Document:

Blueprint

 

Exhibit
10.5

 

INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement
(“Agreement”),
dated as of August 26, 2019, is entered into by and between
DYNATRONICS CORPORATION, a Utah corporation (the
“Company”)
and Brian Baker (the “Indemnitee”).
Company and Indemnitee are sometimes referred to as a
“Party”
or collectively as the “Parties”
in this Agreement.

 

RECITALS:

 

WHEREAS, Indemnitee is the Chief Executive Officer of the
Company and a member of the Company’s Board of Directors
(“Board”);

 

WHEREAS, both the Company and Indemnitee recognize the
increased risk of litigation and other claims being asserted
against directors and executive officers of public
companies;

 

WHEREAS, the Board is aware that because of the increased
exposure to litigation and the costs associated with such
litigation, talented and experienced Persons are increasingly reluctant to serve or
continue serving as officers and directors of corporations unless
they are protected by comprehensive liability insurance and
indemnification;

 

WHEREAS, the Board has concluded that, in order to retain
and attract talented and experienced individuals to serve as
officers and directors of the Company
and its subsidiaries and to encourage such individuals to take the
business risks necessary for the success of the Company and its
subsidiaries, the Company should contractually indemnify its
officers and directors, and the officers and directors of its
subsidiaries, in connection with claims against such officers and
directors relating to their services to the Company and its
subsidiaries and has further concluded that the failure to provide
such contractual indemnification could be detrimental to
the Company, its subsidiaries and
shareholders and

 

WHEREAS, Indemnitee’s willingness to serve as an
officer of the Company is predicated, in substantial part, upon
the Company’s willingness
to indemnify Indemnitee in accordance with the principles reflected
above, to the fullest extent permitted by the laws of the State of
Utah, and upon the other undertakings set forth in this
Agreement.

 

AGREEMENT:

 

NOW,
THEREFORE, in consideration of
the mutual promises made in this Agreement and for other good and
valuable consideration, the receipt and legal sufficiency of which
is hereby acknowledged, the Parties, intending to be legally bound
hereby, agree as follows:

 

1. Definitions.
For purposes of this Agreement, the following terms shall have the
following meanings:

 

(a) “Agent”
with respect to the Company means any person who is
or was a director, officer, employee
or other agent of the Company
or a subsidiary; or is or was serving at the request of, for the
convenience of, or to represent
the interests of, the Company
or a subsidiary as a director,
officer, employee or Agent of another corporation, partnership,
joint venture, trust or other enterprise (including without
limitation any employee benefit plan whether or not subject to
the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”));
or was a director, officer,
employee or Agent of a predecessor corporation (or other
predecessor entity or enterprise) of the Company or a subsidiary, or was a
director, officer, employee or Agent
of another corporation, partnership, joint venture, trust or other
enterprise (including without limitation any employee benefit plan
whether or not subject to the ERISA) at the request of, for the convenience of,
or to represent the interests of such
predecessor.

 

 

1

 

 

(b) “Beneficial
Owner” has the meaning
given to the term “beneficial owner” in
Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”).

 

(c) “Change
in Control” means the
occurrence after the date of this Agreement of any of the following
events: (i) any Person is or
becomes the Beneficial Owner, directly or indirectly,
of securities of the Company
representing 30% or more of the Company’s then outstanding
Voting Securities; (ii) the
consummation of a reorganization, merger or consolidation, unless
immediately following such reorganization, merger or consolidation,
all of the Beneficial Owners of
the Voting Securities of the Company immediately prior to such
transaction beneficially own, directly or indirectly, more than 60%
of the combined voting power of the outstanding Voting Securities
of the entity resulting from such transaction; (iii)
during any period of two (2)
consecutive years, not including any period prior to the execution
of this Agreement, individuals who at the beginning of such period
constituted the Board (including for this purpose any new directors
whose election by the Board or nomination for election by the
Company’s shareholders 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 at least a majority of the Board; or
(iv) the shareholders of the
Company approve a plan of complete liquidation or dissolution of
the Company or an agreement for
the sale or disposition by the Company of all or substantially all
of the Company’s assets. Notwithstanding anything in this
Agreement, however, it is agreed that a change in ownership of
Prettybrook Partners, LLC or of Provco Partners I, LP, shall not be
deemed a Change in Control for purposes of this
Agreement.

 

(d) “Company”
shall include, in addition to Dynatronics Corporation, any constituent
corporation (including any constituent of a constituent) absorbed
in a consolidation or merger to which Dynatronics Corporation (or any of its
wholly­ owned subsidiaries) is a party which, if its separate existence had
continued, would have had power and authority to indemnify its
directors, officers, employees, Agents or fiduciaries, so that if Indemnitee
is or was a director, officer,
employee, Agent or fiduciary of
such constituent corporation, or is or was serving at the request
of such constituent corporation as a director, officer, manager, employee,
Agent or fiduciary of another
corporation, partnership, limited liability company, joint venture,
employee benefit plan, trust or other enterprise, Indemnitee shall
stand in the same position under the provisions of this Agreement
with respect to the resulting or surviving corporation as
Indemnitee would have with respect to such constituent corporation
if its separate existence had continued.

