Document:

Exhibit 4.4

 

NEITHER THIS CONVERTIBLE SUBORDINATED PROMISSORY NOTE NOR ANY OF THE SECURITIES ISSUABLE UPON CONVERSION HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR UNDER THE SECURITIES LAWS OF ANY FOREIGN JURISDICTION OR ANY STATE SECURITIES LAWS WITHIN THE UNITED STATES AND MAY NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED UNLESS THERE IS A REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND OTHER APPLICABLE SECURITIES LAWS IN EFFECT COVERING THIS CONVERTIBLE SUBORDINATED PROMISSORY NOTE OR SUCH SECURITIES, AS THE CASE MAY BE, OR THERE IS AVAILABLE AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.

 

THIS CONVERTIBLE SUBORDINATED PROMISSORY NOTE AND ALL PAYMENT AND ENFORCEMENT PROVISIONS HEREOF ARE SUBJECT TO A SUBORDINATION AGREEMENT DATED AS OF APRIL 28, 2014 IN FAVOR OF OXFORD FINANCE LLC AND TO THE OTHER SUBORDINATION PROVISIONS SET FORTH IN ARTICLE 4 BELOW. IN THE EVENT OF ANY INCONSISTENCY BETWEEN THIS NOTE AND THE SUBORDINATION AGREEMENT, THE TERMS OF THE SUBORDINATION AGREEMENT SHALL CONTROL.

 

AGILE THERAPEUTICS, INC.

 

CONVERTIBLE SUBORDINATED PROMISSORY NOTE

 

$

 

FOR VALUE RECEIVED, Agile Therapeutics, Inc. (the “Company”), a Delaware corporation, promises to pay to                       (the “Holder”), or registered assigns, the principal amount of                    Dollars ($                 ).

 

This Convertible Promissory Note (this “Note”) shall bear interest at the rate of 8% per annum on the outstanding principal amount of this Note, accruing daily, compounded annually and calculated on the basis of a 360-day year and the actual number of days elapsed; provided that, upon the Company’s failure to pay any principal or interest on this Note when due, interest will thereafter accrue at the rate of 12% per annum on the outstanding principal amount, accruing daily, compounded annually and calculated on the basis of a 360-day year and the actual number of days elapsed.  Unless converted pursuant to Section 2.1 or Section 2.2, the principal amount of this Note and all accrued and unpaid interest hereon shall be payable in full upon maturity of this Note as provided in Section 1.1, which payment shall be made by check mailed to the address of the Holder as such address shall appear on the record books of the Company.

 

This Note is one of a series of convertible subordinated promissory notes in the aggregate principal amount of up to three million dollars ($3,000,000) (collectively the “Notes”) being issued by the Company pursuant to that certain Note Purchase Agreement dated as of April 28, 2014 among the Company and the purchasers of the Notes (the “Note Purchase Agreement”).  No individual holder of a Note may demand repayment or elect conversion of such holder’s Note

 

 

without the prior written consent of the holders of Notes representing at least a majority of the principal amount of all of the Notes then outstanding (the “Majority Holders”).

 

This Note is subject to the following provisions, terms and conditions:

 

ARTICLE 1— PAYMENT

 

Section 1.1                                   Maturity.  Subject to the acceleration provisions of Section 3.2 and the conversion provisions of Section 2.1 and Section 2.2, this Note shall be paid in full on the date of the earliest to occur of the following (such earliest date being hereinafter referred to as the “Maturity Date”): (a) ten (10) days following written demand from the Majority Holders made to the Company at any time after August 1, 2014, (b) the consummation of a Sale Transaction (as defined below), or (c) a liquidation, dissolution or winding up of the Company.  As used herein, “Sale Transaction” means the closing of: (i) a merger or consolidation or any other transaction or series of related transactions (other than a future equity financing of the Company) in which the Company’s stockholders immediately prior to the transaction do not own, directly or indirectly, more than 50% of the capital stock of the surviving corporation (or equivalent outstanding equity interests in any other type of entity), (ii) the sale or transfer of all or substantially all of the assets of the Company or (iii) any other event that would be considered a “Deemed Liquidation Event” pursuant to the Company’s Second Amended and Restated Certificate of Incorporation, as amended, as it may be amended and/or restated and then in effect.  In the event that the Company becomes a party to a Sale Transaction, the Company shall notify the holders of the Notes of such Sale Transaction as soon as reasonably practicable prior to the closing of such Sale Transaction.

 

Section 1.2                                   Prepayment.  This Note may not be prepaid by the Company, in whole or in part, without the prior written consent of the Majority Holders.

 

Section 1.3                                   Pro Rata Payments.  All payments made by the Company with respect to any of the Notes shall be made pro rata to the holders of all of the Notes in accordance with the respective principal amounts outstanding thereunder.

