INDEMNIFICATION AGREEMENT
Exhibit 10.2
This
Agreement is made as of the ___ day of , 2008, by and between Bookham, Inc.,
a Delaware corporation (the “Corporation), and (the “Indemnitee”), a
director or officer of the Corporation.
WHEREAS, highly competent persons have become more reluctant to serve corporations as
directors or in other capacities 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, Indemnitee may also be entitled to indemnification pursuant to the General
Corporation Law of the State of Delaware (“DGCL”). The By-laws, Certificate of Incorporation of
the Corporation and the DGCL expressly provide that indemnification provisions are not exclusive,
and contemplate that contracts may be entered into between the Corporation and members of the board
of directors, officers and other persons with respect to indemnification;
WHEREAS, the board of directors of the Corporation (the “Board”) has determined that the
increased difficulty in attracting and retaining such persons is detrimental to the best interests
of the Corporation’s stockholders and that the Corporation should act to assure such persons that
there will be increased certainty of indemnification protection in the future;
WHEREAS, it is reasonable, prudent and necessary for the Corporation to contractually 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 Corporation free from
undue concern that they will not be so indemnified;
WHEREAS, this Agreement is a supplement to and in furtherance of the By-laws and Certificate
of Incorporation of the Corporation and any resolutions adopted pursuant the By-laws and
Certificate of Incorporation, and shall not be deemed a substitute for, nor to diminish or abrogate
any rights of Indemnitee under such charter documents;
NOW, THEREFORE, the parties agree as follows:
1. Agreement to Serve. The Indemnitee agrees to serve or continue to serve as a
director or officer of the Corporation for so long as the Indemnitee is duly elected or appointed
or until such time as the Indemnitee tenders a resignation in writing.
2. Definitions. As used in this Agreement:
(a) “Corporate Status” means the status of a person who is or was a director, officer,
employee, agent or fiduciary of the Corporation, or is or was serving, or has agreed to serve, at
the request of the Corporation, as a director, officer, fiduciary, partner, trustee, member,
employee or agent of, or in a similar capacity with, another corporation, partnership, joint
venture, trust, limited liability company or other enterprise.
(b) “Disinterested Director” means a director of the Corporation who is not and was not a
party to the Proceeding in respect of which indemnification is sought by Indemnitee.
(c) “Enterprise” means the Corporation and any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise that Indemnitee is or was serving at
the express written request of the Corporation as a director, officer, employee, agent or
fiduciary. With respect to employee benefit plans: references to “fines” shall include any
excise tax assessed with respect to any employee benefit plan; references to “serving at the
request of the Corporation” shall include any service as a director, officer, employee or agent
of the Corporation which imposes duties on, or involves services by, such director, officer,
employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries;
and a person who acted in good faith and in a manner such person reasonably believed to be in the
interests of the participants and beneficiaries of an employee benefit plan shall be deemed to
have acted in a manner “not opposed to the best interests of the Corporation” as referred to in
this Agreement.
(d) “Expenses” means, without limitation, attorneys’ fees, retainers, court costs,
transcript costs, fees and expenses of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery service fees and 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 shall also mean any federal, state or local or foreign
taxes imposed on the Indemnitee as a result of the actual or deemed receipt of any payments under
this Agreement and shall include any ERISA excise taxes or penalties imposed in any Proceeding
relating to any Indemnifiable Event. 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, or other appeal bond or its equivalent.
Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of
judgments or 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 (5) years has been,
retained to represent: (1) the Corporation 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 (2) any other party to the Proceeding
giving rise to a claim for indemnification hereunder. 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 Corporation or Indemnitee in an
action to determine Indemnitee’s rights under this Agreement. The Corporation 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 to this Agreement.
