Exhibit 10.12

 

FORM OF INDEMNIFICATION AGREEMENT FOR

 

WESTWOOD MANAGEMENT CORP.

 

THIS INDEMNIFICATION AGREEMENT, dated as of January 1, 2004 (this “Agreement”),
is made by and between Westwood Management Corp., a New York corporation (the
“Company”), and                                          (“Indemnitee”).

 

RECITALS

 

A. It is important to the Company to attract and retain as directors and
officers the most capable persons reasonably available.

 

B. Indemnitee is a director and/or officer of the Company.

 

C. Both the Company and Indemnitee recognize the increased risk of litigation
and other claims being asserted against directors and officers of companies in
today’s environment.

 

D. The Company’s Amended and Restated By-laws (together with the Company’s
Restated Certificate of Incorporation, the “Constituent Documents”) provide that
the Company shall indemnify its directors and officers, and Indemnitee’s
willingness to serve as a director and/or officer of the Company, or at the
Company’s request to serve another entity in any capacity, is based in part on
Indemnitee’s reliance on such provisions.

 

E. In recognition of Indemnitee’s need for substantial protection against
personal liability in order to encourage Indemnitee’s continued service to the
Company or, at the Company’s request, another entity, in an effective manner,
and Indemnitee’s reliance on the aforesaid provisions of the Constituent
Documents, and to provide Indemnitee with express contractual indemnification
(regardless of, among other things, any amendment to or revocation of such
provisions or any change in the composition of the Company’s Board of Directors
(the “Board”) or any acquisition, disposition or other business combination
transaction relating to the Company), the Company wishes to provide in this
Agreement for the indemnification of Indemnifiable Losses (as defined in Section
1(d)) and the advancement of Expenses (as defined in Section 1(c)) to Indemnitee
as set forth in this Agreement and, to the extent insurance is maintained, for
the continued coverage of Indemnitee under the Company’s directors’ and
officers’ liability insurance policies.

 

NOW, THEREFORE, the parties hereby agree as follows:

 

1. CERTAIN DEFINITIONS. In addition to terms defined elsewhere herein, the
following terms have the following meanings when used in this Agreement with
initial capital letters:

 

(a) “AFFILIATE” has the meaning given to that term in Rule 405 under the
Securities Act of 1933, provided, however, that for purposes of this Agreement
the Company and its subsidiaries will not be deemed to constitute Affiliates of
Indemnitee or the Indemnitee.

 

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(b) “CLAIM” means any threatened, pending or completed action, suit or
proceeding (whether civil, criminal, administrative, arbitrative, investigative
or other), whether instituted by the Company or any other party (including,
without limitation, any governmental entity), or any inquiry or investigation,
whether instituted by the Company or any other party (including, without
limitation, any governmental entity) that Indemnitee in good faith believes
might lead to the institution of any such action, suit or proceeding.

 

(c) “EXPENSES” includes all attorneys’ and experts’ fees, expenses and charges
and all other costs, expenses and obligations paid or incurred in connection
with investigating, defending, or participating (as a party, a witness, or
otherwise) in (including on appeal), or preparing to defend or participate in,
any Claim.

 

(d) “INDEMNIFIABLE LOSSES” means any and all Expenses, damages, losses,
liabilities, judgments, fines, penalties and amounts paid or payable in
settlement (including, without limitation, all interest, assessments and other
charges paid or payable in connection with or in respect of any of the
foregoing) relating to, resulting from or arising out of any act or failure to
act by the Indemnitee, or his or her status as any person referred to in clause
(i) of this sentence, (i) in his or her capacity as a director, officer,
employee or agent of the Company, any of its Affiliates or any other entity as
to which the Indemnitee is or was serving at the request of the Company as a
director, officer, employee, member, manager, trustee, agent or any other
capacity of another corporation, limited liability company, partnership, joint
venture, trust or other entity or enterprise, whether or not for profit and (ii)
in respect of any business, transaction or other activity of any entity referred
to in clause (i) of this sentence.