 

ARTICLE 2— CONVERSION

 

Section 2.1                                   Automatic Conversion upon Qualified Financing.  If, at any time prior to August 1, 2014 while this Note is outstanding, the Company concludes an equity financing where at least $45,000,000 or such lesser amount as shall be approved by the Majority Holders (excluding amounts converted under the Notes) is raised from investors, whether or not such investors are then holders of any debt or equity securities of the Company or any other equity financing as a result of which all outstanding Preferred Stock of the Company is automatically converted into Common Stock (as defined below) (a “Qualified Financing”), the entire unpaid principal amount outstanding under this Note and the other Notes and accrued interest thereon shall be automatically converted, upon the closing of the Qualified Financing, into shares of the equity security issued in the Qualified Financing (the “Qualified Financing Securities”) at the Applicable Conversion Price.  As used herein, the “Applicable Conversion Price” means the following price per share: equal to (a) in the case of a Qualified Financing that is an underwritten public offering of shares of Common Stock of the Company (the “Common Stock”) (a “Public Offering”), the purchase price at which shares of the Common Stock are sold by the Company to the public in such Public Offering and (b) in the case of all Qualified Financings other than a

 

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Public Offering, 90% of the price per share of the Qualified Financing Securities sold in the Qualified Financing.  The Qualified Financing Securities shall otherwise be issued on terms and conditions that apply to the Qualified Financing.

 

Section 2.2                                   Optional Conversion into Series C Preferred Stock.  (i) If the Company does not consummate a Qualified Financing prior to August 1, 2014, at any time thereafter, or (ii) immediately prior to, and conditioned upon the effectiveness of, a Sale Transaction, the Majority Holders may elect, upon written notice to the Company, to cause the entire unpaid principal amount outstanding under this Note and the other Notes and all accrued interest thereon to be converted into shares of the Company’s Series C Convertible Preferred Stock (the “Series C Shares”).  In the case of conversion pursuant to this Section 2.2, the conversion price shall be equal to $15.00 per share (as adjusted for any stock splits, stock dividends, recapitalizations or the like with respect to such shares).  The Series C Shares shall otherwise be issued pursuant to a mutually acceptable conversion agreement and otherwise subject to the same terms and conditions that apply to the Series C Shares that are issued and outstanding at the time of conversion.

 

Section 2.3                                   Surrender of Note; Issuance of Stock Certificates.  As promptly as practicable after the conversion of this Note as provided in Section 2.1 or Section 2.2, the Holder shall surrender this Note to the Company for cancellation, whereupon the Company shall issue and deliver to the Holder, in the name of the Holder, a certificate or certificates for the number of full shares of the Company’s capital stock issuable upon the conversion of this Note.  In the case of a Public Offering, in lieu of issuing certificates, the Company may, if agreed by the Holder, deliver other evidence of the issuance of the Common Stock into which this Note is converted to the Holder (i.e., book entry issuance).  Notwithstanding any failure on the part of the Holder to deliver this Note as aforesaid, upon the occurrence of the applicable conversion event pursuant to Section 2.1 or Section 2.2, this Note shall no longer be deemed to be outstanding, and the Holder, conditioned upon the Holder’s compliance with this Section 2, shall be deemed to be the holder of the securities into which this Note was so converted effective as of such conversion.

 

Section 2.4                                   No Fractional Shares.  No fractional shares shall be issued upon conversion of this Note.  If conversion of this Note would result in the issuance of a fractional share, the amount payable under this Note that therefore cannot be applied to the purchase of the shares purchasable upon conversion shall be returned to the Holder by the Company.

 

ARTICLE 3 - SUBORDINATION

 

Section 3.1                                   Subordination of Note to Senior Indebtedness.  All indebtedness evidenced by this Note shall be subordinated and junior in right and time of payment to the prior payment in full of all amounts due under all indebtedness of the Company for money that it borrows from financial institutions and other third-party lenders and to the Company’s obligations under equipment leases (the “Senior Indebtedness”).

 

Section 3.2                                   No Payments on Note Unless Senior Indebtedness Provided for or During Defaults on Senior Indebtedness.  No payment under this Note shall be made by the Company unless full payment of amounts then due under the Senior Indebtedness has been made

 

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or provided for by the Company.  No payment under this Note shall be made by the Company if making such payment would violate any terms of the Senior Indebtedness.

 

Section 3.3                                   No Limitation on Right to Convert.  Nothing set forth in this Article 3 shall be deemed to limit the right of the Holder to convert this Note into equity of the Company in accordance with the terms of Article 2.

 

Section 3.4                                   Oxford Subordination Agreement.  Without limitation of any of the foregoing provisions of this Article 3, all of the Notes, and the payment of any amount thereunder, shall be subordinated to the Company’s obligations to Oxford Finance, LLC (“Oxford”) pursuant to the terms and provisions of, and to the extent set forth in, that certain Subordination Agreement dated as of April 28, 2014 among Oxford, the Company and the holders of the Notes (the “Subordination Agreement”).  By the Holder’s acceptance of this Note, the Holder agrees to be bound by the provisions of such Subordination Agreement to the extent provided therein.  In the event of any inconsistency between this Note and the Subordination Agreement, the terms of the Subordination Agreement shall control.