(f) “Proceedings” means any threatened, pending or completed action, suit,
arbitration, alternative dispute resolution proceeding, formal or informal investigation,
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inquiry, administrative hearing or any other actual, threatened or completed
proceeding, whether brought by or in the right of the Corporation or otherwise and whether
civil, criminal, administrative or investigative, in which Indemnitee is or will be involved
as a party or otherwise, by reason of the fact that Indemnitee is or was an officer or
director of the Corporation, by reason of any action taken by him or her, or of any inaction
on his or her part while acting as an officer or director of the Corporation, or by reason
of the fact that the Indemnitee is or was serving at the request of the Corporation as a
director, officer, employee, agent or fiduciary of an Enterprise; in each case whether or
not he or she 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 11 of this Agreement to enforce his or her rights under this
Agreement.
3. Indemnity of Indemnitee. The Corporation 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 of this
obligation:
(a) Indemnification in Third-Party Proceedings. The Corporation shall indemnify the
Indemnitee in accordance with the provisions of this Paragraph 3(a) if, by reason of the
Indemnitee’s Corporate Status or by reason of any action alleged to have been taken or omitted in
connection with such status, the Indemnitee was or is a party to or threatened to be made a party to
or otherwise involved in any Proceeding (other than a Proceeding by or in the right of the
Corporation to procure a judgment in its favor). Pursuant to this Paragraph 3(a), Indemnitee
shall be indemnified against all Expenses, judgments, fines, penalties and amounts paid in
settlement actually and reasonably incurred by or on behalf of the Indemnitee in connection with
such Proceeding, if the Indemnitee acted in good faith and in a manner which the Indemnitee
reasonably believed to be in, or not opposed to, the best interests of the Corporation and, with
respect to any criminal Proceeding, had no reasonable cause to believe that his or her conduct
was unlawful.
(b) Indemnification in Proceedings by or in the Right of the Corporation. The
Corporation shall indemnify the Indemnitee in accordance with the provisions of this
Paragraph 3(b) if, by reason of the Indemnitee’s Corporate Status or by reason of any action
alleged to have been taken or omitted in connection with such status, the Indemnitee was or is a
party to or threatened to be made a party to or otherwise involved in any Proceeding by or in the
right of the Corporation to procure a judgment in its favor. Pursuant to this Paragraph 3(b),
Indemnitee shall be indemnified against all Expenses and, to the extent permitted by law, amounts
paid in settlement actually and reasonably incurred by or on behalf of the Indemnitee in
connection with such Proceeding, if the Indemnitee acted in good faith and in a manner which the
Indemnitee reasonably believed to be in, or not opposed to, the best interests of the
Corporation, except that, if applicable law so provides, no indemnification shall be made under
this Paragraph 3(b) in respect of any claim, issue, or matter as to which the Indemnitee shall
have been adjudged to be liable to the Corporation, unless, and only to the extent, that the
Court of Chancery of Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of such liability but in view of all
the
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circumstances of the case, the Indemnitee is fairly and reasonably entitled to indemnity for
such Expenses as the Court of Chancery or such other court shall deem proper.
4. Additional Indemnity. In addition to, and without regard to any limitations on,
the indemnifications provided elsewhere in this Agreement, the Corporation indemnifies and holds
harmless Indemnitee against all Expenses, judgments, penalties, fines and amounts paid or to be
paid in settlement actually and reasonably incurred by or on behalf of the Indemnitee, if, by
reason of his or her Corporate Status, he or she 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 Corporation),
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 Corporation’s obligations
pursuant to this Agreement shall be that the Corporation 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 Paragraph 10) to be unlawful.
5. Indemnification for Expenses of a Witness. To the extent that the Indemnitee is,
by reason of the Indemnitee’s Corporate Status, a witness in any Proceeding to which the Indemnitee
is not a party, the Indemnitee shall be indemnified against all Expenses actually and reasonably
incurred by or on behalf of the Indemnitee in connection with serving as a witness.
