legal counsel) that Indemnitee has
not met such applicable standard of conduct, shall be a defense to the action
or
create a presumption that Indemnitee has not met the applicable standard of
conduct.
5
(e) Indemnitee
shall be deemed to have acted in good faith if Indemnitee’s action is based on
the records or books of account of the Enterprise (as hereinafter defined),
including financial statements, or on information supplied to Indemnitee by
the
officers of the Enterprise in the course of their duties, or on the advice
of
legal counsel for the Enterprise or on information or records given or reports
made to the Enterprise by an independent certified public accountant or by
an
appraiser or other expert selected with reasonable care by the Enterprise.
In
addition, the knowledge and/or actions, or failure to act, of any director,
officer, agent or employee of the Enterprise shall not be imputed to Indemnitee
for purposes of determining the right to indemnification under this Agreement.
Whether or not the foregoing provisions of this Section
6(e)
are
satisfied, it shall in any event be presumed that Indemnitee has at all times
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Company. Anyone seeking to overcome this
presumption shall have the burden of proof and the burden of persuasion by
clear
and convincing evidence.
(f) If
the
person, persons or entity empowered or selected under Section
6
to
determine whether Indemnitee is entitled to indemnification shall not have
made
a determination within sixty (60) days after receipt by the Company of the
request therefor, the requisite determination of entitlement to indemnification
shall be deemed to have been made and Indemnitee shall be entitled to such
indemnification absent (i) a misstatement by Indemnitee of a material fact,
or
an omission of a material fact necessary to make Indemnitee’s statement not
materially misleading, in connection with the request for indemnification,
or
(ii) a prohibition of such indemnification under applicable law; provided,
however, that such 60-day period may be extended for a reasonable time, not
to
exceed an additional thirty (30) days, if the person, persons or entity making
such determination with respect to entitlement to indemnification in good faith
requires such additional time to obtain or evaluate documentation and/or
information relating thereto; and provided, further, that the foregoing
provisions of this Section
6(g)
shall
not apply if the determination of entitlement to indemnification is to be made
by the stockholders pursuant to Section
6(b)
of this
Agreement and if (A) within fifteen (15) days after receipt by the Company
of
the request for such determination, the Board or the Disinterested Directors,
if
appropriate, resolve to submit such determination to the stockholders for their
consideration at an annual meeting thereof to be held within seventy-five (75)
days after such receipt and such determination is made thereat, or (B) a special
meeting of stockholders is called within fifteen (15) days after such receipt
for the purpose of making such determination, such meeting is held for such
purpose within sixty (60) days after having been so called and such
determination is made thereat.
(g) Indemnitee
shall cooperate with the person, persons or entity making such determination
with respect to Indemnitee’s entitlement to indemnification, including providing
to such person, persons or entity upon reasonable advance request any
documentation or information which is not privileged or otherwise protected
from
disclosure and which is reasonably available to Indemnitee and reasonably
necessary to such determination. Any Independent Counsel, member of the Board
or
stockholder of the Company shall act reasonably and in good faith in making
a
determination regarding the Indemnitee’s entitlement to indemnification under
this Agreement. Any costs or expenses (including attorneys’ fees and
disbursements) incurred by Indemnitee in so cooperating with the person, persons
or entity making such determination shall be borne by the Company (irrespective
of the determination as to Indemnitee’s entitlement to indemnification) and the
Company hereby indemnifies and agrees to hold Indemnitee harmless
therefrom.
6
(h) The
Company acknowledges that a settlement or other disposition short of final
judgment may be successful if it permits a party to avoid expense, delay,
distraction, disruption and uncertainty. In the event that any action, claim
or
proceeding to which Indemnitee is a party is resolved in any manner other than
by adverse judgment against Indemnitee (including, without limitation,
settlement of such action, claim or proceeding with or without payment of money
or other consideration) it shall be presumed that Indemnitee has been successful
on the merits or otherwise in such action, suit or proceeding. Anyone seeking
to
overcome this presumption shall have the burden of proof and the burden of
persuasion by clear and convincing evidence.
