Exhibit 10.26
INDEMNITY AGREEMENT
This Indemnity Agreement, dated effective as of August 1, 2003, is made
by and between Health Sciences Group, Inc., a Colorado corporation (the
"Company"), and Xxxxx Xxxxx, Xxxx Xxxxxxx, Xxxx Xxxxxx, Xxxxxxx X. Xxxxxx (the
"Indemnitees").
RECITALS
A. The Company is a corporation organized under the laws of the State
of Colorado;
B. Company has the power, to the maximum extent permitted by Colorado
law in effect from time to time, to obligate itself to indemnify the directors,
officers and employees of the Company; and
C. The bylaws of the Company (the "Bylaws") provide that each officer
and director of the Company shall be indemnified by the Company to the extent
permitted by Article VII of the bylaws.
D. Indemnitees are either directors or officers or may become directors
or officers of the Company and the Company desires to fulfill its obligations to
indemnify the officers and directors to the maximum extent permitted by the
Bylaws;
NOW, THEREFORE, the parties hereto are entering into this
Indemnification Agreement (the "Agreement") as of the date hereof to evidence
the obligation of the Company to indemnify the Indemnitees.
SECTION 1
DEFINITIONS. In this Agreement the following words have the meanings
indicated.
1
(1) "Company" includes any domestic or foreign predecessor entity of
the Company in a merger, consolidation or other transaction in which the
predecessor's existence ceased upon consummation of the transaction.
(2) "Director" means any person who is or was a director of the Company
and any person who, while a director of the Company, is or was serving at the
request of the Company as a director, officer, partner, trustee, employee, or
agent of another foreign or domestic corporation, partnership, joint venture,
trust, other enterprise, or employee benefit plan.
(3) "Expenses" include attorneys' fees.
(4) "Official Capacity" means the following:
(i) When used with respect to a director, the office of
director in the Company; and
(ii) When used with respect to a person other than a director as
contemplated in Section 9, the elective or appointive office in the Company held
by the officer, or the employment or agency relationship undertaken by the
employee or agent in behalf of the Company.
(iii) "Official Capacity" does not include service for any other
foreign or domestic corporation or any partnership, joint venture, trust, other
enterprise, or employee benefit plan.
(5) "Party" includes a person who was, is or is threatened to be made a
named defendant or respondent in a proceeding.
(6) "Proceeding" means any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative, or investigative.
SECTION 2
INDEMNIFICATION OF DIRECTOR.
(1) Provided the determination required under Section 5 has been made,
the Company shall indemnify any Director (or officer, employee or agent as set
forth below in Section 9) made a Party to any Proceeding by reason of service in
that Director's Official Capacity unless it is established that:
(i) The act or omission of the Director was material to the
matter giving rise to the proceeding; and
1. Was committed in bad faith; or
2. Was the result of active and deliberate
dishonesty; or
(ii) The Director actually received an improper personal benefit in
money, property, or services; or
(iii) In the case of any criminal proceeding, the Director had
reasonable cause to believe that the act or omission was unlawful.
(2) (i) Indemnification shall be against judgments, penalties, fines,
settlements, and reasonable Expenses actually incurred by the Director in
connection with the Proceeding.
(ii) However, if the Proceeding was one by or in the right of the
Company, indemnification shall be made only against reasonable Expenses and may
not be made in respect of any Proceeding in which the Director shall have been
adjudged to be liable to the Company.
(3) (i) The termination of any Proceeding by judgment, order, or
settlement does not create a presumption that the Director did not meet the
requisite standard of conduct set forth in this Section.
(ii) The termination of any Proceeding by conviction, or a plea of
nolo contendere or its equivalent, or an entry of an order of probation prior to
judgment, creates a rebuttable presumption that the Director did not meet the
requisite standard of conduct set forth in this Section.
SECTION 3
NO INDEMNIFICATION OF DIRECTOR LIABILITY FOR IMPROPER PERSONAL BENEFIT.
A Director shall not be indemnified under Section 1 in respect of any Proceeding
charging improper personal benefit to the Director, whether or not involving
action in the Director's Official Capacity, in which the Director was adjudged
to be liable on the basis that personal benefit was improperly received.
SECTION 4
REQUIRED INDEMNIFICATION AGAINST EXPENSES INCURRED IN SUCCESSFUL
DEFENSE.
(1) A Director who has been successful, on the merits or otherwise, in
the defense of any Proceeding referred to in Section 1 shall be indemnified
against reasonable Expenses incurred by the Director in connection with the
Proceeding.
(2) Nothing in this Agreement shall limit the power of a court of
appropriate jurisdiction to order indemnification of a Director to the maximum
extent permitted by Colorado law in effect from time to time, including the
right to recover the Expenses of securing such reimbursement.
SECTION 5
DETERMINATION THAT INDEMNIFICATION IS PROPER.
(1) Indemnification under Section 1 shall not be made by the Company
unless authorized for the specific Proceeding after a determination has been
made that indemnification of the Director is permissible in the circumstances
because the Director has met the standard of conduct set forth in Section 1.
(2) Such determination shall be made:
(i) By the Board of Directors by a majority vote of a quorum
consisting of Directors not, at the time, Parties to the Proceeding, or, if such
a quorum cannot be obtained, then by a majority vote of a committee of the Board
consisting solely of two or more Directors not, at the time, Parties to such
Proceeding and who were duly designated to act in the matter by a majority vote
of the full Board in which the designated Directors who are Parties may
participate;
(ii) By special legal counsel selected by the Board of Directors or
a committee of the Board by vote as set forth in subparagraph (i) of this
paragraph, or, if the requisite quorum of the full Board cannot be obtained
therefor and the committee cannot be established, by a majority vote of the full
Board in which Directors who are Parties may participate; or
(iii) By the stockholders.
