Exhibit 10.1

 

FORM OF

 

INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement (the “Agreement”) is made as of
                      , by and between SM&A, a Delaware corporation (the
“Company”), and                                       (the “Indemnitee”).

 

RECITALS

A.                                    The Company and Indemnitee recognize the
increasing difficulty in obtaining liability insurance for directors, officers
and key employees, the significant 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 directors, officers and key employees to expensive litigation risks
at the same time as the availability and coverage of liability insurance has
been severely limited.

 

C.                                    Indemnitee does not regard the current
protection available as adequate under the present circumstances, and Indemnitee
and agents of the Company may not be willing to continue to serve as agents of
the Company without additional protection.

 

D.                                    The Company desires to attract and retain
the services of highly qualified individuals, such as Indemnitee, and to
indemnify its directors, officers and key employees so as to provide them with
the maximum protection permitted by law.

 

AGREEMENT

In consideration of the mutual promises made in this Agreement, and for other
good and valuable consideration, receipt of which is hereby acknowledged, the
Company and Indemnitee hereby agree as follows:

 

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 threatened, pending or completed action, suit, proceeding, or
investigation whether civil, criminal, administrative or investigative (other
than an action by or in the right of the Company) by reason of the fact that
Indemnitee is or was a director, officer, employee or agent of the Company, or
any subsidiary of the Company, by reason of any action or inaction on the part
of Indemnitee while an officer or director or by reason of the fact that
Indemnitee 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, against expenses (including attorneys’ fees),
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 action,
suit or 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 action or proceeding, had no
reasonable cause to believe Indemnitee’s conduct was unlawful. 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, 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, or, with respect to any criminal action or proceeding, that
Indemnitee had reasonable cause to believe that Indemnitee’s conduct was
unlawful.

 

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(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 threatened, pending or completed
action or 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 fact that Indemnitee
is or was a director, officer, employee or agent of the Company, or any
subsidiary of the Company, by reason of any action or inaction on the part of
Indemnitee while an officer or director or by reason of the fact that Indemnitee
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, against expenses (including attorneys’ fees) and, to the fullest
extent permitted by law, amounts paid in settlement (if such settlement is
approved in advance by the Company, which approval shall not be unreasonably
withheld), in each case to the extent actually and reasonably incurred by
Indemnitee in connection with the defense or settlement of such action or suit
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 as to which Indemnitee shall have been finally
adjudicated by court order or judgment 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 action or 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 such
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 action, suit or 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 (including attorneys’ fees) actually and reasonably
incurred by Indemnitee in connection therewith.

 

(d)                                 Exceptions.  Any other provision herein to
the contrary notwithstanding, the Company shall not be obligated pursuant to the
terms of this Agreement:

 

                                               
(i)                                     Claims Initiated by Indemnitee.  To
indemnify or advance expenses to Indemnitee with respect to proceedings or
claims 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 under this Agreement or any other statute or law or otherwise as
required under Section 145 of the Delaware General Corporation Law, but such
indemnification or advancement of expenses may be provided by the Company in
specific cases if the Board finds it to be appropriate; or

 

                                               
(ii)                                  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
and Exchange Act of 1934, as amended, or any similar successor statute.

 

2.                                       No Employment Rights.  Nothing
contained in this Agreement is intended to create in Indemnitee any right to
continued employment.

 

3.                                       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 civil or criminal action,
suit or proceeding referred to in Section 1(a) or Section 1(b) hereof (including
amounts actually paid in settlement of any such action, suit or 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.

 

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(b)                                 Notice/Cooperation by Indemnitee. 
Indemnitee shall, as a condition precedent to his or her 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
President or the Chief Executive Officer of the Company and shall be given in
accordance with the provisions of Section 11(d) below. In addition, Indemnitee
shall give the Company such information and cooperation as it may reasonably
require and as shall be within Indemnitee’s power.

 

(c)                                  Procedure.  Any indemnification and
advances provided for in Section 1 and this Section 3 shall be made no later
than thirty (30) 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 providing for indemnification,
is not paid in full by the Company within thirty (30) 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 and, subject to Section 10 of this
Agreement, Indemnitee shall also be entitled to be paid for the expenses
(including attorneys’ fees) of bringing such action. It shall be a defense to
any such 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 3(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 create a presumption that Indemnitee has or has not
met the applicable standard of conduct.