6. Indemnification of Expenses of Successful Party. To the extent that the Indemnitee
has been successful, on the merits or otherwise, in defense of any Proceeding or in defense of any
claim, issue or matter in a Proceeding, the Indemnitee shall be indemnified against all Expenses
incurred by or on behalf of the Indemnitee in connection with such Proceeding. Without limiting
the foregoing, if any Proceeding or any claim, issue or matter in a Proceeding is disposed of, on
the merits or otherwise (including a disposition without prejudice), without (i) the disposition
being adverse to the Indemnitee, (ii) an adjudication that the Indemnitee was liable to the
Corporation, (iii) a plea of guilty or nolo
contendere by the Indemnitee, (iv) an adjudication that
the Indemnitee did not act in good faith and in a manner the Indemnitee reasonably believed to be
in or not opposed to the best interests of the Corporation, and (v) with respect to any criminal
proceeding, an adjudication that the Indemnitee had reasonable cause to believe his or her conduct
was unlawful, the Indemnitee shall be considered for the purposes of this Agreement to have been
wholly successful with respect to the Proceeding, or claim, issue or matter in a Proceeding,
respectively. If Indemnitee is not wholly successful in a 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 Corporation shall indemnify Indemnitee against all Expenses actually and reasonably
incurred by or on behalf of the Indemnitee in connection with each successfully resolved claim,
issue or matter. For purposes of this paragraph and without limitation, the termination of any
claim, issue or matter in a Proceeding by dismissal, with or without prejudice, shall be deemed to
be a successful result as to such claim, issue or matter.
7. Exceptions to Right of Indemnification.
(a) Action Initiated by Indemnitee. The Corporation shall not indemnify the
Indemnitee in connection with a Proceeding (or part thereof) initiated by the Indemnitee against
the Corporation or its directors, officers, employees or other Indemnitees, unless the
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initiation of such Proceeding (1) was approved by the Board, or (2) the Corporation provides
the indemnification in its sole discretion, pursuant to the power vested in the Corporation under
applicable law.
(b) Indemnitee Reimbursed From Insurance. The Corporation shall not indemnify the
Indemnitee to the extent the Indemnitee is reimbursed from the proceeds of insurance, and in the
event the Corporation makes any indemnification payments to the Indemnitee and the Indemnitee is
subsequently reimbursed from the proceeds of insurance, the Indemnitee shall promptly refund such
indemnification payments to the Corporation to the extent of such insurance reimbursement.
(c) Section 16(b) Actions. The Corporation shall not indemnify the Indemnitee for
an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of
securities of the Corporation within the meaning of Section 16(b) of the Securities Exchange Act
of 1934, as amended, or similar provision of state statutory law or common law. Notwithstanding
anything to the contrary stated or implied in this Section 7(c), indemnification pursuant to this
Agreement relating to any Proceeding against Indemnitee for an accounting for profits made from
the purchase or sale by Indemnitee of securities of the Company pursuant to the provisions of
Section 16(b) of the Exchange Act or similar provisions of any federal, state or local laws shall
not be prohibited if Indemnitee ultimately establishes in any Proceeding that no recovery of such
profits from Indemnitee is permitted under Section 10(b) of the Exchange Act of similar
provisions of any federal, state of local laws.
8. Notification and Defense of Claim. As a condition precedent to the Indemnitee’s
right to be indemnified, the Indemnitee must notify the Corporation in writing as soon as
practicable of any Proceeding for which indemnity will or could be sought; provided, that the
failure to so notify the Corporation shall not release the Corporation of any liability it may have
to the Indemnitee, except to the extent that the Corporation has been prejudiced by such failure.
