Document:

ex_454174.htm

Exhibit 10.1

 

NORTHWEST PIPE COMPANY

FORM OF INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement (this “Agreement”) is dated as of _________________, and is between Northwest Pipe Company, an Oregon corporation (the “Company”), and _________________ (“Indemnitee”).

 

RECITALS

 

A.             Indemnitee’s service to the Company substantially benefits the Company.

 

B.             Individuals are reluctant to serve as directors or officers of corporations or in certain other capacities unless they are provided with adequate protection through insurance or indemnification against the risks of claims and actions against them arising out of such service.

 

C.             Indemnitee does not regard the protection currently provided by applicable law, the Company’s certificate of incorporation and bylaws, and any insurance as adequate under the present circumstances, and Indemnitee may not be willing to serve as a director or officer or certain other capacities without additional protection.

 

D.             The Oregon Business Corporation Act (“OBCA”) expressly provides that the indemnification provisions set forth in the OBCA are not exclusive, and thereby contemplates that contracts may be entered into between the Company and members of the Board or officers with respect to indemnification of directors and officers.

 

E.             In order to induce Indemnitee to continue to provide services to the Company, it is reasonable, prudent, and necessary for the Company to contractually obligate itself to indemnify, and to advance expenses on behalf of, Indemnitee as permitted by applicable law.

 

F.             This Agreement is a supplement to and in furtherance of the indemnification provided in the Company’s certificate of incorporation and bylaws, any resolutions adopted pursuant thereto, any insurance purchased by the Company that may benefit Indemnitee, and this Agreement shall not be deemed a substitute therefor, nor shall this Agreement be deemed to limit, diminish or abrogate, any rights of Indemnitee thereunder.

 

The parties therefore agree as follows:

 

	 	
			1. 

				
			Definitions

			

 

(a)          A “Change in Control” shall be deemed to occur upon the earliest to occur after the date of this Agreement of any of the following events:

 

(i)          Acquisition of Stock by Third Party. Any Person (as defined below) becomes the Beneficial Owner (as defined below), directly or indirectly, of securities of the Company representing 15% or more of the combined voting power of the Company’s then outstanding securities;

 

 

 

 

 

(ii)          Change in Board Composition. During any period of two consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constituted the Company’s board of directors and any Approved Directors cease for any reason to constitute at least a majority of the members of the Company’s board of directors. “Approved Directors” means new directors (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in Section l(a)(i), l(a)(iii) or l(a)(iv) hereof) whose election or nomination by the Company’s board of directors (or, if applicable, by the Company’s stockholders) was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such two-year period or whose election or nomination for election was previously so approved;

 

(iii)          Corporate Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity;

 

(iv)          Liquidation. The approval by the Company’s stockholders of a complete liquidation or the dissolution of the Company or an agreement for the sale, lease or disposition by the Company of (in one transaction or a series of transactions) all or substantially all of the Company’s assets; and

 

(v)          Other Events. Any other event of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Exchange Act (as defined below), whether or not the Company is then subject to such reporting requirement.

 

For purposes of this Section 1(a), the following terms shall have the following meanings:

 

(1)          "Person” shall have the meaning as set forth in Sections 13(d) and 14(d) of the Exchange Act; provided, however, that “Person” shall exclude (i) the Company, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (iii) any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.

 

(2)          “Beneficial Owner” shall have the meaning given to such term in Rule 13d-3 under the Exchange Act; provided, however, that “Beneficial Owner” shall exclude any Person otherwise becoming a Beneficial Owner by reason of (i) the Company’s stockholders approving a merger of the Company with another entity or (ii) the Company’s board of directors approving a sale of securities by the Company to such Person.

 

(b)          “Corporate Status” describes the status of a person who is or was a director, trustee, general partner, managing member, officer, employee, agent or fiduciary of the Company or any other Enterprise.

 

(c)          “Disinterested Directors” means directors of the Company who are not and were not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

 

(d)          “Enterprise” means the Company and any other corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was serving at the request of the Company as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary, including as a deemed fiduciary thereto.

 

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(e)          “Expenses” include all reasonable and actually incurred attorneys’ fees, retainers, court costs, transcript costs, fees and costs of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding. Expenses also 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 their equivalent, (ii) for purposes of Section 12(d) hereof, Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise, or under any directors’ and officers’ liability insurance policies maintained by the Company, (iii) any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement (on a grossed up basis), and (iv) any interest, assessments or other charges in respect of the foregoing. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.

 

(f)          “Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

(g)          “Independent Counsel” means a law firm, or a partner or member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent the Company: (i) any Enterprise or Indemnitee in any matter material to any such party (other than as Independent Counsel with respect to matters concerning Indemnitee under this Agreement, or other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, “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.

 

(h)          “OBCA” means the Oregon Business Corporation Act.

 

(i)          “Proceeding” means any threatened, pending or completed action, suit, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or proceeding, whether brought in the right of the Company or otherwise and whether of a civil, criminal, administrative or investigative nature, whether formal or informal, including any appeal therefrom and including without limitation any such Proceeding pending as of the date of this Agreement, in which Indemnitee was, is or will be involved as a party, a potential party, a non-party witness or otherwise by reason of (i) the fact that Indemnitee is or was a director or officer of the Company, (ii) any action taken by Indemnitee or any action or inaction on Indemnitee’s part while acting as a director or officer of the Company or (iii) the fact that Indemnitee is or was serving at the request of the Company as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary of the Company or any other Enterprise, in each case whether or not serving in such capacity at the time any liability or Expense is incurred for which indemnification or advancement of expenses can be provided under this Agreement.

