Document:

EXHIBIT 10.2

 

INDEMNITY
AGREEMENT

 

This Agreement is made as of                       ,
200   , by and between Metro One Telecommunications Inc., an
Oregon corporation (the “Corporation”), and                                             
(“Indemnitee”), a director and/or officer of the Corporation.

 

WHEREAS, it is essential to the Corporation to retain
and attract as directors and officers of the Corporation and its subsidiaries
the most capable persons available; and

 

WHEREAS, the substantial increase in corporate
litigation subjects directors and officers to expensive litigation risks at the
same time that adequate coverage of directors’ and officers’ liability
insurance may be severely limited or unavailable; and

 

WHEREAS, the Third Restated Articles of Incorporation
of the Corporation (the “Articles”) require indemnification of the current and
former directors and officers to the fullest extent not prohibited by law, and
provide for the advancement of expenses; and

 

WHEREAS, the Articles and the Oregon Business
Corporation Act (the “Act”) expressly provide that the indemnification and
entitlement to advancement of expenses provided by the Act (or, in the case of
the Articles, provided by the Articles or the Act) are not exclusive, and
thereby contemplate that agreements may be entered into between the Corporation
and directors and officers with respect to indemnification and provision for
advancement of expenses; and

 

WHEREAS, Indemnitee does not regard the protection
available under the Articles and insurance adequate in the present
circumstances, and may not be willing to serve as a director or officer without
adequate protection, and the Corporation desires Indemnitee to serve in such
capacity.

 

NOW THEREFORE, the Corporation and Indemnitee agree as
follows:

 

1.                                       Agreement to Serve. 
Indemnitee agrees to serve or continue to serve as a director and/or
officer of the Corporation and/or one or more of its subsidiaries for so long
as Indemnitee is duly elected or appointed or until such time as Indemnitee
tenders a resignation in writing.

 

2.                                       Definitions.  As used
in this Agreement:

 

(a)                                  The
term “Proceeding” shall include any threatened, pending or completed action,
suit or proceeding, and whether brought in the right of the Corporation or
otherwise, whether of a civil, criminal, administrative or investigative
nature, and whether formal or informal, in which Indemnitee may be or may have
been involved as a party or otherwise, by reason of the fact that Indemnitee is
or was a director and/or officer of the Corporation, or is or was a fiduciary
within the meaning of the Employee Retirement Income Security Act of 1974 (“ERISA”)
with respect to any benefit plan of the Corporation, or is or was serving at
the request of the Corporation as a director, officer or fiduciary of an
employee benefit plan of another corporation, partnership, joint venture, trust
or other enterprise, whether or not serving in such capacity at the time any
liability or expense is incurred for which indemnification or reimbursement can
be provided under this Agreement.

 

 

(b)                                 The
term “Expenses” includes, without limitation thereto, expense of
investigations, judicial or administrative proceedings or appeals, amounts paid
in settlement by Indemnitee, attorneys’ fees and disbursements and any expenses
of establishing a right to indemnification under Section 7 of this
Agreement, but shall not include the amount of judgments or fines against
Indemnitee.

 

(c)                                  References
to “fines” shall include any excise tax assessed with respect to any employee benefit
plan; references to “serving at the request of the corporation” shall include
any service as a director, officer or fiduciary which imposes duties on, or
involves services by, such director, officer or fiduciary with respect to an
employee benefit plan, its participants, or beneficiaries; and a person who
acted in good faith and in a manner reasonably believed to be in the interest
of the participants in and beneficiaries of the plan shall be deemed to have
acted in a manner “not opposed to the best interests of the Corporation” as
referred to in this Agreement.

 

3.                                       Indemnity in Third Party Proceedings.  The Corporation shall indemnify Indemnitee in
accordance with the provisions of this Section 3 if Indemnitee is a party
to or threatened to be made a party to any Proceeding (other than a Proceeding
by or in the right of the Corporation to procure a judgment in its favor)
against all Expenses, judgments and fines actually and reasonably incurred by
Indemnitee in connection with such Proceeding, but only if Indemnitee acted in
good faith and in a manner which Indemnitee reasonably believed to be in or not
opposed to the best interests of the Corporation and, in the case of a criminal
proceeding, in addition, had no reasonable cause to believe that Indemnitee’s
conduct was unlawful.  The termination of
any such Proceeding by judgment, order of court, settlement, conviction or upon
a plea of nolo contendere, or its
equivalent, shall not, of itself, create a presumption that Indemnitee did not
act in good faith and in a manner which Indemnitee reasonably believed to be in
the best interest of the Corporation, and with respect to any criminal
proceeding, that such person had reasonable cause to believe that Indemnitee’s
conduct was unlawful.