 

ARTICLE 4— REMEDIES OF HOLDER IN EVENT OF DEFAULT

 

Section 4.1                                   Events of Default Defined.  Any of the following that shall occur and be continuing for any reason whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be effected by operation of law or otherwise) shall constitute an event of default (each an “Event of Default”):

 

(a)                                 the Company shall fail to perform or observe any covenant or agreement set forth in this Note or the Note Purchase Agreement in any material respect, or the Company shall breach any representation or warranty contained in the Note Purchase Agreement in any material respect, and (except as set forth in Section 4.1(e)) such failure or breach continues uncured for 15 days after written notice thereof shall be received by the Company from the Majority Holders; or

 

(b)                                 if an order, judgment or decree is entered adjudicating the Company bankrupt or insolvent; or if the Company shall commence any case, proceeding or other action relating to it in bankruptcy or seeking reorganization, liquidation, dissolution, winding-up, arrangement, composition or readjustment of its debts, or for any other relief, under any bankruptcy, insolvency, reorganization, liquidation, dissolution, arrangement, composition, readjustment of debt or other similar act or law of any jurisdiction, domestic or foreign, now or hereafter existing; or if the Company shall apply for a receiver, custodian or trustee of it or for all or a substantial part of its property, or makes a general assignment for the benefit of creditors; or

 

(c)                                  if any case, proceeding or other action against the Company shall be commenced in bankruptcy or seeking reorganization, liquidation, dissolution, winding-up, arrangement, composition or readjustment of its debts, or any other relief, under any bankruptcy, insolvency, reorganization, liquidation, dissolution, arrangement, composition, readjustment of debt or other similar act or law of any jurisdiction, domestic or foreign, now or hereafter existing; or if a receiver, custodian or trustee of the Company or for all or a substantial part of its properties shall be appointed; or if a warrant of attachment, execution or distraint, or similar

 

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process, shall be issued against any substantial part of the property of the Company; and if, in each such case, such condition shall continue for a period of 90 days undismissed, undischarged or unbonded; or

 

(d)                                 any indebtedness for borrowed money of the Company becomes or is declared due and payable prior to the stated maturity thereof or is not paid as and when it becomes due and payable, or any event occurs that constitutes, or that with the giving of notice or lapse of time, or both, would constitute, an event of default with respect to any indebtedness for borrowed money of the Company; or

 

(e)                                  any default occurs in the payment of any principal of or accrued interest on this Note provided that at least five days’ prior written notice thereof is received by the Company from the Majority Holders.

 

Section 4.2                                   Notice to Holder.  Upon the occurrence of any Event of Default described in Section 4.1 hereof, subject to Article 3, the Majority Holders may, by written notice thereof provided to the Company, declare the entire principal amount and all interest accrued and unpaid on the Notes to be, and the Notes shall thereupon become, forthwith due and payable, without any presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived.  No course of dealing on the part of the Holder nor any delay or failure on the part of the Holder or the Majority Holders to exercise any right shall operate as a waiver of such right or otherwise prejudice such holders’ rights, powers and remedies.

 

ARTICLE 5— TRANSFER, ETC.

 

Section 5.1                                   Instruments of Transfer.  The transfer of this Note shall be subject to the provisions of Section 4.2 of the Note Purchase Agreement and shall be subject to the restrictions on transfer set forth in that certain Fifth Amended and Restated Stockholders Agreement dated as of July 18, 2012, as amended, (the “Stockholders Agreement”) among the Company and the stockholders of the Company to the same extent as would apply in connection with a transfer by a Purchaser of Preferred Stock (as such terms are defined in the Stockholders Agreement).  Subject to the foregoing, this Note, if presented or surrendered for exchange or transfer, shall, if so required by the Company, be accompanied by a duly executed written instrument of transfer, in form satisfactory to the Company, and such other documentation as the Company shall reasonably request.

 

Section 5.2                                   Loss, Theft, etc.  Upon receipt of evidence satisfactory to the Company of the loss, theft, mutilation or destruction of this Note, and in the case of such loss, theft or destruction upon delivery of a bond of indemnity in such form and amount as shall be reasonably satisfactory to the Company, or in the event of such mutilation upon surrender and cancellation of this Note, the Company shall make and deliver without expense to the Holder a new Note, of like tenor, in lieu of such lost, stolen, destroyed or mutilated Note.  At the discretion of the Company, the Company may accept in lieu of a bond of indemnity, the affidavit of the Holder that sets forth the fact of loss, theft or destruction and of the Holder’s ownership of this Note at the time of such loss, theft or destruction as satisfactory evidence thereof and no further indemnity shall be required as a condition to the execution and delivery of a new Note other than the written agreement of such owner to indemnify the Company.

 

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Section 5.3                                   Person Deemed Owner.  Prior to due presentation of this Note for transfer in accordance with this Article 4, the Company may deem and treat the Holder as the absolute owner of this Note (whether or not this Note shall be overdue and notwithstanding any notation of ownership or other writing hereon) for the purpose of receiving payment of or on account of the principal amount hereof and interest due thereon and for all other purposes, and the Company shall not be affected by any notice to the contrary.

 

ARTICLE 6— MISCELLANEOUS

 

Section 6.1                                   Undertaking.  By acceptance of this Note, the Holder acknowledges that there may not be sufficient shares of Common Stock or Series C Preferred Stock authorized under the Second Amended and Restated Certificate of Incorporation, as amended, upon the conversion of Notes pursuant to Section 2.2.  In connection with any conversion pursuant to Article 2, the Company shall take such action within its control as shall be necessary to authorize the securities being issued in such conversion, to the extent that a sufficient number of such securities is not otherwise authorized at the time of such conversion.

