INDEMNIFICATION AGREEMENT
Parties
This INDEMNIFICATION AGREEMENT (the "Agreement") is made by YP Corp.,
a Nevada corporation (the "Company"), and Xxxxx X. Xxxxxxxx (the "Indemnitee")
as of June 6, 2004.
Background
A. Recently highly competent persons have become more reluctant to
serve publicly-held companies as directors, officers, or in other capacities,
unless they are provided with better protection from the risk of claims and
actions against them arising out of their service to and activities on behalf of
such corporations.
B. The high cost of obtaining adequate insurance and the uncertainties
related to indemnification have increased the difficulty of attracting and
retaining such persons.
C. The Board of Directors of the Company (the "Board") has determined
that the potential inability to attract and retain such persons is detrimental
to the best interests of the Company's securityholders and that such persons
should be assured that they will have better protection in the future.
D. It is reasonable, prudent and necessary for the Company to obligate
itself contractually to indemnify such persons to the fullest extent permitted
by applicable law so that such persons will serve or continue to serve the
Company free from undue concern that they will not be adequately indemnified.
E. In recognition of Indemnitee's need for substantial protection
against personal liability in order to enhance Indemnitee's continued service to
the Company in an effective manner and Indemnitee's reliance on the protections
currently provided by the Company's Operating Agreement and in part to provide
Indemnitee with specific contractual assurance that the protection promised
thereby will be available to Indemnitee (regardless of, among other things, any
amendment thereto or revocation thereof or any change in the composition of the
Company's Board of Directors or acquisition transaction relating to the
Company), the Company wishes to provide in this Agreement for the
indemnification of and the advancing of expenses to Indemnitee to the fullest
extent permitted by law and as set forth in this Agreement, and, to the extent
insurance is maintained, for the continued coverage of Indemnitee under the
Company's directors' and officers' liability insurance policies.
F. Indemnitee is willing to serve, continue to serve and to take on
additional service for or on behalf of the Company on the condition that he be
indemnified according to the terms of this Agreement.
Terms of Agreement
In consideration of the premises and the mutual covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and Indemnitee hereby agree as
follows:
Section 1. Definitions. For purposes of this Agreement:
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(a) "Change in Control" means a change in control of the Company
occurring after the date of this Agreement of a nature that would be required to
be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in
response to any similar item on any similar schedule or form) promulgated, under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), whether or not
the Company is then subject to such reporting requirement; provided, that,
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without limitation, such change in control shall be deemed to have occurred if
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of the 0000
Xxx) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
1934 Act), directly or indirectly, of securities of the Company representing 20%
or more of the combined voting power of the Company's then outstanding
securities without the prior approval of at least two-thirds of the members of
the Board in office immediately prior to such person attaining such percentage
interest; (ii) the Company is a party to a merger, consolidation, sale of assets
or other reorganization, or a proxy contest, as a consequence of which members
of the Board in office immediately prior to such transaction or event constitute
less than a majority of the Board thereafter, or (iii) during any period of two
consecutive years, individuals who at the beginning of such period constituted
the Board (including for this purpose any new director whose election or
nomination for election by the Company's stockholders was approved by a vote of
at least two-thirds of the directors then still in office who were directors at
the beginning of such period) cease for any reason to constitute at least a
majority of the Board.
(b) "Company Status" means the status of a person who is or was a
director, officer, employee, agent or fiduciary of the Company or of any other
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise which such person is or was serving at the request of the Company.
(c) "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.
(d) "Expense" means 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, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, or being or preparing to be a witness in a
Proceeding.
(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 other matter material to either such party, or (ii) any other
party to the proceeding giving rise to a claim for indemnification hereunder.
Notwithstanding the foregoing, the term "Independent Counsel"
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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.
(f) "Potential Change in Control" shall be deemed to have occurred if
(i) the Company enters into an agreement or arrangement, the consummation of
which would result in the occurrence of a Change in Control or (ii) the Board
adopts a resolution to the effect that, for purposes of this Agreement, a
Potential Change in Control has occurred.
