Document:

Exhibit 10.1

 

Indemnification Agreement

 

AGREEMENT,
effective as of               ,
2008, between Walter Industries, Inc., a Delaware corporation (the “Corporation”),
and                     (the
“Indemnitee”).

 

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

 

WHEREAS,
Indemnitee is a director or officer of the Corporation;

 

WHEREAS,
both the Corporation and Indemnitee recognize the increased risk of litigation
and other claims being asserted against directors and officers of public
companies in today’s environment and that competent and experienced individuals
are increasingly reluctant to serve or to continue to serve as directors or
officers of public corporations unless they are protected by comprehensive
liability insurance or indemnification, or both, due to such increased risk;

 

WHEREAS,
Section 145 of the Delaware General Corporation Law (“Section 145”),
under which the Corporation is organized, empowers the Corporation to indemnify
its directors and officers by agreement and to indemnify persons who serve, at
the request of the Corporation, as directors or officers, and expressly
provides that the indemnification provided by Section 145 is not
exclusive;

 

WHEREAS,
the By-Laws of the Corporation require the Corporation to indemnify and advance
expenses to its directors and officers to the full extent permitted by law and
the Indemnitee has agreed to serve as a director or officer of the Corporation
in part in reliance on such By-Laws;

 

WHEREAS,
the Corporation, after reasonable investigation, has determined that the
liability insurance coverage presently available to the Corporation may be
inadequate in certain circumstances to cover all possible exposure for which
Indemnitee should be protected, in the judgment of the Corporation, and the
Corporation is of the opinion that the best interests of the Corporation and
its stockholders would best be served by a combination of insurance and
indemnification from the Corporation;

 

WHEREAS,
in recognition of Indemnitee’s need for substantial protection against personal
liability in order to enhance Indemnitee’s continued service to the Corporation
in an effective manner and Indemnitee’s reliance on the aforesaid By-Laws, and
in part to provide Indemnitee with specific contractual assurance that the
protection promised by such By-Laws will be available to Indemnitee (regardless
of, among other things, any amendment to or revocation of such By-Laws or any
change in the composition of the Corporation’s Board of Directors or
acquisition transaction relating to the Corporation), the Corporation wishes to
provide in this Agreement for the indemnification of and the advancing of
expenses to Indemnitee to the full extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the extent
insurance is maintained, for the continued coverage of Indemnitee under the
Corporation’s directors’ and officers’ liability insurance policies;

 

NOW,
THEREFORE, in consideration of the premises set forth above, and the mutual
covenants and agreement set forth below, and of Indemnitee continuing to serve
the Corporation as a director or officer, and intending to be legally bound
hereby, the parties hereto agree as follows:

 

1.                                       Certain Definitions:

 

(a)                                  Change in Control: shall be deemed to have occurred if (i) any
“person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the Corporation
or a corporation owned directly or indirectly by the stockholders of the
Corporation in substantially the same proportions as their ownership of stock
of the Corporation, is or becomes the “beneficial owner” (as defined in Rule 13d-3
under said Act), directly or indirectly, of securities of the Corporation
representing 20% or more of the total voting power represented by the
Corporation’s then outstanding Voting Securities, or (ii) during any
period of two consecutive years, individuals who at the 

 

 

beginning of such period
constitute the Board of Directors of the Corporation and any new director whose
election by the Board of Directors or nomination for election by the
Corporation’s stockholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were directors at
the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority thereof,
or (iii) the stockholders of the Corporation approve a merger or
consolidation of the Corporation with any other entity, other than a merger or
consolidation which would result in the Voting Securities of the Corporation
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities of the
surviving entity) at least 80% of the total voting power represented by the
Voting Securities of the Corporation or such surviving entity outstanding
immediately after such merger or consolidation, or the stockholders of the
Corporation approve a plan of complete liquidation of the Corporation or an
agreement for the sale or disposition by the Corporation (in one transaction or
a series of transactions) of all or substantially all of the Corporation’s
assets.

 

(b)                                 Corporate Capacity: shall mean Indemnitee’s status or
capacity as, or fact that Indemnitee is or was, a director, officer, employee,
agent or fiduciary of the Corporation, or is or was serving at the request of
the Corporation as a director, officer, employee, trustee, agent or fiduciary
of another Entity.

 

(c)                                  Entity: shall mean a corporation, partnership, limited
liability company, joint venture, employee benefit plan, trust or other
enterprise.  References herein to a
director of an Entity shall include, in the case of any Entity that is not
managed by a board of directors, such other position, such as manager or
trustee or member of the governing body of such Entity, that entails
responsibility for the management and direction of such Entity’s affairs,
including, without limitation, the general partner of any partnership (general
or limited) and the manager or managing member of any limited liability
company.

 

(d)                                 Expenses: include attorneys’ fees and all other costs,
expenses and obligations reasonably paid or incurred in connection with
investigating, defending, being a witness in or participating in (including on
appeal), or preparing to defend, be a witness in or participate in any
Proceeding for which indemnity is available under Section 2(a) hereof
or in connection with seeking recovery under any directors’ and officers’
liability insurance policies maintained by the Corporation.

 

(e)                                  Indemnifiable Event: any event or occurrence related to the
fact that Indemnitee is or was a director, officer, employee, agent or
fiduciary of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee, trustee, agent or fiduciary of
another Entity, or by reason of anything done or not done by Indemnitee in any
such capacity.

 

(f)                                    Proceeding: is any threatened, pending or completed action,
suit, arbitration, alternative dispute mechanism or proceeding, or any inquiry
or investigation (including an internal investigation), whether conducted by
the Corporation or any other party, that Indemnitee in good faith believes
might lead to the institution of any such action, suit or proceeding, whether
civil, criminal, administrative, investigative or other.