(i) The
termination of any Proceeding or of any claim, issue or matter therein, by
judgment, order, settlement or conviction, or upon a plea of nolo contendere
or
its equivalent, shall not (except as otherwise expressly provided in this
Agreement) of itself adversely affect the right of Indemnitee to indemnification
or create a presumption that Indemnitee did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the Company or, with respect to any criminal Proceeding, that
Indemnitee had reasonable cause to believe that his conduct was
unlawful.
7. Remedies
of Indemnitee.
(a) In
the
event that (i) a determination is made pursuant to Section
6
of this
Agreement that Indemnitee is not entitled to indemnification under this
Agreement, (ii) advancement of Expenses is not timely made pursuant to
Section
5
of this
Agreement, (iii) no determination of entitlement to indemnification is made
pursuant to Section
6(b)
of this
Agreement within 90 days after receipt by the Company of the request for
indemnification, (iv) payment of indemnification is not made pursuant to this
Agreement within ten (10) days after receipt by the Company of a written request
therefor or (v) payment of indemnification is not made within ten (10) days
after a determination has been made that Indemnitee is entitled to
indemnification or such determination is deemed to have been made pursuant
to
Section
6
of this
Agreement, Indemnitee shall be entitled to an adjudication in an appropriate
court of the State of Delaware, or in any other court of competent jurisdiction,
of Indemnitee’s entitlement to such indemnification. Indemnitee shall commence
such proceeding seeking adjudication within 180 days following the date on
which
Indemnitee first has the right to commence such proceeding pursuant to this
Section
7(a).
The
Company shall not oppose Indemnitee’s right to seek any such
adjudication.
(b) In
the
event that a determination shall have been made pursuant to Section
6(b)
of this
Agreement that Indemnitee is not entitled to indemnification, any judicial
proceeding commenced pursuant to this Section
7
shall be
conducted in all respects as a de novo trial on the merits, and Indemnitee
shall
not be prejudiced by reason of the adverse determination under Section
6(b).
(c) If
a
determination shall have been made pursuant to Section
6(b)
of this
Agreement that Indemnitee is entitled to indemnification, the Company shall
be
bound by such determination in any judicial proceeding commenced pursuant to
this Section
7,
absent
(i) a misstatement by Indemnitee of a material fact, or an omission of a
material fact necessary to make Indemnitee’s misstatement not materially
misleading in connection with the application for indemnification, or (ii)
a
prohibition of such indemnification under applicable law.
7
(d) In
the
event that Indemnitee, pursuant to this Section
7,
seeks a
judicial adjudication of his rights under, or to recover damages for breach
of,
this Agreement, or to recover under any directors’ and officers’ liability
insurance policies maintained by the Company, the Company shall pay on his
behalf, in advance, any and all expenses (of the types described in the
definition of Expenses in Section
13
of this
Agreement) actually and reasonably incurred by him in such judicial
adjudication, regardless of whether Indemnitee ultimately is determined to
be
entitled to such indemnification, advancement of expenses or insurance
recovery.
(e) The
Company shall be precluded from asserting in any judicial proceeding commenced
pursuant to this Section
7
that the
procedures and presumptions of this Agreement are not valid, binding and
enforceable and shall stipulate in any such court that the Company is bound
by
all the provisions of this Agreement. The Company shall indemnify Indemnitee
against any and all Expenses and, if requested by Indemnitee, shall (within
ten
(10) days after receipt by the Company of a written request therefore) advance,
to the extent not prohibited by law, such expenses to Indemnitee, which are
incurred by Indemnitee in connection with any action brought by Indemnitee
for
indemnification or advance of Expenses from the Company under this Agreement
or
under any directors' and officers' liability insurance policies maintained
by
the Company, regardless of whether Indemnitee ultimately is determined to be
entitled to such indemnification, advancement of Expenses or insurance recovery,
as the case may be.