(g) "Proceeding" means any threatened, pending or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation,
administrative hearing or any other proceeding, whether civil, criminal,
administrative or investigative, whether formal or informal, except one
initiated by an Indemnitee pursuant to Section 11 of this Agreement to enforce
his rights under this Agreement.
Section 2. Services by Indemnitee. Indemnitee agrees to serve as an
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officer and director of the Company, and, at its request, as a director,
officer, employee, agent or fiduciary of certain other corporations and
entities. Indemnitee may at any time and for any reason resign from any such
position (subject to any other contractual obligation or any obligation imposed
by operation of law).
Section 3. Indemnification - General. The Company shall indemnify, and
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advance Expenses to, Indemnitee as provided in this Agreement to the fullest
extent permitted by applicable law in effect on the date hereof and to such
greater extent as applicable law may thereafter from time to time permit. The
rights of Indemnitee provided under the preceding sentence shall include, but
shall not be limited to, the rights set forth in the other Sections of this
Agreement.
Section 4. Proceedings Other Than Proceedings by or in the Right of
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the Company. Indemnitee shall be entitled to the rights of indemnification
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provided in this Section if, by reason of his Company Status, he is, or is
threatened to be made, a party to any threatened, pending or completed
Proceeding, other than a Proceeding by or in the right of the Company. Pursuant
to this Section, Indemnitee shall be indemnified against Expenses, judgments,
penalties, fines and amounts paid in settlement actually and reasonably incurred
by him or on his behalf in connection with any such Proceeding or any claim,
issue or matter therein, if he acted in good faith and in a manner he 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 his
conduct was unlawful.
Section 5. Proceedings by or in the Right ofthe Company. Indemnitee
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shall be entitled to the rights of indemnification provided in this Section if,
by reason of his Company Status, he is, or is threatened to be made, a party to
any threatened proceeding or completed Proceeding brought by or in the right of
the Company to procure a judgment in its favor. Pursuant to this Section,
Indemnitee shall be indemnified against Expenses actually and reasonably
incurred by him or on his behalf in connection with any such Proceeding if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests
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of the Company. Notwithstanding the foregoing, no indemnification against such
Expenses shall be made in respect of any claim, issue or matter in any such
proceeding as to which Indemnitee shall have been adjudged to be liable to the
Company if applicable law prohibits such indemnification unless a court of
competent jurisdiction in Nevada, or the court in which such Proceeding shall
have been brought or is pending, shall determine that indemnification against
Expenses may nevertheless be made by the Company.
Section 6. Indemnification for Expenses of Party Who is Wholly or
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Partly Successful. Notwithstanding any other provision of this Agreement, to the
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extent the Indemnitee is, by reason of his Company Status, a party to and is
successful, on the merits or otherwise, in any Proceeding, he shall be
indemnified 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 the purposes of this Section and without limiting the
foregoing, the termination of any claim, issue or matter in any such Proceeding
by dismissal, with or without prejudice, shall be deemed to be a successful
result as to such claim, issue or matter.
Section 7. Indemnification of Expenses of a Witness. Notwithstanding
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any other provision of this Agreement, to the extent that Indemnitee is, by
reason of his Company Status, a witness in any Proceeding, he shall be
indemnified against all Expenses actually and reasonably incurred by him or on
his behalf in connection therewith.
Section 8. Advancement of Expenses. The Company shall advance all
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Expenses incurred by or on behalf of Indemnitee in connection with any
Proceeding within 20 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.
Section 9. Procedure for Determination of Entitlement to
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Indemnification.
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(a) To obtain indemnification under this Agreement in connection with
any Proceeding, and for the duration thereof, 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
any such request for indemnification, advise the Board in writing that
Indemnitee has requested indemnification.