 

(g)                                 Reviewing Party: subject to Section 3 of this
Agreement, a committee or person consisting of a member or members of the
Corporation’s Board of Directors or any other person or body appointed by the
Board who is not a party to or affected by the particular claim for which
Indemnitee is seeking indemnification. 
If there has not been a Change in Control, the Reviewing Party shall be
selected by the Board of Directors (unless the Indemnitee is a director or
officer of the Corporation at the time of the determination of 

 

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entitlement to
indemnification contemplated by Section 3 of this Agreement, in which case
the Reviewing Party shall be determined as provided in Section 3), and if
there has been such a Change in Control, the Reviewing Party shall be special,
independent counsel selected by Indemnitee and approved by the Corporation
(which approval shall not be unreasonably withheld), and who has not otherwise
performed services for the Corporation or Indemnitee within the last 5 years
(other than in connection with such matters). Such counsel, among other things,
shall render its written opinion to the Corporation and Indemnitee as to
whether and to what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Corporation agrees to pay the reasonable fees of such
special, independent counsel and to indemnify fully such counsel against any
and all expenses (including attorney’s fees), claims, liabilities and damages
arising out of or relating to this Agreement or its engagement pursuant hereto.

 

(h)                                 Voting Securities: any securities of the Corporation which
vote generally in the election of directors.

 

2.                                       Basic Indemnification Arrangement.

 

(a)                                  In the event Indemnitee was, is or becomes
a party to or witness or other participant in, or is threatened to be made a
party to or witness or other participant in a Proceeding by reason of (or
arising in part out of) the Indemnitee’s Corporate Capacity or an Indemnifiable
Event, the Corporation shall indemnify Indemnitee to the fullest extent
authorized by applicable law as soon as practicable but in any event no later
than thirty days (60 days if the Reviewing Party is special, independent
counsel) after written demand is presented to the Corporation, against any and
all Expenses, judgments, fines, penalties and amounts paid in settlement
(including all interest, assessments and other charges paid or payable in
connection with or in respect of such Expenses, judgments, fines, penalties or
amounts paid in settlement), paid or incurred in connection with such
Proceeding.  To the fullest extent
authorized by applicable law, if so requested by Indemnitee in writing, the
Corporation shall advance (within ten business days of such request) any and
all Expenses to Indemnitee in advance of the final disposition of a Proceeding
to which Indemnitee was, is or becomes a party to or in which Indemnitee was,
is or becomes a witness or other participant in, or to which Indemnitee is
threatened to be made a party to or witness or other participant in, by reason
of (or arising in part out of) the Indemnitee’s Corporate Capacity or an
Indemnifiable Event or in connection with seeking recovery under any directors’
and officers’ liability insurance policies maintained by the Corporation (an “Expense
Advance”).  An Expense Advance shall be
made only upon receipt of (1) an undertaking by or on behalf of the
Indemnitee to repay all amounts so advanced in the event that it shall
ultimately be determined in accordance with this Agreement, including Section 2(c) hereof,
that the Indemnitee is not entitled to be indemnified by the Corporation as
authorized in this Agreement and applicable law; and (2) satisfactory
evidence as to the amount of such Expenses. 
The Indemnitee’s written certification, together with a copy of the
statement paid or to be paid by the Indemnitee, shall constitute satisfactory
evidence of the amount of such Expenses.

 

(b)                                 Notwithstanding anything in this
Agreement to the contrary, prior to a Change in Control Indemnitee shall not be
entitled to indemnification or Expense Advance pursuant to this Agreement in
connection with any Proceeding, however denominated, initiated by Indemnitee
against the Corporation or any director or officer of the Corporation unless
the Corporation has joined in or consented to the initiation of such
Proceeding.

 

3.                                       Indemnification Determination: Any indemnification under this
agreement (unless ordered by a Court) shall be made by the Corporation only as
authorized in the specific case upon a determination by the Reviewing Party
that indemnification of the Indemnitee is proper in the circumstance because
Indemnitee has satisfied the standards of conduct set forth in Section 145
of the General Corporation Law of the State of Delaware and is otherwise
entitled to be indemnified pursuant to this Agreement and applicable law. The
Corporation agrees that all determinations of the right of Indemnitee to
indemnification under this 

 

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Agreement or any other
agreement, insurance policy, by-law or certificate of incorporation of the
Corporation and its predecessors shall be made by the Reviewing Party in a
writing delivered to the Corporation and the Indemnitee (and if the Reviewing
Party is special, independent counsel, in a written opinion delivered to the
Corporation and the Indemnitee).  If the
Reviewing Party determines that the Indemnitee is not entitled to
indemnification, then such writing (or opinion) shall disclose the bases for
such determination in reasonable detail. 
Notwithstanding anything in this Agreement to the contrary, if
Indemnitee is a director or officer of the Corporation at the time of the
determination contemplated by this Section 3, then to the extent required
by applicable law, the Reviewing Party that makes the determination of
entitlement to indemnification contemplated by this Section 3 shall be one
of the following: (i) if there has been a Change in Control, the Reviewing
Party shall be special, independent counsel selected in the manner provided in Section 1(g);
and (ii) if there has not been a Change in Control, the Reviewing Party
shall be (A) the directors who are not parties to the Proceeding in
connection with which Indemnification is sought, even though less than a quorum
of the Board of Directors, (B) a committee of such directors designated by
a majority vote of such directors, even though less than a quorum of the Board
of Directors, or (C) if there are no such directors, or if a majority of
such directors so direct, special, independent legal counsel who has not
otherwise performed services for the Corporation or Indemnitee within the last
5 years (other than in connection with such matters).  If there has been no determination by the
Reviewing Party within thirty days (60 days if the Reviewing Party is special,
independent counsel) after written demand for indemnification is presented to
the Corporation or if the Reviewing Party determines that Indemnitee is not
permitted to be indemnified in whole or in part under applicable law,
Indemnitee shall have the right to commence litigation in any court in the
State of Delaware having subject matter jurisdiction thereof and in which venue
is proper seeking a determination by the court or challenging any such
determination by the Reviewing Party or any aspect thereof, and the Corporation
hereby consents to service of process and to appear in any such proceeding.

 

4.             Indemnification for Expenses. To the fullest
extent permitted by applicable law, the Corporation shall indemnify Indemnitee
against any and all Expenses.