 

(j)          “Sarbanes-Oxley Act” means the Sarbanes-Oxley Act of 2002, as amended.

 

(k)          “other enterprises” shall include employee benefit plans; “fines” shall include any excise taxes assessed on a person with respect to any employee benefit plan; “serving at the request of the Company” shall include, without limitation, any service as a director, officer, employee or agent of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner he or she reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Company.”

 

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2.          Indemnity in Third-Party Proceedings. The Company shall indemnify Indemnitee in accordance with the provisions of this Section 2 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding, other than a Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 2, Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all Expenses, judgments, fines, and amounts paid in settlement actually and reasonably incurred by Indemnitee or on his or her behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee 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 and, with respect to any criminal action or Proceeding, had no reasonable cause to believe that his or her conduct was unlawful.

 

3.          Indemnity in Proceedings by or in the Right of the Company. The Company shall indemnify Indemnitee in accordance with the provisions of this Section 3 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 3, Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the Company. No indemnification for Expenses shall be made under this Section 3 in respect of any claim, issue or matter as to which Indemnitee shall have been finally adjudged by a court of competent jurisdiction to be liable to the Company, unless and only to the extent that any court in which the Proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification for such expenses as such court shall deem proper.

 

4.          Indemnification for Expenses of a Party Who is Wholly or Partly Successful. To the extent that Indemnitee is a party to or a participant in and is successful (on the merits or otherwise) in defense of any Proceeding or any claim, issue or matter therein, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by him or her or on his or her behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Section 4 and without limitation, Indemnitee will be deemed to have been “successful on the merits” in circumstances including but not limited to the termination of any Proceeding or of any claim, issue or matter therein, by the winning of a dismissal (with or without prejudice), motion for summary judgment, settlement (with or without court approval), or upon a plea of nolo contendere or its equivalent.

 

5.          Indemnification for Expenses of a Witness or in Response to a Subpoena. To the extent that Indemnitee is, by reason of his or her Corporate Status, (i) a witness in any Proceeding to which Indemnitee is not a party or (ii) receives a subpoena with respect to any Proceeding to which Indemnitee is not a party and is not threatened to be made a party, Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.

 

6.          Additional Indemnification.

 

(a)          Except as provided for in Section 7 hereof, notwithstanding any limitation in Section 2, 3 or 4 hereof, the Company shall indemnify Indemnitee to the fullest extent permitted by applicable law if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding (including a Proceeding by or in the right of the Company to procure a judgment in its favor) against all Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee or on his or her behalf in connection with the Proceeding or any claim, issue or matter therein.

 

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(b)          For purposes of Section 6(a) hereof, the meaning of the phrase “to the fullest extent permitted by applicable law” shall include, but not be limited to:

 

(i)          the fullest extent permitted by the provision of the OBCA that authorizes or contemplates additional indemnification by agreement, or the corresponding provision of any amendment to or replacement of the OBCA; and

 

(ii)          the fullest extent authorized or permitted by any amendments to or replacements of the OBCA adopted after the date of this Agreement that increase the extent to which a corporation may indemnify its officers and directors.

 

7.          Exclusions. Notwithstanding any provision in this Agreement, the Company shall not be obligated under this Agreement to make any indemnity in connection with any Proceeding (or any part of any Proceeding):

 

(a)          Except as provided for in Section 18 hereof, for which payment has actually been made to or on behalf of Indemnitee under any statute, insurance policy, indemnity provision, vote or otherwise, except with respect to any excess beyond the amount paid; provided, however, that payment made to Indemnitee pursuant to an insurance policy purchased and maintained by Indemnitee at his or her own expense of any amounts otherwise indemnifiable or obligated to be made pursuant to this Agreement shall not reduce the Company’s obligations to Indemnitee pursuant to this Agreement.

 

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

 

(c)          For an accounting or disgorgement of profits pursuant to Section 16(b) of the Exchange Act or similar provisions of federal, state or local statutory law or common law, if Indemnitee is held liable therefor, including pursuant to any settlement arrangements to which the Indemnitee has consented (provided, however, that the Company must advance expenses for such matters otherwise permissible under this Agreement);

 

(d)          For any reimbursement of the Company by Indemnitee of any bonus or other incentive-based or equity-based compensation or 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 that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act or the payment to the Company of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act), if Indemnitee is held liable therefor, including pursuant to any settlement arrangements to which the Indemnitee has consented (provided, however, that the Company must advance expenses for such matters otherwise permissible under this Agreement);

 

(e)          Initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees, agents or other indemnitees, unless (i) the Company’s board of directors authorized the Proceeding (or the relevant part of the Proceeding) prior to its initiation, (ii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law, (iii) otherwise authorized in Section 12(a) or 12(d) hereof or (iv) otherwise required by applicable law; provided, for the avoidance of doubt, Indemnitee shall not be deemed for purposes of this Section 7(e) to have initiated any Proceeding (or any part of a Proceeding) by reason of (i) having asserted any affirmative defenses in connection with a claim not initiated by Indemnitee or (ii) having made any counterclaim (whether permissive or mandatory) in connection with any claim not initiated by Indemnitee; or

 

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(f)          If prohibited by applicable law or public policy as determined by a court of competent jurisdiction in a final adjudication not subject to further appeal or public policy (and, in this respect, both the Company and Indemnitee have been advised that the Securities and Exchange Commission believes 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 appropriate courts for adjudication).