(b) Upon written request by Indemnitee for indemnification pursuant to
Section 9(a) hereof, a determination, if required by applicable law, with
respect to Indemnitee's
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entitlement thereto shall be made in such case: (i) if a Change in Control shall
have occurred, by Independent Counsel in a written opinion to the Board, a copy
of which shall be delivered to Indemnitee (unless Indemnitee shall request that
such determination be made by the Board or the securityholders, in which case in
the manner provided for in clauses (ii) or (iii) of this Section 9(b)); (ii) if
a Change in Control shall not have occurred, (A) by the Board by a majority vote
of a quorum consisting of Disinterested Directors, or (B) if a quorum of the
Board consisting of Disinterested Directors is not obtainable, or even if such
quorum is obtainable, if such quorum of Disinterested Directors so directs,
either (x) by Independent Counsel in a written opinion to the Board, a copy of
which shall be delivered to Indemnitee, or (y) by the securityholders of the
Company, as determined by such quorum of Disinterested Directors, or a quorum of
the Board, as the case may be; or (iii) as provided in Section 10(b) of this
Agreement. If it is so determined that Indemnitee is entitled to
indemnification, payment to Indemnitee shall be made within 10 days after such
determination. 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
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.
(c) If required, Independent Counsel shall be selected as follows: (i)
if a Change in Control shall not have occurred, Independent Counsel shall be
selected by the Board, and the Company shall give written notice to Indemnitee
advising him of the identity of Independent Counsel so selected or (ii) if a
Change in Control shall have occurred, Independent Counsel shall be selected by
Indemnitee (unless Indemnitee shall request that such selection be made by the
Board, in which event the foregoing clause (i) shall apply), and Indemnitee
shall give written notice to the Company advising it of the identity of
Independent Counsel so selected. In either event, Indemnitee or the Company, as
the case may be, may, within seven days after such written notice of selection
shall have been given, deliver to the Company or to Indemnitee, as the case may
be, a written objection to such selection. Such objection may be asserted only
on the ground that Independent Counsel so selected does not meet the
requirements of "Independent Counsel" as defined in Section 1 of this Agreement,
and the objection shall set forth with particularity the factual basis of such
assertion. If such written objection is made, Independent Counsel so selected
may not serve as Independent Counsel unless and until 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 9(a)
hereof, no Independent Counsel shall have been selected and not objected to,
either the Company or Indemnitee may petition a court of competent jurisdiction
in the State of Nevada, or other court of competent jurisdiction, for resolution
of any objection which shall have been made by the Company or Indemnitee to the
other's selection of Independent Counsel and/or for the appointment as
Independent Counsel of a person selected by such court or by such other person
as such court shall designate, and the person with respect to whom an objection
is so resolved or the person so appointed shall act as Independent Counsel under
Section 9(b) hereof. The
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Company shall pay any and all reasonable fees and expenses of Independent
Counsel incurred by such Independent Counsel in connection with its actions
pursuant to this Agreement, and the Company shall pay all reasonable fees and
expenses incident to the procedures of this Section 9(c), regardless of the
manner in which such Independent Counsel was selected or appointed. Upon the due
commencement date of any judicial proceeding or arbitration pursuant to Section
11(a) of this Agreement, Independent Counsel shall be discharged and relieved of
any further responsibility in such capacity (subject to the applicable standards
of professional conduct then prevailing).
Section 10. Presumptions and Effects of Certain Proceedings.
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(a) If a Change in Control shall have occurred, 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 if Indemnitee has
submitted a request for indemnification in accordance with Section 9(a) of this
Agreement, and the Company shall have the burden of proof to overcome that
presumption in connection with the making by any person, persons or entity of
any determination contrary to that presumption.