 

5.             Partial Indemnity, Etc. If Indemnitee is entitled
under any provision of this Agreement to indemnification by the Corporation for
some or a portion of the Expenses, judgments, fines, penalties and amounts paid
in settlement of a Proceeding but not, however, for all of the total amount
thereof, the Corporation shall nevertheless indemnify Indemnitee for the
portion thereof to which Indemnitee is entitled. Moreover, notwithstanding any
other provision of this Agreement, to the extent that Indemnitee has been
successful on the merits or otherwise in defense of any or all Proceedings
relating in whole or in part to an Indemnifiable Event or Indemnitee’s
Corporate Capacity or in defense of any issue or matter therein, including
dismissal without prejudice, Indemnitee shall be indemnified against all
Expenses incurred in connection therewith. In connection with any determination
by the Reviewing Party or otherwise as to whether Indemnitee is entitled to be
indemnified hereunder the burden of proof shall be on the Corporation to
establish that Indemnitee is not so entitled.

 

6.             No Presumption. For purposes of this Agreement,
the termination of any claim, action, suit or proceeding, by judgment, order,
settlement (whether with or without court approval) or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not create a presumption that
Indemnitee did not meet any particular standard of conduct or have any
particular belief or that a court has determined that indemnification is not
permitted by applicable law.

 

7.             Non-exclusivity, Etc. The rights of the
Indemnitee hereunder shall be in addition to any other rights Indemnitee may
have under the Corporation’s Certificate of Incorporation or By-Laws, the
Delaware General Corporation Law, a vote of stockholders, a resolution of
directors, or otherwise. To the extent that a change in the Delaware General
Corporation Law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the
Corporation’s 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.   But no
amendment or alteration of the Corporation’s Certificate of Incorporation or
By-Laws or any other agreement shall adversely affect the rights provided to
Indemnitee hereunder.

 

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8.             Liability Insurance. To the extent the Corporation
maintains an insurance policy or policies providing directors’ and officers’
liability insurance, Indemnitee shall be covered by such policy or policies, in
accordance with its or their terms, to the maximum extent of the coverage
available for any Corporation director or officer.  If, at the time of the receipt of a notice of
a claim pursuant to the terms hereof, the Corporation has director and officer
liability insurance in effect, the Corporation shall give prompt notice of such
claim or of the commencement of a proceeding, as the case may be, to the
insurers in accordance with the procedures set forth in the respective
policies.  The Corporation shall
thereafter take all necessary or desirable action to cause such insurers to
pay, on behalf of the Indemnitee, all amounts payable as a result of such
proceeding in accordance with the terms of such policies.  This Agreement shall not limit the Indemnitee’s
rights under any direct of so-called “Side A” coverages available to the
Indemnitee.

 

9.             Period of Limitations. No legal action shall be
brought and no cause of action shall be asserted by or on behalf of the
Corporation or any affiliate of the Corporation against Indemnitee, Indemnitee’s
spouse, heirs, executors or personal or legal representatives after the
expiration of two years from the date of accrual of such cause of action, and
any claim or cause of action of the Corporation or its affiliate shall be
extinguished and deemed released unless asserted by the timely filing of a
legal action within such two-year period; provided, however, that if any
shorter period of limitations is otherwise applicable to any such cause of
action such shorter period shall govern.

 

10.           No Modification. This
Agreement supersedes any prior indemnification agreement between Indemnitee and
the Corporation or its predecessors (but not any indemnification provision
contained in any by-law or certificate of incorporation of any of the
foregoing).  No supplement, modification
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.

 

11.           Subrogation. In the event of
payment under this Agreement, the Corporation shall be subrogated to the extent
of such payment to all of the rights of recovery of Indemnitee, who shall
execute all papers required and shall do everything reasonably necessary to
secure such rights, including the execution of such documents necessary to
enable the Corporation effectively to bring suit to enforce such rights.

 

12.           No Duplication of Payments.
The Corporation shall not be liable under this Agreement to make any payment in
connection with any claim made against Indemnitee to the extent Indemnitee has
otherwise actually received payment (under any insurance policy, by-law,
certificate of incorporation, other indemnity provision, or otherwise) of the
amounts otherwise indemnifiable hereunder.

 

13.           Binding Effect, Etc. 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 Corporation,
spouses, heirs, and personal and legal representatives. The Corporation shall
require and cause any successor (whether direct or indirect by purchase,
merger, consolidation or otherwise) to all, substantially all, or a substantial
part, of the business and/or assets of the Corporation, by written agreement in
form and substance satisfactory to the Indemnitee, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent that
the Corporation would be required to perform if no such succession had taken
place. This Agreement shall continue in effect regardless of whether Indemnitee
continues to serve as a director or officer of the Corporation or of any other
enterprise at the Corporation’s request.

 

14.           Severability. The provisions
of this Agreement shall be severable in the event that any of the provisions
hereof (including any provision within a single section, paragraph or sentence)
are held by a court of competent jurisdiction to be invalid, void or otherwise
unenforceable, and the remaining provisions shall remain enforceable to the
fullest extent permitted by law.

 

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15.           Governing Law. This Agreement
shall be governed by and construed and enforced in accordance with the laws of
the State of Delaware applicable to contracts made and to be performed in such
State without giving effect to the principles of conflicts of laws.  Indemnitee is specifically authorized to
bring suit in the event of any determination by any person that indemnification
is not available to the Indemnitee hereunder or that Indemnitee will not be
entitled to an Expense Advance, if a payment owed to Indemnitee has not been
made in a timely manner, or if there is any other breach of the Agreement.  For purposes of any action or proceeding
arising out of or in connection with this Agreement, the Indemnitee agrees to (i) the
exclusive jurisdiction of the Chancery Court of the State of Delaware (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, (ii) waive any objection to the
laying of venue of any such action or proceeding in the Delaware Court and (iii) waive
any claim that any such action or proceeding brought in the Delaware Court has
been brought in an improper or inconvenient forum.

 

IN
WITNESS WHEREOF, the Corporation has duly executed and delivered this Agreement
as of the date first above written.

 

	
   

  	
   

  	
  Walter
  Industries, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Accepted
  and agreed

  	
   

  	
   

  
	
  as
  of the date first written above:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  [Name
  of Director or Officer]

  	
   

  	
   

  

 

6Exhibit
10.1

 

INDEMNIFICATION AGREEMENT

 

THIS INDEMNIFICATION AGREEMENT, made and executed this
       day
of                                 ,
2008, by and between Northern Technologies International Corporation, a
Delaware corporation (the “Company”), and                                                             ,
an individual resident of the State
of                                        (the
“Indemnitee”).

