EXHIBIT 10.62
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("AGREEMENT") is made effective as of the
____ day of _________, 2005 by and between CARDIAC SCIENCE CORPORATION, a
Delaware corporation (the "COMPANY"), and ______________ ("INDEMNITEE").
RECITALS
A. The Company and Indemnitee recognize the continuing difficulty in
obtaining directors' and officers' liability insurance, the increases in the
cost of such insurance and the general reductions in the coverage of such
insurance.
B. The Company and Indemnitee further recognize the substantial increase
in corporate litigation in general, subjecting officers and directors to
expensive litigation risks at the same time as the availability and coverage of
liability insurance has been limited.
C. The Company's Certificate of Incorporation and Bylaws contain certain
provisions providing for indemnification of the Company's directors and officers
to the fullest extent permitted by the Delaware General Corporation Law.
D. To attract and retain the services of highly qualified individuals,
such as Indemnitee, to serve as officers and directors of the Company and to
indemnify its officers and directors so as to provide them with the maximum
protection permitted by law, the Company and Indemnitee now agree that they
should enter into this Indemnification Agreement.
AGREEMENT
1. Indemnification.
(a) Third Party Proceedings. The Company shall indemnify Indemnitee
if Indemnitee is or was a party or is threatened to be made a party to any
Proceeding (other than an action by or in the right of the Company) by reason of
the Indemnitee's Corporate Status, against Expenses, judgments, fines and
amounts paid in settlement (if such settlement is approved in advance by the
Company, which approval shall not be unreasonably withheld) actually and
reasonably incurred by Indemnitee in connection with such Proceeding if
Indemnitee acted in good faith and in a manner Indemnitee 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 Indemnitee's conduct
was unlawful. The termination of any Proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that Indemnitee did not act in good faith and in a
manner which Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company, and, with respect to any criminal Proceeding, that
Indemnitee had reasonable cause to believe that Indemnitee's conduct was
unlawful.
(b) Proceedings By or in the Right of the Company. The Company shall
indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made
a party to any Proceeding by or in the right of the Company or any subsidiary of
the Company to procure a judgment in its favor by reason of the Indemnitee's
Corporate Status, against Expenses and, to the fullest extent permitted by law,
amounts paid in settlement (if such settlement is approved in advance by the
Company, such approval not to be unreasonably withheld or delayed), in each case
to the extent actually and reasonably incurred by Indemnitee in connection with
the defense or settlement of such Proceeding if Indemnitee acted in good faith
and in a manner Indemnitee reasonably believed to be in or not opposed to the
best interests of the Company and its stockholders, except that no
indemnification shall be made in respect of any claim, issue or matter in such
Proceeding as to which Indemnitee shall have been adjudged to be liable to the
Company in the performance of Indemnitee's duty to the Company and its
stockholders unless and only to the extent that the court in which such
Proceeding is or was pending shall determine upon application that, in view of
all the circumstances of the case, Indemnitee is fairly and reasonably entitled
to indemnity for Expenses which such court shall deem proper.
(c) Mandatory Payment of Expenses. To the extent that Indemnitee has
been successful on the merits or otherwise in defense of any Proceeding referred
to in Section 1(a) or Section 1(b) or the defense of any claim, issue or matter
therein, Indemnitee shall be indemnified against Expenses actually and
reasonably incurred by Indemnitee in connection therewith.
(d) Other Payment of Expenses. Other than for indemnification of
Expenses by the Company pursuant to Section 1(c) or otherwise ordered by a court
of law, Indemnitee shall be indemnified by the Company against Expenses actually
and reasonably incurred by Indemnitee only if authorized in a specific case upon
a determination that indemnification of Indemnitee is proper in the
circumstances because Indemnitee has met the applicable standard of conduct set
forth in Section 1(a) or Section 1(b), as applicable, which determination shall
be made by one of the following methods (as chosen by the Company): (i) by a
majority vote of the Disinterested Directors, even though less than a quorum,
(ii) by a majority vote of a committee of Disinterested Directors designated by
a majority vote of Disinterested Directors, even though less than a quorum,
(iii) if there are no Disinterested Directors or if the Disinterested Directors
so direct, by Independent Legal Counsel , reasonably acceptable to Indemnitee
and the Company, in a written opinion applying the applicable standard of
conduct set forth in Section 1(a) or Section 1(b), as applicable, or (iv) by the
stockholders of the Company applying the applicable standard of conduct set
forth in Section 1(a) or Section 1(b), as applicable; provided, that, in any
case, all requirements of applicable law have been met.
