EXHIBIT
10.11
This Indemnification Agreement (this
“Agreement”) is made as of __________, 1999, by and between ACME
Communications, Inc., a Delaware corporation (the “Company”), and the
individual whose name appears below the word “Indemnitee” on the signature page
(the “Indemnitee”). In consideration of the services of the Indemnitee,
and to induce the Indemnitee to consent to becoming a director following the required
approval from the Federal Communications Commission (the “FCC Approval”)
or to continue to serve as a director and/or officer, the Company and the Indemnitee
agrees as follows:
R E C I T A L S
| A.
|
The Indemnitee has agreed to become a director following the FCC Approval or to
continue to serve as a director and/or officer of the Company and in such
capacity will render valuable services to the Company. |
| B.
|
The Company has concluded that insurance and statutory indemnity provisions may
provide inadequate protection to individuals requested to serve as its directors
and officers. |
| C.
|
To induce and encourage the Indemnitee to consent to becoming a director
following the FCC Approval or to continue to serve as a director and/or officer
of the Company, the Company’s Board of Directors has decided that this
Agreement is not only reasonable and prudent, but necessary, to promote and
ensure the best interests of the Company and its stockholders. |
1. Definitions
As used in this Agreement:
“Agent” means a
director, officer, person who has consented to become a director following the FCC
Approval, employee or agent of the Company or of any other corporation, partnership, joint
venture, trust, employee benefit plan, or other enterprise that the Indemnitee served in
any of such capacities at the request of the Company.
“Change in Control
Event” has the meaning set forth in the Company’s 1999 Stock Incentive Award
Plan.
“Expenses” includes,
but is not limited to, attorneys’ fees, disbursements and retainers, accounting and
witness fees, travel and deposition costs, expenses of investigations and amounts paid in
settlement by or on behalf of the Indemnitee, and any expenses of establishing a right to
indemnification pursuant to this Agreement, to the extent actually and reasonably incurred
by the Indemnitee in connection with any Proceeding. “Expenses” does not
include the amount of judgments, fines, penalties or ERISA excise taxes actually levied
against the Indemnitee.
“Indemnified Costs”
means all Expenses, judgments, fines, penalties and ERISA excise taxes actually and
reasonably incurred by the Indemnitee in connection with the investigation, defense,
appeal, or settlement of any Proceeding.
A “Potential Change in
Control Event” will be deemed to have occurred if:
| (a) |
the Company enters into an agreement or arrangement that would constitute a
Change in Control Event if consummated; |
| (b) |
any person (including the Company) publicly announces an intention to take or
to consider taking actions that would constitute a Change in Control Event if
consummated; |
or
| (c) |
the Board of Directors adopts a resolution to the effect that, for purposes of
this Agreement, a Potential Change in Control Event has occurred. |
“Proceeding” means
any threatened, pending or completed action, suit or proceeding (including appeals
thereof), whether brought by or in the name of the Company or otherwise and whether of a
civil, criminal or administrative or investigative nature, in which the Indemnitee is or
will be a party at the time because the Indemnitee is or was an Agent, whether or not the
Indemnitee is serving in such capacity at the time any liability or Expense is incurred
for which indemnification or reimbursement is to be provided under this Agreement.
2. Indemnification
| 2.1 |
|
Indemnification in Third Party Actions. The Company will indemnify the
Indemnitee if the Indemnitee becomes a party to, is threatened to be made a party to, is a
witness or other participant in, or is otherwise involved in any Proceeding (other than a
Proceeding by or in the name of the Company to procure a judgment in its favor), because
the Indemnitee is or was an Agent, against all Indemnified Costs, to the fullest extent
permitted by applicable law. Any settlement must be approved in writing by the Company. |
| 2.2 |
|
Indemnification in Proceedings By or In the Name of the Company. The
Company will indemnify the Indemnitee if the Indemnitee is a party to, is threatened to be
made a party to, is a witness or other participant in, or is otherwise involved in any
Proceeding by or in the name of the Company to procure a judgment in its favor because the
Indemnitee was or is an Agent of the Company against all Expenses in connection with the
defense or settlement of the Proceeding, to the fullest extent permitted by applicable
law. |
| 2.3 |
|
Partial Indemnification. If the Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a portion of, but not the
total amount of, the Indemnified Costs, the Company will nevertheless indemnify the
Indemnitee for the portion of the Indemnified Costs to which the Indemnitee is entitled. |
| 2.4 |
|
Indemnification Hereunder Not Exclusive. The indemnification provided by
this Agreement is not exclusive of any other rights to which the Indemnitee may be
entitled under the Company’s Certificate of Incorporation, the Bylaws, any agreement,
any vote of stockholders or disinterested directors, applicable law, or otherwise, both as
to action in the Indemnitee’s official capacity and as to action in another capacity
on behalf of the Company. |
| 2.5 |
|
Indemnification of Indemnified Costs of Successful Party. Notwithstanding
any other provisions of this Agreement, to the extent that the Indemnitee has been