 

WHEREAS, the Company is
aware that, in order to induce highly competent persons to serve the Company as
directors or officers or in other capacities, the Company must provide such
persons with adequate protection through insurance and indemnification against
inordinate risks of claims and actions against them arising out of their
service to and activities on behalf of the Company;

 

WHEREAS, the Company
recognizes that the increasing difficulty in obtaining directors’ and officers’
liability insurance, the increases in the cost of such insurance and the
general reductions in the coverage of such insurance have increased the
difficulty of attracting and retaining such persons;

 

WHEREAS, the Board of
Directors of the Company has determined that it is essential to the best
interests of the Company’s stockholders that the Company act to assure such
persons that there will be increased certainty of such protection in the
future;

 

WHEREAS, it is reasonable,
prudent and necessary for the Company contractually to obligate itself to
indemnify such persons to the fullest extent permitted by applicable law so that
they will continue to serve the Company free from undue concern that they will
not be so indemnified; and

 

WHEREAS, the Indemnitee is
willing to serve, continue to serve, and take on additional service for or on
behalf of the Company or any of its direct or indirect subsidiaries on the
condition that he/she be so indemnified.

 

NOW, THEREFORE, in
consideration of the premises and the mutual promises and covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Indemnitee do
hereby agree as follows:

 

1.             Service by the Indemnitee. 
The Indemnitee agrees to serve and/or continue to serve as a director,
officer, employee or other agent of the Company faithfully and will discharge
his/her duties and responsibilities to the best of his/her ability so long as
the Indemnitee is duly elected or qualified in accordance with the provisions
of the Company’s Certificate of Incorporation, as amended or restated from time
to time (the “Certificate”) or the Company’s Bylaws, as amended or restated
from time to time (the “Bylaws”) and the General Corporation Law of the State
of Delaware, as amended from time to time (the “DGCL”), or until his/her
earlier death, resignation or removal. The Indemnitee may at any time and for
any reason resign from such position (subject to any other contractual
obligation or other obligation imposed by operation by law), in which event the
Company shall have no obligation under this Agreement to

 

 

continue to
retain the Indemnitee in any such position. Nothing in this Agreement shall
confer upon the Indemnitee the right to continue in the employ of the Company
or as a director of the Company or affect the right of the Company to terminate
the Indemnitee’s employment or service at any time in the sole discretion of
the Company, with or without cause, subject to any contract rights of the
Indemnitee created or existing otherwise than under this Agreement.

 

2.             Indemnification. 
The Company shall indemnify the Indemnitee against all Expenses (as
defined below), judgments, fines and amounts paid in settlement actually and
reasonably incurred by the Indemnitee as provided in this Agreement to the
fullest extent permitted by the Certificate, Bylaws and DGCL or other
applicable law in effect on the date of this Agreement and to any greater
extent that applicable law may in the future from time to time permit. Without
diminishing the scope of the indemnification provided by this Section 2,
the rights of indemnification of the Indemnitee provided hereunder shall
include, but shall not be limited to, those rights hereinafter set forth,
except that no indemnification shall be paid to the Indemnitee:

 

(a)           on
account of any action, suit or proceeding in which judgment is rendered against
the Indemnitee for disgorgement of profits made from the purchase or sale by
the Indemnitee of securities of the Company pursuant to the provisions of Section 16(b) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or
similar provisions of any federal, state or local statutory law;

 

(b)           on
account of conduct of the Indemnitee which is finally adjudged by a court of
competent jurisdiction to have been knowingly fraudulent or to constitute
willful misconduct;

 

(c)           in
any circumstance where such indemnification is expressly prohibited by
applicable law;

 

(d)           with
respect to liability for which payment is actually made to the Indemnitee under
a valid and collectible insurance policy of the Company or under a valid and
enforceable indemnity clause, Bylaw or agreement (other than this Agreement) of
the Company, except in respect of any liability in excess of payment under such
insurance, clause, Bylaw or agreement;

 

(e)           if
a final decision by a court having jurisdiction in the matter shall determine
that such indemnification is not lawful (and, in this respect, both the Company
and the Indemnitee have been advised that it is the position of the Securities
and Exchange Commission that indemnification for liabilities arising under the
federal securities laws is against public policy and is, therefore,
unenforceable, and that claims for indemnification should be submitted to the
appropriate court for adjudication); or

 

(f)            in
connection with any action, suit or proceeding by the Indemnitee against the
Company or any of its direct or indirect subsidiaries or the directors,
officers, employees or other Indemnitees of the Company or any of its direct or
indirect subsidiaries, (i) unless such indemnification is expressly required
to be made by law, (ii) unless the proceeding was authorized by the Board
of Directors of the Company,

 

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(iii) unless such indemnification is provided by
the Company, in its sole discretion, pursuant to the powers vested in the
Company under applicable law, or (iv) except as provided in Sections 11
and 13 hereof.

 

3.             Actions or Proceedings Other Than an Action
by or in the Right of the Company.  The Indemnitee shall be
entitled to the indemnification rights provided in this Section 3 if the
Indemnitee was or is a party or witness or is threatened to be a party or witness
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative in nature, other than an
action by or in the right of the Company, by reason of the fact that the
Indemnitee is or was a director, officer, employee, agent or fiduciary of the
Company, or any of its direct or indirect subsidiaries, or is or was serving at
the request of the Company, or any of its direct or indirect subsidiaries, as a
director, officer, employee, agent or fiduciary of any other entity, including,
but not limited to, another corporation, partnership, limited liability
company, employee benefit plan, joint venture, trust or other enterprise, or by
reason of any act or omission by him/her in such capacity. Pursuant to this Section 3,
the Indemnitee shall be indemnified against all Expenses, judgments,
penalties (including excise and similar taxes), fines and amounts paid in
settlement which were actually and reasonably incurred by the Indemnitee in
connection with such action, suit or proceeding (including, but not limited to,
the investigation, defense or appeal thereof), if the Indemnitee acted in good faith
and in a manner the Indemnitee reasonably believed to be in or not opposed to
the best interests of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his/her conduct was unlawful.