2. Expenses; Indemnification Procedure.
(a) Advancement of Expenses. The Company shall advance all Expenses
incurred by Indemnitee in connection with the investigation, defense, settlement
or appeal of any Proceeding referenced in Section l(a) or Section 1(b) hereof
(including amounts actually paid in settlement of any such Proceeding).
Indemnitee hereby undertakes to repay such amounts advanced only if, and to the
extent that, it shall ultimately be determined that Indemnitee is not entitled
to be indemnified by the Company as authorized hereby. The advances to be made
hereunder shall be paid promptly by the Company to Indemnitee following delivery
of a written request therefor by Indemnitee to the Company which request
provides documentation supporting such advances.
(b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a
condition precedent to the right to be indemnified under this Agreement, give
the Company notice in writing as soon as practicable of any claim made against
Indemnitee for which indemnification will or could be sought under this
Agreement. Notice to the Company shall be directed to the Chief Executive
Officer of the Company at the address shown on the signature page of this
Agreement (or such other address as the Company shall designate in writing to
Indemnitee). Omission of such Notice does not relieve the Company from any
obligation that it may have to Indemnitee under this Agreement or otherwise
unless and only to the extent that such omission can be shown to have prejudiced
the Company. Notice shall be deemed received three business days after the date
postmarked if sent by domestic certified or registered mail, properly addressed;
otherwise notice shall be deemed received when such notice shall actually be
received by the Company. In addition, Indemnitee shall give the Company such
information and cooperation as the Company may reasonably require and as shall
be within Indemnitee's power.
(c) Procedure.
(i) Any indemnification and advances provided for in Section 1
and/or Section 2, shall be made as soon as practicable, but in no event no later
than forty-five (45) days after receipt of the written request of Indemnitee. If
a claim under this Agreement, under any statute, or under any provision of the
Company's Certificate of Incorporation or Bylaws, as such are amended from time
to time, providing for indemnification, is not paid in full by the Company
within forty-five (45) days after a written request for payment thereof has
first been received by the Company, Indemnitee may, but need not, at any time
thereafter bring an action against the Company to recover the unpaid amount of
the claim (an "ENFORCEMENT ACTION") and, subject to Section 12 of this
Agreement, Indemnitee shall also be entitled to be paid for the Expenses of
bringing an Enforcement Action. It shall be a defense to any such Enforcement
Action (other than an action brought to enforce a claim for Expenses incurred in
connection with any action, suit or proceeding in advance of its final
disposition) that Indemnitee has not met the standards of conduct which make it
permissible under applicable law for the Company to indemnify Indemnitee for the
amount claimed, but the burden of proving such defense shall be on the Company,
and Indemnitee shall be entitled to receive interim payments of Expenses
pursuant to Section 2(a) unless and until such defense may be finally
adjudicated by court order or judgment from which no further right of appeal
exists. It is the parties' intention that if the Company contests Indemnitee's
right to indemnification, the question of Indemnitee's right to indemnification
shall be for the court to decide, and neither the failure of the Company
(including its Board of Directors, any committee or subgroup of the Board of
Directors, Independent Legal Counsel or its stockholders) to have made a
determination that indemnification of Indemnitee is proper in the circumstances
because Indemnitee has met the applicable standard of conduct required by
applicable law, nor an actual determination by the Company (including its Board
of Directors, any committee or subgroup of the Board of Directors, Independent
Legal Counsel or its stockholders) that Indemnitee has not met such
applicable standard of conduct, shall be a defense to an Enforcement Action or
create a presumption that Indemnitee has or has not met the applicable standard
of conduct. In addition, in an Enforcement Action, the Company shall
conclusively be presumed to have entered into this Agreement and assumed the
obligations imposed on it to induce Indemnitee to accept the position of, or to
continue as a director and/or officer of, the Company.