 

8.          Advances of Expenses. The Company shall advance the Expenses incurred by Indemnitee in connection with any Proceeding whether prior to or after its final disposition, if Indemnitee furnishes the Company a written affirmation, substantially in the form attached hereto as Exhibit A, of the Indemnitee’s good faith belief that Indemnitee is entitled to be indemnified by the Company under this Agreement and agreement to repay such advancement if it is ultimately decided by a court of competent jurisdiction that Indemnitee is not entitled to be indemnified. Such advancement shall be made as soon as reasonably practicable, but in any event no later than thirty (30) days, after the receipt by the Company of a written statement or statements requesting such advances from time to time (which shall include invoices received by Indemnitee in connection with such Expenses but, in the case of invoices in connection with legal services, any references to legal work performed or to expenditure made that would cause Indemnitee to waive any privilege accorded by applicable law are not required to be included with the invoice). Advances shall be unsecured and interest free and made without regard to Indemnitee’s ability to repay such advances. This Section 8 shall apply to any Proceeding (or any part of any Proceeding) referenced in Section 7(b) or 7(c) hereof prior to a determination that Indemnitee is not entitled to be indemnified by the Company.

 

	 	
			9. 

				
			Procedures for Notification and Defense of Claim.

			

 

(a)          Indemnitee shall notify the Company in writing of any matter with respect to which Indemnitee intends to seek indemnification or advancement of Expenses as soon as reasonably practicable following the receipt by Indemnitee of notice thereof. The written notification to the Company shall include, in reasonable detail, a description of the nature of the Proceeding and the facts underlying the Proceeding. The failure by Indemnitee to notify the Company will not relieve the Company from any liability which it may have to Indemnitee hereunder or otherwise than under this Agreement, and any delay in so notifying the Company shall not constitute a waiver by Indemnitee of any rights, except to the extent that such failure or delay materially prejudices the Company’s ability to defend such Proceeding, provided, further, that notice will be deemed to have been given without any action on the part of Indemnitee in the event the Company is a party to the same Proceeding.

 

(b)          If, at the time of the receipt of a notice of a Proceeding pursuant to the terms hereof, the Company has directors’ and officers’ liability insurance in effect that may be applicable to the Proceeding, the Company shall give prompt notice of the commencement of the Proceeding to the insurers in accordance with the procedures set forth in the applicable policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.

 

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(c)          In the event the Company may be obligated to make any indemnity in connection with a Proceeding, the Company shall be entitled to assume the defense of such Proceeding with counsel approved by Indemnitee, which approval shall not be unreasonably withheld, conditioned or delayed, upon the delivery to Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, from that time forward, the Company will not be liable to Indemnitee for any fees or expenses of counsel subsequently incurred by Indemnitee with respect to the same Proceeding. If two or more persons who may be entitled to indemnification from the Company, including the Indemnitee, are parties to any Proceeding, the Company may require Indemnitee to use the same legal counsel as the other parties. Notwithstanding the Company’s assumption of the defense of any such Proceeding, the Company shall be obligated to pay the fees and expenses of Indemnitee’s separate counsel to the extent (i) the employment of separate counsel by Indemnitee is authorized by the Company, (ii) counsel for the Company or Indemnitee shall have reasonably concluded that there may be or might arise a conflict of interest between the Company and Indemnitee in the conduct of any such defense such that Indemnitee needs to be separately represented, (iii) the Company is not financially or legally able to perform its indemnification obligations, (iv) the fees and expenses are non-duplicative and reasonably incurred in connection with Indemnitee’s role in the Proceeding despite the Company’s assumption of the defense, or (v) the Company shall not have retained, or shall not continue to retain, counsel to defend such Proceeding. Indemnitee agrees that any such separate counsel retained by Indemnitee will be a member of any approved list of panel counsel under the Company’s applicable directors’ and officers’ liability insurance policy, should the applicable policy provide for a panel of approved counsel and should such approved panel list comprise law firms with well-established reputations in the type of litigation at issue. (For clarity, the fact of a law firm’s being part of a panel shall not be evidence of such law firm’s having a well-established national reputation for the type of litigation at issue). The Company shall not be entitled, without the consent of Indemnitee, to assume the defense of any claim brought by or in the right of the Company. Notwithstanding anything in this Agreement to the contrary, the Indemnitee shall have the right to employ the Indemnitee’s own counsel in connection with any such proceeding, at Indemnitee’s own expense, if such counsel serves in a review, observer, advice, and counseling capacity and does not otherwise materially control or participate in the defense of such Proceeding.

 

(d)          Indemnitee shall give the Company such information and cooperation in connection with the Proceeding as may be reasonably appropriate.

 

(e)          The Company shall not be liable to indemnify Indemnitee for any settlement of any Proceeding (or any part thereof) without the Company’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed. The Company acknowledges that a settlement or other disposition short of final judgment may be successful if it permits a party to avoid expense, delay, distraction, disruption and uncertainty. In the event that any action, claim or Proceeding to which Indemnitee is a party is resolved in a settlement to which the Company has given its prior written consent, such settlement shall be treated as a success on the merits in the settled action, suit or Proceeding.

 

(f)          The Company shall not settle any Proceeding (or any part thereof) in a manner that imposes any penalty or liability on Indemnitee without Indemnitee’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed.