With respect to any Proceeding of which the Corporation is so notified, the Corporation will be
entitled to participate in the Proceeding at its own expense and/or to assume the defense of the
Proceeding at its own expense, with legal counsel reasonably acceptable to the Indemnitee. After
notice from the Corporation to the Indemnitee of its election so to assume such defense, the
Corporation shall not be liable to the Indemnitee for any legal or other expenses subsequently
incurred by the Indemnitee in connection with such Proceeding, other than as provided below in this
Paragraph 8. The Indemnitee shall have the right to employ his or her own counsel in connection
with such Proceeding, but the fees and expenses of such counsel incurred after notice from the
Corporation of its assumption of the defense of the Proceeding shall be at the expense of the
Indemnitee unless (i) the employment of counsel by the Indemnitee has been authorized by the
Corporation, (ii) counsel to the Indemnitee shall have reasonably concluded that there may be a
conflict of interest or position on any significant issue between the Corporation and the
Indemnitee in the conduct of the defense of such Proceeding or (iii) the Corporation shall not in
fact have employed counsel to assume the defense of such Proceeding, in each of which cases the
fees and expenses of counsel for the Indemnitee shall be at the expense of the Corporation, except
as otherwise expressly provided by this Agreement. The Corporation shall not be entitled, without
the consent of the Indemnitee, to assume the defense of any claim brought by or
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in the right of the Corporation or as to which counsel for the Indemnitee shall have
reasonably made the conclusion provided for in clause (ii) above. The Corporation shall not be
required to indemnify the Indemnitee under this Agreement for any amounts paid in settlement of any
Proceeding effected without its written consent. The Corporation shall not settle any Proceeding
in any manner, without the Indemnitee’s written consent, provided that Indemnitee’s written consent
shall be required if such settlement (i) grants Indemnitee a complete and unqualified release of
liability, (ii) does not impose any penalty or limitation on Indemnitee, and (iii) does not admit
any liability or misconduct by Indemnitee. Neither the Corporation nor the Indemnitee will
unreasonably withhold or delay their consent to any proposed settlement.
9. Advancement of Expenses. In the event that the Corporation does not assume the
defense, pursuant to Paragraph 8 of this Agreement, of any Proceeding of which the Corporation
receives notice under this Agreement, any Expenses incurred by or on behalf of the Indemnitee in
defending such Proceeding shall be paid by the Corporation in advance of the final disposition of
such Proceeding within ten (10) days after the receipt by the Corporation of a statement or
statements from Indemnitee requesting such advance or advances from time to time; provided,
however, that the payment of such Expenses incurred by or on behalf of the Indemnitee in advance of
the final disposition of such Proceeding shall be made only upon receipt of an undertaking by or on
behalf of the Indemnitee to repay all amounts so advanced in the event that it shall ultimately be
determined that the Indemnitee is not entitled to be indemnified by the Corporation as authorized
in this Agreement. Such undertaking shall be accepted without reference to the financial ability
of the Indemnitee to make repayment. Any advances and undertakings to
repay pursuant to this Paragraph 9 shall be unsecured and interest
free.
10. Procedures and Presumptions for Indemnification.
(a) Written Request. In the event the Indemnitee wishes to exercise his or her
rights to indemnification or advancement of Expenses pursuant to the Paragraphs 3, 4, 5 or 6 or
any other indemnification obligations under this Agreement, the Indemnitee shall submit to the
Corporation a written statement to this effect, including with such statement 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
Corporation shall, promptly upon receipt of such a request for indemnification, advise the Board
in writing that Indemnitee has requested indemnification.
(b) Payment Dates. Any such advancement of Expenses or indemnification pursuant to
Paragraphs 5 and 6, or any other indemnification obligations under this Agreement other than
pursuant to Paragraphs 3 and 4, shall be paid within ten (10) days of receipt by the Corporation
of the written request of the Indemnitee. Indemnification pursuant to Paragraphs 3 or 4 of this
Agreement, that are approved following a determination of entitlement as set forth in this
Paragraph 10, shall be made promptly within thirty (30) days after receipt by the Corporation of
the written request of the Indemnitee.