(ii) During the interval between the Company's receipt of such
a request under paragraph (b) of this Section 2, and the later to occur of (x)
payment in full to Indemnitee of the indemnification or advances required by
Section 1 and Section 2 or (y) a determination (if required) pursuant to this
Agreement and applicable law that Indemnitee is not entitled to indemnification
hereunder, the Company shall take all necessary steps (whether or not such steps
require expenditures to be made by the Company at that time), to stay (pending a
final determination of Indemnitee's entitlement to indemnification and, if
Indemnitee is so entitled, the payment thereof) the execution, enforcement or
collection of any judgments, penalties, fines or any other amounts for which
Indemnitee may be liable (and as to which Indemnitee has requested
indemnification hereunder) in order to avoid Indemnitee being or becoming in
default with respect to any such amounts (such necessary steps to include, but
not be limited to, the procurement of a surety bond to achieve such stay or a
loan to Indemnitee of amounts for which Indemnitee may be liable and as to which
a stay of execution as aforesaid cannot be obtained), promptly after receipt of
Indemnitee's written request therefor together with a written undertaking by
Indemnitee to repay promptly following receipt of a statement therefor from the
Company, amounts (if any) expended by the Company for such purpose, if it is
ultimately determined (if such determination is required) that Indemnitee is not
entitled to be indemnified against such judgments, penalties, fines or other
amounts.
(d) Notice to Insurers. If, at the time of the receipt of a notice
of a claim pursuant to Section 2(b) hereof, the Company has director and officer
liability insurance in effect, the Company shall give prompt notice of the
commencement of such action, suit or proceeding to the insurers in accordance
with the procedures set forth in the respective policies. The Company shall
thereafter take all necessary or desirable action to cause such insurers to pay,
on behalf of Indemnitee, all amounts payable as a result of such action, suit or
proceeding in accordance with the terms of such policies.
(e) Selection of Counsel. In the event the Company shall be
obligated under Section 2(a) hereof to pay the Expenses of any action, suit or
proceeding against Indemnitee, the Company, if appropriate, shall be entitled to
assume the defense of such Proceeding, with counsel approved by Indemnitee, upon
the delivery to Indemnitee of written notice of its election so to do. After
delivery of such notice, approval of such counsel by Indemnitee and the
retention of such counsel by the Company, the Company will not be liable to
Indemnitee under this Agreement for any fees of counsel subsequently incurred by
Indemnitee with respect to the same Proceeding, provided that (i) Indemnitee
shall have the right to employ counsel in any such Proceeding at Indemnitee's
expense; and (ii) if (A) the employment of counsel by Indemnitee has been
previously authorized by the Company, (B) Indemnitee shall have reasonably
concluded that there may be a conflict of interest between the Company and
Indemnitee in the conduct of any such defense, (C) the Company shall not, in
fact, have employed counsel to assume the
defense of such action, suit or proceeding or (D) the Company is not
financially or legally able to perform its indemnification obligations, then the
fees and expenses of Indemnitee's counsel shall be at the expense of the
Company. The Company shall not be entitled to assume the defense of any
Proceeding brought by or on behalf of the Company against Indemnitee or as to
which Indemnitee shall have made the conclusion provided for in (ii) (B) or (D)
above.
