EXHIBIT 10-FF

 

INDEMNIFICATION AGREEMENT

 

THIS AGREEMENT is made this      day of                     ,         , between
PRIORITY HEALTHCARE CORPORATION, an Indiana corporation (the “Corporation”), and
«Name_of_Outside_Director», a director of the Corporation (“Director”).

 

WITNESSETH THAT:

 

WHEREAS, Director is a member of the Board of Directors of the Corporation and
in such capacity is performing valuable services for the Corporation; and

 

WHEREAS, recent developments with respect to the terms and availability of
directors’ and officers’ liability insurance (“D&O Insurance”) and with respect
to the application, amendment and enforcement of statutory and other
indemnification provisions generally have raised questions concerning the
adequacy and reliability of the protection afforded to directors thereby; and

 

WHEREAS, in order to resolve such questions and thereby induce Director to
continue to serve as a member of the Board of Directors of the Corporation, the
Corporation has determined and agreed to enter into this contract with Director;

 

NOW, THEREFORE, in consideration of Director’s continued service as a director
of the Corporation after the date hereof the parties hereto agree as follows:

 

1. Indemnity of Director. The Corporation hereby agrees to (i) hold harmless and
indemnify Director against expenses (including attorneys’ fees), judgments,
fines, penalties and amounts paid in settlement resulting from any action, suit
or proceeding threatened or brought against Director by reason of his or her
serving as a director of the Corporation or serving another enterprise in any
capacity at the request of the Corporation, and (ii) pay for or reimburse the
reasonable expenses incurred by Director in advance of the final disposition of
the action, suit or proceeding, to the fullest extent now or hereafter
authorized or permitted by the provisions of the Indiana Business Corporation
Law, or by any amendment thereof or other statutory provision authorizing or
permitting such indemnification which is adopted after the date hereof.

 

2. Maintenance of Insurance.

 

(a) The Corporation represents that it presently has in force and effect
policies of D&O Insurance in insurance companies and amounts as summarized in
Attachment 1 (the “Insurance Policies”).

 

Subject only to the provisions of Section 2(b) hereof, the Corporation hereby
agrees that, so long as Director shall continue to serve as a director of the
Corporation (or shall continue at the request of Corporation to serve as a
director, officer, employee or agent of another enterprise) and thereafter so
long as Director shall be subject to any possible claim or threatened, pending
or completed action, suit or proceeding, whether civil, criminal or
investigative by reason of the fact that Director was a director of the
Corporation (or served in any of said other capacities), the Corporation will
purchase and maintain in effect for the benefit of Director one or more valid,
binding and enforceable policy or policies of D&O Insurance providing, in all
respects, coverage at least comparable to that presently provided pursuant to
the Insurance Policies.

 

(b) The Corporation shall not be required to maintain said policy or policies of
D&O Insurance in effect if said insurance is not reasonably available or if, in
the reasonable

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business judgment of the then directors of the Corporation, either (i) the
premium cost for such insurance is disproportionate to the amount of coverage or
(ii) the coverage provided by such insurance is so limited by exclusions that
there is insufficient benefit from such insurance.

 

3. Continuation of Indemnity. All agreements and obligations of the Corporation
contained herein shall continue during the period Director is a director of the
Corporation (or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise) and shall continue thereafter so long as
Director shall be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether civil, criminal or investigative,
by reason of the fact that Director was a director of the Corporation or serving
in any other capacity referred to herein.

 

4. Notification and Defense of Claim. Promptly after receipt by Director of
notice of the commencement of any action, suit or proceeding, he or she will, if
a claim in respect thereof is to be made against the Corporation under this
Agreement, notify the Corporation of the commencement thereof; but the omission
to so notify the Corporation will not relieve it from any liability which it may
have to Director otherwise than under this Agreement. With respect to any such
action, suit or proceeding as to which Director notifies the Corporation of the
commencement thereof:

 

(a) The Corporation will be entitled to participate therein at its own expense;
and

 

(b) Except as otherwise provided below, to the extent that it may wish, the
Corporation jointly with any other indemnifying party similarly notified will be
entitled to assume the defense thereof, with counsel satisfactory to Director.
After notice from the Corporation to Director of its election to so assume the
defense thereof, the Corporation will not be liable to Director under this
Agreement for any legal or other expenses subsequently incurred by Director in
connection with the defense thereof other than reasonable costs of investigation
or as otherwise provided below. Director shall have the right to employ his or
her own counsel in such action, suit or proceeding but the fees and expenses of
such counsel incurred after notice from the Corporation of its assumption of the
defense thereof shall be at the expense of Director unless (i) the employment of
counsel by Director has been authorized by the Corporation, (ii) Director shall
have reasonably concluded that there may be a conflict of interest between the
Corporation and Director in the conduct of the defense of such action, or (iii)
the Corporation shall not in fact have employed counsel to assume the defense of
such action, in each of which cases the fees and expenses of Director 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 as to which Director shall have made the conclusion provided
for in (ii) above.

 

(c) The Corporation shall not be liable to indemnify Director under this
Agreement for any amounts paid in settlement of any action or claim effected
without its written consent. The Corporation shall not settle any action or
claim in any manner, which would impose any penalty or limitation on Director
without his or her written consent. Neither the Corporation nor Director will
unreasonably withhold consent to any proposed settlement.

 

5. Repayment of Expenses. Director agrees that he or she will reimburse the
Corporation for all reasonable expenses paid by the Corporation in defending any
civil or criminal action, suit or proceeding against Director in the event and
only to the extent that it shall be ultimately determined that Director is not
entitled to be indemnified by the Corporation for such expenses under the
provisions of the Indiana Business Corporation Law, the Corporation’s Articles
of Incorporation, its By-Laws, this Agreement or otherwise.

 

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6. Enforcement.

 

(a) The Corporation expressly confirms and agrees that it has entered into this
Agreement and assumed the obligations imposed on the Corporation hereby in order
to induce Director to continue as a director of the Corporation, and
acknowledges that Director is relying upon this Agreement in continuing in such
capacity.

 

(b) In the event Director is required to bring any action to enforce rights or
to collect moneys due under this Agreement and is successful in such action, the
Corporation shall reimburse Director for all of his or her reasonable fees and
expenses in bringing and pursuing such action.

 

7. Separability. Each of the provisions of this Agreement is a separate and
distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.

 

8. Governing Law; Binding Effect; Amendment and Termination.

 

(a) This Agreement shall be interpreted and enforced in accordance with the laws
of the State of Indiana.

 

(b) This Agreement shall be binding upon Director and upon the Corporation, its
successors and assigns, and shall inure to the benefit of Director, his or her
heirs, personal representatives and assigns and to the benefit of the
Corporation, its successors and assigns.

 

(c) No amendment, modification, termination or cancellation of this Agreement
shall be effective unless in writing signed by both parties hereto.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of
the day and year first above written.

 

PRIORITY HEALTHCARE CORPORATION By:  

 

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    Steven D. Cosler    

 

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    «Name_of_Outside_Director»

 

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