(c) Procedure for Determining Entitlement to Indemnification.
| (i) | Upon written request by Indemnitee for indemnification pursuant to this Paragraph 10, a determination, if required by applicable law, with respect to Indemnitee’s entitlement to indemnification |
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| shall be made in the specific case by one of the following four methods, which shall be at the election of the Board: (A) by a majority vote of the Disinterested Directors, even though less than a quorum, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum, (C) if there are no Disinterested Directors or if the Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to the Indemnitee, or (D) if so directed by the Board, by the stockholders of the Corporation. |
| (ii) | If the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to this Paragraph 10, the Independent Counsel shall be selected as provided in this Paragraph 10(c). The Independent Counsel shall be selected by the Board. Indemnitee may, within ten (10) days after such written notice of selection shall have been given, deliver to the Corporation, as the case may be, 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 Paragraph 2 of this Agreement, and 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 twenty (20) days after submission by Indemnitee of a written request for indemnification pursuant to this Paragraph 10(c), no Independent Counsel shall have been selected and not objected to, either the Corporation or Indemnitee may petition the Court of Chancery of the State of Delaware or other court of competent jurisdiction for resolution of any objection made by the Indemnitee to the Corporation’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 this Paragraph 10(c). The Corporation shall pay any and all reasonable fees and expenses of Independent Counsel incurred by such Independent Counsel in connection with acting pursuant to this Paragraph 10, and the Corporation shall pay all reasonable fees and expenses incident to the procedures of this Paragraph 10, regardless of the manner in which such Independent Counsel was selected or appointed. |
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| (iii) | If the person, persons or entity empowered or selected under this Paragraph 10 to determine whether Indemnitee is entitled to indemnification shall not have made a determination within sixty (60) days after receipt by the Corporation of the request for indemnification, the requisite determination of entitlement to indemnification shall be deemed to have been made and Indemnitee shall be entitled to such indemnification absent (A) 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 (B) a prohibition of such indemnification under applicable law; provided, however, that such sixty (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 to the determination; and provided, further, that the foregoing provisions of this Paragraph 10 shall not apply if the determination of entitlement to indemnification is to be made by the stockholders pursuant to this Paragraph 10 and if (A) within fifteen (15) days after receipt by the Corporation 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 of the stockholders to be held within seventy-five (75) days after such receipt and such determination is made at the meeting, or (B) a special meeting of stockholders is called within fifteen (15) days after such receipt for the purpose of making the determination, such meeting is held for such purpose within sixty (60) days after having been so called and such determination is made at the meeting. | ||
| (iv) | 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 Corporation 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 |
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| making such determination shall be borne by the Corporation (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Corporation indemnifies and agrees to hold Indemnitee harmless from such costs and expenses. |
(d) Presumptions for Determination of Entitlement to Indemnification.
| (i) | In making a determination with respect to entitlement to indemnification under this Agreement, 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 Corporation (including by its directors or Independent 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 Corporation (including by its directors or Independent 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. | ||
| (ii) | 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, 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 subparagraph (ii) 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 Corporation. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence. | ||
| (iii) | The termination of any Proceeding or any claim, issue or matter in a Proceeding, by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall not, of itself, |
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| adversely affect the right of Indemnitee to indemnification or 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 Corporation, and, with respect to any criminal Proceeding, had reasonable cause to believe that his or her conduct was unlawful. |
| (iv) | The Corporation 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. |
11. Remedies. The right to indemnification or advancement of Expenses as provided by
this Agreement shall be enforceable by the Indemnitee in any court of competent jurisdiction.
Unless otherwise required by law, the burden of proving that indemnification is not appropriate
shall be on the Corporation. The Indemnitee’s expenses (of the type described in the definition of
“Expenses” in Paragraph 2(d)) incurred in connection with successfully establishing the
Indemnitee’s right to indemnification, in whole or in part, in any such Proceeding shall also be
indemnified by the Corporation.
(a) In the event that (1) a determination is made pursuant to Paragraph 10 of this Agreement
that Indemnitee is not entitled to indemnification under this Agreement, (2) advancement of
Expenses is not timely made pursuant to Paragraph 9 of this Agreement, (3) payment of
indemnification is not made pursuant to Paragraph 10(b) of this Agreement, or (4) no determination
of entitlement to indemnification is made pursuant to Paragraph 10(c) of this Agreement within
ninety (90) days after receipt by the Corporation of the request for indemnification, 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 an adjudication within one hundred eighty (180)
days following the date on which Indemnitee first has the right to commence such proceeding
pursuant to this Paragraph 11(a). The Corporation shall not oppose Indemnitee’s right to seek any
such adjudication.