3. Additional Indemnification Rights; Nonexclusivity.
(a) Scope. Notwithstanding any other provision of this Agreement,
the Company hereby agrees to indemnify Indemnitee to the fullest extent
permitted by law, notwithstanding that such indemnification is not specifically
authorized by the other provisions of this Agreement, the Company's Certificate
of Incorporation or Bylaws, as such are amended from time to time, or by
statute. In the event of any change, after the date of this Agreement, in any
applicable law, statute or rule which narrows the right of a Delaware
corporation to indemnify a member of its board of directors or an officer, such
changes, to the extent not otherwise required by such law, statute or rule to be
applied to this Agreement shall have no effect on this Agreement or the parties'
rights and obligations hereunder. In the event of any change, after the date of
this Agreement, in any applicable law, statute, or rule which expands the right
of a Delaware corporation to indemnify a member of its board of directors or an
officer, it is the intent of the parties hereto that Indemnitee shall, without
the necessity of amending this Agreement, be entitled to the full benefit of
such expanded indemnification rights. Indemnitee's rights under this Agreement
are contractual rights which may not be diminished, modified or restricted by
any subsequent change in the Company's Certificate of Incorporation, Bylaws or
corporate policies, as such are amended from time to time.
(b) Nonexclusivity. The indemnification provided by this Agreement
shall not be deemed exclusive of any rights to which Indemnitee may be entitled
under the Company's Certificate of Incorporation, or Bylaws, as such may be
amended from time to time, any agreement, any vote of stockholders or
disinterested Directors, the Corporation Law of the State of Delaware, or
otherwise, both as to action in Indemnitee's official capacity and as to action
in another capacity while holding such office. The indemnification provided
under this Agreement shall continue as to Indemnitee for any action taken or not
taken while serving in an indemnified capacity even though Indemnitee may have
ceased to serve in such capacity at the time of any action, suit or other
covered proceeding.
4. Partial Indemnification. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a portion of the
Expenses, judgments, fines or penalties actually or reasonably incurred in the
investigation, defense, appeal or settlement of any Proceeding, but not,
however, for the total amount thereof, the Company shall nevertheless indemnify
Indemnitee for the portion of such Expenses, judgments, fines or penalties to
which Indemnitee is entitled.
5. Mutual Acknowledgement. Both the Company and Indemnitee acknowledge
that in certain instances, federal law or public policy may override applicable
state law and prohibit the Company from indemnifying Indemnitee under this
Agreement or otherwise. For example, the Company and Indemnitee acknowledge that
the Securities and Exchange Commission (the "SEC") has taken the position that
indemnification is not permissible for liabilities arising under certain federal
securities laws, and federal legislation prohibits indemnification for certain
ERISA violations. Indemnitee understands and acknowledges that the Company has
undertaken or may be required in the future to undertake with the SEC to submit
the question of indemnification to a court in certain circumstances for a
determination of the Company's right under public policy to indemnify
Indemnitee.
6. Officer and Director Liability Insurance.
(a) The Company shall, from time to time, make the good faith
determination whether or not it is practicable for the Company to obtain and
maintain a policy or policies of insurance with reputable insurance carriers to
provide the officers and directors of the Company with coverage for losses
caused by wrongful acts, or to ensure the Company's ability to perform its
indemnification obligations under this Agreement. Among other considerations,
the Company will weigh the costs of obtaining such insurance coverage against
the protection afforded by such coverage. In all policies of director and
officer liability insurance, Indemnitee, so long as he or she is a director or
officer of the Company, shall be named as an insured in such a manner as to
provide Indemnitee the same rights and benefits as are accorded to the most
favorably insured of the Company's directors, if Indemnitee is a director; or of
the Company's officers, if Indemnitee is not a director of the Company but is an
officer. Notwithstanding the foregoing, the Company shall have no obligation to
obtain or maintain such insurance if the Company determines in good faith that
such insurance is not reasonably available, if the premium costs for such
insurance are disproportionate to the amount of coverage provided, if the
coverage provided by such insurance is limited by exclusions so as to provide an
insufficient benefit or if Indemnitee is covered by similar insurance maintained
by a subsidiary or parent of the Company.