(3) Authorization of indemnification and determination as to
reasonableness of Expenses shall be made in the same manner as the determination
that indemnification is permissible. However, if the determination that
indemnification is permissible is made by special legal counsel, authorization
of indemnification and determination as to the reasonableness of Expenses shall
be made in the manner specified in subparagraph (ii) of paragraph (2) of this
Section for selection of such counsel.
(4) Shares held by Directors who are Parties to the Proceeding shall
not be voted on the subject matter under this Section.
SECTION 6
PAYMENT OF EXPENSES IN ADVANCE OF FINAL DISPOSITION OF ACTION.
(1) Reasonable Expenses incurred by a Director who is a Party to a
Proceeding shall be paid or reimbursed by the Company in advance of the final
disposition of the Proceeding, upon receipt by the Company of:
(i) A written affirmation by the Director of the Director's
good faith belief that the standard of conduct necessary for indemnification by
the Company as authorized in this Agreement has been met; and
(ii) A written undertaking by or on behalf of the Director to repay
the amount if it shall ultimately be determined that the standard of conduct has
not been met.
(2) The undertaking required by subparagraph (ii) of paragraph (1) of
this Section shall be an unlimited general obligation of the Director but need
not be secured and may be accepted without reference to financial ability to
make the repayment.
SECTION 7
REIMBURSEMENT OF DIRECTOR'S EXPENSES INCURRED WHILE APPEARING AS
WITNESS. The Company shall pay or reimburse Expenses incurred by a Director in
connection with an appearance as a witness in a Proceeding at a time when the
Director has not been made a named defendant or respondent in the Proceeding.
SECTION 8
DIRECTOR'S SERVICE TO EMPLOYEE BENEFIT PLAN. For purposes of this
Agreement:
(1) The Company shall be deemed to have requested a Director to serve
an employee benefit plan where the performance of the Director's duties to the
Company also imposes duties on, or otherwise involves services by, the Director
to the plan or participants or beneficiaries of the plan;
(2) Excise taxes assessed on a Director with respect to an employee
benefit plan pursuant to applicable law shall be deemed fines; and
(3) Action taken or omitted by the Director with respect to an employee
benefit plan in the performance of the Director's duties for a purpose
reasonably believed by the Director to be in the interest of the participants
and beneficiaries of the plan shall be deemed to be for a purpose which is not
opposed to the best interests of the Company.
SECTION 9
OFFICER, EMPLOYEE OR AGENT.
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(1) The Company shall indemnify and advance Expenses to an officer,
employee, or agent of the Company to the same extent that it shall indemnify
Directors under this Agreement.
SECTION 10
The indemnification and advancement of Expenses provided or authorized
by this Agreement may not be deemed exclusive of any other rights, by
indemnification or otherwise, to which a Director may be entitled under the
Charter, the Bylaws, a resolution of stockholders or directors, an agreement or
otherwise, both as to action in an Official Capacity and as to action in another
capacity while holding office.
SECTION 11
INSURANCE. The Company may purchase and maintain insurance on behalf of
any person who is or was a Director, officer, employee, or agent of the Company,
or who, while a Director, officer, employee, or agent of the Company, is or was
serving at the request of the Company as a director, officer, partner, trustee,
employee, or agent of another foreign or domestic corporation, partnership,
joint venture, trust, other enterprise, or employee benefit plan against any
liability asserted against and incurred by such person in any such capacity or
arising out of such person's position, whether or not the Company would have the
power to indemnify against liability under the provisions of this Agreement or
under Maryland law in effect from time to time.
SECTION 12
GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Colorado applicable to agreements to be
made and to be performed entirely within such State, however in the event the
reincorporation of the Company into another state, all references to Colorado
law shall be deemed references to the law of such other state.
SECTION 13
CAPTIONS. The captions assigned to provisions of this Agreement are for
convenience only and shall be disregarded in construing this Agreement.
SECTION 14
NUMBER AND GENDER. Use of the singular in this Agreement includes the
plural, use of the plural includes the singular, and use of one gender include
both genders, as the context may require.
SECTION 15
CROSS REFERENCES AND EXHIBITS. Any reference in this Agreement to a
"Section" or "paragraph" shall be construed, respectively, as referring to a
section of this Agreement, or a paragraph of the Section of this Agreement in
which the reference appears.
SECTION 16
SUCCESSORS. This Agreement shall be binding upon and inure to the
benefit of the successors of the Company and to the heirs, personal
representatives and estates of the Indemnitees.
SECTION 17
SEVERABILITY. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity of any other provision, and all
other provisions shall remain in full force and effect.
SECTION 18
ENTIRE AGREEMENT. This Agreement and the Bylaws contain the entire
agreement between the parties as to the rights granted and the obligations
assumed in this instrument. This Agreement may be amended only by a subsequent
written instrument signed by both parties. To the extent if any inconsistency
between this Agreement and the bylaws, the bylaws shall govern.
SECTION 19
NON-ASSIGNABILITY. This Agreement may not be assigned by either party
hereto, and any purported assignment of this Agreement shall be null and void.
SECTION 20
WAIVER. Any forbearance by a party to this Agreement in exercising any
right or remedy under this Agreement or otherwise afforded by applicable law
shall not be a waiver of or preclude the exercise of that or any other right or
remedy.
The parties hereto have entered into this Indemnification Agreement
effective as of the date first above written. This Agreement may be entered into
in counterparts or independently with anyone or all of Indemnitees. Failure of
anyone of the Indemnitees to enter into this Agreement shall not affect the
enforceability of this Agreement as to any other one of the Indemnitees who
signs below.
"Company"
HEALTH SCIENCES GROUP, INC.
By:______________________________
Name:
Title:
"Indemnitees"
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