 

(g)          The Company shall not, on its own behalf, settle any part of any Proceeding to which Indemnitee is a party with respect to other parties (including the Company) if any portion of such settlement is to be funded from corporate insurance proceeds unless approved by (i) the written consent of Indemnitee or (ii) a majority of the independent directors of the board; provided, however, that the right to constrain the Company’s use of corporate insurance as described in this section shall terminate at the time the Company concludes (according to the terms of this Agreement) that Indemnitee is not entitled to indemnification pursuant to this Agreement, or such indemnification obligation to Indemnitee has been fully discharged by the Company.

 

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			10. 

				
			Procedures upon Application for Indemnification.

			

 

(a)          To obtain indemnification, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and as is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of the Proceeding. Any delay in providing the request will not relieve the Company from its obligations under this Agreement, except to the extent such failure is prejudicial.

 

(b)          Upon written request by Indemnitee for indemnification pursuant to Section 10(a) hereof, a determination with respect to Indemnitee’s entitlement thereto shall be made as follows, provided that a Change in Control shall not have occurred: (i) by a majority vote of the Disinterested Directors, even though less than a quorum of the Company’s board of directors; (ii) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Company’s board of directors; (iii) if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel in a written opinion to the Company’s board of directors, a copy of which shall be delivered to Indemnitee; or (iv) if so directed by the Company’s board of directors, by the Company’s stockholders. If a Change in Control shall have occurred, a determination with respect to Indemnitee’s entitlement to indemnification shall be made by Independent Counsel in a written opinion to the Company’s board of directors, a copy of which shall be delivered to Indemnitee. If it is determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten days after such determination. Indemnitee shall cooperate with the person, persons or entity making the determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information that is not privileged or otherwise protected from disclosure and that is reasonably available to Indemnitee and reasonably necessary to such determination. Any costs or expenses (including attorneys’ fees and disbursements) actually and reasonably incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Company, to the extent permitted by applicable law. The Company will advance and pay any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making the indemnification determination irrespective of the determination as to Indemnitee’s entitlement to indemnification and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.

 

(c)          In the event the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 10(b) hereof, the Independent Counsel shall be selected as provided in this Section 10(c). If a Change in Control shall not have occurred, the Independent Counsel shall be selected by the Company’s board of directors, and the Company shall give written notice to Indemnitee advising him or her of the identity of the Independent Counsel so selected. If a Change in Control shall have occurred, the Independent Counsel shall be selected by Indemnitee (unless Indemnitee shall request that such selection be made by the Company’s board of directors, in which event the preceding sentence shall apply), and Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either event, Indemnitee or the Company, as the case may be, may, within ten days after such written notice of selection shall have been given, deliver to the Company or to Indemnitee, as the case may be, a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 1 hereof, and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person so selected shall act as Independent Counsel. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit. If, within 20 days after the later of (i) submission by Indemnitee of a written request for indemnification pursuant to Section 10(a) hereof and (ii) the final disposition of the Proceeding, the parties have not agreed upon an Independent Counsel, either the Company or Indemnitee may petition a court of competent jurisdiction for resolution of any objection which shall have been made by the Company or Indemnitee to the other’s selection of Independent Counsel and for the appointment as Independent Counsel of a person selected by the court or by such other person as the court shall designate, and the person with respect to whom all objections are so resolved or the person so appointed shall act as Independent Counsel under Section 10(b) hereof. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 12(a) hereof, the Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

 

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(d)          The Company agrees to pay the reasonable fees and expenses of any Independent Counsel and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.

 

(e)          If the determination of the Indemnitee’s entitlement to indemnification has not been made pursuant to this Section 10 within sixty (60) days after the later of (i) receipt by the Company of Indemnitee’s request for indemnification pursuant to Section 10(a) and (ii) the final disposition of the Proceeding for which Indemnitee requested Indemnification (the “Determination Period”), the requisite determination of entitlement to indemnification will be deemed to have been made and Indemnitee will be entitled to such indemnification, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification. The Determination Period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if the person, persons or entity making the determination with respect to entitlement to indemnification in good faith requires such additional time for the obtaining or evaluating of documentation and/or information relating thereto; and provided, further, the Determination Period may be extended an additional sixty (60) days if the determination of entitlement to indemnification is to be made by the stockholders pursuant to Section 10(b) of this Agreement.

 

	 	
			11. 

				
			Presumptions and Effect of Certain Proceedings.

			

 

(a)          In making a determination with respect to entitlement to indemnification hereunder, the person, persons or entity making such determination shall, to the fullest extent not prohibited by law, presume that Indemnitee is entitled to indemnification under this Agreement, and the Company shall, to the fullest extent not prohibited by law, have the burden of proof to overcome that presumption by clear and convincing evidence.

 

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

 

(c)          For purposes of any determination of good faith, Indemnitee shall be deemed to have acted in good faith to the extent Indemnitee relied in good faith on (i) the records or books of account of the Enterprise, including financial statements, (ii) information supplied to Indemnitee by the officers of the Enterprise in the course of their duties, (iii) the advice of legal counsel for the Enterprise or its board of directors or counsel selected by any committee of the board of directors or (iv) information or records given or reports made to the Enterprise by an independent certified public accountant, an appraiser, investment banker or other expert selected with reasonable care by the Enterprise or its board of directors or any committee of the board of directors. The provisions of this Section 11(c) shall not be deemed to be exclusive or to limit in any way the other circumstances in which Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.