 

Section 6.2                                   Amendment and Waiver.  For purposes of the Notes, no course of dealing between the Company and the holders of the Notes, or any of them, and no delay on the part of any such party in exercising any rights hereunder shall operate as a waiver of the rights thereof.  Any term of this Note may be amended, supplemented, modified or waived only with the written consent of the Company and the Majority Holders; provided, however, that any such amendment, supplement, modification or waiver that impairs the rights or increases the obligations of any Holder shall not be effected without the prior written consent of such Holder unless such amendment, supplement, modification or waiver applies to all holders of the Notes in the same fashion.  Any amendment, supplement, modification of waiver effected in accordance with this Section 5.2 shall be binding upon the Holder and each transferee thereof (or the securities issuable upon conversion thereof).

 

Section 6.3                                   Section and Other Headings.  The section and other headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.

 

Section 6.4                                   Governing Law.  This Note shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware.

 

Section 6.5                                   Notices.  All notices given hereunder shall be in writing and shall be delivered in person or duly sent by mail, postage prepaid; by an overnight delivery service, charges prepaid; or by confirmed facsimile; addressed to the Holder at the Holder’s address in the records of the Company and addressed to the Company at its principal place of business to the attention of its Secretary.

 

[Signature page follows.]

 

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IN WITNESS WHEREOF, the Company has caused this Note to be signed by its duly authorized officer as of the day and year first above written.

 

	
 
    	
AGILE   THERAPEUTICS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

7Exhibit 10.1

 

AGILE THERAPEUTICS, INC.

 

INDEMNIFICATION AGREEMENT

 

THIS INDEMNIFICATION AGREEMENT is made as of                          between Agile Therapeutics, Inc. (the “Company”), a Delaware corporation, and                          (“Indemnitee”) and shall be effective as of the date hereof.

 

WHEREAS, highly competent persons have become more reluctant to serve corporations as directors or in other capacities unless they are provided with adequate protection through insurance or adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation; and

 

WHEREAS, the Board of Directors of the Company (the “Board”) has determined that, in order to attract and retain qualified individuals, the Company shall attempt to maintain on an ongoing basis, at its sole expense, liability insurance to protect persons serving the Company and its subsidiaries from certain liabilities.  Although the furnishing of such insurance has been a customary and widespread practice among United States-based corporations and other business enterprises, the Company believes that, given current market conditions and trends, such insurance may be available to it in the future only at higher premiums and with more exclusions.  At the same time, directors, officers and other persons in service to corporations or business enterprises are being increasingly subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the corporation or business enterprise itself.  The By-Laws (as defined in Section 13 hereof) and Certificate of Incorporation (as defined in Section 13 hereof) require indemnification of the officers and directors of the Company.  Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the State of Delaware (the “DGCL”).  The By-Laws and Certificate of Incorporation and the DGCL expressly provide that the indemnification provisions set forth therein are not exclusive, and thereby contemplate that contracts may be entered into between the Company and members of the Board, officers and other persons with respect to indemnification; and

 

WHEREAS, the uncertainties relating to such insurance and to indemnification have increased the difficulty of attracting and retaining such persons; and

 

WHEREAS, the Board has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Company’s stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future; and

 

WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify, and to advance expenses on behalf of, such persons so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified; and

 

WHEREAS, this Agreement is a supplement to and in furtherance of the By-Laws and Certificate of Incorporation of the Company and any resolutions adopted pursuant thereto, and

 

 

shall not be deemed a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder; and

 

WHEREAS, the parties wish to provide for the indemnification and advancement of expenses to Indemnitee in accordance with the terms and provisions of this Agreement; and

 

WHEREAS, certain capitalized terms used herein are defined in Section 13 hereof.

 

NOW, THEREFORE, in consideration of the premises, and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties agree as follows:

 

1.                                      Indemnity of Indemnitee.  Subject to the terms and provisions of this Agreement, the Company hereby agrees to hold harmless and indemnify Indemnitee to the fullest extent permitted by applicable law, as such may be amended from time to time.  In furtherance of the foregoing indemnification, and without limiting the generality thereof:

 

(a)                                 Indemnitee shall be entitled to the rights of indemnification provided in this Section l(a) if, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding other than a Proceeding by or in the right of the Company.  Pursuant to this Section 1(a), Indemnitee shall be indemnified against all Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such Proceeding or any claim, issue or matter therein, 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 Proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful.

 

(b)                                 Indemnitee shall be entitled to the rights of indemnification provided in this Section 1(b) if, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding brought by or in the right of the Company.  Pursuant to this Section 1(b), Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such 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; provided, however, that no indemnification against such Expenses shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been adjudged to be liable to the Company unless and to the extent that the Delaware Court or other court of competent jurisdiction shall determine that such indemnification may be made.

 

(c)                                  Subject to the terms and provisions of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a party to and is successful, on the merits or otherwise, in any Proceeding, Indemnitee shall be indemnified to the maximum extent permitted by applicable law, as such may be amended from time to time, against all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection therewith.  If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such

 

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Proceeding, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with each successfully resolved claim, issue or matter.  For purposes of this Section 1 and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

 

(d)                                 In addition to, and without regard to any limitations on, the indemnification provided for in this Section 1, the Company shall and hereby does indemnify and hold harmless Indemnitee against all Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, if, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding (including a Proceeding by or in the right of the Company), including, without limitation, all liability arising out of the negligence or active or passive wrongdoing of Indemnitee.  The only limitations that shall exist upon the Company’s obligations pursuant to this Agreement shall be (i) those set forth in Section 9 hereof and (ii) that the Company shall not be obligated to make any payment to Indemnitee that is finally determined (under the procedures, and subject to the presumptions, set forth in Sections 5, 6 and 7 hereof) to be unlawful.