7. Severability. Nothing in this Agreement is intended to require or shall
be construed as requiring the Company to do or fail to do any act in violation
of applicable law. The Company's inability, pursuant to court order, to perform
its obligations under this Agreement shall not constitute a breach of this
Agreement. The provisions of this Agreement shall be severable as provided in
this Section 7. If this Agreement or any portion hereof shall be invalidated on
any ground by any court of competent jurisdiction, then the Company shall
nevertheless indemnify Indemnitee to the full extent permitted by any applicable
portion of this Agreement that shall not have been invalidated, and the balance
of this Agreement not so invalidated shall be enforceable in accordance with its
terms.
8. Exceptions. Any other provision herein to the contrary notwithstanding,
the Company shall not be obligated pursuant to the terms of this Agreement:
(a) Claims Initiated by Indemnitee. To indemnify or advance Expenses
to Indemnitee with respect to actions, suits, proceedings or claims initiated or
brought voluntarily
by Indemnitee and not by way of defense, except with respect to actions, suits
or proceedings brought to establish or enforce a right to indemnification under
this Agreement or any other statute or law or otherwise as required under
Section 145 of the General Corporation Law of the State of Delaware, but such
indemnification or advancement of Expenses may be provided by the Company in
specific cases if the Board of Directors has approved the initiation or bringing
of such suit;
(b) Lack of Good Faith. To indemnify Indemnitee for any Expenses
incurred by Indemnitee with respect to any action instituted by Indemnitee to
enforce or interpret this Agreement, if a court of competent jurisdiction
determines that each of the material assertions made by Indemnitee in such
action was not made in good faith or was frivolous;
(c) Insured Claims. To indemnify Indemnitee for Expenses or
liabilities of any type whatsoever (including, but not limited to, judgments,
fines, ERISA excise taxes or penalties, and amounts paid in settlement) which
have been paid directly to Indemnitee by an insurance carrier under a policy of
officers' and directors' liability insurance maintained by the Company or by
plaintiff;
(d) Claims Under Section 16(b). To indemnify Indemnitee for Expenses
or the payment of profits arising from the purchase and sale by Indemnitee of
securities in violation of Section 16(b) of the Securities Exchange Act of 1934,
as amended, or any similar successor statute;
(e) Settlement. To indemnify Indemnitee for any amounts paid in
settlement of any Proceeding effected without the written consent of the
Company; provided, however, the Company shall not settle any Proceeding in any
manner which would impose any penalty or limitation on Indemnitee without the
written consent of Indemnitee; provided further, that neither the Company nor
Indemnitee shall unreasonably withhold written consent to any proposed
settlement; or
(f) Indemnification Unlawful. To indemnify Indemnitee if a final
decision by a court having jurisdiction on the matter shall determine that such
indemnification is not lawful
9. No Employment Rights. Nothing contained in this Agreement is intended
to create in Indemnitee any right to continued employment.
10. Construction of Certain Phrases. As used in this Agreement:
(a) The term "Company" shall include, without limitation and in
addition to the resulting corporation, any constituent corporation (including
any constituent of a constituent) absorbed in a consolidation or merger which,
if its separate existence had continued, would have had power and authority to
indemnify its directors, officers, and employees or agents, so that if
Indemnitee is or was a director, officer, employee or agent of such constituent
corporation, or is or was serving at the request of such constituent corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, Indemnitee shall
stand in the same position under the provisions of this Agreement with respect
to the resulting or surviving corporation as Indemnitee would have with respect
to such constituent corporation if its separate existence had continued.
(b) The term "Corporate Status" shall mean the fact that a person
shall be, is or was, or shall have been, a director, officer, employee or agent
of the Company, or any subsidiary of the Company or by reason of the fact that
such person shall serve, is or was serving, or shall have served, at the request
of the Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including service with
respect to an employee benefit plan.