 

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(d)          Neither the knowledge, actions nor failure to act of any other director, officer, agent or employee of the Enterprise shall be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

 

	 	
			12. 

				
			Remedies of Indemnitee.

			

 

(a)          Subject to Section 12(e) hereof, in the event that (i) a determination is made pursuant to Section 10 hereof that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 8 or 12(d) hereof, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 10 hereof within 30 days after the later of the receipt by the Company of the request for indemnification or the final disposition of the Proceeding, (iv) payment of indemnification pursuant to this Agreement is not made (A) within ten days after a determination has been made that Indemnitee is entitled to indemnification or (B) with respect to indemnification pursuant to Sections 4, 5 and 12(d) hereof, within 30 days after receipt by the Company of a written request therefor, or (v) the Company or any other person or entity takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or proceeding designed to deny, or to recover from, Indemnitee the benefits provided or intended to be provided to Indemnitee hereunder, Indemnitee shall be entitled to an adjudication by a court of competent jurisdiction of his or her entitlement to such indemnification and/or advancement of Expenses. Alternatively, Indemnitee, at his or her option, may seek an award in arbitration with respect to his or her entitlement to such indemnification or advancement of Expenses, to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Indemnitee shall commence such proceeding seeking an adjudication or an award in arbitration within 12 months following the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 12(a); provided, however, that the foregoing clause shall not apply in respect of a proceeding brought by Indemnitee to enforce his or her rights under Section 4 hereof. The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration in accordance with this Agreement.

 

(b)          Neither (i) the failure of the Company, its stockholders, its board of directors, any committee or subgroup of its board of directors or Independent Counsel to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor (ii) an actual determination by the Company, its stockholders, its board of directors, any committee or subgroup of its board of directors or Independent Counsel that Indemnitee has not met the applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. In the event that a determination shall have been made pursuant to Section 10 hereof that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 12 shall be conducted in all respects as a de novo trial or arbitration on the merits, and Indemnitee shall not be prejudiced by reason of that adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section 12, the Company shall, to the fullest extent not prohibited by law, have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be, and the burden of proof shall be by clear and convincing evidence.

 

(c)          To the fullest extent not prohibited by law, the Company shall be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 12 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Company is bound by all the provisions of this Agreement. If a determination shall have been made pursuant to Section 10 hereof that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 12, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statements not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law as determined by a court of competent jurisdiction in a final adjudication not subject to further appeal.

 

10

 

 

(d)          To the extent not prohibited by law as determined by a court of competent jurisdiction in a final adjudication not subject to further appeal, the Company shall indemnify Indemnitee against all Expenses that are reasonably and necessarily incurred by Indemnitee in connection with any action for indemnification or advancement of Expenses from the Company under this Agreement, any other agreement, the Company’s certificate of incorporation and bylaws, or any directors’ and officers’ liability insurance policies maintained by the Company to the extent Indemnitee is successful in such action, and, if requested by Indemnitee, shall (as soon as reasonably practicable, but in any event no later than 30 days, after receipt by the Company of a written request therefor) advance such Expenses to Indemnitee, subject to the provisions of Section 8 hereof.

 

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

 

13.          Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee, the Company, in lieu of indemnifying Indemnitee, shall pay, in the first instance, the entire amount incurred by Indemnitee, whether for Expenses, judgments, decisions of arbitrators, fines, penalties, and/or amounts paid or to be paid in settlement, in connection with any Proceeding without requiring Indemnitee to contribute to such payment, and the Company hereby waives and relinquishes any right of contribution it may have at any time against Indemnitee; provided, however, that such right to contribution described in this section shall terminate at the time the Company concludes (per the terms of this Agreement) that (i) Indemnitee is not entitled to indemnification pursuant to this Agreement, or (ii) such indemnification obligation to Indemnitee has been fully discharged by the Company.

 

14.          Non-exclusivity. The rights of indemnification and to receive advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Company’s certificate of incorporation and bylaws, any agreement, a vote of the Company’s stockholders, a resolution of the Company’s board of directors or otherwise. To the extent that a change in Oregon law, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Company’s certificate of incorporation and bylaws 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, subject to the restrictions expressly set forth herein or therein. Except as expressly set forth herein, no right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. Except as expressly set forth herein, the assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

 

15.          No Duplication of Payments. Except as provided for in Section 18 hereof, the Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder (or for which advancement is provided hereunder) if and to the extent that Indemnitee has otherwise actually received payment for such amounts under any insurance policy, contract, agreement or otherwise; provided, however, that payment made to Indemnitee pursuant to an insurance policy purchased and maintained by Indemnitee at his or her own expense of any amounts otherwise indemnifiable or obligated to be made pursuant to this Agreement shall not reduce the Company’s obligations to Indemnitee pursuant to this Agreement.

 

11

 

 

16.          Insurance.

 

(a)          To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, trustees, general partners, managing members, officers, employees, agents or fiduciaries of the Company or any other Enterprise, Indemnitee shall be covered by such policy or policies to the same extent as the most favorably-insured persons under such policy or policies in a comparable position.

 

(b)          If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company has D&O 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 Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies. The Company will instruct the insurers and their insurance brokers that they may communicate directly with Indemnitee regarding such claim.