 

(e) “Expense
Advance” means any
payment of Expenses advanced to
Indemnitee by the Company pursuant to Section
2
or Section
3
hereof.

 

(f) “Expenses”
means any and all expenses,
including attorneys’ and experts’ fees, court costs,
transcript costs, travel expenses, duplicating, printing and
binding costs, telephone charges, and all other costs and
expenses incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, be a witness or
participate in, any Proceeding. Expenses also shall include (i) expenses incurred
in connection with any appeal resulting from any Proceeding,
including without limitation the premium, security for, and other
costs relating to any cost bond, supersedeas bond, or other appeal
bond or its equivalent, and (ii) for purposes of
Section
4
only, Expenses incurred by Indemnitee in connection with
the interpretation, enforcement or defense of Indemnitee’s
rights under this Agreement, by litigation or otherwise. Expenses,
however, shall not include amounts paid in settlement by Indemnitee
or the amount of judgments or fines against
Indemnitee.

 

 

2

 

 

(g) “Indemnifiable
Event” means any event or
occurrence, whether occurring before, on or after the date of this
Agreement, related to the fact that Indemnitee is
or was a director, officer, employee or Agent of the Company or any subsidiary of the
Company, or is or was serving at the request of the Company as a
director, officer, employee, member, manager, trustee or
Agent of any other corporation,
limited liability company,
partnership, joint venture, trust or other entity or enterprise or
by reason of an action or inaction by Indemnitee in any such
capacity (whether or not serving in such capacity at the time any
Loss is incurred for which indemnification can be provided under
this Agreement).

 

(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 performs, nor in the past
three (3) years has performed, services for either: (i) the Company
or Indemnitee (other than in connection with matters concerning
Indemnitee under this Agreement or of other indemnitees under similar 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.

 

(i) “Losses”
means any and all Expenses, damages, losses, liabilities,
judgments, fines, penalties (whether civil, criminal or
other), ERISA excise taxes,
amounts paid or payable in settlement, including any interest,
assessments, and all other charges paid or payable in connection
with investigating, defending, being a witness in or participating
in (including on appeal), or preparing to defend, be a witness or
participate in, any Proceeding.

 

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

 

(k) “Person”
means any individual, corporation, firm, partnership, joint
venture, limited liability company, estate, trust, business association,
organization, governmental entity or other entity and includes the
meaning set forth in Sections
13(d) and 14(d) of the Exchange Act.

 

(l) “Proceeding”
means any threatened, pending, or completed claim, suit, action,
proceeding or alternative dispute resolution mechanism, or any
hearing or investigation, whether civil, criminal, administrative,
investigative or otherwise, including without limitation any
situation which Indemnitee
believes in good faith might lead to the institution of any
such proceeding.

 

(m) “Reviewing
Party” shall mean,
subject to the provisions of Section
2(e),
any person or body appointed by the Board in accordance with
applicable law to review the Company’s obligations
hereunder and under applicable law,
which may include a member or members of the Board,
Independent Counsel or any other
person or body not a party to the
particular Proceeding for which Indemnitee is seeking
indemnification, as set forth in Section
2(g). 

 

 

3

 

  

(n) “Utah
Court” shall have the
meaning ascribed to it in Section
8(e)
below.

 

(o) “Voting
Securities” means any
securities of the Company that vote generally in the election of
directors.

 

2. Indemnification.

 

(a) Third Party
Proceedings. The Company shall
defend, indemnify and hold harmless Indemnitee to the fullest
extent permitted by the Utah
Revised Business Corporation Act (the “Act”) if Indemnitee is or was a
party or is threatened to be made
a party to any Proceeding
(other than an action by or in
the right of the Company) by reason of the fact that Indemnitee is
or was or is claimed to be an Agent of the
Company or any subsidiary of the Company, by reason of any action
or inaction on the part of Indemnitee while an Agent of the Company, against all Expenses and
liabilities of any type whatsoever (including, but not limited to,
judgments, fines, ERISA excise
taxes or penalties, and amounts paid in settlement (if such
settlement is approved in advance by the Company, which approval shall not be
unreasonably withheld)) actually and reasonably incurred by
Indemnitee 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, and, with
respect to any criminal action or proceeding, had no reasonable cause to
believe Indemnitee’s
conduct was unlawful.

