1
Exhibit 10.23
FORM OF
OFFICER INDEMNIFICATION AGREEMENT
This Indemnification Agreement is made and entered into as of
__________________, 19___, by and between ORBITAL SCIENCES CORPORATION (the
"Corporation") and (the "Officer").
W I T N E S S E T H:
WHEREAS, the Officer has agreed to serve as an officer of the
Corporation; and
WHEREAS, the Corporation wishes to indemnify the Officer against
certain liabilities and expenses that may be incurred in connection with the
Officer's service on behalf of the Corporation.
NOW THEREFORE, the parties hereto agree, subject to the terms and
conditions hereof, as follows:
1. Indemnification Agreement.
a. Third Party Actions. The Corporation shall indemnify and hold
harmless the Officer in the event that the Officer was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in right of the Corporation) by reason of the fact
that the Officer (A) is or was a director, officer, employee or agent of (i) the
Corporation or (ii) any subsidiary of the Corporation or any corporation,
partnership or other entity affiliated with the Corporation (each of the
foregoing being hereinafter referred to as an "Affiliate") or (B) is or was
serving at the request of the Corporation or any Affiliate as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise (including any employee benefit plan of the
Corporation or any Affiliate) against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by the Officer in connection with such action, suit or proceeding if the Officer
acted in good faith and in a manner the Officer reasonably believed to be in or
not opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe the Officer's
conduct was unlawful; provided, however, that the foregoing shall not require
the Corporation to indemnify or advance expenses to any person in connection
with any action, suit, proceeding, claim or counterclaim initiated by or on
behalf of such person.
b. Actions By or In Right of the Corporation. The Corporation shall,
to the full extent permitted by applicable law as then in effect, indemnify and
hold harmless the Officer in the event that the Officer was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in right of the Corporation to procure a judgment in its favor by
reason of the fact that the Officer (A) is or was a director, officer, employee
or agent of the Corporation or any Affiliate or (B) is or was serving at the
request of
2
the Corporation or any Affiliate as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
(including any employee benefit plan of the Corporation or any Affiliate)
against expenses (including attorneys' fees) actually and reasonably incurred by
the Officer in connection with the defense or settlement of such action or suit
if the Officer acted in good faith and in a manner the Officer reasonably
believed to be in or not opposed to the best interests of the Corporation and
except that no indemnification shall be made in respect of any claim, issue or
matter as to which the Officer shall have been adjudged to be liable to the
Corporation unless and only to the extent that the court in which such action
was brought shall determine that the Officer is entitled to be indemnified.
c. Nature of Right; Non-Exclusivity; Survival. The indemnification
provided by this Agreement shall be a contract right of the Officer and shall
not be deemed exclusive of and shall be in addition to, and not in lieu of, any
other rights to which the Officer may be entitled under any provision of the
Corporation's Certificate of Incorporation or By-Laws or pursuant to any
agreement, vote of stockholders or disinterested directors or otherwise, both as
to action in the Officer's official capacity and as to action in another
capacity while holding such office. The indemnification and advancement of
expenses provided by this Agreement shall continue as to the Officer when the
Officer has ceased to be a director, officer, employee or agent of the
Corporation and shall inure to the benefit of the Officer's heirs, executors and
administrators.
2. Advancement of Expenses; Procedures; Presumptions. In furtherance,
but not in limitation of the foregoing provisions, the following procedures and
presumptions shall apply with respect to the advancement of expenses and the
right to indemnification under this Agreement:
a. Advancement of Expenses. All reasonable expenses incurred by the
Officer in defending an action, suit or proceeding for which indemnification may
be had under Section 1(a) shall be advanced to the Officer by the Corporation
within ten (10) days after submission by the Officer to the Corporation of each
statement requesting such advance and setting forth in reasonable detail such
expenses, whether prior to or after final disposition of such action, suit or
proceeding; provided, however, that if required by law at the time such
advancement of expenses is to be made, then no such advancement shall be made
except upon receipt of an undertaking by or on behalf of the Officer, in form
and substance satisfactory to the Corporation, to repay any amounts advanced to
the Officer pursuant to this Section 2(a) if it shall ultimately be determined
that the Officer is not entitled to be indemnified by the Corporation with
respect to the matter for which such advancement was made.