 

(c)          In the event of a Change in Control or the Company’s becoming insolvent, the Company shall undertake all commercially reasonable efforts to maintain in force any and all insurance policies then maintained by the Company in providing insurance — directors’ and officers’ liability, fiduciary, employment practices or otherwise — in respect of the individual directors and officers of the Company, for a fixed period of six years thereafter (a “Tail Policy”). Such coverage shall be non-cancellable and shall be placed and serviced for the duration of its term by the Company’s incumbent insurance broker. The Company shall direct such broker to place the Tail Policy with the incumbent insurance carriers using the policies that were in place at the time of the Change in Control event (unless the incumbent carriers will not offer such policies, in which case the Tail Policy placed by the Company’s insurance broker shall be substantially comparable in scope and amount as the expiring policies, and the insurance carriers for the Tail Policy shall have an AM Best rating that is the same or better than the AM Best ratings of the expiring policies).

 

17.          Subrogation. Except as provided for in Section 19 hereof, in the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

 

18.          Monetary Damages Insufficient/Specific Performance. The Company and Indemnitee agree that a monetary remedy for breach of this Agreement may be inadequate, impracticable and difficult of proof, and further agree that such breach may cause Indemnitee irreparable harm. Accordingly, the parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief and/or specific performance hereof, without any necessity of showing actual damage or irreparable harm (having agreed that actual and irreparable harm will result in not forcing the Company to specifically perform its obligations pursuant to this Agreement) and that by seeking injunctive relief and/or specific performance, Indemnitee shall not be precluded from seeking or obtaining any other relief to which he may be entitled. The Company and Indemnitee further agree that Indemnitee shall be entitled to such specific performance and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bonds or other undertaking in connection therewith. The Company acknowledges that in the absence of a waiver, a bond or undertaking may be required of Indemnitee by a court, and the Company hereby waives any such requirement of a bond or undertaking. If Indemnitee seeks mandatory injunctive relief, it shall not be a defense to enforcement of the Company’s obligations set forth in this Agreement that Indemnitee has an adequate remedy at law for damages

 

12

 

 

19.          Primacy of Indemnification. The Company hereby acknowledges that to the extent Indemnitee is serving as a director on the Company’s board of directors at the request or direction of a venture capital fund or other entity and/or certain of its affiliates (collectively, the “Fund Indemnitors”), Indemnitee may have certain rights to indemnification, advancement of expenses and/or insurance provided by the Fund Indemnitors. The Company hereby agrees (i) that it is the indemnitor of first resort (i.e., its obligations to Indemnitee are primary and any obligation of the Fund Indemnitors to advance expenses or to provide indemnification for the same expenses or liabilities incurred by Indemnitee are secondary), (ii) that it shall be required to advance the full amount of expenses incurred by Indemnitee and shall be liable for the full amount of all Expenses, judgments, penalties, fines and amounts paid in settlement to the extent legally permitted and as required by the terms of this Agreement, the Company’s certificate of incorporation or bylaws or any other agreement between the Company and Indemnitee, without regard to any rights Indemnitee may have against the Fund Indemnitors, and (iii) that it irrevocably waives, relinquishes and releases the Fund Indemnitors from any and all claims against the Fund Indemnitors for contribution, subrogation or any other recovery of any kind in respect thereof. The Company further agrees that no advancement or payment by the Fund Indemnitors on behalf of Indemnitee with respect to any claim for which Indemnitee has sought indemnification from the Company shall affect the foregoing and the Fund Indemnitors shall have a right of contribution and/or be subrogated to the extent of such advancement or payment to all of the rights of recovery of Indemnitee against the Company. The Company and Indemnitee agree that the Fund Indemnitors are express third-party beneficiaries of the terms of this Section 19.

 

20.          Information Sharing. If Indemnitee is the subject of or is implicated in any way during an investigation, whether formal or informal, the Company shall promptly notify the Indemnitee of such investigation. The Company shall further share with Indemnitee any information it has turned over to any third parties concerning the investigation (“Shared Information”) at the time such information is so furnished. By executing this agreement, Indemnitee agrees that such Shared Information is material non-public information that Indemnitee is obligated to hold in confidence and may not disclose publicly; provided, however, that Indemnitee is permitted to use the Shared Information and to disclose such Shared information to Indemnitee’s legal counsel and third parties solely in connection with defending Indemnitee from legal liability.

 

21.          Services to the Company. Indemnitee agrees to serve as a director or officer of the Company or, at the request of the Company, as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary of another Enterprise, for so long as Indemnitee is duly elected or appointed or until Indemnitee tenders his or her resignation or is removed from such position. Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or any obligation imposed by operation of law), in which event the Company shall have no obligation under this Agreement to continue Indemnitee in such position. This Agreement shall not be deemed an employment contract between the Company (or any of its subsidiaries or any Enterprise) and Indemnitee. Indemnitee specifically acknowledges that any employment with the Company (or any of its subsidiaries or any Enterprise) is at will, and Indemnitee may be discharged at any time for any reason, with or without cause, with or without notice, except as may be otherwise expressly provided in any executed, written employment contract between Indemnitee and the Company (or any of its subsidiaries or any Enterprise), any existing formal severance policies adopted by the Company’s board of directors or, with respect to service as a director or officer of the Company, the Company’s certificate of incorporation or bylaws or the OBCA. No such document shall be subject to any oral modification thereof.

 

13

 

 

22.          Duration. All the rights and privileges afforded by this Agreement, including the right to indemnification and the advancement of Expenses provided under this Agreement, shall continue as to Indemnitee so long as Indemnitee is a party to or participant in a Proceeding as a result of Indemnitee’s Corporate Status, even though Indemnitee may no longer serve in the same Corporate Status at the time of any Proceeding.