(f) Notwithstanding
anything in this Agreement to the contrary, no determination as to entitlement
to indemnification under this Agreement shall be required to be made prior
to
the final disposition of the Proceeding.
8. Non-Exclusivity;
Survival of Rights; Insurance; Subrogation.
(a) The
rights of indemnification as provided by this Agreement shall not be deemed
exclusive of any other rights to which Indemnitee may at any time be entitled
under applicable law, the certificate of incorporation of the Company, the
Bylaws, any agreement, a vote of stockholders, a resolution of directors or
otherwise. No amendment, alteration or repeal of this Agreement or of any
provision hereof shall limit or restrict any right of Indemnitee under this
Agreement in respect of any action taken or omitted by such Indemnitee in his
Corporate Service prior to such amendment, alteration or repeal. To the extent
that a change in the Delaware General Corporation Law, whether by statute or
judicial decision, permits greater indemnification than would be afforded
currently under the Bylaws and this Agreement, it is the intent of the parties
hereto that Indemnitee shall enjoy by this Agreement the greater benefits so
afforded by such change. No right or remedy herein conferred is intended to
be
exclusive of any other right or remedy, and every other right and remedy shall
be cumulative and in addition to every other right and remedy given hereunder
or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent
the
concurrent assertion or employment of any other right or remedy.
(b) To
the
extent that the Company maintains an insurance policy or policies providing
liability insurance for directors, officers, employees, or agents or fiduciaries
of the Company or of any other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise that such person serves at the request
of the Company, Indemnitee shall be covered by such policy or policies in
accordance with its or their terms to the maximum extent of the coverage
available for any director, officer, employee, agent or fiduciary under such
policy or policies. If, at the time of the receipt of a notice of a claim
pursuant to the terms hereof, the Company has director and officer liability
insurance in effect, the Company shall give prompt notice of the commencement
of
such proceeding to the insurers in accordance with the procedures set forth
in
the respective policies. The Company shall thereafter take all necessary or
desirable action to cause such insurers to pay, on behalf of the Indemnitee,
all
amounts payable as a result of such proceeding in accordance with the terms
of
such policies. The Company shall indemnify Indemnitee for Expenses incurred
by
Indemnitee for recovery under any insurance policy referred to in this Section
7(b) and shall advance to Indemnitee the Expenses of such action in the manner
provided in Section 5 above.
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(c) In
the
event of any payment under this Agreement, the Company shall be subrogated
to
the extent of such payment to all of the rights of recovery of Indemnitee,
who
shall execute all papers required and take all action necessary to secure such
rights, including execution of such documents as are necessary to enable the
Company to bring suit to enforce such rights.
(d) The
Company shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable hereunder if and to the extent that Indemnitee has
otherwise actually received such payment under any insurance policy, contract,
agreement or otherwise.
(e) The
Company's obligation to indemnify or advance Expenses hereunder to Indemnitee
who is or was serving at the request of the Company as a director, officer,
employee or agent of any other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise shall be reduced by any amount
Indemnitee has actually received as indemnification or advancement of expenses
from such other corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise.
9. Exception
to Right of Indemnification.
Notwithstanding any provision in this Agreement, the Company shall not be
obligated under this Agreement to make any indemnity in connection with any
claim made against Indemnitee:
(a) for
which
payment has actually been made to or on behalf of Indemnitee under any insurance
policy or other indemnity provision, except with respect to any excess beyond
the amount paid under any insurance policy or other indemnity provision;
or
(b) for
an
accounting of profits made from the purchase and sale (or sale and purchase)
by
Indemnitee of securities of the Company within the meaning of Section
16(b)
of the
Securities Exchange Act of 1934, as amended, or similar provisions of state
statutory law or common law; or
(c) in
connection with any Proceeding (or any part of any Proceeding) initiated by
Indemnitee, including any Proceeding (or any part of any Proceeding) initiated
by Indemnitee against the Company or its directors, officers, employees or
other
indemnitees, unless (i) the Board authorized the Proceeding (or any part of
any
Proceeding) prior to its initiation or (ii) the Company provides the
indemnification, in its sole discretion, pursuant to the powers vested in the
Company under applicable law.