 

(b) Proceedings
By or in
the Right of the Company. The
Company shall defend, indemnify and hold harmless Indemnitee to the
fullest extent permitted by the Act if Indemnitee was or is
a party or is threatened to be
made a party to any Proceeding
by or in the right of the
Company or any subsidiary of the Company to procure a judgment in
its favor by reason of the fact that Indemnitee is or was or is
claimed to be an Agent of the Company, all Expenses and liabilities
of any type whatsoever (including, but not limited to, legal fees,
judgments, fines, ERISA excise
taxes or penalties, and amounts paid in settlement (if such
settlement is approved in advance by the Company, which approval shall not be
unreasonably withheld)), in each case to the extent actually and
reasonably incurred by Indemnitee in connection with the
defense or settlement of 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 and its stockholders, except that no
indemnification shall be made in respect of any claim, issue or
matter as to which Indemnitee shall have been finally adjudicated
by court order or judgment to be liable to the Company in the
performance of
Indemnitee’s duty to the Company
and its stockholders unless and only to the extent that the court
in which such action or Proceeding is or was pending shall
determine upon application that, in view of all the circumstances
of the case, Indemnitee is fairly and reasonably entitled to
indemnity for such expenses,
which such court shall deem proper.

 

(c) Actions
Where Indemnitee Is Deceased.
If Indemnitee was or is a party, or is threatened to be made a
party, to any Proceeding by reason of
the fact that Indemnitee is or was an Agent of the Company, or by
reason of anything done or not done by Indemnitee in any such
capacity, and prior to, during the pendency of, or after completion
of, such Proceeding, Indemnitee shall die, then the Company shall defend, indemnify and hold
harmless the estate, heirs and legatees of Indemnitee against any
and all Expenses and liabilities reasonably incurred by or for
such persons or entities in
connection with the investigation, defense, settlement or appeal of
such Proceeding on the same basis as provided for Indemnitee
in Section
2(a)
and Section
2(b)
above.

 

(d) Extent
of Insurance. The Expenses and
liabilities covered hereby shall be net of any payments made
by D&O Insurance (as
defined in Section
14)
carriers or others.

 

 

4

 

 

(e) Review of
Indemnification Obligations.
Notwithstanding the foregoing, in the event any Reviewing Party
shall have determined (in a written opinion, in any case in
which Independent Counsel is
the Reviewing Party) that Indemnitee is not entitled to be
indemnified hereunder under applicable law: (i) the Company shall
have no further obligation under Section
2(a)
or Section
2(b)
to make any payments to Indemnitee not
made prior to such determination by such Reviewing Party; and (ii)
the Company shall be entitled to be reimbursed by Indemnitee (who
hereby agrees to reimburse the Company) for all Expenses
theretofore paid to Indemnitee to which Indemnitee is not
entitled hereunder under applicable
law; provided, however, that if Indemnitee has commenced or
thereafter commences legal Proceedings in a court of competent jurisdiction
to secure a determination that Indemnitee is entitled to be indemnified hereunder under
applicable law, any determination made by any Reviewing Party that
Indemnitee is not
entitled to be indemnified
hereunder under applicable law shall
not be binding and Indemnitee shall not be required to reimburse
the Company for any Expenses theretofore paid in indemnifying
Indemnitee until a final judicial determination is made with
respect thereto (as to which all rights of appeal therefrom have
been exhausted or lapsed). Indemnitee’s obligation to reimburse the
Company for any Expenses shall be unsecured and no interest shall
be charged thereon.

 

(f) Indemnitee
Rights on Unfavorable Determination; Binding
Effect. If any Reviewing Party
determines that Indemnitee
substantively is not entitled to be indemnified hereunder in whole
or in part under applicable law, Indemnitee shall have the right to
commence litigation seeking an initial determination by the court
or challenging any such determination by such Reviewing Party or
any aspect thereof, including the legal or factual bases therefor,
and the Company hereby consents to service of process and to appear
in any such Proceeding. Absent
such litigation, any determination by any Reviewing Party shall be
conclusive and binding on the Company and
Indemnitee.

 

(g) Selection of Reviewing
Party; Change in Control. A
determination, if required by applicable law, with respect
to Indemnitee’s
entitlement to indemnification shall be made in accordance with the
provisions of this Section
2(g).
If there has not been a Change in Control, a Reviewing Party shall
be selected by the Board, and if there has been such a Change in
Control (other than a Change in Control which has been approved by
a majority of the Board who were directors immediately prior to
such Change in Control), any Reviewing Party with respect to all
matters thereafter arising concerning the rights of Indemnitee to
indemnification of Expenses under this Agreement or any
other agreement or under
the Company’s Articles of
Incorporation or Bylaws (collectively, the
“Constituent
Documents”) as now or
hereafter in effect, or under any other applicable law, if desired
by Indemnitee, shall be Independent Counsel selected by Indemnitee and
approved by the Company (which
approval shall not be unreasonably withheld). Such counsel, among
other things, shall render its written opinion to the Company and
Indemnitee as to whether and to what extent Indemnitee would be
entitled to be indemnified hereunder under applicable law and the
Company agrees to abide by such opinion. The Company agrees to pay
the reasonable fees of the Independent Counsel referred to above and to
indemnify fully such counsel against any and all
Expenses (including
attorneys’ fees), claims,
liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto. Notwithstanding any
other provision of this Agreement, the Company shall not be
required to pay Expenses of more than one Independent Counsel in connection with all matters
concerning a single Indemnitee, and such Independent Counsel shall be the
Independent Counsel for any or all
other Indemnitees unless: (i) the employment of separate counsel by
one (1) or more Indemnitees has been previously authorized by the
Board in writing; or (ii) an Indemnitee shall have provided to the
Company a written statement that such Indemnitee has reasonably
concluded that there may be a conflict of interest between such
Indemnitee and the other Indemnitees with respect to the matters
arising under this Agreement.