 

4.             Actions by or in the Right of the Company. 
The Indemnitee shall be entitled to the indemnification rights provided
in this Section 4 if the Indemnitee was or is a party or witness or is
threatened to be made a party or witness to any threatened, pending or
completed action, suit or proceeding brought by or in the right of the Company
to procure a judgment in its favor by reason of the fact that the Indemnitee is
or was a director, officer, employee, agent or fiduciary of the Company, or any
of its direct or indirect subsidiaries, or is or was serving at the request of
the Company, or any of its direct or indirect subsidiaries, as a director,
officer, employee, agent or fiduciary of another entity, including, but not
limited to, another corporation, partnership, limited liability company,
employee benefit plan, joint venture, trust or other enterprise, or by reason
of any act or omission by him/her in any such capacity. Pursuant to this Section 4,
the Indemnitee shall be indemnified against all Expenses actually and reasonably
incurred by him/her in connection with the defense or settlement of such
action, suit or proceeding (including, but not limited to the investigation,
defense or appeal thereof), if the Indemnitee acted in good faith and in a
manner the Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company; provided however, that no such indemnification shall
be made in respect of any claim, issue, or matter as to which the Indemnitee
shall have been adjudged to be liable to the Company, unless and only to the
extent that the Court of Chancery of the State of Delaware or the court in
which such action, suit or proceeding was brought shall determine upon
application that, despite the adjudication of liability but in view of all the circumstances
of the case, the Indemnitee is fairly and reasonably entitled to be indemnified
against such Expenses actually and reasonably incurred by him/her which such
court shall deem proper.

 

3

 

5.             Good Faith Definition. 
For purposes of this Agreement, the Indemnitee shall be deemed to have
acted in good faith and in a manner the Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company, or, with respect to any
criminal action or proceeding to have had no reasonable cause to believe the
Indemnitee’s conduct was unlawful, if such action was based on (i) the records
or books of the account of the Company or other enterprise, including financial
statements; (ii) information supplied to the Indemnitee by the officers of the
Company or other enterprise in the course of their duties; (iii) the
advice of legal counsel for the Company or other enterprise; or (iv) information
or records given in reports made to the Company or other enterprise by an
independent certified public accountant or by an appraiser or other expert
selected with reasonable care by the Company or other enterprise.

 

6.             Indemnification for Expenses of Successful
Party.  Notwithstanding the other provisions of this
Agreement, to the extent that the Indemnitee has served on behalf of the
Company, or any of its direct or indirect subsidiaries, as a witness or other
participant in any class action or proceeding, or has been successful, on the
merits or otherwise, in defense of any action, suit or proceeding referred to
in Section 3 and 4 hereof, or in defense of any claim, issue or matter
therein, including, but not limited to, the dismissal of any action without
prejudice, the Indemnitee shall be indemnified against all Expenses actually
and reasonably incurred by the Indemnitee in connection therewith, regardless
of whether or not the Indemnitee has met the applicable standards of Section 3
or 4 and without any determination pursuant to Section 8.

 

7.             Partial Indemnification. 
If the Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the Expenses,
judgments, fines and amounts paid in settlement actually and reasonably incurred
by the Indemnitee in connection with the investigation, defense, appeal or
settlement of such suit, action, investigation or proceeding described in Section 3
or 4 hereof, but is not entitled to indemnification for the total amount
thereof, the Company shall nevertheless indemnify the Indemnitee for the
portion of such Expenses, judgments, penalties, fines and amounts paid in
settlement actually and reasonably incurred by the Indemnitee to which the
Indemnitee is entitled.

 

8.             Procedure
for Determination of Entitlement to Indemnification.

 

(a)           To
obtain indemnification under this Agreement, the Indemnitee shall submit to the
Company a written request, including documentation and information which is
reasonably available to the Indemnitee and is reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to indemnification. The
Secretary of the Company shall, promptly upon receipt of a request for
indemnification, advise the Board of Directors in writing that the Indemnitee
has requested indemnification. Any Expenses incurred by the Indemnitee in
connection with the Indemnitee’s request for indemnification hereunder shall be
borne by the Company. The Company hereby indemnifies and agrees to hold the
Indemnitee harmless for any Expenses incurred by the Indemnitee under the
immediately preceding sentence irrespective of the outcome of the determination
of the Indemnitee’s entitlement to indemnification.

 

(b)           Upon
written request by the Indemnitee for indemnification pursuant to Section 3
or 4 hereof, the entitlement of the Indemnitee to indemnification pursuant to
the

 

4

 

terms of this Agreement shall be determined by the
following person or persons, who shall be empowered to make such determination:
(i) if a Change in Control (as hereinafter defined) shall have occurred,
by Independent Counsel (as hereinafter defined) (unless the Indemnitee shall
request in writing that such determination be made by the Board of Directors
(or a committee thereof) in the manner provided for in clause (ii) of
this Section 8(b)) in a written opinion to the Board of Directors, a copy
of which shall be delivered to the Indemnitee; or (ii) if a Change in
Control shall not have occurred, (A)(1) by the Board of Directors of the
Company, by a majority vote of Disinterested Directors (as hereinafter defined)
even though less than a quorum, or (2) by a committee of Disinterested
Directors designated by majority vote of Disinterested Directors, even though
less than a quorum, or (B) if there are no such Disinterested Directors
or, even if there are such Disinterested Directors, if the Board of Directors,
by the majority vote of Disinterested Directors, so directs, by Independent
Counsel in a written opinion to the Board of Directors, a copy of which shall
be delivered to the Indemnitee. Such Independent Counsel shall be selected by
the Board of Directors and approved by the Indemnitee. Upon failure of the
Board of Directors to so select, or upon failure of the Indemnitee to so
approve, such Independent Counsel shall be selected by the Chancellor of the
State of Delaware or such other person as the Chancellor shall designate to
make such selection. Such determination of entitlement to indemnification shall
be made not later than 45 days after receipt by the Company of a written
request for indemnification. If the person making such determination shall
determine that the Indemnitee is entitled to indemnification as to part (but
not all) of the application for indemnification, such person shall reasonably
prorate such part of indemnification among such claims, issues or matters. If
it is so determined that the Indemnitee is entitled to indemnification, payment
to the Indemnitee shall be made within ten days after such determination.