 

2. BASIC INDEMNIFICATION ARRANGEMENT. The Company will indemnify and hold
harmless Indemnitee to the fullest extent permitted by the laws of the State of
New York in effect on the date hereof or as such laws may from time to time
hereafter be amended to increase the scope of such permitted indemnification
(but in no case less than the extent permitted under the laws in effect as of
the date hereof) against all Indemnifiable Losses relating to, resulting from or
arising out of any Claim. The failure by Indemnitee to notify the Company of
such Claim will not relieve the Company from any liability hereunder unless, and
only to the extent that, the Company did not otherwise learn of the Claim and
such failure results in forfeiture by the Company of substantial defenses,
rights or insurance coverage. Except as provided in Sections 3 and 17,
Indemnitee will not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has joined in or consented
to the initiation of such Claim.

 

3. INDEMNIFICATION OR ADVANCEMENT OF EXPENSES.

 

(a) The Indemnitee hereby is granted the right to receive in advance of a final,
non-appealable judgment or other final adjudication of a Proceeding (a “Final
Determination”) the amount of any and all expenses, including, without
limitation, investigation expenses, expert

 

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witness and attorneys’ fees and other expenses expended or incurred by the
Indemnitee in connection with any Proceeding or otherwise expended or incurred
by the Indemnitee (such amounts so expended or incurred being referred to as
“Advanced Amounts”).

 

(b) In making any written request for Advanced Amounts, the Indemnitee shall
submit to the Company a schedule setting forth in reasonable detail the dollar
amount expended or incurred and expected to be expended. Each such listing shall
be supported by the bill, agreement or other documentation relating thereto,
each of which shall be appended to the schedule as an exhibit. In addition,
before the Indemnitee may receive Advanced Amounts from the Company, the
Indemnitee shall provide to the Company (i) a written affirmation of the
Indemnitee’s good faith belief that the applicable standard of conduct required
for indemnification by the Company has been satisfied by the Indemnitee and (ii)
a written undertaking by or on behalf of the Indemnitee to repay the Advanced
Amount if it shall ultimately be determined that the Indemnitee has not
satisfied any applicable standard of conduct. The written undertaking required
from the Indemnitee shall be an unlimited general obligation of the Indemnitee
but need not be secured. The Company shall pay to the Indemnitee all Advanced
Amounts within ten (10) business days after receipt by the Company of all
information and documentation required to be provided by the Indemnitee pursuant
to this Section 3(b).

 

4. PARTIAL INDEMNITY, ETC. If Indemnitee is entitled under any provision of this
Agreement to indemnification by the Company for some or a portion of any
Indemnifiable Loss but not for all of the total amount thereof, the Company will
nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is
entitled. Moreover, notwithstanding any other provision of this Agreement, to
the extent that 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
Loss or in defense of any issue or matter therein, including, without
limitation, dismissal without prejudice, Indemnitee will be indemnified against
all Expenses incurred in connection therewith.

 

5. PRESUMPTIONS, ETC. In connection with any determination as to whether
Indemnitee is entitled to be indemnified hereunder, there will be a presumption
that Indemnitee is so entitled, and the burden of proof shall, to the extent
permitted by law, be on the Company to establish that Indemnitee is not so
entitled. For purposes of this Agreement, the termination of any Claim by
judgment, order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere or its equivalent, will not create
a presumption that Indemnitee did not meet any particular standard of conduct or
have any particular belief or that a court has determined that indemnification
is not permitted by applicable law.

 

6. NON-EXCLUSIVITY, ETC. The rights of Indemnitee hereunder will be in addition
to any other rights Indemnitee may have under the Constituent Documents, or the
substantive laws of the Company’s jurisdiction of incorporation, any other
contract or otherwise (collectively, “Other Indemnity Provisions”); provided,
however, that (i) to the extent that Indemnitee otherwise would have any greater
right to indemnification under any Other Indemnity Provision, Indemnitee will be
deemed to have such greater right hereunder and (ii) to the extent that any
change is made to any Other Indemnity Provision which permits any greater right
to indemnification than that provided under this Agreement as of the date
hereof,

 

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Indemnitee will be deemed to have such greater right hereunder. The Company will
not adopt any amendment to any of the Constituent Documents the effect of which
would be to deny, diminish or encumber Indemnitee’s right to indemnification
under this Agreement or any Other Indemnity Provision.