9
10. Duration
of Agreement.
All
agreements and obligations of the Company contained herein shall continue during
the period Indemnitee is an officer or director of the Company (or is or was
serving at the request of the Company as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other enterprise)
plus three (3) years after such period and shall continue thereafter so
long as Indemnitee shall be subject to any Proceeding (or any proceeding
commenced under Section
7
hereof)
by reason of his Corporate Service, whether or not he is acting or serving
in
any such capacity at the time any liability or expense is incurred for which
indemnification can be provided under this Agreement. This Agreement shall
be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business or assets of the Company), assigns, spouses,
registered domestic partners, heirs, executors and personal and legal
representatives.
11. Security.
To the
extent requested by Indemnitee and approved by the Board, the Company may at
any
time and from time to time provide security to Indemnitee for the Company’s
obligations hereunder through an irrevocable bank line of credit, funded trust
or other collateral. Any such security, once provided to Indemnitee, may not
be
revoked or released without the prior written consent of the
Indemnitee.
12. Enforcement.
(a) The
Company expressly confirms and agrees that it has entered into this Agreement
and assumes the obligations imposed on it hereby in order to induce Indemnitee
to serve as an officer or director of the Company, and the Company acknowledges
that Indemnitee is relying upon this Agreement in serving as an officer or
director of the Company.
(b) This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements and
understandings, oral, written and implied, between the parties hereto with
respect to the subject matter hereof.
13. Definitions.
For
purposes of this Agreement:
(a) “Corporate
Service”
describes the status of a person who is or was a director, officer, employee,
agent or fiduciary of the Company or any other Enterprise and is intended to
include, without limitation, such person’s service to or activities on behalf of
the Company or any such Enterprise.
(b) “Disinterested
Director”
means
a
director of the Company who is not and was not a party to the Proceeding in
respect of which indemnification is sought by Indemnitee.
(c) “Enterprise”
shall
mean the Company and any other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise that Indemnitee is or was serving
at
the request of the Company as a director, officer, employee, agent or
fiduciary.
10
(d) “Expenses”
shall
include all reasonable attorneys’ fees, retainers, court costs, transcript
costs, fees of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery service fees,
plus the interest accrued thereon and all other disbursements or expenses of
the
types customarily incurred in connection with prosecuting, defending, preparing
to prosecute or defend, investigating, participating, or being or preparing
to
be a witness in a Proceeding. Expenses also shall include Expenses incurred
in
connection with any appeal resulting from any Proceeding, including without
limitation the premium, security for, and other costs relating to any cost
bond,
supersedeas bond, or other appeal bond or its equivalent. Additionally, Expenses
shall include amounts paid in settlement, if such settlement is approved in
advance by the Board, which approval shall not be unreasonably withheld.
Expenses, however, shall not include amounts paid in fines against
Indemnitee.
(e) “Independent
Counsel”
means
a
law firm, or a member of a law firm, that is experienced in matters of
corporation law and neither presently is, nor in the past five years has been,
retained to represent: (i) the Company or Indemnitee in any matter material
to
either such party (other than with respect to matters concerning Indemnitee
under this Agreement, or of other indemnitees under similar indemnification
agreements), or (ii) any other party to the Proceeding giving rise to a claim
for indemnification hereunder. Notwithstanding the foregoing, the term
“Independent Counsel” shall not include any person who, under the applicable
standards of professional conduct then prevailing, would have a conflict of
interest in representing either the Company or Indemnitee in an action to
determine Indemnitee’s rights under this Agreement. The Company agrees to pay
the reasonable fees of the Independent Counsel referred to above and to fully
indemnify such counsel against any and all Expenses, claims, liabilities and
damages arising out of or relating to this Agreement or its engagement pursuant
hereto.