 

4.                                       Indemnity in Proceedings By or In the Right of
the Corporation.  The
Corporation shall indemnify Indemnitee in accordance with the provisions of
this Section 4 if Indemnitee is a party to or threatened to be made a
party to any Proceeding by or in the right of the Corporation to procure a
judgment in its favor against all Expenses actually and reasonably incurred by
Indemnitee in connection with the defense or settlement of such Proceeding, but
only if Indemnitee acted in good faith and in a manner which Indemnitee reasonably
believed to be in or not opposed to the best interests of the Corporation,
except that no indemnification for Expenses shall be made under this Section 4
in respect of any claim, issue or matter as to which such person shall have
been adjudged by a court to be liable to the Corporation, unless and only to
the extent that any court in which such Proceeding was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, Indemnitee is fairly and reasonably entitled to
indemnity.

 

5.                                       Indemnification of Expenses of Successful Party.  Notwithstanding any other provisions of this
Agreement, to the extent that Indemnitee has been wholly successful on the
merits or otherwise, in defense of any Proceeding or in defense of any claim,
issue or matter therein, including the dismissal of an action without
prejudice, Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by Indemnitee in connection therewith.

 

2

 

6.                                       Advances of Expenses. 
The Expenses incurred by Indemnitee pursuant to Sections 3, 4 and 8 in
any Proceeding shall be paid by the Corporation in advance at the written
request of Indemnitee, if Indemnitee shall furnish the Corporation a written
affirmation of the Indemnitee’s good faith belief that Indemnitee is entitled
to be indemnified by the Corporation under this Agreement and shall undertake
to repay such amount to the extent that it is ultimately determined by a court
that Indemnitee is not entitled to be indemnified by the Corporation.  Such advances shall be made without regard to
Indemnitee’s ability to repay such expenses and without regard to the
Indemnitee’s ultimate entitlement of indemnification.

 

7.                                       Right of Indemnitee to Indemnification Upon
Application; Procedure Upon Application.  Any indemnification or advances under
Sections 3, 4, 6 or 8 shall be made no later than 45 days after receipt of the
written request of Indemnitee, unless a determination is made within such
45-day period that the Indemnitee has not met the relevant standards for
indemnification set forth in Section 3, 4 or 8 or that an exclusion set
forth in Section 9 is applicable, by:

 

(a)                                  the Board of Directors by a majority vote of a quorum
consisting of directors not at the time parties to the Proceeding; or

 

(b)                                 if
a quorum cannot be obtained under paragraph (a) of this Section 7, by a
majority vote of a committee duly designated by the full board of directors
(including directors who are parties to the Proceeding) consisting solely of
two or more directors not at the time parties to the Proceeding; or

 

(c)                                  by
special legal counsel selected by the board of directors or its committee in
the manner described in paragraph (a) or (b) of this Section 7, or if a
quorum of the board of directors cannot be obtained under paragraph (a) of this
Section 7 and a committee cannot be designated under paragraph (b) of this
Section 7, the special legal counsel shall be selected by a majority vote
of the full board of directors (including directors who are parties to the
Proceeding).

 

The right to indemnification or advances as provided
by this Agreement shall be enforceable by Indemnitee in any court of competent
jurisdiction.  The burden of proving that
indemnification or advances are not appropriate shall be on the
Corporation.  Neither the failure of the
Corporation (including its Board of Directors or special legal counsel) to have
made a determination prior to the commencement of such action that
indemnification or advances are proper in the circumstances because Indemnitee
has met the applicable standard of conduct nor an actual determination by the
Corporation (including its Board of Directors or special legal 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. 
Indemnitee’s expenses incurred in connection with successfully
establishing Indemnitee’s right to indemnification or advances, in whole or in
part, in any such Proceeding shall also be indemnified by the Corporation.