 

 

5

 

 

3. Advancement of
Expenses. The Company shall
advance, prior to the final disposition of any Proceeding by final
adjudication to which there are no further rights of appeal, any
and all Expenses actually and reasonably paid or incurred by
Indemnitee in connection with any Proceeding arising out of an Indemnifiable Event.
Indemnitee’s right to such advancement is not subject to the
satisfaction of any standard of conduct. Without limiting the
generality or effect of the foregoing, within thirty (30) days
after any request by Indemnitee, the Company shall, in accordance
with such request, (a) pay such Expenses on behalf of Indemnitee,
(b) advance to Indemnitee funds in an amount sufficient to pay such
Expenses, or (c) reimburse Indemnitee for such Expenses. In
connection with any request for Expense Advances, Indemnitee shall
not be required to provide any documentation or information to the
extent that the provision thereof would undermine or otherwise
jeopardize attorney-client privilege. Execution and delivery to the
Company of this Agreement by Indemnitee constitutes an undertaking
by the Indemnitee to repay any amounts paid, advanced or reimbursed
by the Company pursuant to this Section
3
in respect of Expenses relating to,
arising out of or resulting from any Proceeding in respect of which
it shall be determined, pursuant to Section 8,
following the final disposition of such Proceeding,
that Indemnitee is not entitled to
indemnification hereunder. No other form of undertaking shall be
required other than the execution of this Agreement.
Indemnitee’s obligation to reimburse the Company for Expense
Advances shall be unsecured and no interest shall be charged
thereon.

 

4. Indemnification for
Expenses in Enforcing Rights.
To the full extent allowable under applicable law,
the Company shall also indemnify
against, and, if requested by Indemnitee, shall advance to
Indemnitee subject to and in accordance with Section
2,
any Expenses actually and reasonably paid or incurred by Indemnitee
in connection with any action or Proceeding by Indemnitee for (a) indemnification
or reimbursement or advance payment of Expenses by the Company under any
provision of this Agreement, or under any other agreement or provision of the Constituent Documents now or hereafter in effect
relating to Proceedings relating to Indemnifiable Events, and/or
(b) recovery under any directors’ and officers’
liability insurance policies maintained by the Company. However, in
the event that Indemnitee is ultimately determined not to be
entitled to such indemnification or insurance recovery, as the case
may be, then all amounts advanced under this Section
4
shall be repaid. Indemnitee shall be
required to reimburse the Company in the event that a final
judicial determination is made that such action brought by
Indemnitee was frivolous or not made in good
faith.

 

5. Partial
Indemnity. If Indemnitee is
entitled under any provision of this Agreement to indemnification
by the Company for a portion of any Losses in respect of a
Proceeding related to an Indemnifiable Event but not for the total
amount thereof, the Company shall nevertheless indemnify Indemnitee
for the portion thereof to which Indemnitee is
entitled.

 

6. Notification
and Defense.

 

(a) Notification.
Indemnitee shall notify the Company in writing as soon as
practicable of any Proceeding which could relate to an
Indemnifiable Event or for which Indemnitee could seek Expense
Advances, including a brief description (based upon information
then available to Indemnitee) of the nature of, and the facts
underlying, such Proceeding. The failure by Indemnitee to timely
notify the Company hereunder shall not relieve the Company from any
liability hereunder unless such failure materially prejudices the
Company.

 

(b) Notice
to Insurers. If, at the time of
the receipt of a notice of a claim pursuant to Section
6(a)
hereof, the Company has
D&O Insurance (as defined
in Section 14
below) 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 such policies.

 

 

 

6

 

 

(c) Defense
of Proceedings. The Company
shall be entitled to participate in the defense of any Proceeding
relating to an Indemnifiable Event at its own expense and, except as otherwise provided below,
to the extent the Company so wishes, it may assume the defense
thereof with counsel reasonably satisfactory to Indemnitee. After
notice from the Company to Indemnitee of its election to assume
the defense of any such
Proceeding, the Company shall not be liable to Indemnitee under
this Agreement or otherwise for any Expenses subsequently directly
incurred by Indemnitee in connection with Indemnitee’s
defense of such Proceeding other than
reasonable costs of investigation or as otherwise provided
below.