(b) If the person, persons or entity empowered or selected under
Section 9 of this Agreement to determine whether Indemnitee is entitled to
indemnification shall not have made a determination within 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) prohibition of such indemnification under
applicable law; provided, that such 60-day period may be extended for a
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reasonable time, not to exceed an additional 30 days, if the person, persons or
entity making the determination with respect to entitlement to indemnification
in good faith require(s) such additional time for the obtaining or evaluating of
documentation and/or information relating thereto and so notifies Indemnitee in
writing prior to the expiration of such 60 day period; and provided, further,
that the foregoing provisions of this Section 10(b) shall not apply (i) if the
determination of entitlement to indemnification is to be made by the
securityholders pursuant to Section 9(b) of this Agreement and if (A) within 15
days after receipt by the Company of the request for such determination the
Board has resolved to submit such determination to the securityholders for their
consideration at an annual meeting thereof to be held within 75 days after such
receipt and such determination is made thereat, or (B) a special meeting of
securityholders is called within 15 days after such receipt for the purpose of
making such determination, such meeting is held for such purpose within 60 days
after having been so called and such determination is made thereat, or (ii) if
the determination of entitlement to indemnification is to be made by Independent
Counsel pursuant to Section 9(b) of this Agreement.
(c) 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
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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.
Section 11. Remedies of Indemnitee.
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(a) In the event that (i) a determination is made pursuant to Section
9 of this Agreement that Indemnitee is not entitled to indemnification under
this Agreement, (ii) advancement of Expenses is not timely made pursuant to
Section 8 of this Agreement, (iii) the determination of indemnification is to be
made by Independent Counsel pursuant to Section 9(b) of this Agreement and such
determination shall not have been made and delivered in a written opinion within
90 days after receipt by the Company of the request for indemnification, (iv)
payment of indemnification is not made pursuant to Section 7 of this Agreement
within ten days after receipt by the Company of a written request therefor, or
(v) payment of indemnification is not made within 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 9 or 10 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 his entitlement to such indemnification or advancement of Expenses.
Alternatively, the Indemnitee, at his option, may seek an award in arbitration
to be conducted by a single arbitrator pursuant to the rules of the American
Arbitration Association. Indemnitee shall commence such proceeding seeking an
adjudication or an award in arbitration within 180 days following the date on
which Indemnitee first has the right to commence such proceeding pursuant to
this Section 11(a). The Company shall not oppose Indemnitee's right to seek any
such adjudication or award in arbitration.
(b) In the event that a determination shall have been made pursuant to
Section 9 of this Agreement that Indemnitee is not entitled to indemnification,
any judicial proceeding or arbitration commenced pursuant to this Section shall
be conducted in all respects as a de novo trial or arbitration on the merits and
Indemnitee shall not be prejudiced by reason of that adverse determination. If
a Change in Control shall have occurred in any judicial proceeding or
arbitration commenced pursuant to this Section, the Company shall have the
burden of proving that Indemnitee is not entitled to indemnification or
advancement of Expenses, as the case may be.
(c) If a determination shall have been made or deemed to have been
made pursuant to Section 9 or 10 of this Agreement that Indemnitee is entitled
to indemnification, the Company shall be bound by such determination in any
judicial proceeding or arbitration commenced pursuant to this Section, 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)
prohibition of such indemnification under applicable law.
(d) The Company shall be precluded from asserting in any judicial
proceeding or arbitration commenced pursuant to this Section that the procedures
and presumptions of this
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Agreement are not valid, binding and enforceable and shall stipulate in any such
court or before any such arbitrator that the Company is bound by all the
provisions of this Agreement.
(e) In the event that Indemnitee, pursuant to this Section, seeks a
judicial adjudication of, or an award in arbitration to enforce his rights
under, or to recover damages for breach of, this Agreement, Indemnitee shall be
entitled to recover from the Company, and shall be indemnified by the Company
against, any and all expenses (of the kinds described in the definition of
Expenses) actually and reasonably incurred by him in such judicial adjudication
or arbitration, but only if he prevails therein. If it shall be determined in
such judicial adjudication or arbitration that Indemnitee is not entitled to
receive all of the indemnification or advancement of expenses sought, the
expenses incurred by Indemnitee in connection with such judicial adjudication or
arbitration shall be appropriately prorated.