 

3

 

8.                                       Additional Indemnification.

 

(a)                                  Notwithstanding
any limitation in Sections 3 or 4, the Corporation shall indemnify Indemnitee
in accordance with the provisions of this Section 8(a) to the fullest
extent permitted by law if Indemnitee is party to or threatened to be made a
party to any Proceeding (including a Proceeding by or in the right of the
Corporation to procure a judgment in its favor) involving a claim against
Indemnitee for breach of fiduciary duty by Indemnitee against all Expenses,
judgments and fines actually and reasonably incurred by Indemnitee in connection
with such Proceeding, provided that no indemnity shall be made under this Section 8(a)
on account of Indemnitee’s conduct which constitutes a breach of Indemnitee’s
duty of loyalty to the Corporation or its shareholders or is an act or omission
not in good faith or which involves intentional misconduct or a knowing
violation of the law or with respect to an unlawful distribution under Oregon
Revised Statutes (“ORS”) 60.367.

 

(b)                                 Notwithstanding
any limitation in Sections 3, 4 or 8(a), the Corporation shall indemnify
Indemnitee if Indemnitee is a party to or threatened to be made a party to any
Proceeding (including a Proceeding by or in the right of the Corporation to
procure a judgment in its favor) against all Expenses, judgments and fines
actually and reasonably incurred by Indemnitee in connection with such
Proceeding to the fullest extent permitted by the Act, including the
nonexclusivity provision of ORS 60.414(1) and any successor provision and
including any amendments to the Act adopted after the date hereof that may
increase the extent to which a corporation may indemnify its directors and
officers.

 

(c)                                  The
indemnification provided by this Agreement shall not be deemed exclusive of any
other rights to which Indemnitee may be entitled under the Articles, the
Corporation’s Bylaws, any other agreement, any vote of shareholders or
directors, the Act, or otherwise, both as to action in Indemnitee’s official
capacity or as to action in another capacity while holding such office.  The indemnification under this Agreement
shall continue as to Indemnitee even though Indemnitee may have ceased to be a
director or officer and shall inure to the benefit of the heirs and personal
representatives of Indemnitee.

 

9.                                       Exclusions. 
Notwithstanding any provision in this Agreement, the Corporation shall
not be obligated under this Agreement to make any indemnification or advances
in connection with any claim made against Indemnitee:

 

(a)                                  for which payment is required to be made to or on behalf of
Indemnitee under any insurance policy, except with respect to any excess beyond
the amount of required payment under such insurance, unless payment under such
insurance policy is not made after reasonable effort by Indemnitee to obtain
payment.  The Corporation shall be
subrogated with respect to any other rights of Indemnitee with respect to any
payment made by or on behalf of the Corporation under this Agreement; or

 

(b)                                 for any transaction from which Indemnitee derived an
improper personal benefit; or

 

(c)                                  for an accounting of profits made from the purchase and sale
by Indemnitee of securities of the Corporation within the meaning of Section 16(b)
of the Securities

 

4

 

Exchange
Act of 1934 and amendments thereto or similar provisions of any state statutory
law or common law.

 

10.                                 Partial Indemnification. 
If Indemnitee is entitled under any provisions of this Agreement to
indemnification by the Corporation for some or a portion of the Expenses,
judgments and fines actually and reasonably incurred by Indemnitee in the
investigation, defense, appeal or settlement of any Proceeding but not,
however, for the total amount thereof, the Corporation shall nevertheless
indemnify Indemnitee for the portion of such Expenses, judgments or fines to
which Indemnitee is entitled.

 

11.                                 Mutual Acknowledgement. 
The Corporation and Indemnitee acknowledge that, in certain instances,
federal law or public policy may override applicable state law and prohibit the
Corporation from indemnifying Indemnitee under this Agreement or
otherwise.  For example, the Corporation
and Indemnitee acknowledge that the Securities and Exchange Commission (the “SEC”)
has taken the position that indemnification is not permissible for liabilities
arising under certain federal securities laws, and federal legislation
prohibits indemnification for certain ERISA violations.  Furthermore, Indemnitee understands that the
Corporation has undertaken or may be required in the future to undertake with
the SEC to submit for judicial determination the issue of the Corporation’s
power to indemnify Indemnitee in certain circumstances.  All of the Corporation’s obligations under
this Agreement will be subject to the requirements of any such undertaking
required by the SEC to be made by the Corporation.

 

12.                                 Severability.  If this
Agreement or any portion thereof shall be invalidated on any ground by any
court of competent jurisdiction, then the Corporation shall nevertheless
indemnify Indemnitee as to Expenses, judgments and fines with respect to any
Proceeding to the full extent permitted by any applicable portion of this
Agreement that shall not have been invalidated or by any other applicable law.