 

(d) Selection of
Counsel. Indemnitee shall be
entitled to retain one (1) or more counsel from time to time
selected by Indemnitee in Indemnitee’s reasonable discretion to act as
its counsel in and for the investigation, defense, settlement or
appeal of each Proceeding. The Company shall not waive any
privilege or right available to Indemnitee in any such
Proceeding. All Expenses
related to such counsel incurred after notice from the Company of
its assumption of the defense shall be at Indemnitee’s
own expense;
provided,
however, that if (i) Indemnitee’s employment of its
own legal counsel has been authorized by the Company, (ii)
Indemnitee has reasonably determined that there may be a conflict
of interest between Indemnitee and the Company in the defense of
such Proceeding, (iii) after a Change in Control,
Indemnitee’s employment of its own counsel has been approved
by the Independent Counsel or (iv) the Company shall not in fact
have employed counsel to assume the defense of such Proceeding,
then Indemnitee shall be entitled to retain its own separate
counsel (but not more than one (1) law firm plus, if applicable,
local counsel in respect of any such Proceeding) and all Expenses related to such
separate counsel shall be borne by the Company.

 

7. Procedure
upon Application for Indemnification. In order to obtain indemnification pursuant to
this Agreement, Indemnitee shall submit to the Company a written
request therefor, including in such request 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 following the final
disposition of the Proceeding. Indemnification shall be made
insofar as the Company determines Indemnitee is entitled to
indemnification in accordance with Section
8
below.

 

8. Determination of Right
to Indemnification.

 

(a) Mandatory
Indemnification; Indemnification as a Witness.

 

(i) To
the extent that Indemnitee shall have been successful on the merits
or otherwise in defense of any Proceeding relating to an Indemnifiable Event or
any portion thereof or in defense of any issue or matter therein,
including without limitation dismissal without prejudice,
Indemnitee shall be indemnified against all Losses relating to such
Proceeding in accordance with Section
2
to the full extent allowable by
law.

 

(ii) To
the extent that Indemnitee’s involvement in a Proceeding
relating to an Indemnifiable Event is to prepare to serve and serve
as a witness, and not as a party, the Indemnitee shall be indemnified against
all Losses incurred in connection therewith to the full extent
allowable by law.

 

(b) Standard of
Conduct. To the extent that the
provisions of Section
8(a)
are inapplicable to a Proceeding
related to an Indemnifiable Event that shall have been finally
disposed of, any determination of whether Indemnitee has satisfied the applicable standard
of conduct set forth in Section 16-10a-902 of
the Act that is a legally required condition to indemnification of
Indemnitee hereunder against Losses relating to such Proceeding and
any determination that Expense Advances must be repaid to the
Company (a “Standard of Conduct
Determination”) shall be
made as follows: (i) by a
majority vote of the Disinterested Directors (as defined by the Act),
even if less than a quorum of the Board; (ii) by a committee
of Disinterested Directors
designated by a majority vote of the Disinterested Directors, even though less than a
quorum; or (iii) if there are no such Disinterested Directors, by Independent Counsel in
a written opinion addressed to the Board, a copy of which shall be
delivered to Indemnitee.

 

 

7

 

 

(c) Making the Standard of
Conduct Determination. The
Company shall use its reasonable best efforts to cause any Standard
of Conduct Determination required under Section
8(b)
to be made as promptly as practicable.
If the person or persons designated to make the Standard of Conduct
Determination under Section
8(b)
shall not have made a determination
within thirty (30) days after the later of (A) receipt by the
Company of a written request from Indemnitee for indemnification
pursuant to Section 6(d)
(the date of such receipt being the
“Notification
Date”) and (B) the
selection of an Independent Counsel, if such determination is to be
made by Independent Counsel, then Indemnitee shall be deemed to
have satisfied the applicable standard of conduct;
provided
that such 30-day period may be
extended for a reasonable time, not to exceed an additional thirty
(30) days, if the person or persons making such determination in
good faith requires such additional time to obtain or evaluate
information relating thereto. Notwithstanding anything in this
Agreement to the contrary, no determination as to entitlement of
Indemnitee to indemnification under this Agreement shall be
required to be made prior to the final disposition of any
Proceeding.

 

(d) Payment
of Indemnification. If, in
regard to any Losses: (i)
Indemnitee shall be entitled to indemnification pursuant to
Section
8(a);
(ii) no Standard of Conduct
Determination is legally required as a condition to indemnification
of Indemnitee hereunder; or (iii) Indemnitee has been determined or deemed pursuant
to Section or Section 8(c)
to have satisfied the Standard of
Conduct Determination, then the
Company shall pay to Indemnitee, within five (5) days after the
later of (A) the Notification Date or (B) the earliest date on
which the applicable criterion specified in clause (i), (ii) or (iii)
is satisfied, above, an amount equal to such
Losses.

 

(e) Selection of
Independent Counsel for Standard of Conduct
Determination. If a Standard of
Conduct Determination is to be made by Independent Counsel pursuant
to Section
8(b),
the Independent Counsel shall be selected by the Board of
Directors, and the Company shall give written notice to Indemnitee
advising Indemnitee of the identity of the Independent Counsel so
selected.

 

(f) Presumptions
and Defenses.