Section 12. Non-Exclusivity; Survival of Rights; Insurance;
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Subrogation.
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(a) The rights of indemnification and to receive advancement of
Expenses as provided by this Agreement shall not be deemed exclusive of, and
shall not diminish, any other rights to which Indemnitee may at any time be
entitled under applicable law, the certificate of incorporation or by-laws of
the Company, any agreement, a vote of securityholders or a resolution of
directors, or otherwise, and shall neither be deemed to be a substitute therefor
nor to diminish or abrogate any rights of Indemnitee thereunder. No amendment,
alteration or repeal of this Agreement or any provision hereof shall be
effective as to any Indemnitee with respect to any action taken or omitted by
such Indemnitee in his Company Status prior to such amendment, alteration or
repeal.
(b) To the extent that the Company maintains an insurance policy or
policies providing liability insurance for directors, officers, employees,
agents or fiduciaries of the Company or of any other corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise which 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 such director, officer, employee, agent or
fiduciary under such policy or policies.
(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.
Section 13. Establishment of Trust. In the event of a Potential Change
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in Control or a Change in Control, the Company shall, promptly upon written
request by Indemnitee, create a Trust for the benefit of Indemnitee and from
time to time, upon written request of Indemnitee
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to the Company, shall fund such Trust in an amount, as set forth in such
request, sufficient to satisfy any and all Expenses reasonably anticipated at
the time of each such request, if, by reason of his Company Status, he is, or is
threatened to be made, a party to any threatened, pending or completed
Proceeding, and any and all judgments, fines, penalties and settlement amounts
actually and reasonably incurred by him or on his behalf in connection with any
such Proceeding from time to time actually paid or claimed, reasonably
anticipated or proposed to be paid. The terms of the Trust shall provide that
upon a Change in Control (i) the Trust shall not be revoked or the principal
thereof invaded, without the written consent of Indemnitee; (ii) the Trustee
shall advance, within two business days of a request by Indemnities, any and all
Expenses to Indemnitee, not advanced directly by the Company to Indemnitee (and
Indemnitee hereby agrees to reimburse the Trust under the circumstances under
which Indemnitee would be required to reimburse the Company under Section 8 of
this Agreement); (iii) the Trust shall continue to be funded by the Company in
accordance with the funding obligation set forth above; (iv) the Trustee shall
promptly pay to Indemnitee all amounts for which Indemnitee shall be entitled to
indemnification pursuant to this Agreement or otherwise; and (v) all unexpended
funds in such Trust shall revert to the Company upon a final determination by
the Board, arbitrator or court of competent jurisdiction, as the case may be,
that Indemnitee has been fully indemnified under the terms of this Agreement.
The Trustee shall be chosen by Indemnitee. Nothing in this Section 13 shall
relieve the Company of any of its obligations under this Agreement.
Section 14. Contribution. In the event that the indemnification
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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 the Proceeding as to which such indemnification is unavailable,
in such proportion as is deemed fair and reasonable in light of all of the
circumstances of such action by the Board, arbitrator or court before which such
action was brought, as the case may be, 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 action; and/or (ii) the relative
fault of the Company (and its other directors, officers, employees and agents)
and Indemnitee in connection with such event(s) and/or transactions(s).
Indemnitee's right to contribution under this Section 14 shall be determined in
accordance with, pursuant to and in the same manner as, the provisions hereof
relating to Indemnitee's right to indemnification under this Agreement.
Section 15. Duration of Agreement. This Agreement shall continue until
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and terminate upon the later of: (a) 10 years after the date that Indemnitee
shall have ceased to serve as a director, officer, employee, agent or fiduciary
of the Company or of any other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise which Indemnitee served at the request
of the Company; or (b) the final termination of all pending Proceedings in
respect of which Indemnitee is granted rights of indemnification or advancement
of Expenses hereunder and or any proceeding commenced by Indemnitee pursuant to
Section 11 of this Agreement. This Agreement shall be binding upon the Company
and its successors and assigns and shall inure to the benefit of Indemnitee and
his heirs, executors and administrators.