 

13.                                 Notice.  Indemnitee
shall, as a condition precedent to Indemnitee’s right to be indemnified under
this Agreement, give to the Corporation notice in writing as soon as
practicable of any claim made against Indemnitee for which indemnity will or
could be sought under this Agreement. 
Notice to the Corporation shall be directed to Metro One Telecommunications,
Inc., 11200 Murray Scholls Place, Beaverton, Oregon 97007, Attention:
Corporate Secretary (or such other address as the Corporation shall designate
in writing to Indemnitee).  Notice shall
be deemed received three days after the date postmarked if sent by prepaid
mail, properly addressed.  In addition,
Indemnitee shall give the Corporation such information and cooperation as it
may reasonably require and as shall be within Indemnitee’s power.

 

14.                                 Counterparts.  This
Agreement may be executed in any number of counterparts, each of which shall
constitute the original.

 

15.                                 Applicable Law.  This
Agreement shall be governed by and construed in accordance with Oregon law.

 

16.                                 Successors and Assigns. 
This Agreement shall be binding upon the Corporation and its successors
and assigns.

 

5

 

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

 

	
   

  	
  METRO
  ONE TELECOMMUNICATIONS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  INDEMNITEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  

 

6Exhibit 4.6

SPECIAL DEVICES,
INCORPORATED,

as Issuer

SCOT, INCORPORATED,

as Guarantor

and

UNITED STATES TRUST
COMPANY OF NEW YORK,

as Trustee

SECOND SUPPLEMENTAL INDENTURE

Dated as of September 21, 2000

to

INDENTURE

Dated as of December 15, 1998

between

SPECIAL DEVICES, INCORPORATED, as Issuer

and

UNITED STATES TRUST COMPANY OF NEW YORK, as Trustee

up to $150,000,000

113¤8%
Senior Subordinated Notes due 2008, Series A

113¤8% Senior
Subordinated Notes due 2008, Series B

SECOND SUPPLEMENTAL
INDENTURE, dated as of September 21, 2000, among Special Devices,
Incorporated, a Delaware corporation (the “Company”), Scot Incorporated, a
Delaware corporation and a wholly owned subsidiary of the Company (“Scot”), and
United States Trust Company of New York, as trustee (the “Trustee”).

WHEREAS, SDI Acquisition
Corp., A Delaware corporation (“SDI Acquisition”), has heretofore executed and
delivered to the Trustee an Indenture dated as of December 15, 1998, (as
amended, the “Indenture”), providing for the issuance of its 113¤8%
Senior Subordinated Notes due 2008, Series A in the principal amount of
$100,000,000 (the “Initial Securities”) and its 113¤8% Senior
Subordinated Notes due 2008, Series B (the “Exchange Securities” and,
together with the Initial Securities, the “Securities”); and

WHEREAS, SDI Acquisition
merged with and into the Company and, in connection with the First Supplemental
Indenture, the Company assumed by operation of law all of SDI Acquisition’s
debts, liabilities, duties and obligations, including SDI Acquisition’s
obligations in respect of the Securities and under the Indenture; and

WHEREAS, pursuant to the
Agreement and Plan of Merger (the “Merger Agreement”), dated as of August 18,
2000 among Scot, the Company, SMS Acquisition Corp., a Delaware corporation (“Buyer”),
Scot Acquisition Corp., a Delaware corporation and a wholly owned subsidiary if
Buyer (“Acquisition Sub”), and J.F. Lehman Equity Investors I, L.P., a Delaware
limited partnership, the Buyer will acquire Scot through the merger of
Acquisition Sub with and into Scot (the Merger”); and

WHEREAS, the Merger
complies with the conditions and requirements set forth in the Indenture,
including Section 5.01; and

WHEREAS, pursuant to Section 4.19
of the Indenture, the Guarantee of Scot and all obligations of Scot thereunder
and each and every covenant, undertaking, agreements and obligations under the
Indenture will be automatically released immediately upon the consummation of
the Merger; and

WHEREAS, the Trustee, the
Company and Scot desire by this Second Supplemental Indenture pursuant to and
as contemplated by Sections 4.19 and 10.01 of the Indenture, to expressly
acknowledge the release and discharge of the Guarantee of Scot under the
Indenture and the Securities; and

WHEREAS, all conditions
and requirements necessary to make this Second Supplemental Indenture a valid,
binding and legal instrument in accordance with its terms upon the Company,
Scot and the Trustee, have been performed and fulfilled by the applicable
parties hereto and the execution and deliver thereof have been in all respects
duly authorized by the applicable parties hereto.