b. Procedure for Determination of Entitlement to Indemnification. To
obtain indemnification under this Agreement, the Officer shall submit to the
Secretary of the Corporation a written request therefor, including such
documentation and information as is reasonably available to the Officer and
reasonably necessary to determine whether and to what extent the Officer is
entitled to indemnification (the "Supporting Documentation"). The determination
of the Officer's entitlement to indemnification shall be made by the
Corporation's Board of Directors (the "Board") or in such other manner as
required by law as then in effect not later than sixty (60) days after receipt
by the Corporation of the Officer's written request for indemnification together
with the Supporting Documentation. The Secretary of the Corporation
-2-
3
shall, promptly upon receipt of such a request for indemnification, advise the
Board in writing that the Officer has requested indemnification.
c. Presumptions and Effect of Certain Proceedings. Except as otherwise
expressly provided in this Agreement, the Officer shall be presumed to be
entitled to indemnification under this Agreement upon submission of a written
request for indemnification together with the Supporting Documentation in
accordance with Section 2(b) hereof, and thereafter the Corporation shall have
the burden of proof to overcome such presumption in reaching a contrary
determination. In any event, if a determination of the Officer's entitlement to
indemnification shall not have been made within sixty (60) days after receipt by
the Corporation of the Officer's written request therefor together with the
Supporting Documentation, the Officer shall be deemed to be entitled to
indemnification and shall be entitled to such indemnification unless (A) the
Officer misrepresented or failed to disclose a material fact in making the
request for indemnification or (B) such indemnification is prohibited by
applicable law as then in effect. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent shall not, of itself, adversely affect the right of
the Officer to indemnification or create a presumption that the Officer did not
act in good faith and in a manner which the Officer reasonably believed to be in
or not opposed to the best interests of the Corporation or, with respect to any
criminal action or proceeding, that the Officer had reasonable cause to believe
that his or her conduct was unlawful.
3. Notification and Defense of Claim. Promptly after receipt of notice
of the commencement of any action, suit or proceeding, the Officer shall, if a
claim for indemnification in respect thereof is to be made against the
Corporation under this Agreement, notify the Corporation of the commencement
thereof, but the omission so to notify the Corporation will not relieve the
Corporation from any liability that the Corporation may have to the Officer
under this Agreement unless the Corporation is materially prejudiced thereby.
With respect to any such action, suit or proceeding as to which the Officer
notifies the Corporation of the commencement thereof:
a. The Corporation will be entitled to participate therein at its own
expense;
b. Except as otherwise provided below, the Corporation jointly with
any other indemnifying party similarly notified will be entitled to assume the
defense thereof, with counsel reasonably satisfactory to the Officer. After
notice from the Corporation to the Officer of the Corporation's election to
assume the defense thereof, the Corporation will not be liable to the Officer
under this Agreement for any legal or other expenses subsequently incurred by
the Officer in connection with the defense thereof other than reasonable costs
of investigation or as otherwise provided below. The Officer shall have the
right to employ the Officer's own counsel in any such action, suit or
proceeding, but the fees and disbursements of such counsel incurred after notice
from the Corporation of the Corporation's assumption of the defense thereof
shall be at the expense of the Officer unless (i) the employment of counsel by
the Officer has been authorized by the Corporation, (ii) the Officer shall have
reasonably concluded that there may be a conflict of interest between the
Corporation and the Officer in the conduct of the defense of such action, suit
or proceeding, (iii) such action, suit or proceeding seeks penalties or other
relief against the Officer with respect to which the Corporation could not
provide monetary indemnification to the Officer (such as injunctive relief or
incarceration) or (iv) the Corporation
-3-
4
shall not in fact have employed counsel to assume the defense of such action,
suit or proceeding, in each of which cases the reasonable fees and disbursements
of the Officer's counsel shall be at the expense of the Corporation. The
Corporation shall not be entitled to assume the defense of any action, suit or
proceeding brought by or on behalf of the Corporation, or which involves
penalties or other relief against the Officer of the type referred to in clause
(iii) above; and
c. The Corporation shall not be liable to indemnify the Officer under
this Agreement for any amounts paid in settlement of any action, suit or
proceeding entered into without the Corporation's written consent. The
Corporation shall not settle any action, suit or proceeding in any manner that
would impose any penalty or limitation on the Officer without the Officer's
written consent. Neither the Corporation nor the Officer will unreasonably
withhold consent to any proposed settlement.