 

7. LIABILITY INSURANCE. To the extent the Company maintains an insurance policy
or policies providing directors’ and officers’ liability insurance (the “D&O
Insurance”), Indemnitee will be covered by such policy or policies, in
accordance with its or their terms, to the maximum extent of the coverage
available for any director or officer of the Company. Notwithstanding the
foregoing, the Company shall not be required to cover the Indemnitee under its
D&O Insurance to the same extent as other directors or officers of the Company,
or at all, if the Company determines in good faith that such insurance is not
available, or the premium costs (or increases in premium costs of other
directors or officers of the Company as a result of such coverage) for such
insurance is materially disproportionate to the amount of coverage provided.

 

8. SUBROGATION. In the event of payment under this Agreement, the Company will
be subrogated to the extent of such payment to all of the related rights of
recovery of Indemnitee against other persons or entities (other than
Indemnitee’s successors). The Indemnitee will execute all papers reasonably
required to evidence such rights (all of Indemnitee’s reasonable Expenses,
including attorneys’ fees and charges, related thereto to be reimbursed by or,
at the option of Indemnitee, advanced by the Company).

 

9. NO DUPLICATION OF PAYMENTS. The Company will not be liable under this
Agreement to make any payment in connection with any Indemnifiable Loss made
against Indemnitee to the extent Indemnitee has otherwise actually received
payment (net of Expenses incurred in connection therewith) under any insurance
policy, the Constituent Documents and Other Indemnity Provisions or otherwise of
the amounts otherwise indemnifiable hereunder provided that, if Indemnitee for
any reason is required to disgorge any payment actually received by him, the
Company shall be obligated to pay such amount to Indemnitee in accordance with
the other terms of this Agreement (i.e., disregarding the terms of this Section
9).

 

10. DEFENSE OF CLAIMS. The Company will be entitled to participate in the
defense (including, without limitation, the negotiation and approval of any
settlement) of any Claim in respect of which Indemnitee may seek indemnification
from the Company hereunder, or to assume the defense thereof, with counsel
reasonably satisfactory to the Indemnitee, provided that in the event that (i)
the use of counsel chosen by the Company to represent Indemnitee would present
such counsel with an actual or potential conflict, (ii) the named parties in any
such Claim (including any impleaded parties) include both the Company and
Indemnitee and Indemnitee shall conclude that there may be one or more legal
defenses available to him or her that are different from or in addition to those
available to the Company, or (iii) any such representation by the Company would
be precluded under the applicable standards of professional conduct then
prevailing, then Indemnitee will be entitled to retain separate counsel (but not
more than one law firm plus, if applicable, local counsel in respect of any
particular Claim) at the Company’s expense. Notwithstanding the preceding
sentence, in any event the Company shall be liable to Indemnitee under this
Agreement for the reasonable costs of investigation and preparation for the
defense of any Claim (including, without limitation, appearing as a witness and
reasonable fees and expenses of counsel in connection therewith).

 

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The Company will not, without the prior written consent of the Indemnitee,
effect any settlement of any threatened or pending Claim that the Indemnitee is
or could have been a party to unless such settlement solely involves the payment
of money and includes an unconditional release of the Indemnitee from all
liability on any claims that are the subject matter of such Claim.

 

11. SUCCESSORS AND BINDING AGREEMENT.

 

(a) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company (a “Successor”), by
agreement in form and substance satisfactory to Indemnitee and his or her
counsel, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent the Company would be required to perform if no
such succession had taken place. This Agreement will be binding upon and inure
to the benefit of the Company and may be assigned to a Successor, but will not
otherwise be assignable or delegatable by the Company.

 

(b) This Agreement will inure to the benefit of and be enforceable by the
Indemnitee’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, legatees and other successors.