(b) In the event that a determination shall have been made pursuant to Paragraph 10(c) of this
Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding commenced
pursuant to this Paragraph 11 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 Paragraph 10.
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(c) If a determination shall have been made pursuant to Paragraph 10(c) of this Agreement that
Indemnitee is entitled to indemnification, the Corporation shall be bound by such determination in
any judicial proceeding commenced pursuant to this Paragraph 11, 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.
(d) In the event that Indemnitee, pursuant to this Paragraph 11, seeks a judicial adjudication
of his or her 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 Corporation, the
Corporation shall pay on his or her behalf, in advance, any and all expenses (of the types
described in the definition of Expenses in Paragraph 2(d) of this Agreement) actually and
reasonably incurred by him or her 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 Corporation shall be precluded from asserting in any judicial proceeding commenced
pursuant to this Paragraph 11 that the procedures and presumptions of this Agreement are not valid,
binding and enforceable and shall stipulate in any such court that the Corporation is bound by all
the provisions of this Agreement. The Corporation shall indemnify Indemnitee against any and all
Expenses and, if requested by Indemnitee, shall (within ten (10) days after receipt by the
Corporation of a written request for same) 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 Corporation under this Agreement or
under any directors’ and officers’ liability insurance policies maintained by the Corporation,
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) No determination as to entitlement to indemnification under this Agreement shall be
required to be made prior to the final disposition of the Proceeding.
12. Contribution.
(a) Whether or not the indemnification provided in Paragraphs 3 and 4 of this Agreement is
available, in respect of any threatened, pending or completed action, suit or proceeding in which
the Corporation is jointly liable with Indemnitee (or would be if joined in such action, suit or
proceeding), the Corporation 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 Corporation waives and relinquishes any right of contribution it may have against
Indemnitee. The Corporation shall not enter into any settlement of any action, suit or proceeding
in which the Corporation 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.
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(b) Without diminishing or impairing the obligations of the Corporation 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 Corporation is jointly liable with Indemnitee (or would be if joined in
such action, suit or proceeding), the Corporation 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 Corporation and all officers, directors or employees of the Corporation, 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 Corporation and all officers, directors or employees of the
Corporation 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 Corporation and all officers, directors or employees of the Corporation, 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.
(c) The Corporation agrees to fully indemnify and hold Indemnitee harmless from any claims of
contribution which may be brought by officers, directors or employees of the Corporation, 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 Corporation, 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 (1) the relative benefits received by the Corporation and Indemnitee
as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (2) the
relative fault of the Corporation (and its directors, officers, employees and agents) and
Indemnitee in connection with such event(s) and/or transaction(s).
13. Subrogation. In the event of any payment under this Agreement, the Corporation
shall be subrogated to the extent of such payment to all of the rights of recovery of the
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 Corporation to bring
suit to enforce such rights. The Corporation’s obligation to
indemnify or advance Expenses under this Agreement to an Indemnitee who is or was serving at the request of the Corporation as a
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director, officer, employee or agent of an Enterprise shall be reduced by any amount Indemnitee has
actually received as indemnification or advancement of expenses from such Enterprise.
14. Term of Agreement. This Agreement shall continue until and terminate upon the
later of (i) six years after the date that the Indemnitee shall have ceased to serve as a director
or officer of the Corporation or, at the request of the Corporation, as a director, officer,
partner, trustee, member, employee or agent of an Enterprise or (ii) the final termination of all
Proceedings pending on the date set forth in clause (i) in respect of which the Indemnitee is
granted rights of indemnification or advancement of Expenses under this Agreement and of any
Proceeding commenced by the Indemnitee pursuant to Paragraph 11 of this Agreement relating to such
Proceedings.