4. Expenses of Enforcing Agreement or Other Indemnification Rights. The
Corporation agrees to pay all out-of-pocket expenses of the Officer (including
reasonable fees and expenses of the Officer's counsel) in connection with any
action brought by the Officer to enforce any provision of this Agreement or in
connection with any action brought by the Officer to enforce the Officer's right
to indemnification under applicable law as then in effect or under the
Corporation's or any Affiliate's Certificate of Incorporation or By-Laws, as
either may be amended from time to time, in any case only if and to the extent
that the Officer prevails in such action.
5. Corporation's Right to Indemnification. Nothing in this Agreement
shall diminish, limit or otherwise restrict or modify in any way the
Corporation's right to indemnification or contribution from the Officer or the
Officer's obligation to indemnify or hold harmless the Corporation under any
agreement, instrument, commitment or understanding now or hereafter in effect.
6. Amendments and Waiver.
a. No amendment, modification or discharge of this Agreement, and no
waiver hereunder, shall be valid or binding unless set forth in writing and duly
executed by both of the parties hereto. Neither the waiver by any of the parties
hereto of a breach of or a default under any of the provisions of this
Agreement, nor the failure of any of the parties, on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right or
privilege hereunder shall thereafter be construed as a waiver of any subsequent
breach or default of a similar nature, or as a waiver of any of such provisions,
rights or privileges hereunder. No delay or failure on the part of any party in
exercising any right, power or privilege under this Agreement or under any other
instruments given in connection with or pursuant to this Agreement shall impair
any such right, power or privilege or be construed as a waiver of any default or
any acquiescence therein. No single or partial exercise of any such right, power
or privilege shall preclude the further exercise of such right, power or
privilege, or the exercise of any other right, power or privilege.
b. No amendment or repeal of the Corporation's or any Affiliate's
Certificate of Incorporation or By-Laws shall adversely affect or deny to the
Officer the rights of indemnification provided herein with respect to any
action, suit or proceeding relating to any act
-4-
5
or omission, or alleged act or omission, of the Officer that occurs before such
amendment or repeal; and the provisions of this Agreement shall apply to any
such action, suit or proceeding whenever commenced, including any such action,
suit or proceeding commenced after any such amendment or repeal of the
Corporation's or any Affiliate's Certificate of Incorporation or By-Laws.
7. Subrogation. In the event of payment under this Agreement, the
Corporation shall be subrogated to the extent of such payment to all of the
rights of recovery of the Officer, who shall execute all papers required and
shall do everything that may be necessary to secure such rights, including the
execution and delivery of such documents as may be necessary, in the reasonable
judgment of the Corporation, to enable the Corporation effectively to bring suit
to enforce such rights.
8. No Duplication of Payment. The Corporation shall not be liable under
this Agreement to make any payment in connection with any claim made against the
Officer to the extent the Officer has otherwise actually received payment (under
any provision of applicable law as then in effect, under any provision of the
Certificate of Incorporation or By-Laws of the Corporation or any Affiliate,
under any insurance policy or otherwise) of amounts otherwise indemnifiable
hereunder.
9. Severability. If, at any time subsequent to the date hereof, any
provisions of this Agreement shall be held by any court of competent
jurisdiction to be illegal, void or unenforceable, such provision shall be of no
force and effect; but the illegality or unenforceability of such provision shall
have no effect upon and shall not impair the enforceability of any other
provision of this Agreement.
10. Governing Law; Headings. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without giving
effect to the conflicts of laws principles thereof. The section and other
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
11. Benefit; Assignment; Binding Effect. It is the explicit intention of
the parties hereto that no person or entity other than the parties hereto is or
shall be entitled to bring any action to enforce any provision of this Agreement
against either of the parties hereto, and that the covenants, undertakings and
agreements set forth in this Agreement shall be solely for the benefit of, and
shall be enforceable only by, the parties hereto or their respective successors
and assigns as permitted hereunder. The Officer may not assign the Officer's
rights under this Agreement. The Officer may not attempt to have any other
person or entity assume the Officer's obligations under this Agreement without
the prior written consent of the Corporation. The rights and obligations of the
Corporation under this Agreement may be freely assigned to any person or entity
as long as the obligations of the Corporation hereunder are satisfied in full.
Subject to the foregoing provisions restricting assignment of this Agreement,
this Agreement shall be binding upon and shall inure to the benefit of the
Officer and the Corporation and their respective successors and permitted
assigns.
-5-
6
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement or have caused this Agreement to be executed and delivered as of
the day and year first above written.
ORBITAL SCIENCES CORPORATION: OFFICER:
By
----------------------------- ----------------------------
-6-