 

(c) This Agreement is personal in nature and neither of the parties hereto will,
without the consent of the other, assign or delegate this Agreement or any
rights or obligations hereunder except as expressly provided in Sections 11(a)
and 11(b). Without limiting the generality or effect of the foregoing,
Indemnitee’s right to receive payments hereunder will not be assignable, whether
by pledge, creation of a security interest or otherwise, other than by a
transfer by the Indemnitee’s will or by the laws of descent and distribution,
and, in the event of any attempted assignment or transfer contrary to this
Section 11(c), the Company will have no liability to pay any amount so attempted
to be assigned or transferred.

 

12. NOTICES. For all purposes of this Agreement, all communications, including
without limitation notices, consents, requests or approvals, required or
permitted to be given hereunder will be in writing and will be deemed to have
been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof orally confirmed), or five business days
after having been mailed by United States registered or certified mail, return
receipt requested, postage prepaid or one business day after having been sent
for next-day delivery by a nationally recognized overnight courier service,
addressed to the Company (to the attention of the Secretary of the Company) at
its principal executive offices and to the Indemnitee at the address shown on
the signature page hereto, or to such other address as any party may have
furnished to the other in writing and in accordance herewith, except that
notices of changes of address will be effective only upon receipt.

 

13. GOVERNING LAW. The validity, interpretation, construction and performance of
this Agreement will be governed by and construed in accordance with the
substantive laws of the State of New York, without giving effect to the
principles of conflict of laws of such State. Each party consents to
non-exclusive jurisdiction of any New York state or federal court for purposes
of any action, suit or proceeding hereunder, waives any objection to venue
therein or any defense based on forum non conveniens or similar theories and
agrees that service of process

 

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may be effected in any such action, suit or proceeding by notice given in
accordance with Section 12.

 

14. VALIDITY. If any provision of this Agreement or the application of any
provision hereof to any person or circumstance is held invalid, unenforceable or
otherwise illegal, the remainder of this Agreement and the application of such
provision to any other person or circumstance will not be affected, and the
provision so held to be invalid, unenforceable or otherwise illegal will be
reformed to the extent, and only to the extent, necessary to make it
enforceable, valid or legal.

 

15. MISCELLANEOUS. No provision of this Agreement may be waived, modified or
discharged unless such waiver, modification or discharge is agreed to in writing
signed by Indemnitee and the Company. No waiver by either party hereto at any
time of any breach by the other party hereto or compliance with any condition or
provision of this Agreement to be performed by such other party will be deemed a
waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time. No agreements or representations, oral or otherwise,
expressed or implied with respect to the subject matter hereof have been made by
either party that are not set forth expressly in this Agreement. References to
Sections are to references to Sections of this Agreement.

 

16. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which will be deemed to be an original but all of which together will
constitute one and the same agreement.

 

17. LEGAL FEES AND EXPENSES. It is the intent of the Company that the Indemnitee
not be required to incur legal fees and or other Expenses associated with the
interpretation, enforcement or defense of Indemnitee’s rights under this
Agreement by litigation or otherwise because the cost and expense thereof would
substantially detract from the benefits intended to be extended to the
Indemnitee hereunder. Accordingly, without limiting the generality or effect of
any other provision hereof, if it should appear to the Indemnitee that the
Company has failed to comply with any of its obligations under this Agreement or
in the event that the Company or any other person takes or threatens to take any
action to declare this Agreement void or unenforceable, or institutes any
litigation or other action or proceeding designed to deny, or to recover from,
the Indemnitee the benefits provided or intended to be provided to the
Indemnitee hereunder, the Company irrevocably authorizes the Indemnitee from
time to time to retain counsel of Indemnitee’s choice, at the expense of the
Company as hereafter provided, to advise and represent the Indemnitee in
connection with any such interpretation, enforcement or defense, including
without limitation the initiation or defense of any litigation or other legal
action, whether by or against the Company or any director, officer, stockholder
or other person affiliated with the Company. Notwithstanding any existing or
prior attorney-client relationship between the Company and such counsel, the
Company irrevocably consents to the Indemnitee’s entering into an
attorney-client relationship with such counsel, and in that connection the
Company and the Indemnitee agree that a confidential relationship shall exist
between the Indemnitee and such counsel. Without respect to whether the
Indemnitee prevails, in whole or in part, in connection with any of the
foregoing, the Company will pay and be solely financially responsible for any
and all attorneys’ and related fees and expenses incurred by the Indemnitee in
connection with any of the foregoing. The Indemnitee shall be entitled to the

 

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advancement of all attorneys’ and related fees and expenses to the full extent
contemplated by Section 3 hereof in connection with any such action or
proceeding.