(f) “Proceeding”
includes any threatened, pending or completed action, suit, arbitration,
alternate dispute resolution mechanism, investigation, inquiry, administrative
hearing or any other actual, threatened or completed proceeding, whether brought
by or in the right of the Company or otherwise and whether civil, criminal,
administrative or investigative, in which Indemnitee was, is or will be involved
as a party or otherwise, by reason of the fact that Indemnitee is or was an
officer, director, employee, or agent of the Company, by reason of any action
taken by him or of any inaction on his part while acting as an officer,
director, employee, or agent of the Company, or by reason of the fact that
he is
or was serving at the request of the Company as a director, officer, employee,
agent or fiduciary of another corporation, partnership, joint venture, trust
or
other Enterprise; in each case whether or not he is acting or serving in any
such capacity at the time any liability or expense is incurred for which
indemnification can be provided under this Agreement; including one pending
on
or before the date of this Agreement, but excluding one initiated by an
Indemnitee pursuant to Section
7
of this
Agreement to enforce his rights under this Agreement.
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14. Severability.
The
invalidity of unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provision. Without limiting the
generality of the foregoing, this Agreement is intended to confer upon
Indemnitee indemnification rights to the fullest extent permitted by applicable
laws. In the event any provision hereof conflicts with any applicable law,
such
provision shall be deemed modified, consistent with the aforementioned intent,
to the extent necessary to resolve such conflict.
15. Modification
and Waiver.
No
supplement, modification, termination or amendment of this Agreement shall
be
binding unless executed in writing by both of the 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.
16. Notice
By Indemnitee.
Indemnitee agrees promptly to notify the Company in writing upon being served
with or otherwise receiving any summons, citation, subpoena, complaint,
indictment, information or other document relating to any Proceeding or matter
which may be subject to indemnification covered hereunder. The failure to so
notify the Company shall not relieve the Company of any obligation which it
may
have to Indemnitee under this Agreement or otherwise unless and only to the
extent that such failure or delay materially prejudices the
Company.
17. Notices.
All
notices and other communications given or made pursuant to this Agreement shall
be in writing and shall be deemed effectively given: (a) upon personal delivery
to the party to be notified, (b) when sent by confirmed electronic mail or
facsimile if sent during normal business hours of the recipient, and if not
so
confirmed, then on the next business day, (c) five (5) days after having been
sent by registered or certified mail, return receipt requested, postage prepaid,
or (d) one (1) day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. All
communications shall be sent:
|
(a)
|
To
Indemnitee at the address set forth below Indemnitee signature
hereto.
|
|
(b)
|
To
the Company at:
|
000
Xxxxxxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxx,
XX 00000-0000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attn.:
CEO
or
to
such other address as may have been furnished to Indemnitee by the Company
or to
the Company by Indemnitee, as the case may be.
12
18. Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
Agreement. This Agreement may also be executed and delivered by facsimile
signature and in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
19. 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.
20. Governing
Law and Consent to Jurisdiction.
This
Agreement and the legal relations among the parties shall be governed by, and
construed and enforced in accordance with, the laws of the State of Delaware,
without regard to its conflict of laws rules. The Company and Indemnitee hereby
irrevocably and unconditionally (i) agree that any action or proceeding arising
out of or in connection with this Agreement shall be brought only in the
Chancery Court of the State of Delaware (the “Delaware
Court”),
and
not in any other state or federal court in the United States of America or
any
court in any other country, (ii) consent to submit to the exclusive jurisdiction
of the Delaware Court for purposes of any action or proceeding arising out
of or
in connection with this Agreement, (iii) waive any objection to the laying
of
venue of any such action or proceeding in the Delaware Court, and (iv) waive,
and agree not to plead or to make, any claim that any such action or proceeding
brought in the Delaware Court has been brought in an improper or inconvenient
forum.
SIGNATURE
PAGE TO FOLLOW
13
IN
WITNESS WHEREOF, the parties hereto have executed this Indemnification Agreement
as of the date first above written.
By:____________________________________
Name:____________________________
Title:_____________________________
INDEMNITEE
______________________________________
Name:
________________________________
Address:
____________________
____________________
14