successful in defense of any Proceeding or in defense of any claim, issue or matter in the
Proceeding, on the merits or otherwise, including, but not limited to, the dismissal of a
Proceeding without prejudice, the Indemnitee will be indemnified against all Indemnified
Costs incurred in connection therewith to the fullest extent permitted by applicable law. |
| 2.6 |
|
Indemnified Costs Advanced. The Indemnified Costs incurred by the Indemnitee
in any Proceeding will be paid promptly by the Company in advance of the final disposition
of the Proceeding at the written request of the Indemnitee to the fullest extent permitted
by applicable law. The advances to be made will be paid by the Company to the Indemnitee
within 30 days following delivery of the written request by Indemnitee to the Company,
accompanied by substantiated documentation. |
| 2.7 |
|
Limitations on Indemnification. Notwithstanding anything to the contrary in this Agreement, the
Company is not
required
to make payments to: |
|
(a)
indemnify or advance Indemnified Costs with respect to Proceedings initiated or
brought voluntarily by the Indemnitee and not by way of defense, except with
respect to Proceedings brought to establish or enforce a right to
indemnification under this Agreement or any other statute or law or otherwise as
required under applicable law; |
|
(b)
indemnify the Indemnitee for any Indemnified Costs for which payment is actually
made to the Indemnitee under an insurance policy, except for any excess beyond
the amount of payment under the policy; |
|
(c)
indemnify the Indemnitee for any Indemnified Costs sustained in any Proceeding
for an accounting of profits made from the purchase or sale by the Indemnitee of
securities of the Company pursuant to Section 16(b) of the Securities
Exchange Act of 1934, as amended, the rules and regulations promulgated
thereunder and amendments thereto or similar provisions of any federal, state or
local law; |
|
(d)
indemnify the Indemnitee for any Indemnified Costs resulting from
Indemnitee’s conduct that is finally adjudged by a court of competent
jurisdiction to have been willful misconduct, knowingly fraudulent or
deliberately dishonest; or |
|
(e)
indemnify the Indemnitee if a court of competent jurisdiction finally determines
that such payment is unlawful. |
3. Presumptions
| 3.1 |
|
Presumption Regarding Standard of Conduct. The Indemnitee will be
conclusively presumed to have met the relevant standards of conduct as defined by
applicable law for indemnification pursuant to this Agreement unless a determination that
the Indemnitee has not met the relevant standards is made by (a) the Board of
Directors of the Company by a majority vote of a quorum consisting of directors who are
not parties to the Proceeding, (b) the stockholders of the Company by majority vote,
or (c) in a written opinion by independent legal counsel, selection of whom has been
made by the Company’s Board of Directors and approved by the Indemnitee. |
3.2 Determination of
Right to Indemnification.
| 3.2.1 |
|
Burden. If a claim under this Agreement is not paid by the Company within 30
days of receipt of written notice, the right to indemnification as provided by this
Agreement will be enforceable by the Indemnitee in any court of competent jurisdiction.
The burden of proving by clear and convincing evidence that indemnification or advances
are not appropriate will be on the Company. Neither the failure of the directors,
stockholders, or independent legal counsel to have made a determination before the
commencement of the action that indemnification or advances are proper in the
circumstances because the Indemnitee has met the applicable standard of conduct, nor an
actual determination by the directors, stockholders or independent legal counsel that the
Indemnitee has not met the applicable standard of conduct, will be a defense to the action
or create a presumption that the Indemnitee has not met the applicable standard of
conduct. |
| 3.2.2 |
|
Standard. The Indemnitee’s Expenses incurred in connection with any
Proceeding concerning the Indemnitee’s right to indemnification or advances in whole
or in part pursuant to this Agreement will also be indemnified by the Company regardless
of the outcome of the Proceeding, unless a court of competent jurisdiction determines that
each of the material assertions made by the Indemnitee in the Proceeding was not made in
good faith or was frivolous. |
4. Other Agreements
| 4.1 |
|
Change in Control Event. If there is a Change in Control Event or a
Potential Change in Control Event of the Company (other than a Change in Control Event or
Potential Change in Control Event that has been approved by a majority of the
Company’s Board of Directors who were directors immediately before the Change in
Control Event or Potential Change in Control Event), then with respect to all matters
thereafter arising concerning the rights of the Indemnitee to be indemnified for
Indemnified Costs, the Company will seek legal advice only from independent counsel
selected by the Indemnitee, and reasonably satisfactory to the Company, and who has not
otherwise performed other services for the Company or the Indemnitee within the last three
years (“Special Independent Counsel”). The Special Independent Counsel,
among other things, will render its written opinion to the Company and the Indemnitee as
to whether and to what extent the Indemnitee would be permitted to be indemnified under
applicable law or this Agreement. The Company will pay the reasonable fees and expenses of
the Special Independent Counsel. |
4.2
Maintenance of
Liability Insurance.