 

18. RIGHT OF INDEMNITEE TO INDEMNIFICATION UPON APPLICATION; PROCEDURE UPON
APPLICATION.

 

(a) To obtain indemnification under this Agreement, the Indemnitee shall submit
to the Company a written request for payment of the appropriate Indemnified
Amounts, including with such request such documentation and information as is
reasonably available to the Indemnitee and reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to indemnification. The
Secretary of the Company shall, promptly upon receipt of such a request for
indemnification, advise the Board in writing that the Indemnitee has requested
indemnification.

 

(b) The Company shall pay the Indemnitee the appropriate Indemnified Amounts
unless it is established that the Indemnitee has not met any applicable standard
of conduct of the Express Permitted Indemnification Provisions.

 

(c) Any determination that the Indemnitee has not met the applicable standard of
conduct required to qualify for indemnification shall be made (i) either by the
Board by a majority vote of a quorum consisting of directors who were not
parties of such action, suit or proceeding or (ii) by independent legal counsel
(who may be the outside counsel regularly employed by the Company), provided
that the manner in which (and, if applicable, the counsel by which) the right to
indemnification is to be determined shall be approved in advance in writing by
both the highest ranking executive officer of the Company who is not party to
such action (sometimes hereinafter referred to as the “Senior Officer”) and by
the Indemnitee. In the event that such parties are unable to agree on the manner
in which any such determination is to be made, such determination shall be made
by independent legal counsel retained by the Company especially for such
purpose, provided that such counsel be approved in advance in writing by both
the Senior Officer and Indemnitee and provided further, that such counsel shall
not be outside counsel regularly employed by the Company. The fees and expenses
of counsel in connection with making said determination contemplated hereunder
shall be paid by the Company, and if requested by such counsel, the Company
shall give such counsel an appropriate written agreement with respect to the
payment of their fees and expenses and such other matters as may be reasonably
requested by counsel.

 

(d) The Company will use its best efforts to conclude as soon as practicable any
required determination pursuant to subsection (c) above and promptly will advise
the Indemnitee in writing with respect to any determination that the Indemnitee
is or is not entitled to indemnification, including a description of any reason
or basis for which indemnification has been denied. Payment of any applicable
Indemnified Amounts will be made to the Indemnitee within ten (10) days after
any determination of the Indemnitee’s entitlement to indemnification.

 

(e) Notwithstanding the foregoing, the Indemnitee may, at any time after sixty
(60) days after a claim for Indemnified Amounts has been filed with the Company
(or upon receipt of written notice that a claim for Indemnified Amounts has been
rejected, if earlier) and before three (3) years after a claim for Indemnified
Amounts has been filed, petition a court of

 

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competent jurisdiction to determine whether the Indemnitee is entitled to
indemnification under the provisions of this Agreement, and such court shall
thereupon have the exclusive authority to make such determination unless and
until such court dismisses or otherwise terminates such action without having
made such determination. The court shall, as petitioned, make an independent
determination of whether the Indemnitee is entitled to indemnification as
provided under this Agreement, irrespective of any prior determination made by
the Board or independent counsel.

 

19. CERTAIN INTERPRETIVE MATTERS. No provision of this Agreement will be
interpreted in favor of, or against, either of the parties hereto by reason of
the extent to which any such party or its counsel participated in the drafting
thereof or by reason of the extent to which any such provision is inconsistent
with any prior draft hereof or thereof.

 

IN WITNESS WHEREOF, Indemnitee has executed and the Company has caused its duly
authorized representative to execute this Agreement as of the date first above
written.

 

WESTWOOD MANAGEMENT CORP.

By:

       

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    Brian O. Casey, President

INDEMNITEE:

 

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Print Name:

       

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Address:

       

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The registrant has entered into this indemnification agreement with the
following individuals:

 

  • Susan M. Byrne

 

  • Brian O. Casey

 

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