 

23.          Successors. This Agreement shall be binding upon the Company and its successors and assigns, including any direct or indirect successor, by purchase, merger, consolidation or otherwise, to all or substantially all of the business or assets of the Company, and shall inure to the benefit of Indemnitee and Indemnitee’s heirs, executors and administrators. Further, the Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Company, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement to the fullest extent permitted by law.

 

24.          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 or other applicable law, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (ii) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (iii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

 

25.          Enforcement. The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director or officer of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving as a director or officer of the Company. The Company shall not seek from a court, or agree to, a “bar order” which would have the effect of prohibiting or limiting the Indemnitee's rights to receive advancement of expenses under this Agreement.

 

26.          Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the Company’s certificate of incorporation and bylaws and applicable law.

 

27.          Modification and Waiver. No supplement, modification or amendment to this Agreement shall be binding unless executed in writing by the parties hereto. No amendment, alteration or repeal of this Agreement shall adversely affect any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in his or her Corporate Status prior to such amendment, alteration or repeal. No waiver of any of the provisions of this Agreement shall constitute or be deemed a waiver of any other provision of this Agreement nor shall any waiver constitute a continuing waiver.

 

14

 

 

28.          Notices. All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by registered or certified mail, postage prepaid, sent by facsimile or electronic mail or otherwise delivered by hand, messenger or courier service addressed:

 

(a)          If to Indemnitee, to Indemnitee’s address, facsimile number, or electronic mail address as shown on the signature page of this Agreement or in the Company’s records, as may be updated in accordance with the provisions hereof; or

 

(b)          If to the Company, to the attention of the [Corporate Secretary] of Northwest Pipe Company, at 201 NE Park Plaza Drive, Suite 100, Vancouver, Washington 98684, or at such other current address as the Company shall have furnished to Indemnitee.

 

Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given (i) if delivered by hand, messenger or courier service, when delivered (or if sent via a nationally-recognized overnight courier service, freight prepaid, specifying next-business-day delivery, one business day after deposit with the courier), (ii) if sent via mail, at the earlier of its receipt or five days after the same has been deposited in a regularly-maintained receptacle for the deposit of the U.S. mail, addressed and mailed as aforesaid, or (iii) if sent via facsimile, upon confirmation of facsimile transfer, or, if sent via electronic mail, upon confirmation of delivery when directed to the relevant electronic mail address, in the case of facsimile and electronic mail, if sent during normal business hours of the recipient, or if not sent during normal business hours of the recipient, then on the recipient’s next business day.

 

29.          Governing Law and Consent to Jurisdiction. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Oregon applicable to contracts made and to be performed in such state without giving effect to its principles of conflicts of laws. Any proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement may be brought in any state or federal court sitting in the State of Oregon having jurisdiction over the parties and the matter, and each party consents to the non-exclusive jurisdiction and venue of such court (and of the appropriate appellate courts therefrom) in any such proceeding and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such proceeding in any such court or that any such proceeding brought in any such court has been brought in an inconvenient forum. Process in any such action, suit or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court.

 

30.          Counterparts. This Agreement may be executed in 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. This Agreement may also be executed and delivered by facsimile signature and in 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 needs to be produced to evidence the existence of this Agreement.

 

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

 

[Signature page follows.]

 

15

 

 

The parties are signing this Indemnification Agreement as of the date stated in the introductory sentence.

 

	 	NORTHWEST PIPE COMPANY	 
	 	 	 
	 	By:                                                              	 
	 	Name:                                                         	 
	 	Title:                                                            	 
	 	 	 
	 	 	 
	 	[INDEMNITEE] 	 
	 	 	 
	 	By:                                                              	 
	 	Name:                                                         	 
	 	Address:                                                      	 
	 	                                                                    	 
	 	                                                                    	 

 

 

[Northwest Pipe Company Indemnification Agreement]

 

 

 

 

EXHIBIT A

[FORM OF] UNDERTAKING TO REPAY ADVANCEMENT OF EXPENSES

 

[DATE]

 

Northwest Pipe Company

201 NE Park Plaza Drive, Suite 100

Vancouver, Washington 98684

Attention: Corporate Secretary

 

Re: Undertaking to Repay Advancement of Expenses

 

Dear Sir/Madam:

 

This undertaking is being provided pursuant to that certain Indemnification Agreement, dated [DATE], by and between Northwest Pipe Company, an Oregon corporation (the “Company”), and the undersigned as Indemnitee (the “Indemnification Agreement”). Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to them in the Indemnification Agreement. Pursuant to the Indemnification Agreement, among other things, I am entitled to the advancement of Expenses from the Company, which I have paid or incurred in connection with any proceeding, whether prior to or after its final disposition, subject to furnishing this undertaking.

 

I have become subject to [DESCRIPTION OF PROCEEDING] (the “proceeding”) based on [my status as [an officer/a director] of the Company]/[alleged actions or failures to act in my capacity as [an officer/a director] of the Company]. [This undertaking also constitutes notice to the Company of the proceeding pursuant to Section [9(a)] of the Indemnification Agreement.] [Notice of this proceeding was previously delivered to the Company in accordance with Section [9(a)] of the Indemnification Agreement] on [DATE]. [The following is a brief description of the current status of the proceeding]:

 

[DESCRIPTION OF CURRENT STATUS OF PROCEEDING]

 

Pursuant to Section [8] of the Indemnification Agreement, I hereby request an advancement of Expenses in connection with the proceeding. The Expenses for which advances are requested are as follows:

 

[DESCRIPTION OF EXPENSES]

 

In connection with this request for advancement of Expenses [set out above/delivered to the Company separately on [DATE]], I hereby undertake to repay any amounts paid, advanced or reimbursed by the Company for such advancement of Expenses to the extent that it is ultimately decided by a court of competent jurisdiction that I am not entitled to be indemnified.