| 4.2.1 |
|
Affirmative Covenant of the Company. While the Indemnitee continues to serve
as a director or officer of the Company, and thereafter while the Indemnitee is subject to
any possible Proceeding, the Company will promptly obtain and maintain in full force and
effect directors’ and officers’ liability insurance (“D&O
Insurance”) in reasonable amounts from reputable insurers. The Company has no
obligation, however, to obtain or maintain D&O Insurance if it determines in good
faith that insurance is not reasonably available, the premium costs for insurance are
disproportionate to the amount of coverage provided, the coverage provided by insurance is
so limited by exclusions that it provides an insufficient benefit, or the Indemnitee is
covered by similar insurance maintained by a subsidiary of the Company. If at the time it
receives a notice a Proceeding has commenced the Company has D&O Insurance, the
Company will give prompt notice of such commencement to the insurers as required by the
respective policies. The Company will 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. |
| 4.2.2 |
|
Indemnitee Named as Insured. In all D&O Insurance policies, the
Indemnitee will be named as an insured in a manner that provides the Indemnitee the same
rights and benefits accorded to the most favorably insured of the Company’s directors
and officers. |
| 4.3 |
|
Agreement to Serve. Indemnitee will serve or continue to serve as an Agent
of the Company for so long as the Indemnitee is duly elected or appointed or until the
Indemnitee voluntarily resigns. Indemnitee will give notice to the Company at least thirty
(30) days before voluntarily resigning. |
| 4.4 |
|
Effect of this Agreement on Employment Agreement. Any present or future
employment agreement between the Indemnitee and the Company is not modified by this
Agreement. Nothing contained in this Agreement creates in the Indemnitee any right of
continued employment. |
| 4.5 |
|
Nature of Rights; Separability. The rights afforded to the Indemnitee by
this Agreement are contract rights and may not be diminished, eliminated or otherwise
affected by amendments to the Company’s Certificate of Incorporation, Bylaws or
agreements, including D&O Insurance policies. Each provision of this Agreement is a
separate and distinct agreement and independent of the others, so that if any provision of
this Agreement is held to be invalid or unenforceable for any reason, the invalidity or
unenforceability will not affect the validity or enforceability of the other provisions.
To the extent required, any provision of this Agreement may be modified by a court of
competent jurisdiction to preserve its validity and to provide the Indemnitee with the
broadest possible indemnification permitted under applicable law. |
| 4.6 |
|
Savings Clause. If this Agreement or any portion of it is invalidated on any
ground by any court of competent jurisdiction, then the Company will nevertheless
indemnify the Indemnitee as to Indemnified Costs with respect to any Proceeding to the
full extent permitted by any applicable portion of this Agreement that is not invalidated,
or by any applicable law. |
| 4.7 |
|
Repayment of Indemnified Costs. The Indemnitee will reimburse the Company
for all Indemnified Costs paid by the Company in defending any Proceeding against the
Indemnitee if and only to the extent that a court of competent jurisdiction finally
decides that the Indemnitee is not entitled to be indemnified by the Company for such
Indemnified Costs under the provisions of applicable law, the Company’s Bylaws,
Certificate of Incorporation, this Agreement, or otherwise. |
| 4.8 |
|
Repayment. The Indemnitee will promptly repay to the Company any amounts
paid to the Indemnitee pursuant to other rights of indemnification or under any insurance
policy, to the extent those payments are duplicative of payments under this Agreement. |
5. Indemnification
Procedure
| 5.1 |
|
Notice. Promptly after receipt of notice that a Proceeding has commenced,
the Indemnitee will, if a claim is to be made under this Agreement, notify the Company of
that fact. The failure to notify the Company will not relieve the Company from any
liability that it may have to the Indemnitee except to the extent of the Company’s
material damage resulting from such failure. |
| 5.2 |
|
Company Participation. The Company will be entitled to participate in any
Proceeding at its own expense and, except as otherwise provided below, to the extent that
it may wish, the Company may assume the defense of any Proceeding for which
indemnification is sought hereunder, with counsel reasonably satisfactory to the
Indemnitee. After the Company notifies the Indemnitee of the Company’s election to
assume the defense of a Proceeding, during the Company’s good faith active defense
the Company will not be liable to the Indemnitee under this Agreement for any legal or
other expenses subsequently incurred by the Indemnitee in connection with the defense of