 

(i) Indemnitee’s
Entitlement to Indemnification.
In making any Standard of Conduct Determination, the person or
persons making such determination shall presume that Indemnitee has
satisfied the applicable standard of conduct and is entitled to
indemnification, and the Company shall have the burden of proof to
overcome that presumption and establish that Indemnitee is not so
entitled. Any Standard of Conduct Determination that is adverse to
Indemnitee may be challenged by the Indemnitee in the Utah Court.
No determination by the Company (including by its directors or any
Independent Counsel) that Indemnitee has not satisfied any applicable
standard of conduct may be used as a defense to any legal
Proceedings brought by Indemnitee to
secure indemnification or reimbursement or advance payment of
Expenses by the Company hereunder or create a presumption
that Indemnitee has not met any
applicable standard of conduct.

 

(ii) Reliance
as a Safe Harbor. For purposes
of this Agreement, and without creating any presumption as to a
lack of good faith if the following circumstances do not exist,
Indemnitee shall be deemed to have acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to the best interests of the Company if
Indemnitee’s actions or omissions to act are taken in good
faith reliance upon the records of the Company, including its
financial statements, or upon information, opinions, reports or
statements furnished to Indemnitee by the officers or employees
of the Company or any of its
subsidiaries in the course of their duties, or by committees of the
Board or by any other Person (including legal counsel, accountants
and financial advisors) as to matters Indemnitee reasonably
believes are within such other Person’s professional or
expert competence and who has been selected with reasonable care by
or on behalf of the Company. In addition, the knowledge and/or
actions, or failures to act, of any director, officer,
Agent or employee of the Company shall
not be imputed to Indemnitee for purposes of determining the right
to indemnity hereunder.

 

 

8

 

 

(iii) No
Other Presumptions.
In making any determination concerning
Indemnitee’s right to indemnification, there shall be a
presumption that Indemnitee has satisfied the applicable standard
of conduct, and the Company may overcome such presumption only by
its adducing clear and convincing evidence to the contrary. For
purposes of this Agreement, the termination of any 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 this Agreement or applicable law. In addition, neither
the failure of any Reviewing Party to have made a determination as
to whether Indemnitee has met any particular standard of conduct or
had any particular belief, nor an actual determination by any
Reviewing Party that Indemnitee has not met such standard of
conduct or did not have such belief, prior to the commencement of
legal Proceedings by Indemnitee to secure a judicial determination
that Indemnitee should be indemnified under this Agreement under
applicable law, shall be a defense to Indemnitee’s claim or
create a presumption that Indemnitee has not met any particular
standard of conduct or did not have any particular belief. Any
determination concerning Indemnitee’s right to
indemnification that is adverse to Indemnitee may be challenged by
Indemnitee in the courts of the State of Utah. No determination by
the Company (including without limitation by its directors or any
Independent Counsel) that Indemnitee has not satisfied any applicable
standard of conduct shall be a defense to any claim by Indemnitee
for indemnification or reimbursement or advance payment of Expenses
by the Company hereunder or create a presumption that
Indemnitee has not met any applicable
standard of conduct.

 

(iv) Defense
to Indemnification and Burden of Proof. It shall be a defense to any action brought by
Indemnitee against the Company to enforce this Agreement (other
than an action brought to enforce a Proceeding for Losses incurred
in defending against a Proceeding related to an Indemnifiable Event
in advance of its final disposition) that it is not permissible
under applicable law for the Company to indemnify Indemnitee for
the amount claimed. In connection with any such action or any
related Standard of Conduct Determination, the burden of proving
such a defense or that the Indemnitee did not satisfy the
applicable standard of conduct shall be on the
Company.

 

(g) The
Parties acknowledge and agree that the Standard of Conduct
Determination described in Section
8(b)
is being conducted solely for purposes of compliance with applicable Utah
state law. The standards to be utilized in making the Standard of
Conduct Determination shall be those set forth in
Section 16-10a-902 of
the Act. Such Standard of Conduct Determination, when made,
is expressly for use by the Company and shall not be used or
relied upon in any way by any other person or entity nor shall any
Standard of Conduct Determination made under or in connection with
this Agreement be admissible in any judicial or
administrative Proceeding for
any purpose whatsoever other than the enforcement of this Agreement
by the Parties to this Agreement.

 

9. Exclusions
from Indemnification.
Notwithstanding anything in this Agreement to the contrary, the
Company shall not be obligated to:

 

(a) indemnify or advance funds to Indemnitee for
Expenses or Losses with respect to Proceedings initiated by Indemnitee, including
any Proceedings against the
Company or its directors, officers, employees or other
indemnitees and not by way of defense,
except: (i) Proceedings
referenced in this Section
9(a)
(unless a court of competent
jurisdiction determines that each of the material assertions made
by Indemnitee in such Proceeding was not made in good faith or was
frivolous); or (ii) where the
Company has joined in or the Board has consented to the initiation
of such Proceedings.

 

 

9

 

 

(b) indemnify
Indemnitee if a final decision by a court of competent jurisdiction
determines that such indemnification is prohibited by applicable
law.

