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8-K - FORM 8-K - ZIX CORP | d78504e8vk.htm |
Exhibit 10.1
INDEMNITY AGREEMENT
This INDEMNITY AGREEMENT (this Agreement) is made and entered into as of the ____ day of
_____________, ____, by and between Zix Corporation, a Texas corporation (the Company), and
____________________ (the Indemnitee).
WHEREAS, the Indemnitee serves as a member of the Board of Directors of the Company (the
Board);
WHEREAS, in accordance with Texas law and the Companys charter and bylaws, the Indemnitee, as
a member of the Board, is authorized and directed to undertake certain responsibilities on behalf
of the Company and its stockholders; and
WHEREAS, the Company believes that the Indemnitees undertaking of such responsibilities is
important to the Company and its stockholders, and that the protection afforded by this Agreement
will enhance the Indemnitees ability to discharge such responsibilities;
NOW, THEREFORE, in consideration of the premises and of the Indemnitee providing services to
the Company as a member of its Board and, if applicable, as a member of one or more committees
established by the Board, and intending to be legally bound hereby, the parties hereto agree as
follows:
1. Certain Definitions:
(a) Change in Control: shall be deemed to have occurred if (i) any person
(as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended), other than a trustee or other fiduciary holding securities under an employee
benefit plan of the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their ownership of
capital stock of the Company, is or becomes the beneficial owner (as defined in Rule 13d-3
under said Act), directly or indirectly, of securities of the Company representing 20% or
more of the total voting power represented by the Companys then outstanding Voting
Securities (other than any such person or any affiliate thereof that is such a 20%
beneficial owner as of the date hereof), or (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board and any new director
whose election by the Board or nomination for election by the Companys stockholders was
approved by a vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute a majority thereof,
or (iii) the stockholders of the Company approve a merger or consolidation of the Company
with any other corporation, other than a merger or consolidation which would result in the
Voting Securities of the Company outstanding
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immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into Voting Securities of
the surviving entity) at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding immediately after such merger
or consolidation, or the stockholders of the Company approve a plan of complete liquidation
of the Company or an agreement for the sale or disposition by the Company of (in one
transaction or a series of transactions) all or substantially all the Companys assets.
(b) Claim: any threatened, pending or completed action, suit or proceeding
(including any mediation, arbitration or other alternative dispute resolution proceeding),
whether instituted by or in the right of the Company or by any other party, or any inquiry
or investigation that the Indemnitee in good faith believes might lead to the institution of
any such action, suit or proceeding, whether civil (including intentional and unintentional
tort claims), criminal, administrative, investigative or other.
(c) Expenses: include, but are not limited to, attorneys fees and all other
costs, expenses and obligations paid or incurred in connection with investigating,
defending, being a witness in or participating in (including on appeal), or preparing to
defend, be a witness in or participate in any Claim
relating to any Indemnifiable Event. Further, Expenses include, in circumstances where
the payment or reimbursement of Expenses to the Indemnitee creates tax liability for the
Indemnitee, the full amount of such tax liability as well as any gross up that may be
necessary to hold the Indemnitee fully harmless from any tax liability attributable to the
reimbursement in respect of taxes.
(d) Indemnifiable Event: any event or occurrence related to the fact that the
Indemnitee is or was serving as a member of the Board or any committee thereof, or taking
any action or doing anything under the authority and direction set forth in, or otherwise
contemplated by Texas law or other controlling legal authority, the Companys charter or
bylaws or any resolution or other directive adopted or authorized by the Board.
(e) Independent Legal Counsel: an attorney or law firm, selected in accordance
with the provisions of Section 3, who has not performed services for the Company or the
Indemnitee during the five years preceding the relevant Indemnifiable Event, other than with
respect to matters concerning the rights of the Indemnitee under this Agreement, or of other
indemnitees under similar indemnity agreements.
(f) Reviewing Party: any appropriate person or body consisting of a member or
members of the Board or any other person or body appointed by the Board who is not a party
to the particular Claim for which the Indemnitee is seeking indemnification, or Independent
Legal Counsel.
(g) Voting Securities: any securities of the Company that possess the right to
vote generally in the election of directors.
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2. Basic Indemnification Arrangement.