 

2.                                      Contribution.

 

(a)                                 Whether or not the indemnification provided in Section 1 hereof is available, in respect of any threatened, pending or completed Proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such Proceeding), the Company shall pay, in the first instance, the entire amount of any judgment or settlement of such Proceeding without requiring Indemnitee to contribute to such payment, and the Company hereby waives and relinquishes any right of contribution it may have against Indemnitee.  The Company shall not enter into any settlement of any Proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such Proceeding) unless such settlement provides for a full and final release of all claims asserted against Indemnitee.

 

(b)                                 Without diminishing or impairing the obligations of the Company set forth in Section 2(a) hereof, if, for any reason, Indemnitee shall elect or be required to pay all or any portion of any judgment or settlement in any threatened, pending or completed Proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such Proceeding), then the Company shall contribute to the amount of Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred and paid or payable by Indemnitee in proportion to the relative benefits received by the Company and all officers, directors, or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such Proceeding), on the one hand, and Indemnitee, on the other hand, from the transaction from which such Proceeding arose; provided, however, that the proportion determined on the basis of relative benefit may, to the extent necessary to conform to applicable law, be further adjusted by reference to the relative fault of the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such Proceeding), on the one hand, and Indemnitee, on the other hand, in connection with the events that resulted in such Expenses, judgments, fines or settlement amounts, as well as any other equitable considerations that applicable law may require

 

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to be considered.  The relative fault of the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such Proceeding), on the one hand, and Indemnitee, on the other hand, shall be determined by reference to, among other things, the degree to which their actions were motivated by intent to gain personal profit or advantage, the degree to which their liability is primary or secondary and the degree to which their conduct is active or passive.

 

(c)                                  The Company hereby agrees to fully indemnify Indemnitee and hold Indemnitee harmless from any claims of contribution that may be brought by officers, directors or employees of the Company, other than Indemnitee, who may be jointly liable with Indemnitee.

 

(d)                                 Subject to the terms and provisions of this Agreement, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee to the fullest extent permissible under applicable law, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).

 

3.                                      Indemnification for Expenses of a Witness.  Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a witness, or is made (or asked to) respond to discovery requests, in any Proceeding to which Indemnitee is not a party, Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection therewith.

 

4.                                      Advancement of Expenses.  The Company shall advance all Expenses actually and reasonably incurred by or on behalf of Indemnitee in connection with any Proceeding by reason of Indemnitee’s Corporate Status within 30 days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding.  Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall include or be preceded or accompanied by a written undertaking by or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately be determined that Indemnitee is not entitled to be indemnified against such Expenses.  Any advances and undertakings to repay pursuant to this Section 4 shall be unsecured and interest free.

 

5.                                      Notification and Defense of Claim.  Indemnitee agrees promptly, but in any event no later than 45 days, to notify the Company in writing upon being served with or otherwise receiving any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or any other matter that may be subject to indemnification hereunder.  The failure to notify the Company promptly shall not relieve the Company from any obligation that it may have to Indemnitee under this Agreement or otherwise

 

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unless and only to the extent that the Company is prejudiced materially by such failure.  With respect to any Proceeding as to which Indemnitee notifies the Company of the commencement thereof:

 

(a)                                 the Company shall be entitled to participate therein at its own expense;

 

(b)                                 except as otherwise provided below, to the extent that it may wish, the Company, jointly with any other indemnifying party similarly notified, shall be entitled to assume the defense thereof, with counsel reasonably satisfactory to Indemnitee.  After notice from the Company to Indemnitee of the Company’s election to assume the defense thereof, the Company shall not be liable to Indemnitee under this Agreement for any Expenses subsequently incurred by Indemnitee in connection with the defense thereof other than reasonable costs of investigation or as otherwise provided herein.  Indemnitee shall have the right to employ Indemnitee’s own counsel in such Proceeding, but the Expenses associated with the employment of such counsel incurred after notice from the Company of its assumption of the defense thereof shall be at the expense of Indemnitee unless (i) the employment of counsel by Indemnitee has been authorized by the Company, (ii) Indemnitee shall have reasonably concluded based on the advice of counsel that there may be a conflict of interest between the Company and Indemnitee in the conduct of the defense of such Proceeding or (iii) the Company shall not in fact have employed counsel to assume the defense of such Proceeding, and in each case the Expenses of Indemnitee’s separate counsel shall be borne by the Company.  The Company shall not be entitled to assume the defense of any Proceeding brought by or on behalf of the Company or in the case that Indemnitee shall have made the conclusion provided for in clause (ii) of the preceding sentence; and

 

(c)                                  the Company shall not be liable to indemnify Indemnitee under this Agreement for any amounts paid in settlement of any Proceeding effected without the Company’s written consent, which consent shall not be unreasonably withheld.  The Company shall be permitted to settle any Proceeding, except that it shall not settle any Proceeding in any manner that does not provide for the unconditional release from liability of Indemnitee or would impose any penalty, out-of-pocket liability or limitation on Indemnitee without Indemnitee’s written consent, which consent shall not be unreasonably withheld.