(c) The term "Disinterested Director" shall mean a director of the
Company who is not and was not a party to or threatened with a Proceeding in
respect of which indemnification is sought be Indemnitee
(d) The term "Expenses" shall include, without limitation, all
direct and indirect costs of any type or nature whatsoever (including, without
limitation, all attorneys' fees and related disbursements, appeal bonds, other
out-of-pocket costs and reasonable compensation for time spent by Indemnitee for
which Indemnitee is not otherwise compensated by the Company or any third party,
provided that the rate of compensation and estimated time involved is approved
by the Board, which approval shall not be unreasonably withheld), actually and
reasonably incurred by Indemnitee in connection with either the investigation,
defense or appeal of a Proceeding or establishing or enforcing a right to
indemnification under this Agreement.
(e) The term "Independent Legal Counsel" shall mean a law firm, or a
member of a law firm, that is experienced in matters of corporate law and
neither presently is, nor in the past five years has been, retained to
represent: (A) the Company or Indemnitee in any matter (other than jointly with
respect to the rights of Indemnitee under this Agreement or other indemnities,
under similar indemnity agreements); or (B) any other party to the action, suit
or proceeding giving rise to a claim for indemnification hereunder; provided,
however, Independent Legal Counsel shall not include any firm or 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) The term "Proceeding" shall include any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative in which the Indemnitee is or was a party or is threatened to be
made a party to by reason of the Indemnitee's Corporate Status.
(g) References to "other enterprises" shall include, without
limitation, employee benefit plans.
(h) References to "fines" shall include any excise taxes assessed on
Indemnitee with respect to an employee benefit plan.
(i) References to "serving at the request of the Company" shall
include, without limitation, any service as a director, officer, employee or
agent of the Company 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 if Indemnitee acted in good faith and in
a manner Indemnitee reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan, Indemnitee shall be
deemed to have acted in a manner "not opposed to the best interests of the
Company" as referred to in this Agreement.
11. Counterparts. This Agreement, and any modification, amendment or
waiver of this Agreement, may be executed in one or more counterparts, each of
which shall constitute an original.
12. Successors and Assigns. This Agreement shall be binding upon the
Company and its successors and assigns, and shall inure to the benefit of
Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns.
13. Attorneys' Fees. In the event that any action is instituted by
Indemnitee under this Agreement to enforce or interpret any of the terms hereof,
Indemnitee shall be entitled to be paid all court costs and Expenses, incurred
by Indemnitee with respect to such action, unless as a part of such action, the
court of competent jurisdiction determines that each of the material assertions
made by Indemnitee as a basis for such action were not made in good faith or
were frivolous. In the event of an action instituted by or in the name of the
Company under this Agreement or to enforce or interpret any of the terms of this
Agreement, Indemnitee shall be entitled to be paid all court costs and Expenses
incurred by Indemnitee in defense of such action (including with respect to
Indemnitee's counterclaims and cross-claims made in such action), unless as a
part of such action the court determines that each of Indemnitee's material
defenses to such action were made in bad faith or were frivolous.
14. Notice. All notices, requests, demands and other communications under
this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt, or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Addresses for
notice to either party are as shown on the signature page of this Agreement, or
as subsequently modified by written notice.
15. Choice of Law. This Agreement shall be governed by and its provisions
construed in accordance with the laws of the State of Delaware, without giving
effect to principles of conflict of law.
16. Modification. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof. All prior
negotiations, agreements and understandings between the parties with respect
thereto are superseded hereby. This Agreement may not be modified or amended
except by an instrument in writing signed by or on behalf of the parties hereto.
17. Subrogation. In the event of 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 documents required and shall do
all acts that may be necessary to secure such rights and to enable the Company
to effectively bring suit to enforce such rights.
IN WITNESS WHEREOF, the parties hereto have executed this Indemnification
Agreement as of the date first above written.
CARDIAC SCIENCE CORPORATION
By: _____________________________
Name:____________________________
Title:___________________________
Address: 3033 Monte Villa Parkway
Bothell, Washington 98021
Attn: President
AGREED TO AND ACCEPTED BY
INDEMNITEE:
___________________________
(signature)
___________________________
___________________________
(address)