the Proceeding, other than reasonable costs of investigation or as otherwise provided
below. The Indemnitee will have the right to employ the Indemnitee’s counsel in any
Proceeding, but the fees and expenses of the counsel incurred after the Company assumes
the defense of the Proceeding will be at the expense of the Indemnitee, unless
(a) the employment of counsel by the Indemnitee has been authorized by the Company,
(b) the Indemnitee has reasonably concluded that there may be a conflict of interest
between the Company and the Indemnitee in the conduct of the defense of a Proceeding, or
(c) the Company has not in fact employed counsel to assume the defense of a
Proceeding. In each of the foregoing cases the fees and expenses of the Indemnitee’s
counsel will be at the expense of the Company. The Company will not be entitled to assume
the defense of any Proceeding brought by or on behalf of the Company or as to which the
Indemnitee has made the conclusion that there may be a conflict of interest between the
Company and the Indemnitee. |
| 5.3 |
|
Settlement. The Company will not settle or compromise any Proceeding in any
manner that would impose any penalty or limitation on the Indemnitee without the
Indemnitee’s consent. The Indemnitee will not settle or compromise any Proceeding
without the Company’s consent. Neither the Company nor the Indemnitee will
unreasonably withhold their consent or approval under this Agreement. |
| 5.4 |
|
Subrogation. If the Company pays Indemnified Costs, the Company will be
subrogated to the extent of such payment to all of the rights of recovery of the
Indemnitee against third parties. The Indemnitee will do all things reasonably necessary
to secure such rights, including the execution of documents necessary to enable the
Company effectively to bring suit to enforce such rights. |
6. Miscellaneous
Provisions
| 6.1 |
|
Amendments; Waivers. Amendments, waivers, consents and approvals under this Agreement must be in
writing and
designated
as such. No failure or delay in exercising any right will be deemed a waiver of such right. |
| 6.2 |
|
Integration. This Agreement is the entire agreement between the parties
pertaining to its subject matter, and supersedes all prior agreements and understandings
of the parties in connection with such subject matter. |
| 6.3 |
|
Interpretation; Governing Law. This Agreement is to be construed as a whole
and in accordance with its fair meaning. This Agreement is to be interpreted in accordance
with the laws of the State of Delaware relating to indemnification of Agents. |
| 6.4 |
|
Headings. Headings of Sections and
subsections are
for convenience
only and are not a part of this Agreement. |
| 6.5 |
|
Counterparts. This Agreement may
be signed in one
or more
counterparts, all of which constitute one agreement. |
| 6.6 |
|
Successors and Assigns. This Agreement is binding upon and inures to the
benefit of each party and such party’s respective heirs, personal representatives,
successors and assigns. Nothing in this Agreement, express or implied, is intended to
confer any rights or remedies upon any other person. |
| 6.7 |
|
Expenses; Legal Fees. Each party will pay its own expenses in the
negotiation, preparation and performance of this Agreement. The prevailing party in any
action relating to this Agreement will be entitled to reasonable legal fees, costs and
expenses incurred in such action. |
| 6.8 |
|
Representation by Counsel; Interpretation. Each party acknowledges that it
has been given an opportunity to be represented by counsel in connection with this
Agreement. Any rule of law, including, but not limited to, Section 1654 of the
California Civil Code, or any legal decision that would require interpretation of any
claimed ambiguities in this Agreement against the party that drafted it, has no
application and is expressly waived. |
| 6.9 |
|
Specific Performance. The Company acknowledges that in view of the
uniqueness of the matters contemplated by this Agreement, the Indemnitee would not have an
adequate remedy at law for money damages if this Agreement is not being performed in
accordance with its terms. The Company therefore agrees that the Indemnitee will be
entitled to specific enforcement of the terms hereof in addition to any other remedy to
which the Indemnitee may be entitled. |
| 6.10 |
|
Time is of the Essence. Time is of the essence in the performance of each provision of this
Agreement. |
| 6.11 |
|
Notices. Any notice to be given hereunder must be in writing and delivered as follows (or to
another address
designated
in writing): |
| If to ACME
Communications,
Inc.: |
|
If to the
Indemnitee: |
|
| |
|
|
|
| 0000 Xxxx Xxxxxx Xxxxxx, Xxx.
000 |
|
At the Indemnitee’s most recent
address on the
books |
| Xxxxx Xxx, Xxxxxxxxxx 00000 |
|
and records of the Company |
|
| Attention: Chief Financial
Officer |
|
The parties have signed this Agreement as of the date on page one.
INDEMNITEE
Print
Name:
ACME COMMUNICATIONS, INC.
.
By: Xxx Xxxxx
By: Title:
Executive Vice President & Chief Financial Officer