 

9.             Presumptions
and Effect of Certain Proceedings.

 

(a)           In
making a determination with respect to entitlement to indemnification, the
Indemnitee shall be presumed to be entitled to indemnification hereunder and
the Company shall have the burden of proof in the making of any determination
contrary to such presumption.

 

(b)           If
the Board of Directors, or such other person or persons empowered pursuant to Section 8
to make the determination of whether the Indemnitee is entitled to
indemnification, shall have failed to make a determination as to entitlement to
indemnification within 45 days after receipt by the Company of such
request, the requisite determination of entitlement to indemnification shall be
deemed to have been made and the Indemnitee shall be absolutely entitled to
such indemnification, absent actual and material fraud in the request for
indemnification or a prohibition of indemnification under applicable law. The
termination of any action, suit, investigation or proceeding described in Section 3
or 4 hereof by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall
not, of itself: (i) create a presumption that the Indemnitee did not act
in good faith and in a manner which he/she reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any criminal
action or proceeding, that the Indemnitee has reasonable cause to believe that
the Indemnitee’s conduct was unlawful; or (ii) otherwise

 

5

 

adversely affect the rights of the Indemnitee to
indemnification, except as may be provided herein.

 

10.           Advancement of Expenses. 
All reasonable Expenses actually incurred by the Indemnitee in
connection with any threatened or pending action, suit or proceeding shall be
paid by the Company in advance of the final disposition of such action, suit or
proceeding, if so requested by the Indemnitee, within 20 days after the
receipt by the Company of a statement or statements from the Indemnitee requesting
such advance or advances. The Indemnitee may submit such statements from time
to time. The Indemnitee’s entitlement to such Expenses shall include those
incurred in connection with any proceeding by the Indemnitee seeking an
adjudication or award in arbitration pursuant to this Agreement. Such statement
or statements shall reasonably evidence the Expenses incurred by the Indemnitee
in connection therewith and shall include or be accompanied by a written
affirmation by the Indemnitee of the Indemnitee’s good faith belief that the
Indemnitee has met the standard of conduct necessary for indemnification under
this Agreement and an undertaking by or on behalf of the Indemnitee to repay
such amount if it is ultimately determined that the Indemnitee is not entitled
to be indemnified against such Expenses by the Company pursuant to this
Agreement or otherwise. Each written undertaking to pay amounts advanced must
be an unlimited general obligation but need not be secured, and shall be
accepted without reference to financial ability to make repayment.

 

11.           Remedies of the Indemnitee in Cases of
Determination not to Indemnify or to Advance Expenses. 
In the event that a determination is made that the Indemnitee is not
entitled to indemnification hereunder or if the payment has not been timely
made following a determination of entitlement to indemnification pursuant to
Sections 8 and 9, or if Expenses are not advanced pursuant to Section 10,
the Indemnitee shall be entitled to a final adjudication in an appropriate court
of the State of Delaware or any other court of competent jurisdiction of the
Indemnitee’s entitlement to such indemnification or advance. Alternatively, the
Indemnitee may, at the Indemnitee’s option, seek an award in arbitration to be
conducted by a single arbitrator pursuant to the rules of the American
Arbitration Association, such award to be made within 60 days following
the filing of the demand for arbitration. The Company shall not oppose the
Indemnitee’s right to seek any such adjudication or award in arbitration or any
other claim. Such judicial proceeding or arbitration shall be made de novo, and the Indemnitee shall not be
prejudiced by reason of a determination (if so made) that the Indemnitee is not
entitled to indemnification. If a determination is made or deemed to have been
made pursuant to the terms of Section 8 or Section 9 hereof that the
Indemnitee is entitled to indemnification, the Company shall be bound by such
determination and shall be precluded from asserting that such determination has
not been made or that the procedure by which such determination was made is not
valid, binding and enforceable. The Company further agrees to stipulate in any
such court or before any such arbitrator that the Company is bound by all the
provisions of this Agreement and is precluded from making any assertions to the
contrary. If the court or arbitrator shall determine that the Indemnitee is
entitled to any indemnification hereunder, the Company shall pay all reasonable
Expenses actually incurred by the Indemnitee in connection with such
adjudication or award in arbitration (including, but not limited to, any
appellate proceedings).

 

12.           Notification and Defense of Claim. 
Promptly after receipt by the Indemnitee of notice of the commencement
of any action, suit or proceeding, the Indemnitee will, if a claim in

 

6

 

respect thereof is to be made against the Company
under this Agreement, notify the Company in writing of the commencement
thereof; but the omission to so notify the Company will not relieve the Company
from any liability that it may have to the Indemnitee otherwise than under this
Agreement or otherwise, except to the extent that the Company may suffer
material prejudice by reason of such failure. Notwithstanding any other
provision of this Agreement, with respect to any such action, suit or
proceeding as to which the Indemnitee gives notice to the Company of the
commencement thereof:

 

(a)           The
Company will be entitled to participate therein at its own expense.

 

(b)           Except
as otherwise provided in this Section 12(b), 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 the Indemnitee. After notice from the Company to the
Indemnitee of its election to so assume the defense thereof, the Company shall
not be liable to the Indemnitee under this Agreement for any legal or other
Expenses subsequently incurred by the Indemnitee in connection with the defense
thereof other than reasonable costs of investigation or as otherwise provided
below. The Indemnitee shall have the right to employ the Indemnitee’s own
counsel in such action or lawsuit, but the fees and Expenses of such counsel
incurred after notice from the Company of its assumption of the defense thereof
shall be at the expense of the Indemnitee unless (i) the employment of
counsel by the Indemnitee has been authorized by the Company, (ii) the
Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Company and the Indemnitee in the conduct of the defense
of such action and such determination by the Indemnitee shall be supported by
an opinion of counsel, which opinion shall be reasonably acceptable to the
Company, or (iii) the Company shall not in fact have employed counsel to
assume the defense of the action, in each of which cases the fees and Expenses
of counsel shall be at the expense of the Company. The Company shall not be
entitled to assume the defense of any action, suit or proceeding brought by or
on behalf of the Company or as to which the Indemnitee shall have reached the
conclusion provided for in clause (ii) above.