NOW,
THEREFORE, in consideration of the above premises, each party agrees, for the
benefit of the others and for the equal and ratable benefit of the Holders of
the Securities, as follows:

ARTICLE
ONE

RELEASE OF OBLIGATIONS

SECTION 1.01.   Release of Obligations of Scot.

Pursuant
to the requirements of Section 4.19 of the Indenture, the Trustee hereby
unconditionally releases and terminates the Guarantee of Scot, and releases and
discharges Scot from all obligations and undertakings of a Guarantor under the
Indenture. From and after the date hereof, Scot shall have no further
obligations or liabilities in respect of the Securities or the Guarantee.

ARTICLE TWO

MISCELLANEOUS
PROVISIONS

SECTION 2.01   Terms Defined.

For all purposes of this
Second Supplemental Indenture, except as otherwise defined or unless the
context otherwise requires, terms used in capitalized forms in this Second
Supplemental Indenture and defined in the Indenture have the meanings specified
in the Indenture.

SECTION 2.02   Indenture.

Except as amended hereby,
the Indenture, and the Securities are in all respects ratified and confirmed
and all the terms shall remain in full force and effect.

SECTION 2.03   Governing Law.

THIS SECOND SUPPLEMENTAL
INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE
OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

SECTION 2.04   Successors.

All agreements of the
Company and Scot in this Second Supplemental Indenture and the Securities shall
bind their respective successors. All agreements of the Trustee in this Second
Supplemental Indenture shall bind its successors.

SECTION 2.05   Duplicate Originals.

The parties may sign any
number of copies of this Second Supplemental Indenture. Each signed copy shall
be an original, but all of them together shall represent the same agreement.

SECTION 2.06   Trustee Disclaimer.

The Trustee accepts the
amendment of the Indenture effected by this Second Supplemental Indenture and
agrees to execute the trust created by the Indenture as hereby amended, but
only upon the terms and conditions set forth in the Indenture, including the
terms and provisions defining and limiting the liabilities and responsibilities
of the Trustee, which terms and provisions shall in like manner define and
limit its liabilities and responsibilities in the performance of the trust
created by the Indenture as hereby amended and, without limiting the generality
of the foregoing, the Trustee shall not be responsible in any manner whatsoever
for or with respect to any of the recitals or statements contained here, all of
which recitals or statements are made solely by the Company and Scot, or for or
with respect to (i) the validity of the terms of this Second Supplemental
Indenture or any of the terms or provisions hereof, (ii) the proper
authorization hereof by the Company and Scot by corporate action or otherwise, (iii) the
due execution hereof by the Company and Scot or (iv) the consequences
(direct or indirect and whether deliberate or inadvertent) of any amendment
herein provided for, and the Trustee makes no representation with respect to
any such matters.

[Signature Page Follows]

SIGNATURES

IN
WITNESS WHEREOF, the parties hereto have caused this Second Supplemental
Indenture to be duly executed, all as of the date first written above.

	
  

  	
  SPECIAL DEVICES, INCORPORATED,

  as Issuer

  
	
   

  	
  By:

  	
  /s/ THOMAS W. CRESANTE

  
	
   

  	
   

  	
  Name:

  	
  Thomas W. Cresante

  
	
   

  	
   

  	
  Title:

  	
  President and Chief Executive Officer

  
	
   

  	
  SCOT,
  INCORPORATED,

  as Guarantor

  
	
   

  	
  By:

  	
  /s/ JOSEPH A. STROUD

  
	
   

  	
   

  	
  Name:

  	
  Joseph A. Stroud

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Assistant Secretary

  
	
   

  	
  UNITED
  STATES TRUST COMPANY OF NEW YORK,

  as Trustee

  
	
   

  	
  By:

  	
  /s/ MARGARET M. CIESMELEWSKI

  
	
   

  	
   

  	
  Name:

  	
  Margaret M. Ciesmelewski

  
	
   

  	
   

  	
  Title:

  	
  Assistant Vice President

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