(a) In the event the Indemnitee was, is or becomes a party to or witness or other
participant in, or is threatened to be made a party to or witness or other participant in, a
Claim by reason of (or arising in part out of) an Indemnifiable Event, the Company shall
indemnify the Indemnitee to the fullest extent permitted by applicable law as soon as
practicable but in any event no later than 30 days after written demand is presented to the
Company, against any and all Expenses, judgments, fines, penalties and amounts paid in
settlement (including all interest, assessments and other charges paid or payable in
connection with or in respect of such Expenses, judgments, fines, penalties or amounts paid
in settlement) of such Claim. If so requested by the Indemnitee, the Company shall advance
(within 10 business days of such request) any and all Expenses to the Indemnitee (an
Expense Advance).
(b) Notwithstanding the foregoing, (i) the obligations of the Company under Section
2(a) shall be subject to the condition that the Reviewing Party shall not have determined
(in a written opinion, in any case in which the Independent Legal Counsel referred to in
Section 3 hereof is involved) that the Company is prohibited by applicable law from
indemnifying the Indemnitee, and (ii) the obligation of the Company to make an Expense
Advance pursuant to the second sentence of Section 2(a) shall be subject to the further
condition that, if, when and to the extent that the Reviewing Party determines that the
Company is prohibited by applicable law from indemnifying the Indemnitee, the Company shall
be entitled to be reimbursed by the Indemnitee (who hereby agrees to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if the Indemnitee has
commenced or thereafter commences legal proceedings in a court of competent jurisdiction to
secure a determination that the Indemnitee should be indemnified under applicable law, any
determination made by the Reviewing Party that the Company is prohibited by applicable law
from indemnifying the Indemnitee shall not be binding and the Indemnitee shall not be
required to reimburse the Company for any Expense Advance until a final judicial
determination is made with respect thereto (as to which all rights of appeal therefrom have
been exhausted or lapsed).
(c) The Company shall use all reasonable efforts to cause the Board to expeditiously
appoint a Reviewing Party to pass upon, and to cause such Reviewing Party to expeditiously
consider and pass upon, any request by the Indemnitee for indemnification and/or an Expense
Advance under this Agreement. If there has not been a Change in Control, the Reviewing
Party shall be selected by the Board, and if there has been such a Change in Control (other
than a Change in Control which has been approved by a majority
of the Board who were directors immediately prior to such Change in Control), the
Reviewing Party shall be the Independent Legal Counsel referred to in Section 3 hereof. If
there has been no determination by the Reviewing Party as to the Companys ability to
indemnify the Indemnitee, or if the Reviewing Party determines that the Company is
prohibited by applicable law from indemnifying the Indemnitee, the Indemnitee shall have the
right to commence litigation in any court located in (i) the City of Dallas and State of
Texas, so long as the Company remains incorporated under the
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laws of the State of Texas, or
(ii) the City of Wilmington and State of Delaware, following any reincorporation of the
Company under the laws of the State of Delaware, in each case having subject matter
jurisdiction thereof and in which venue is proper seeking an initial determination by the
court that the Company is not prohibited by applicable law from indemnifying the Indemnitee
or challenging any contrary determination by the Reviewing Party or any aspect thereof,
including the legal or factual bases therefor, and the Company hereby consents to service of
process and to appear in any such proceeding. Any determination by the Reviewing Party
shall be conclusive and binding on the Company and the Indemnitee, subject to the rights of
the Indemnitee set forth in the immediately preceding sentence.
3. Change in Control. If there is a Change in Control of the Company (other than a
Change in Control which has been approved by a majority of the Board who were directors immediately
prior to such Change in Control), then with respect to all matters thereafter arising concerning
the rights of the Indemnitee to indemnity payments and Expense Advances under this Agreement or any
other agreement or Company charter or bylaw provision now or hereafter in effect relating to Claims
for Indemnifiable Events, the Company shall seek legal advice only from Independent Legal Counsel
selected by the Indemnitee and approved by the Company (which approval shall not be unreasonably
withheld). Such counsel shall render its written opinion to the Company and the Indemnitee as to
whether and to what extent the Company is legally permitted to indemnify the Indemnitee under
applicable law. The Company shall pay the reasonable fees and expenses of the Independent Legal
Counsel and shall fully indemnify such counsel against any and all expenses (including attorneys
fees), claims, liabilities and damages arising out of or relating to this Agreement or its
engagement pursuant hereto.
4. Indemnification for Additional Expenses. The Company shall indemnify the
Indemnitee against any and all Expenses and, if requested by the Indemnitee, shall (within 10
business days of such request) advance such Expenses to the Indemnitee, which are incurred by the
Indemnitee in connection with any action brought by the Indemnitee for (i) indemnification or
Expense Advances under this Agreement or any other agreement or Company charter or bylaw provision
now or hereafter in effect relating to Claims for Indemnifiable Events, or (ii) recovering under
any directors and officers liability insurance policies maintained by the Company, regardless of
whether the Indemnitee ultimately is determined to be entitled to such indemnification, Expense
Advance payment or insurance recovery, as the case may be.