 

6.                                      Procedures and Presumptions for Determination of Entitlement to Indemnification.  It is the intent of this Agreement to secure for Indemnitee rights of indemnity that are as favorable as may be permitted under the DGCL and public policy of the State of Delaware, except as otherwise expressly provided in this Agreement.  Accordingly, the parties agree that the following procedures and presumptions shall apply with respect to indemnification under this Agreement:

 

(a)                                 To obtain indemnification under this Agreement (including, but not limited to, contribution by the Company, but excluding advancement of Expenses pursuant to Section 4 hereof), Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification.  Indemnitee shall submit such claim for indemnification within a reasonable time (not to exceed six months) after any judgment, order, settlement, dismissal, arbitration award, conviction,

 

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acceptance of a plea of nolo contendere or its equivalent, final termination or other disposition or partial disposition of any Proceeding for which Indemnitee requests indemnification, whichever occurs latest.  The President or the Secretary or other appropriate officer of the Company shall, promptly upon receipt of such a request for indemnification, advise the Board in writing that Indemnitee has requested indemnification.  Notwithstanding the foregoing, any failure of Indemnitee to provide such a request to the Company, or to provide such a request in a timely fashion, shall not relieve the Company of any liability that it may have to Indemnitee unless, and to the extent that, such failure actually and materially prejudices the interests of the Company.

 

(b)                                 Upon written request by Indemnitee for indemnification pursuant to the first sentence of Section 6(a) hereof, a determination with respect to Indemnitee’s entitlement thereto shall be made in the specific case by one of the following four methods, which shall be at the election of the Board:  (i) by a majority vote of the Disinterested Directors, even though less than a quorum, (ii) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum, (iii) if there are no Disinterested Directors or if the Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee, or (iv) if so directed by the Board, by the stockholders of the Company.

 

(c)                                  If the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 6(b) hereof, the Independent Counsel shall be selected as provided in this Section 6(c).  The Independent Counsel shall be selected by the Board.  Indemnitee may, within 10 days after such written notice of selection shall have been given, deliver to the Company a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel,” and the objection shall set forth with particularity the factual basis of such assertion.  Absent a proper and timely objection, the person so selected shall act as Independent Counsel.  If a written objection is made and substantiated, the Independent Counsel selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit.  If, within 20 days after submission by Indemnitee of a written request for indemnification pursuant to Section 6(a) hereof, no Independent Counsel shall have been selected and not objected to, either the Company or Indemnitee may petition the Delaware Court or other court of competent jurisdiction for resolution of any objection that shall have been made by Indemnitee to the Board’s selection of Independent Counsel and/or for the appointment as Independent Counsel of a person selected by the court or by such other person as the court shall designate, and the person with respect to whom all objections are so resolved or the person so appointed shall act as Independent Counsel under Section 6(b) hereof.  The Company shall pay any and all reasonable fees and expenses of Independent Counsel incurred by such Independent Counsel in connection with acting pursuant to Section 6(b) hereof, and the Company shall pay all reasonable fees and expenses incident to the procedures of this Section 6(c), regardless of the manner in which such Independent Counsel was selected or appointed.

 

(d)                                 In making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement.  Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and

 

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convincing evidence.  Neither the failure of the Company (including by its directors or Independent Counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Company (including by its directors or Independent Counsel) that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.

 

(e)                                  Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on:  (i) the records or books of account of any Enterprise, including financial statements, (ii) information supplied to Indemnitee by the officers of such Enterprise in the course of their duties, (iii) the advice of legal counsel for such Enterprise, or (iv) information or records given or reports made to such Enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by such Enterprise.  In addition, the knowledge and/or actions, or failure to act, of any director, officer, employee, agent or fiduciary of such Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.  Whether or not the foregoing provisions of this Section 6(e) are satisfied, it shall in any event be presumed that Indemnitee has at all times acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company.  Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.

 

(f)                                   Subject to any applicable provision of the DGCL, if the person, persons or entity empowered or selected under this Section 6 to determine whether Indemnitee is entitled to indemnification shall not have made a determination within 60 days of the Company’s receipt of Indemnitee’s written request for such indemnification, the requisite determination of entitlement to indemnification shall be deemed to have been made and Indemnitee shall be entitled to such indemnification absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law; provided, however, that such 60-day period may be extended for a reasonable time, not to exceed an additional 30 days, if the person, persons or entity making such determination with respect to entitlement to indemnification in good faith requires such additional time to obtain or evaluate documentation and/or information relating thereto; and provided, further, that the foregoing provisions of this Section 6(f) shall not apply if the determination of entitlement to indemnification is to be made by the stockholders of the Company pursuant to Section 6(b) hereof and if (A) within 15 days after receipt by the Company of the request for such determination, the Board or the Disinterested Directors, if appropriate, resolve to submit such determination to the stockholders for their consideration at an annual meeting thereof to be held within 75 days after such receipt and such determination is made thereat, or (B) a special meeting of stockholders is called within 15 days after such receipt for the purpose of making such determination, such meeting is held for such purpose within 60 days after having been so called and such determination is made thereat.

 

(g)                                  Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or

 

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information that is not privileged or otherwise protected from disclosure and that is reasonably available to Indemnitee and reasonably necessary to such determination.  Any Independent Counsel, member of the Board or stockholder of the Company shall act reasonably and in good faith in making a determination regarding Indemnitee’s entitlement to indemnification under this Agreement.  Any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.

