INDEMNIFICATION AGREEMENT
-------------------------
This Agreement is made as of September 15, 1998, by and between
NURESCELL, INC.; a Nevada corporation (the "Company"), and the undersigned, a
director and/or officer of the Company ("Indemnitee"), with respect to the
following facts.
A. The Company is aware that competent and experienced persons are
increasingly reluctant to serve as directors or officers of corporations
unless they are protected by comprehensive liability insurance or
indemnification, due to increased exposure to litigation costs and risks
resulting from their service to such corporations, and due to the fact that
the exposure frequently bears no reasonable relationship to the compensation
of such directors and officers.
B. The following facts contribute to unfairness to directors and
officers: (i) laws regarding the duties of directors and officers are often
ambiguous; (ii) costs of litigation may be so enormous (whether or not the
case is meritorious) that the defense and/or settlement of such litigation is
often beyond the personal resources of officers and directors; and
(iii) delay in litigation may extend the period of exposure to an officer or
director until after retirement or death, thus forcing spouses, heirs,
executors or administrators to expend funds.
C. Indemnitee questions that adequacy and reliability of the protection
presently afforded by both the Nevada and California General Corporation Law
(the "Corporation Law") and the Company's Articles of Incorporation and
Bylaws, in part because certain of the indemnification provisions of the
Corporation Law are for the most part merely permissive and because the
impact of provisions of the Company's Articles of Incorporation and Bylaws is
presently uncertain.
D. Indemnitee currently serves as director and/or officer of the
Company. Indemnitee is concerned about continuing to serve the Company as a
director and/or officer without assurance that indemnities available to him
are, and will be, adequate to protect him against the risks associated with
his service to the Company.
E. The Company, in order to induce Indemnitee to continue to serve the
Company as a director and/or officer has agreed to provide Indemnitee with
the benefits contemplated by this Agreement, which benefits are intended to
provide Indemnitee with the maximum possible protection permitted by law.
NOW, THEREFORE, in consideration of the foregoing and the promises,
conditions, representations and warranties set forth herein, the Company and
Indemnitee hereby agrees as follows:
-1-
1. DEFINITIONS. The following terms, as used herein, shall have the
following respective meanings:
1.1 "COVERED ACT" means (i) any actual or alleged action taken or
attempted by Indemnitee (including, without limitation, any breach of duty,
neglect, error, misstatement, or misleading statement) (a) in his capacity
as, or otherwise by reason of, or arising out of his being, a director,
officer, employee or other agent of the Company, or (b) by reason of the fact
he is or was serving at the request of the Company as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise; or (ii) any inaction or omission on Indemnitee's part
while acting in any of the foregoing capacities. For purposes solely of this
Agreement, it shall be conclusively deemed between the parties that the
Indemnitee is serving at the request of the Company whenever such director
serves as an officer, director, employee or other agent of any business
entity controlling, controlled by or under common control with the Company.
1.2 "EXCLUDED CLAIM" means any payment for Losses or Expenses in
connection with any claim: (1) for an accounting of profits in fact made from
the purchase or sale by Indemnitee of securities of the Company within the
meaning of Section 16(b) of the Securities Exchange Act of 1934, as amended,
or similar provisions of any state law, if the Company is in fact entitled to
recover such profits; or (ii) the payment of which by the Company under this
Agreement is not permitted by applicable law, including but not limited to,
statutory prohibitions under Federal or State law; or (iii) initiated or
brought voluntarily by Indemnitee and not by way of defense, except with
respect to proceedings brought to establish or enforce a right to
indemnification or advancement of Expenses and Losses or a proceeding
initiated with the approval of a majority of the members of the Board of
Directors; or (iv) the payment of which has been made directly to Indemnitee
by an insurance carrier under a policy of directors' and officers' liability
insurance maintained by the Company.
Any facts pertaining to any other director, officer, employee
or agent of the Company shall not be imputed to Indemnitee for the purpose of
determining an Excluded Claim.
1.3 "EXPENSES" means any reasonable expenses incurred by Indemnitee
as a result of a claim or claims whether brought by or in the right of the
Company for Covered Acts.
1.4 "LOSS" means any amount which Indemnitee pays or is obligated
to pay as a result of a claim or claims.
-2-
2. INDEMNIFICATION.
2.1 The Company, at the request of Indemnitee, shall indemnify
Indemnitee and hold him harmless from any and all Losses and Expenses
subject, in each case, to the further provisions of this Agreement.
2.2 The protection afforded to Indemnitee hereunder is intended to
supplement the other protections to which Indemnitee may be entitled now or
hereafter under statutory law, the Company's Articles of Incorporation or
Bylaws, any insurance policies maintained by the Company, vote of
stockholders or of directors or otherwise, and all of such protections and
the provisions hereof are intended to be cumulative.
2.3 Indemnitee may seek such indemnification under statutory law,
the Company's Articles of Incorporation or Bylaws, the provisions of
Section 2.1 of this Agreement, or otherwise concurrently or in such sequence
as Indemnitee may choose, in his sole discretion.