 

(c)           The
Company shall not be liable to indemnify the Indemnitee under this Agreement
for any amounts paid in settlement of any action, suit or proceeding effected
without its written consent, which consent shall not be unreasonably withheld.
The Company shall not be required to obtain the consent of the Indemnitee to
settle any action, suit or proceeding which the Company has undertaken to
defend if the Company assumes full and sole responsibility for such settlement
and such settlement grants the Indemnitee a complete and unqualified release in
respect of any potential liability.

 

(d)           If,
at the time of the receipt of a notice of a claim pursuant to this Section 12,
the Company has director and officer liability insurance in effect, the Company
shall give prompt notice of the commencement of such proceeding to the insurers
in accordance with the procedures set forth in the respective policies. The
Company shall thereafter take all necessary or desirable action to cause such
insurers to pay, on behalf of the Indemnitee, all amounts payable as a result
of such proceeding in accordance with the terms of the policies.

 

7

 

13.           Other Right to Indemnification.  The indemnification and advancement of
Expenses provided by this Agreement are cumulative, and not exclusive, and are
in addition to any other rights to which the Indemnitee may now or in the
future be entitled under any provision of the Bylaws or Certificate of the
Company, any vote of stockholders or Disinterested Directors, any provision of
law or otherwise. Except as required by applicable law, the Company shall not
adopt any amendment to its Bylaws or Certificate the effect of which would be
to deny, diminish or encumber the Indemnitee’s right to indemnification under
this Agreement.

 

14.           Director and Officer Liability Insurance.  The Company shall maintain directors’ and
officers’ liability insurance for so long as the Indemnitee’s services are
covered hereunder, provided and to the extent that such insurance is available
on a commercially reasonable basis. In the event the Company maintains
directors’ and officers’ liability insurance, the Indemnitee shall be named as
an insured in such manner as to provide the Indemnitee the same rights and
benefits as are accorded to the most favorably insured of the Company’s
officers or directors. However, the Company agrees that the provisions hereof
shall remain in effect regardless of whether liability or other insurance
coverage is at any time obtained or retained by the Company, except that any
payments made to, or on behalf of, the Indemnitee under an insurance policy
shall reduce the obligations of the Company hereunder.

 

15.           Spousal Indemnification.  The Company will indemnify the Indemnitee’s
spouse to whom the Indemnitee is legally married at any time the Indemnitee is
covered under the indemnification provided in this Agreement (even if the
Indemnitee did not remain married to him or her during the entire period of
coverage) against any pending or threatened action, suit, proceeding or
investigation for the same period, to the same extent and subject to the same
standards, limitations, obligations and conditions under which the Indemnitee
is provided indemnification herein, if the Indemnitee’s spouse (or former
spouse) becomes involved in a pending or threatened action, suit, proceeding or
investigation solely by reason of his or her status as the Indemnitee’s spouse,
including, without limitation, any pending or threatened action, suit,
proceeding or investigation that seeks damages recoverable from marital
community property, jointly-owned property or property purported to have been
transferred from the Indemnitee to his/her spouse (or former spouse). The
Indemnitee’s spouse or former spouse also may be entitled to advancement of
Expenses to the same extent that the Indemnitee is entitled to advancement of
Expenses herein. The Company may maintain insurance to cover its obligation
hereunder with respect to the Indemnitee’s spouse (or former spouse) or set
aside assets in a trust or escrow fund for that purpose.

 

16.           Intent.  This Agreement is intended to be broader than
any statutory indemnification rights applicable in the State of Delaware and
shall be in addition to any other rights the Indemnitee may have under the
Company’s Certificate, Bylaws, applicable law or otherwise. To the extent that
a change in applicable law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the Company’s
Certificate, Bylaws, applicable law or this Agreement, it is the intent of the
parties that the Indemnitee enjoy by this Agreement the greater benefits so
afforded by such change. In the event of any change in applicable law, statute
or rule which narrows the right of a Delaware corporation to indemnify a
member of its Board of Directors or an officer, employee, agent or fiduciary,
such change, to the extent not otherwise required by such law, statute or rule to
be

 

8

 

applied to this Agreement, shall have no effect on
this Agreement or the parties’ rights and obligations hereunder.

 

17.           Attorney’s Fees and Other Expenses to Enforce
Agreement.  In the event that the
Indemnitee is subject to or intervenes in any action, suit or proceeding in
which the validity or enforceability of this Agreement is at issue or seeks an
adjudication or award in arbitration to enforce the Indemnitee’s rights under,
or to recover damages for breach of, this Agreement the Indemnitee, if
he/she prevails in whole or in part in such action, shall be entitled to
recover from the Company and shall be indemnified by the Company against any
actual expenses for attorneys’ fees and disbursements reasonably incurred by
the Indemnitee.

 

18.           Effective Date.  The provisions of this Agreement shall cover
claims, actions, suits or proceedings whether now pending or hereafter
commenced and shall be retroactive to cover acts or omissions or alleged acts
or omissions which heretofore have taken place. The Company shall be liable
under this Agreement, pursuant to Sections 3 and 4 hereof, for all acts of the
Indemnitee while serving as a director and/or officer, notwithstanding the
termination of the Indemnitee’s service, if such act was performed or omitted
to be performed during the term of the Indemnitee’s service to the Company.

 

19.           Duration of Agreement.  This Agreement shall survive and continue
even though the Indemnitee may have terminated his/her service as a director,
officer, employee, agent or fiduciary of the Company or as a director, officer,
employee, agent or fiduciary of any other entity, including, but not limited to
another corporation, partnership, limited liability company, employee benefit
plan, joint venture, trust or other enterprise or by reason of any act or
omission by the Indemnitee in any such capacity. This Agreement shall be
binding upon the Company and its successors and assigns, including, without
limitation, any corporation or other entity which may have acquired all or
substantially all of the Company’s assets or business or into which the Company
may be consolidated or merged, and shall inure to the benefit of the Indemnitee
and his/her spouse, successors, assigns, heirs, devisees, executors,
administrators or other legal representations. The Company shall require any
successor or assignee (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company, by written agreement in form and substance reasonably
satisfactory to the Company and the Indemnitee, expressly to assume and agree
to perform this Agreement in the same manner and to the same extent that the
Company would be required to perform if no such succession or assignment had
taken place.

 

20.           Disclosure of Payments.  Except as expressly required by any Federal
or state securities laws or other Federal or state law, neither party shall
disclose any payments under this Agreement unless prior approval of the other
party is obtained.