 

(h)                                 The Company acknowledges that a settlement or other disposition short of final judgment may be successful if it permits a party to avoid expense, delay, distraction, disruption and uncertainty.  In the event that any Proceeding to which Indemnitee is a party is resolved in any manner other than by adverse judgment against Indemnitee (including, without limitation, settlement of such Proceeding with or without payment of money or other consideration), it shall be presumed that Indemnitee has been successful on the merits or otherwise in such Proceeding.  Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.

 

(i)                                     The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner that Indemnitee reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.

 

7.                                      Remedies of Indemnitee.

 

(a)                                 In the event that (i) a determination is made pursuant to Section 6 hereof that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 4 hereof, (iii) no determination of entitlement to indemnification is made pursuant to Section 6(b) hereof within 90 days after receipt by the Company of the request for indemnification, or (iv) payment of indemnification is not made within 10 days after a determination has been made that Indemnitee is entitled to indemnification or such determination is deemed to have been made pursuant to Section 6 hereof, Indemnitee shall be entitled to an adjudication in an appropriate court of the State of Delaware, or in any other court of competent jurisdiction, of Indemnitee’s entitlement to such indemnification.  Indemnitee shall commence such proceeding seeking an adjudication within 180 days following the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 7(a).  The Company shall not oppose Indemnitee’s right to seek any such adjudication.

 

(b)                                 In the event that a determination shall have been made pursuant to Section 6(b) hereof that Indemnitee is not entitled to indemnification, any judicial proceeding commenced pursuant to this Section 7 shall be conducted in all respects as a de novo trial on the merits, and Indemnitee shall not be prejudiced by reason of the adverse determination under Section 6(b) hereof.

 

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(c)                                  If a determination shall have been made pursuant to Section 6(b) hereof that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding commenced pursuant to this Section 7, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s misstatement not materially misleading in connection with the application for indemnification, or (ii) a prohibition of such indemnification under applicable law.

 

(d)                                 In the event that Indemnitee, pursuant to this Section 7, seeks a judicial adjudication of Indemnitee’s rights under, or to recover damages for breach of, this Agreement, or to recover under any directors’ and officers’ liability insurance policies maintained by the Company, the Company shall pay on Indemnitee’s behalf, in advance, any and all Expenses actually and reasonably incurred by Indemnitee in such judicial adjudication, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement of Expenses or insurance recovery.

 

(e)                                  The Company shall be precluded from asserting in any judicial proceeding commenced pursuant to this Section 7 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court that the Company is bound by all the provisions of this Agreement.  The Company shall indemnify Indemnitee against any and all Expenses and, if requested by Indemnitee, shall (within 10 days after receipt by the Company of a written request therefor) advance, to the extent not prohibited by law, such Expenses to Indemnitee that are actually and reasonably incurred by Indemnitee in connection with any action brought by Indemnitee for indemnification or advancement of Expenses from the Company under this Agreement or under any directors’ and officers’ liability insurance policies maintained by the Company.

 

(f)                                   Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement to indemnification under this Agreement shall be required to be made prior to the final disposition of the Proceeding.

 

8.                                      Non-Exclusivity; Survival of Rights; Insurance; Primacy of Indemnification; Subrogation.

 

(a)                                 The rights of indemnification provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the By-Laws, any agreement, a vote of stockholders, a resolution of the Board or otherwise, of the Company.  No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in Indemnitee’s Corporate Status prior to such amendment, alteration or repeal.  To the extent that a change in the DGCL, whether by statute or judicial decision, permits greater indemnification than would be afforded currently under the Certificate of Incorporation, the By-Laws and this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change, except as otherwise expressly provided in this Agreement.  No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or

 

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employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

 

(b)                                 To the extent that the Company maintains any directors’ and officers’ liability insurance policies, Indemnitee shall be covered by such policies in accordance with its or their terms to the maximum extent of the coverage available for any director, officer, employee, agent or fiduciary under such policies.  If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company has any directors’ and officers’ liability insurance policies in effect, the Company shall give notice of the commencement of such Proceeding to the insurers in accordance with the procedures set forth in such policies.  The Company shall thereafter take all reasonable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.

 

(c)                                  In the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, and Indemnitee shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

 

(d)                                 The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.

 

(e)                                  The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee for serving at the request of the Company as a director, officer, employee, agent or fiduciary of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall be reduced by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise.

 

9.                                      Exception to Right of Indemnification.  Notwithstanding any provision in this Agreement, the Company shall not be obligated under this Agreement to make any indemnity in connection with any claim made against Indemnitee:

 

(a)                                 for which payment has actually been made to or on behalf of Indemnitee under any insurance policy or other indemnity provision, except with respect to any excess beyond the amount paid under any insurance policy or other indemnity provision; or

 

(b)                                 for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Securities Exchange Act of 1934, as amended, or similar provisions of state statutory law or common law; or

 

(c)                                  in connection with any Proceeding (or any part of any Proceeding) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless (i) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation, or (ii) the

 

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Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law.