15. Indemnification Not Exclusive. The indemnification and advancement of Expenses
provided by this Agreement shall not be deemed exclusive of any other rights to which the
Indemnitee may be entitled under the Certification of Incorporation, the By-Laws, any other
agreement, any vote of stockholders or Disinterested Directors, the DGCL, any other law (common or
statutory), or otherwise, both as to action in the Indemnitee’s official capacity and as to action
in another capacity while holding office for the Corporation. No amendment, alteration or repeal
of this Agreement or of any provision of this Agreement shall limit or restrict any right of
Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in his
or her Corporate Status prior to such amendment, alteration or repeal. To the extent that a change
in the DGCL, whether by statute or judicial decision, permits greater indemnification than would be
afforded currently under the Certificate of Incorporation, the Bylaws and this Agreement, it is
the intent of the parties that Indemnitee shall enjoy by this Agreement the greater benefits so
afforded by such change. No right or remedy conferred in this Agreement 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 under this Agreement, or now or after the date of
this Agreement existing at law or in equity or otherwise.
16. Insurance. Nothing contained in this Agreement shall be deemed to prohibit the
Corporation from purchasing and maintaining insurance, at its expense, to protect itself or the
Indemnitee against any expense, liability or loss incurred by it or the Indemnitee in any such
capacity, or arising out of the Indemnitee’s status as such, whether or not the Indemnitee would be
indemnified against such expense, liability or loss under this Agreement; provided that the
Corporation shall not be liable under this Agreement to make any payment of amounts otherwise
indemnifiable under this Agreement if and to the extent that the Indemnitee has otherwise actually
received such payment under any insurance policy, contract, agreement or otherwise. To the extent
that the Corporation maintains an insurance policy or policies providing liability insurance for
directors, officers, employees, or agents or fiduciaries of the Corporation or of any Enterprise
that such person serves at the request of the Corporation, Indemnitee shall be covered by such
policy or policies in accordance with its or their terms. For the duration of Indemnitee’s service
as a director and/or officer of the Corporation, and thereafter for so long as Indemnitee shall be
subject to any pending or possible claim indemnifiable pursuant to the terms of this Agreement, the
Corporation shall use commercially reasonable efforts (taking into account the scope and amount of
coverage available relative to the cost thereof) to cause to be maintained in effect policies or
directors’ and officers’ liability insurance providing
coverage for directors and/or officers of the Corporation that is at least substantially comparable in scope and
amount to
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that proved by the Corporation’s current policies of director’s and officers’ liability
insurance. The minimum AM Best rating for the insurance carriers of such insurance carrier hall be
not less than A-VI. In the event of a Change in Control the Corporation shall maintain in force any
and all insurance policies than maintained by the Company in providing insurance; directors’ and
officers’ liability, fiduciary, employment practices or otherwise, in respect of Indemnitee, for a
period of six year thereafter. If, at the time of the receipt of a notice of a claim pursuant to
the terms of this Agreement, the Corporation has director and officer liability insurance in
effect, the Corporation 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 Corporation
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.
17. No Special Rights. Nothing herein shall confer upon the Indemnitee any right to
continue to serve as an officer or director of the Corporation for any period of time or at any
particular rate of compensation.
18. Savings Clause. The invalidity of unenforceability of any provision of this
Agreement 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 of this Agreement conflicts with any applicable law, such provision shall be deemed
modified, consistent with the aforementioned intent, to the extent necessary to resolve such
conflict. If this Agreement or any portion of this Agreement shall be invalidated on any ground by
any court of competent jurisdiction, then the Corporation shall nevertheless indemnify the
Indemnitee as to Expenses, judgments, fines, penalties and amounts paid in settlement with respect
to any Proceeding to the full extent permitted by any applicable portion of this Agreement that
shall not have been invalidated and to the fullest extent permitted by applicable law.