 

21.           Severability.  If any provision or provisions of this
Agreement shall be held invalid, illegal or unenforceable for any reason
whatsoever, (a) the validity, legality and enforceability of the remaining
provisions of this Agreement (including, but not limited to, all portions of
any Sections of this Agreement containing any such provision held to be
invalid, illegal or unenforceable) shall not in any way be affected or impaired
thereby and (b) to the fullest extent possible, the provisions of this
Agreement (including, but not limited to, all portions of any paragraph of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid,

 

9

 

illegal or unenforceable) shall be construed so as to
give effect to the intent manifest by the provision held invalid, illegal or
unenforceable.

 

22.           Counterparts.  This Agreement may be executed by one or more
counterparts, each of which shall for all purposes be deemed to be an original
but all of which together shall constitute one and the same Agreement. Only one
such counterpart signed by the party against whom enforceability is sought
shall be required to be produced to evidence the existence of this Agreement.

 

23.           Captions.  The captions and headings used in this
Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction thereof.

 

24.           Definitions.  For purposes of this Agreement:

 

(a)           “Change in Control” shall mean the occurrence of any one of the following:

 

(i)            the
sale, lease, exchange or other transfer, directly or indirectly, of
substantially all of the assets of the Company (in one transaction or in a
series of related transactions) to a person or entity that is not controlled
directly or indirectly by the Company;

 

(ii)           the
approval by the stockholders of the Company of any plan or proposal for the
liquidation or dissolution of the Company;

 

(iii)          any
person becomes after the effective date of this Agreement the “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of (A) 20% or more, but not 50% or more, of the combined voting power of
the Company’s outstanding securities ordinarily having the right to vote at
elections of directors, unless the transaction resulting in such ownership has
been approved in advance by the Continuity Directors, or (B) 50% or more
of the combined voting power of the Company’s outstanding securities ordinarily
having the right to vote at elections of directors (regardless of any approval
by the Continuity Directors);

 

(iv)          a
merger or consolidation to which the Company is a party if the stockholders of
the Company immediately prior to effective date of such merger or consolidation
have “beneficial ownership” (as defined in Rule 13d-3 under the Exchange
Act), immediately following the effective date of such merger or consolidation,
of securities of the surviving corporation representing (A) more than 50%,
but less than 80%, of the combined voting power of the surviving corporation’s
then outstanding securities ordinarily having the right to vote at elections of
directors, unless such merger or consolidation has been approved in advance by
the Continuity Directors, or (B) 50% or less of the combined voting power of
the surviving corporation’s then outstanding securities ordinarily having

 

10

 

the right to vote at elections of directors
(regardless of any approval by the Continuity Directors);

 

(v)           the
Continuity Directors cease for any reason to constitute at least a majority of
the Board; or

 

(vi)          any
other change in control of the Company of a nature that would be required to be
reported pursuant to Section 13 or 15(d) of the Exchange Act, whether
or not the Company is then subject to such reporting requirement.

 

(b)           “Continuity
Directors” shall mean any individuals who are members of the Board on the
effective date of this Agreement and any individual who subsequently becomes a
member of the Board whose election, or nomination for election by the Company’s
stockholders, was approved by a vote of at least a majority of the Continuity Directors
(either by specific vote or by approval of the Company’s proxy statement in
which such individual is named as a nominee for director without objection to
such nomination).

 

(c)           “Disinterested
Director” shall mean a director of the Company who is not or was not a party to
the action, suit, investigation or proceeding in respect of which
indemnification is being sought by the Indemnitee.

 

(d)           “Expenses”
shall include all attorneys’ fees, retainers, court costs, transcript costs,
fees of experts, witness fees, travel expenses, duplicating costs, printing and
binding costs, telephone charges, postage, delivery service fees, and all other
disbursements or expenses incurred in connection with prosecuting, defending,
preparing to prosecute or defend, investigating or being or preparing to be a
witness in any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative in nature.

 

(e)           “Independent
Counsel” shall mean a law firm or a member of a law firm that neither is
presently nor in the past five years has been retained to represent (i) the
Company or the Indemnitee in any matter material to either such party or (ii) any
other party to the action, suit, investigation or 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 the Indemnitee in an action to determine the
Indemnitee’s right to indemnification under this Agreement.

 

25.           Entire Agreement, Modification and Waiver.  This Agreement constitutes the entire
agreement and understanding of the parties hereto regarding the subject matter
hereof, and no supplement, modification or amendment of this Agreement shall be
binding unless executed in writing by both 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. No supplement, modification or amendment of
this Agreement shall limit or restrict any right of the Indemnitee under this
Agreement in respect

 

11

 

of any act or omission of the Indemnitee prior to the
effective date of such supplement, modification or amendment unless expressly
provided therein.

 

26.           Notices.  All notices, requests, demands or other
communications hereunder shall be in writing and shall be deemed to have been
duly given if (a) delivered by hand with receipt acknowledged by the party
to whom said notice or other communication shall have been directed, (b) mailed
by certified or registered mail, return receipt requested with postage prepaid,
on the date shown on the return receipt, (c) sent by a recognized next-day
courier service on the first business day following the date of dispatch or (d) delivered
by facsimile transmission on the date shown on the facsimile machine report:

 

(i)             If
to the Indemnitee to:

 

 

 

 

(ii)            If
to the Company, to:

 

Northern
Technologies International Corporation

4201 Woodland Road

Circle Pines,
Minnesota 55014

Attn: Chief
Executive Officer

Fax:  (763) 225-6645

 

with a copy to:

 

Oppenheimer Wolff &
Donnelly LLP

3300 Plaza VII

45 South Seventh Street

Minneapolis, Minnesota 55402

Attn:       Amy E. Culbert, Esq.

Fax:         (612) 607-7100

 

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

 

27.           Governing Law.  The parties hereto agree that this Agreement
shall be governed by, and construed and enforced in accordance with, the laws
of the State of Delaware, applied without giving effect to any conflicts-of-law
principles.

 

[Signature Page Follows]

 

12

 

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

 

	
   

  	
  NORTHERN TECHNOLOGIES

  INTERNATIONAL CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  INDEMNITEE:

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
						

 

13

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