5. Partial Indemnity. If the Indemnitee is entitled to indemnification by the Company
for less than all of the Expenses, judgments, fines, penalties and amounts paid in settlement of a
Claim, the Company shall indemnify the Indemnitee for that portion to which the Indemnitee is
entitled. Moreover, notwithstanding any other provision of this Agreement, to the extent that the
Indemnitee has been successful on the merits or otherwise in defense of any or all Claims relating
in whole or in part to an Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, the Indemnitee shall be indemnified against all Expenses
incurred in connection therewith.
6. Presumption; Burden of Proof. In connection with any determination by the
Reviewing Party or any other party as to whether the Indemnitee is entitled to be indemnified or
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receive an Expense Advance hereunder, (i) the presumption shall be that the Indemnitee is so
entitled, and (ii) the Company shall have the burden of proof to establish to the Reviewing Party
by clear and convincing evidence that the Company is prohibited by applicable law from indemnifying
the Indemnitee or effecting an Expense Advance hereunder.
7. No Presumptions. For purposes of this Agreement, the termination of any claim,
action, suit or proceeding by judgment, order, settlement (whether with or without court approval)
or conviction, or upon a plea of nolo contendere or its equivalent, shall not create a presumption
that the Indemnitee did not meet any particular standard of conduct or have any particular belief
or that a court has determined that indemnification or advancement of Expenses is prohibited or not
permitted by applicable law. In addition, neither the failure of the Reviewing Party to have made
a determination as to whether the Indemnitee has met any particular standard of conduct or had any
particular belief, nor an actual determination by the Reviewing Party that the Indemnitee has
not met such standard of conduct or did not have such belief, prior to the commencement of legal
proceedings by the Indemnitee to secure a judicial determination that the Indemnitee should be
indemnified under applicable law, shall be a defense to the Indemnitees claim or create a
presumption that the Indemnitee has not met any particular standard of conduct or did not have any
particular belief.
8. Nonexclusivity; Subsequent Change in Law or Jurisdiction of Incorporation. The
rights of the Indemnitee hereunder shall be in addition to any rights the Indemnitee may have under
the Companys charter or bylaws, applicable law, other controlling legal authority, or otherwise.
To the extent that any change in applicable law or other controlling legal authority (whether by
statute or judicial decision) or in the Companys jurisdiction of incorporation, permits greater,
broader and/or more expansive rights to indemnification and/or advancement of expenses by agreement
than that afforded under the Companys charter or bylaws and this Agreement, as the foregoing exist
on the date of this Agreement, this Agreement automatically shall be deemed to be amended to
provide the greater, broader and/or more expansive rights afforded by any such change.
9. Amendments; Waiver. No supplement, modification or amendment of this Agreement
shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions
hereof (whether or not similar), nor shall any such waiver constitute a continuing waiver.
10. Subrogation. To the extent of its payments to the Indemnitee under this
Agreement, the Company shall be subrogated to all of the rights of recovery of the Indemnitee, who
shall execute all documents required and shall do everything that may be necessary to effectuate
and secure such rights, including the execution of such documents necessary to enable the Company
effectively to bring suit to enforce such rights.
11. Binding Effect. This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto and their respective successors or assigns (including any
direct or indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company), spouses, heirs, executors and
personal or legal
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representatives. This Agreement shall continue in full force and effect
regardless of whether the Indemnitee continues to serve as a director of the Company.
12. Severability. The provisions of this Agreement shall be severable in the event
that any of the provisions hereof (including any provision within a single section, paragraph or
sentence) is held by a court of competent jurisdiction to be invalid, void or otherwise
unenforceable in any respect, and the validity and enforceability of any such provision in every
other respect and of the remaining provisions hereof shall not be in any way impaired and shall
remain enforceable to the fullest extent permitted by law.
13. Governing Law. This Agreement shall be governed by and construed, interpreted and
enforced in accordance with the laws applicable to contracts made and to be performed in the
jurisdiction in which the Company is incorporated at the time of the applicable Indemnifiable
Event, without giving effect to the principles of choice or conflicts of laws.
[Remainder of page intentionally left blank signature page follows.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the
date first set forth above.
ZIX CORPORATION |
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By: | ||||
[Company Representative] | ||||
[Title] | ||||
INDEMNITEE |
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[Indemnitee Name] |