 

(c) indemnify
Indemnitee for the disgorgement of profits or the advancement or
reimbursements of any Expenses
incurred in connection with the purchase or sale by Indemnitee of
securities of the Company in violation of Section 16(b) of the Exchange Act, or any similar
successor statute.

 

(d) To
indemnify Indemnitee for Expenses or liabilities of any type whatsoever
(including, but not limited to, judgments, fines,
ERISA excise taxes or penalties, and
amounts paid in settlement) to the extent such Expenses or liabilities have been paid directly to
Indemnitee by an insurance carrier under a policy of
officers’ and directors
liability insurance maintained by the Company;
or

 

(e) indemnify
or advance funds to Indemnitee for Indemnitee’s reimbursement
to the Company of any bonus or other incentive-based or
equity-based compensation previously received by Indemnitee or
payment of any profits realized by Indemnitee from the sale of
securities of the Company, as required in each case under
the Exchange Act (including any
such reimbursements under Section 304 of the Sarbanes-Oxley Act of 2002 in
connection with an accounting restatement of the Company or the payment to the Company of
profits arising from the purchase or sale by Indemnitee of
securities in violation of Section 306 of the Sarbanes-Oxley
Act).

 

10. Settlement.
The Company shall not be liable to Indemnitee under this Agreement
for any amounts paid in settlement of any threatened or pending
Proceeding related to an Indemnifiable Event effected without the
Company’s prior written consent, which shall not be
unreasonably withheld. The Company shall not settle any Proceeding
related to an Indemnifiable Event in any manner that would impose
any Losses on the Indemnitee without the Indemnitee’s prior
written consent.

 

11. Mutual
Acknowledgement. Both the
Company and Indemnitee acknowledge that in certain instances,
Federal law or public policy may override applicable state law and
prohibit the Company from indemnifying its directors and officers
under this Agreement or otherwise. For example, the Company 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. Indemnitee understands and
acknowledges that the Company has undertaken or may be required in
the future to undertake with the SEC to submit the question of
indemnification to a court in certain circumstances for a
determination of the Company’s right under public policy to
indemnify Indemnitee.

 

12. Duration.
All agreements and obligations
of the Company contained herein shall continue during the period
that Indemnitee is a director or officer of the Company (or is
serving at the request of the Company as a director, officer,
employee, member, trustee or Agent of another enterprise) and shall continue
thereafter (i) so long as Indemnitee may be subject to any possible
Proceeding relating to an Indemnifiable Event (including any rights
of appeal thereto) and (ii) throughout the pendency of any
Proceeding (including any rights of
appeal thereto) commenced by Indemnitee to enforce or interpret his
or her rights under this Agreement, even if, in either case, he or
she may have ceased to serve in such capacity at the time of any
such Proceeding.

 

13. Non-Exclusivity.
The rights of Indemnitee hereunder will be in addition to any other
rights Indemnitee may have under the Constituent Documents, the Act, any other contract or otherwise
(collectively, “Other Indemnity
Provisions”); provided,
however, that (a) to the extent that Indemnitee otherwise would
have any greater right to indemnification under any Other Indemnity
Provision, Indemnitee will be deemed to have such greater right
hereunder and (b) to the extent that any change is made to any
Other Indemnity Provision which permits any greater right to
indemnification than that provided under this Agreement as of the
date hereof, Indemnitee will be deemed to have such greater right
hereunder.

 

 

10

 

 

14. Liability
Insurance. For the duration of
Indemnitee’s service as a director or officer of the Company,
and thereafter for so long as Indemnitee shall be subject to any
pending Proceeding relating to an Indemnifiable Event, the Company
shall use commercially reasonable efforts (taking into account the
scope and amount of coverage available relative to the cost
thereof) to continue to maintain in effect policies of
directors’ and officers’ liability insurance
(“D&O
Insurance”) providing
coverage that is at least substantially comparable in scope and
amount to that provided by the Company’s current policies of
D&O Insurance. In all policies of D&O Insurance maintained
by the Company, Indemnitee shall be named as an insured in such a
manner as to provide Indemnitee the same rights and benefits as are
provided to the most favorably insured of the Company’s
directors, if Indemnitee is a director, or of the Company’s
officers, if Indemnitee is an officer (and not a director) by such
policy. Upon request, the Company will provide to Indemnitee copies
of all D&O Insurance applications, binders, policies,
declarations, endorsements and other related
materials.

 

15. No
Duplication of Payments.
The Company shall not be liable under
this Agreement to make any payment to Indemnitee in respect of any
Losses to the extent Indemnitee has otherwise received payment
under any insurance policy, the Constituent Documents, Other Indemnity Provisions
or otherwise of the amounts otherwise indemnifiable by the Company
hereunder.

 

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

 

17. Amendments.
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
binding unless in the form of a writing signed by the Party against
whom enforcement of the waiver is sought, and no such waiver shall
operate as a waiver of any other provisions hereof (whether or not
similar), nor shall such waiver constitute a continuing waiver.
Except as specifically provided herein, no failure to exercise or
any delay in exercising any right or remedy hereunder shall
constitute a waiver thereof.