 

(d)                                 Notice to Insurers.  If, at the time of the
receipt of a notice of a claim pursuant to Section 3(b) hereof, the Company has
director and officer liability insurance in effect, the Company shall give
prompt notice of the commencement of such 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 the Indemnitee, all amounts payable as a result of such
proceeding in accordance with the terms of such policies.

 

(e)                                  Selection of Counsel.  In the event the
Company shall be obligated under Section 3(a) hereof to pay the expenses of any
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 or (C) the Company shall not, in
fact, have employed counsel to assume the defense of such proceeding, then the
fees and expenses of Indemnitee’s counsel shall be at the expense of the
Company.

 

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4.                                       Additional Indemnification Rights;
Nonexclusivity.

 

(a)                                  Scope.  Notwithstanding any other provision
of this Agreement, the Company hereby agrees to indemnify the 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, the Company’s Bylaws or by statute. 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, such changes shall
be deemed to be within the purview of Indemnitee’s rights and the Company’s
obligations under this Agreement. In the event of any change 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.

 

(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, its
Bylaws, any agreement, any vote of stockholders or disinterested members of the
Company’s Board of Directors, the General 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 he or
she may have ceased to serve in any such capacity at the time of any action,
suit or other covered proceeding.

 

5.                                       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 civil or criminal action, suit or 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.

 

6.                                       Mutual Acknowledgment.  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 its directors and officers 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.

 

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7.                                       Officer and Director Liability
Insurance.  The Board 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 companies
providing the officers and directors of the Company with coverage for losses
from wrongful acts, or to ensure the Company’s performance of its
indemnification obligations under this Agreement. Among other considerations,
the Board 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 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; or of the Company’s key employees, if Indemnitee is not an officer or
director but is a key employee. Notwithstanding the foregoing, the Company shall
have no obligation to obtain or maintain such insurance if the Board 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 parent or subsidiary of the Company.

 

8.                                       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 8. 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.

 

9.                                       Construction of Certain Phrases.

 

(a)                        For purposes of this Agreement, references to the
“Company” shall include, 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)                       For purposes of this Agreement, references to “other
enterprises” shall include employee benefit plans; references to “fines” shall
include any excise taxes assessed on Indemnitee with respect to an employee
benefit plan; and references to “serving at the request of the Company” shall
include 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.

 

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10.                                 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, including reasonable attorneys’ fees, 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, including
attorneys’ fees, 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.

 

11.                                 Miscellaneous.

 

(a)                                  Governing Law.  This Agreement and all acts
and transactions pursuant hereto and the rights and obligations of the parties
hereto shall be governed, construed and interpreted in accordance with the laws
of the State of Delaware, without giving effect to principles of conflicts of
law.

 

(b)                                 Entire Agreement; Enforcement of Rights.
This Agreement sets forth the entire agreement and understanding of the parties
relating to the subject matter herein and merges all prior discussions between
them. No modification of or amendment to this Agreement, nor any waiver of any
rights under this Agreement, shall be effective unless in writing signed by the
parties to this Agreement. The failure by either party to enforce any rights
under this Agreement shall not be construed as a waiver of any rights of such
party.

 

(c)                                  Construction.  This Agreement is the result
of negotiations between and has been reviewed by each of the parties hereto and
their respective counsel, if any; accordingly, this Agreement shall be deemed to
be the product of all of the parties hereto, and no ambiguity shall be construed
in favor of or against any one of the parties hereto.

 

(d)                                 Notices.  Any notice, demand or request
required or permitted to be given under this Agreement shall be in writing and
shall be deemed sufficient when delivered personally or sent by fax or 48 hours
after being sent by nationally-recognized courier or deposited in the U.S. mail,
as certified or registered mail, with postage prepaid, and addressed to the
party to be notified at such party’s address or fax number as set forth below or
as subsequently modified by written notice.

 

(e)                                  Counterparts.  This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original
and all of which together shall constitute one instrument.

 

(f)                                    Successors and Assigns.  This Agreement
shall be binding upon the Company and its successors and assigns, and inure to
the benefit of Indemnitee and Indemnitee’s heirs, legal representatives and
assigns.

 

(g)                                 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.

 

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The parties hereto have executed this Agreement as of the day and year set forth
on the first page of this Agreement.

 

SM&A, a Delaware corporation

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

Address:

4695 MacArthur Court, 8th Floor

Newport Beach, CA 92660

 

 

 

 

 

 

 

 

 

AGREED TO AND ACCEPTED:

 

 

 

 

 

 

 

Signature

 

 

Print Name:

 

 

 

 

 

Address:

 

 

 

 

 

Telephone:

 

 

 

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