Section 16. Period of Limitations. No legal action shall be brought
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and no cause of action shall be asserted by or on behalf of the Company or any
affiliate of the Company
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against Indemnitee, Indemnitee's spouse, heirs,
executors or personal or legal representatives after the expiration of two years
from the date of accrual of such cause of action, and any claim or cause of
action of the Company or its affiliates shall be extinguished and deemed
released unless asserted by the timely filing of a legal action within such
two-year period; provided, that if any shorter period of limitations is
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otherwise applicable to any such cause of action such shorter period shall
govern.
Section 17. Severability. If any provision or provisions of this
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Agreement shall be held to be invalid, illegal or unenforceable for any reason
whatsoever: (a) the validity, legality and enforceability of the remaining
provisions of this Agreement (including, without limitation, each portion of any
Section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby; and (b) to the fullest
extent possible, the provisions of this Agreement including, without limitation,
each portion of any Section of this Agreement containing any such provision held
to be invalid, illegal or unenforceable, that is not itself invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent manifested
by the provision held invalid, illegal or unenforceable.
Section 18. Exception to Right of Indemnification or Advancement of
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Expenses.
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Except as provided in Section 11(e), Indemnitee shall not be entitled to
indemnification or advancement of Expenses under this Agreement with respect to
any Proceeding, or any claim therein, brought or made by him against the
Company.
Section 19. Identical Counterparts. This Agreement may be executed in
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two or more counterparts, each of which shall for all purposes be deemed to be
an original but all of which together shall constitute one and the same
Agreement. Only one such counterpart signed by the party against whom
enforceability is sought needs to be produced to evidence the existence of this
Agreement.
Section 20. Headings. The headings of the paragraphs of this Agreement
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are inserted for convenience only and shall not to constitute part of this
Agreement or to affect the construction thereof.
Section 21. Modification and Waiver. No supplement, modification or
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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.
Section 22. Notice by Indemnitee. Indemnitee agrees promptly to notify
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the Company in writing upon being served with any summons, citation, subpoena,
complaint, indictment, information or other document relating any Proceeding or
matter which may be subject to indemnification or advancement of Expenses
covered hereunder.
Section 23. Notices. All notices, requests, demands and other
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communications hereunder shall be in writing and shall be deemed to have been
duly given if (i) delivered by hand and receipted for by the party to whom such
notice or other communication shall have been
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directed, or (ii) mailed by certified or registered mail with postage prepaid,
on the third business day after the date on which it is so mailed:
If to Indemnitee, to:
Xxxxx X. Xxxxxxxx
Suite 214
000 Xxxxxxxxxx Xxxx.
Xxxxxx xxx Xxx, Xxxxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
If to the Company, to:
YP Corp.
Suite 105
4840 East Jasmine Street
Mesa, Arizona 00000-0000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attention: Board of Directors
or to such other address or such other person as Indemnitee or the Company shall
designate in writing in accordance with this Section, except that notices
regarding changes in notices shall be effective only upon receipt. A copy of
all notices sent to Executive shall be simultaneously sent to Xxxxxxxx Xxxxx
LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000-0000; attention: Xxxxx X. Xxxxxxxx,
Esq.
Section 24. Governing Law. The parties agree that this Agreement shall
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be governed by, and construed and enforced in accordance with, the laws of the
State of Nevada.
Section 25. Miscellaneous. Use of the masculine noun shall be deemed
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to include usage of the feminine pronoun where appropriate.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
YP CORP., a Nevada corporation INDEMNITEE
/s/ XxXxx Xxxxxxx /s/ Xxxxx X. Xxxxxxxx
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XxXxx Xxxxxxx Xxxxx X. Xxxxxxxx
Executive Vice President
and Corporate Secretary
[XXXXX XXXXXXXX INDEMNIFICATION AGREEMENT]