 

18. Binding
Effect. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the
Parties hereto and their respective successors (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), assigns, spouses, heirs and personal and legal
representatives. The Company 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 Company, by written
agreement in form and substances
satisfactory to 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
had taken place.

 

19. Severability.
Nothing in this Agreement is intended to require or shall be
construed as requiring the Company to do or fail to do any act in
violation of applicable law. The Company’s inability, pursuant to court
order, to perform its obligations under this Agreement shall not
constitute a breach of this Agreement. The provisions of this
Agreement shall be severable as provided in this
Section
19.
If this Agreement or any portion hereof shall be invalidated on any
ground by any court of competent jurisdiction, then the Company
shall nevertheless indemnify Indemnitee to the full extent
permitted by any applicable portion of this Agreement that shall
not have been invalidated, and the balance of this Agreement not so
invalidated shall be enforceable in accordance with its
terms.

 

 

11

 

 

20. Notices.
All notices, requests, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given if
delivered by hand, against receipt, or mailed, by postage prepaid,
certified or registered mail:

 

if
to Indemnitee, to the address set forth on the signature page
hereto.

 

if to the Company, addressed to the
Chairperson of the Board of Directors,
with a copy to the Corporate
Secretary at the principal executive offices of the
Company:

 

DYNATRONICS
CORPORATION

7030
Park Centre Blvd.

Cottonwood
Heights, Utah 84121

 

 

Notice of change of address shall be effective
only when given in accordance with this Section. All notices
complying with this Section shall be deemed to have been received
on the date of hand delivery or on the third (3rd)
business day after mailing.

 

21. Governing
Law and Forum. This Agreement
shall be governed by and construed and enforced in accordance with
the laws of the State of Utah applicable to contracts made and to
be performed in such state without giving effect to its principles
of conflicts of laws. 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 Utah
Court and not in any other state or federal court in the United
States, (b) consent to submit to the exclusive jurisdiction of the
Utah Court for purposes of any action or Proceeding arising out of or in connection with
this Agreement, and (c) waive, and agree not to plead or make, any
claim that the Utah Court lacks venue or that any such action
or Proceeding brought in the
Utah Court has been brought in an improper or inconvenient
forum.

 

22. Headings.
The headings of the sections and 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 or
interpretation thereof.

 

23. Counterparts.
This Agreement may be executed in one (1) 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.

 

 

[SIGNATURE PAGE FOLLOWS]

 

 

12

 

IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the date first above written.

 

	
 

	

DYNATRONICS CORPORATION

 

 

 

	
 

	

By: _____________________

Name:___________________

Title:_____________________

 

 

 

	
 

	

INDEMNITEE

 

 

 

	
 

	

Brian Baker

Address for Notice:

_____________________

_____________________

_____________________

 

	
 

	
 

 

 

 

13Exhibit
4.6

 

LZG
INTERNATIONAL, INC.

DESCRIPTION
OF SECURITIES

 

Authorized
Capital Stock

 

The
Company has 120,000,000 shares of authorized capital stock described as follows: The Company has authorized 100,000,000 shares
of common stock with $.001 par value. The Company has authorized 20,000,000 shares of preferred stock with $.001 par value to
be issued in five (5) series.

 

Common
Stock: The common stock has equal rights and privileges with respect to voting, liquidation and dividend rights. Each share of
common stock is entitled to one vote on all matters submitted to a vote of the stockholders. The holders are not permitted to
vote their shares cumulatively. Upon issuance of preferred stock, the common stock may have junior rights as compared to the preferred
stock. Stockholders of the Company have no preemptive rights to acquire additional shares of common stock or any other securities.
All outstanding shares of common stock are fully paid and non-assessable.

 

Preferred
Stock: Our board of directors is authorized to establish the number of shares to be included in each series and the preferences,
rights of conversion, limitations and other relative rights of each series. As of the date of this filing, our board of directors
has not authorized a series, nor issued any preferred stock.

 

Other
Securities

 

As
of the date of this filing, we do not have any debt securities, warrants or options outstanding.

 

Voting
Rights

 

A
majority of the shares entitled to vote on the matter by each voting group, represented in person or by proxy, shall constitute
a quorum at any meeting of shareholders, but in no event shall a quorum consist of less than one third of the shares of each voting
group entitled to vote. The vote of the holders of a majority of the issued and outstanding shares of common stock entitled to
vote thereon is sufficient to authorize, affirm, ratify or consent to such act or action, except as otherwise provided by law.

 

Dividend
Policy

 

If
our Board of Directors declares dividends, all holders of our common stock are entitled to participate proportionally out of the
funds legally available therefrom. These dividends may be paid in cash, property or additional shares of common stock. We have
not paid any dividends since our inception and presently anticipate that all earnings, if any, will be retained for development
of our business.

 

Transfer
Agent

 

Our
transfer agent is Standard Registrar & Stock Transfer Co., Inc. located in Salt Lake City, Utah.

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