2.4 The Company shall have no obligation to indemnify Indemnitee
for and hold him harmless from any Loss or Expense which constitutes an
Excluded Claim.
3. INDEMNIFICATION PROCEDURES.
3.1 Promptly after receipt by Indemnitee of notice of the
commencement of or the threat of commencement of any action, suit or
proceeding, Indemnitee shall notify the Company of the commencement or threat
thereof.
3.2 With respect to any such action suit or proceeding, Indemnitee
may at his option, either control the defense thereof himself or require the
Company to defend him. If Indemnitee requires the Company to defend him, then
the Company shall promptly undertake to defend any such action, suit or
proceeding, at the Company's sole cost and expense, utilizing counsel of the
Indemnitee's choice who has been reasonably approved by the Company. If
appropriate the Company shall have the right to participate in the defense of
such action, suit or proceeding.
3.3 If the Company shall fail to defend Indemnitee in a timely
manner against any such action Indemnitee shall have the right to do so,
including the right to make any compromise or settlement thereof, and to
recover from the Company all attorney's fees, reimbursements and all amounts
paid as a result thereof.
3.4 Expenses and losses incurred or to be incurred by Indemnitee
from time to time as a result of any actions, covered by the indemnity
provisions of this Agreement, shall be paid by the Company within thirty (30)
days of written request of the Indemnitee. At the election of Indemnitee,
Indemnitee may from time to time request the Company to advance to him funds
to pay any expenses for which there is an actual written invoice from a
third-party which would be subject to reimbursement
-3-
hereunder. The company shall provide such advance within seven (7) business
days after written request thereof. Indemnitee agrees to reimburse the
Company for all losses and expenses paid or advanced by the Company in
connection with any such action in the event that a determination is made
that the Indemnitee is not entitled to be Indemnified by the Company for such
losses and expenses because said claim is an Excluded Claim.
4. SETTLEMENT. Except as otherwise provided in Section 3.3, hereof,
Indemnitee shall not settle any suit, action or proceeding without the
Company's prior written consent. The Company shall not settle any suit,
action or proceeding in any manner which would impose any obligation on
Indemnitee which is not covered by indemnification hereunder without
Indemnitee's written consent. Neither the Company nor Indemnitee shall
unreasonable withhold their consent to any proposed settlement.
5. MISCELLANEOUS.
5.1 NOTICES. Any communication contemplated under this Agreement
shall be in writing and shall be effective upon personal delivery or five
days after deposit in the United States mail, postage prepaid, certified or
registered, return receipt requested, addressed as follows or to such other
address as may be specified in the same manner.
If to Company: Nurescell, Inc.
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxxxx
If to Indemnitee:
5.2 ENFORCEMENTS.
(a) All agreements and obligations of the Company contained
herein shall continue during the period the Indemnitee is a director,
officer, employee of agent of the Company (or is serving at the request of
the Company as a director, officer, employee or agent of another corporation
or other enterprise) and shall continue thereafter so long as Indemnitee
shall be subject to any possible claim or threatened, pending or completed
action, suit or proceeding, whether civil, criminal or investigative, by
reason of the fact that Indemnitee was a director or officer of the Company
or serving in any other capacity referred to herein.
(b) The Company's indemnity obligations hereunder shall be
applicable to any and all claims made after the date hereof regardless of
when the facts upon which such claims are based occurred, including times
prior to the date hereof.
-4-
(c) The Company expressly confirms and agrees that it has
entered into this Agreement and assumed the obligations imposed on the
Company hereby, in order to induce Indemnitee to serve, or continue to serve,
as a director and/or officer of the Company, and acknowledges that Indemnitee
is relying upon this Agreement in agreeing to serve or in continuing to serve
in such capacity.
5.3 SEVERABILITY. In the event that any provision of this Agreement
is determined by a court to require the Company to do or to fail to do any
act which is in violation of applicable law, such provision shall be limited
or modified in its application to the minimum extent necessary to avoid a
violation of law and, as so limited or modified, such provision and the
balance of this Agreement shall be enforceable in accordance with their
terms. Without limiting the generality of the foregoing, if this Agreement or
any portion thereof shall be invalidated on any ground, the Company shall
nevertheless indemnity Indemnitee to the full extent permitted by any
applicable portion of this Agreement that shall not have been invalidated.
5.4 SUCCESSOR AND ASSIGNS. This Agreement shall be (i) binding upon
all successors and assigns of the Company (including any transferee of all or
substantially all of its assets and any successor by merger or otherwise by
operation of law) and (ii) shall be binding on and inure to the benefit of
the heirs, partners, personal representatives and estate of Indemnitee.
IN WITNESS WHEREOF, the Company and Indemnitee have executed this
Agreement as of the date and year first above written.
"Company" NURESCELL, INC., a Nevada Corporation
By
-------------------------------------
Name: Xxxxxx Xxxxxx
----------------------------------
Title: President
---------------------------------
By
-------------------------------------
Name: Xxxxxx Xxxxx
----------------------------------
Title: Secretary
---------------------------------
"Indemnitee"
-------------------------------------
Name:
----------------------------------
-5-