 

10.                               Duration of Agreement.  All agreements and obligations of the Company contained herein shall continue during the period Indemnitee is a director of the Company or any subsidiary, or is or was serving at the request of the Company as a director, officer, employee, agent or fiduciary of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, and shall continue thereafter so long as Indemnitee shall be subject to any Proceeding (or any proceeding commenced under Section 7 hereof) by reason of Indemnitee’s Corporate Status, whether or not Indemnitee is acting or serving in any such capacity at the time any liability or Expense is incurred for which indemnification can be provided under this Agreement.

 

11.                               Security.  To the extent requested by Indemnitee and approved by the Board, the Company may at any time and from time to time provide security to Indemnitee for the Company’s obligations hereunder through an irrevocable bank line of credit, funded trust or other collateral.  Any such security, once provided to Indemnitee, may not be revoked or released without the prior written consent of Indemnitee.

 

12.                               Entire Agreement.  This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof.

 

13.                               Definitions.  For purposes of this Agreement:

 

(a)                                 “By-Laws” means the Company’s By-Laws as now or hereafter in effect or amended.

 

(b)                                 “Certificate of Incorporation” means the Company’s Amended and Restated Certificate of Incorporation as now or hereafter in effect or amended.

 

(c)                                  “Corporate Status” means the status of a person who is or was a director of the Company, or a director, officer, employee, agent or fiduciary of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving at the express written request of the Company.

 

(d)                                 “Delaware Court” means the Chancery Court of the State of Delaware.

 

(e)                                  “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

 

(f)                                   “Enterprise” means the Company and any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that Indemnitee is or was serving at the express written request of the Company as a director, officer, employee, agent or fiduciary.

 

(g)                                  “Expenses” means all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, 

 

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telephone charges, postage, delivery service fees and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, participating, or being or preparing to be a witness in a Proceeding and any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, including without limitation the premium, security for, and other costs relating to any cost bond, supersede as bond, or other appeal bond or its equivalent, or responding to, or objecting to, a request to provide discovery in any Proceeding.  “Expenses” also shall include Expenses incurred in connection with any appeal resulting from any Proceeding.  “Expenses,” however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.

 

(h)                                 “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent:  (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder.  Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.  The Company agrees to pay the reasonable fees of the Independent Counsel referred to above and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or such counsel’s engagement pursuant hereto.

 

(i)                                     “Proceeding” means any threatened, pending or completed action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought by or in the right of the Company or otherwise and whether civil, criminal, administrative or investigative, in which Indemnitee was, is or will be involved as a party or otherwise, by reason of the fact that Indemnitee is or was a director of the Company, by reason of any action taken by Indemnitee or of any inaction on the part of Indemnitee while acting as a director of the Company, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee, agent or fiduciary of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise; in each case whether or not Indemnitee is acting or serving in any such capacity at the time any liability or Expense is incurred for which indemnification can be provided under this Agreement; including one pending on or before the date of this Agreement, but excluding one initiated by Indemnitee pursuant to Section 7 hereof to enforce Indemnitee’s rights under this Agreement.

 

14.                               Severability.  The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision.  Without limiting the generality of the foregoing, this Agreement is intended to confer upon Indemnitee indemnification rights to the fullest extent permitted by applicable law, except as otherwise expressly provided in this Agreement.  In the event any provision hereof conflicts with any applicable law, such provision shall be deemed modified, consistent with the aforementioned intent, to the extent necessary to resolve such conflict.

 

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15.                               Modification and Waiver.  No supplement, modification, termination 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 such waiver constitute a continuing waiver.

 

16.                               Notices.  All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given:  (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient, and if not so confirmed, then on the next business day, (c) five days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one day after deposit with a nationally recognized overnight courier, specifying next business day delivery, with written verification of receipt.  All communications shall be sent:

 

(a)                                 if to Indemnitee, at the address set forth below Indemnitee’s signature hereto.

 

(b)                                 and if to the Company, to:

 

Agile Therapeutics, Inc.
 101 Poor Farm Road
 Princeton, NJ 08540
 Attention:  Chief Executive Officer
 Facsimile:  609-940-0301

 

with a copy to:

 

Duane Morris LLP
 30 South 17th Street
 Philadelphia, Pennsylvania 19103-4196
 Attention:  Kathleen M. Shay
 Facsimile:  215-689-4382

 

or to such other address as may have been furnished to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.

 

17.                               Counterparts; Electronic Transmission.  This Agreement may be executed by the parties in separate counterparts, each of which for all purposes shall be deemed to be an original, but both of which together shall constitute one and the same Agreement.  This Agreement may, upon execution by a party, be transmitted by electronic or facsimile transmission with the same effect as if such party had delivered an executed original counterpart of this Agreement.

 

18.                               Binding Effect; Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors, 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 and/or any 

 

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Subsidiary, as the case may be, and the spouse, heirs, and personal and legal representatives of Indemnitee.

 

19.                               Headings.  The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

 

20.                               Governing Law and Consent to Jurisdiction.  This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules.  The Company and Indemnitee hereby irrevocably and unconditionally (a) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Delaware Court, and not in any other state or federal court in the United States of America or any court in any other country, (b) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (c) waive any objection to the laying of venue of any such action or proceeding in the Delaware Court, and (d) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum.

 

[Signatures on Following Page]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and signed as of the date first written above.

 

	
 
    	
COMPANY
    
	
 
    	
 
    
	
 
    	
AGILE   THERAPEUTICS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
INDEMNITEE
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Address:
    
	
 
    	
 
    
	
 
    	
 
    
				

 

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