19. Counterparts. This Agreement may 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.
20. Successors and Assigns. This Agreement shall be binding upon the Corporation and
its successors and assigns and shall inure to the benefit of the estate, heirs, executors,
administrators and personal representatives of the Indemnitee.
21. 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 of this Agreement.
22. Modification and Waiver. This Agreement may be amended from time to time to
reflect changes in Delaware law or for other reasons. Except as expressly provided in this
Agreement, no supplement, modification or amendment of this Agreement shall be binding unless
executed in writing by both of the parties to this Agreement. No waiver of any of the
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provisions of this Agreement shall be deemed or shall constitute a waiver of any other
provision of this Agreement, nor shall any such waiver constitute a continuing waiver.
23. Notices. All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed to have been given (i) when delivered by hand,
(ii) if mailed by certified or registered mail with postage prepaid, on the third day after the
date on which it is so mailed, or (iii) two (2) business
days after deposit with an internationally
recognized overnight courier, specifying next day delivery, with written verification of receipt.
All communications shall be sent:
| (a) if to the Indemnitee, to: | ||||
| (b) if to the Corporation, to: | Chief Executive Officer | |||
| 0000 Xxxxxxxx Xxxxxx | ||||
| Xxx Xxxx, Xxxxxxxxxx 00000 | ||||
| Copy to: | General Counsel | |||
| 0000 Xxxxxxxx Xxxxxx | ||||
| Xxx Xxxx, Xxxxxxxxxx 00000 |
or to such other address as may have been furnished to the Indemnitee by the Corporation or to the
Corporation by the Indemnitee, as the case may be.
24. Applicable Law. This Agreement shall be governed by, and construed and enforced
in accordance with, the laws of the State of Delaware, without regard to its conflict of law rules.
The Indemnitee may elect to have the right to indemnification or reimbursement or advancement of
Expenses interpreted on the basis of the applicable law in effect at the time of the occurrence of
the event or events giving rise to the applicable Proceeding, to the extent permitted by law, or on
the basis of the applicable law in effect at the time such indemnification or reimbursement or
advancement of Expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or advancement of Expenses is sought;
provided, however, that if no such notice is given, and if the DGCL is amended, or other Delaware
law is enacted, to permit further indemnification of the directors and officers, then the
Indemnitee shall be indemnified to the fullest extent permitted under the DGCL, as so amended, or
by such other Delaware law, as so enacted.
25. Enforcement. The Corporation expressly confirms and agrees that it has entered
into this Agreement in order to induce the Indemnitee to continue to serve as an officer or
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director of the Corporation, and acknowledges that the Indemnitee is relying upon this
Agreement in continuing in such capacity.
26. Entire Agreement. This Agreement sets forth the entire agreement of the parties
to this Agreement in respect of the subject matter contained in this Agreement and supercedes all
prior agreements, whether oral or written, by any officer, employee or representative of any party
in respect of the subject matter contained in this Agreement. Any prior agreement of the parties
in respect of the subject matter contained in this Agreement is terminated and cancelled. For
avoidance of doubt, the parties confirm that the foregoing does not apply to or limit the
Indemnitee’s rights under Delaware law or the Corporation’s Certificate of Incorporation or
By-Laws.
27. Consent to Suit. In the case of any dispute under or in connection with this
Agreement, the Indemnitee may only bring suit against the Corporation in the Court of Chancery of
the State of Delaware. The Indemnitee consents to the exclusive jurisdiction and venue of the
courts of the State of Delaware, and the Indemnitee waives any claim the Indemnitee may have at any
time as to forum non conveniens with respect to such venue. The Corporation shall have the right
to institute any legal action arising out of or relating to this Agreement in any court of
competent jurisdiction. Any judgment entered against either of the parties in any proceeding under
this Agreement may be entered and enforced by any court of competent jurisdiction.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and
year first above written.
| INDEMNITEE | BOOKHAM, INC. | |||||
| By: | ||||||
| Name: | ||||||
Print Name:
|
Title: | |||||
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