 

 

 

 

In connection with the foregoing request and this undertaking, I hereby affirm my good faith belief that I have met any applicable standard of conduct under Oregon law.

 

This undertaking shall be governed by and construed in accordance with the laws of the State of Oregon, without regard to the principles of conflicts of laws thereof.

 

	 	Very Truly Yours,	 
	 	 	 
	 	 	 
	 	Name:	 
	 	[Title:]	 

 

2gmgi_ex101.htm

EXHIBIT 10.1
   
 Software License Agreement
  
 Between
  
 Elray Resources Inc.
  
 and
  
 Golden Matrix Group Inc.
   
  
  
 THIS AGREEMENT has been entered into as of December 1, 2022
   
  
 	 
	1
	

	 

 
 
  
 
 This Software License Agreement (the “Agreement”) is made effective as of December 1, 2022 (the “Effective Date”), by and between Golden Matrix Group Inc., a company incorporated in Nevada, the registered office of which is at 3651 Lindell Road Ste D131 Las Vegas NV 89103, USA (the “Supplier”), and Elray Resources Inc. a company incorporated in Nevada, the registered office of which is at 3651 Lindell Road Ste D131 Las Vegas NV 89103, USA, (the “Licensee”).
  
 WHEREAS,
  
 A. The Supplier is an owner of online casino games or alternatively has the right to distribute third party online games, the Brands of which are described in Schedule A attached hereto (the “Gaming Content”); and
  
 B. Licensee wished to integrate the Licensed Games provided by the Supplier into third party or its own online gaming Website(s) which are in compliance with Applicable law; and
  
 C. Licensee operates, manages, maintains Blockchain Online Gaming operations as well as provides Blockchain Currency Technology to Licensed Casino Operators and/or wishes to acquire a non-exclusive license to utilize and distribute the gaming content.
  
 D. Licensee warrants that it grants the Supplier the Right of First Refusal to provide all branded gaming content listed in Schedule A from the Supplier thereby purchasing said gaming content exclusively from the Supplier.
  
 E. Supplier is willing to grant Licensee such license, on the terms and subject to the conditions set forth in this Agreement and made a part hereof.
  
 NOW, THEREFORE, in consideration of the premises and mutual covenants in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
  
 1. Definitions 
  
 For the purposes of this Agreement, the following terms and expressions shall have the meaning set forth below:
  
 “Agreement” means this written Game Software License Agreement including any appendix or amendment hereto as may be adopted by the Parties in terms hereof;
  
 “API/s” means application programming interface of which is inter alia a set of commands, functions, protocols, and objects that programmers can use to create software or interact with an external system;
  
  
 	 
	2
	

	 

 
 
  
 
 “Applicable Law/s” means all laws and regulations of any jurisdiction in the Territory that are applicable to this Agreement, to any of the Parties hereto or to any activity of any of the Parties hereto (and including without limitation the use of any Licensed Games by any person and/or entity including, without limitation, any Players), as amended and in force from time to time, including the rules, regulations, orders, licences or permits (and the conditions upon which such licences and permits are granted) issued thereunder, including, without limitation, any rules, regulations, orders, licences and permits of any Competent Authority and including, without limitation, any gaming-related legislation, data protection laws, privacy laws, anti-spam laws and intellectual property laws.
  
 “Bonus” or “Bonuses” means incentives provided by the Licensee to End Users on the Website directly related to promote the Licensed Games including, but not limited, to free bets, free rolls, free spins, free chips, bonus-based loyalty programs or similar offered to End Users from time to time;
  
 “Chargebacks” means all amounts paid or returned to financial institutions as a result of disputed or fraudulent financial transactions associated with End Users’ bets/wagers; “Competent Authority” means any governmental, judicial, regulatory, tax, and/or gambling authority (including any court) in any jurisdiction of which regulates the Licensee’s activities; “Confidential Information” means confidential and/or proprietary information of the other Party, whether communicated orally or in writing, including, without limitation, information of the other Party concerning inventions, trade secrets, know-how, methods, processes, techniques, code, technologies, existing and potential customer and clients lists, financial information, strategic business plans, other technical, business, and operational information and the terms and conditions of this Agreement;
  
 “Effective Date” means the date of this Agreement. If the date of the Agreement has not been included the later signature date shall be considered to be the Effective Date;
  
 “Enterprise” means the provision of online games through the Website/s operated by the Licensee or by the Sub-Licensee to Players in the Territory;
  
 “Force Majeure” means any cause beyond the reasonable control of the affected Party, including any fire, explosion, flood, storm, earthquake, elements of nature or acts of God, acts of war, acts or attempted acts of terrorism, riots insurrection, civil disorders, or disturbances, rebellions or revolutions, strikes, lockouts, or labour difficulties (other than by staff of the affected Party), malicious acts of third parties (including theft or property damage), interruption of telecommunications service, electrical service, or breakdown of public infrastructure to the extent if affects a Party;
  
 “Gaming Tax” means any gaming duties, taxes, levies, imports or other similar charges applicable to the online RNG based casino and legally and validly payable by the Licensee or the Sub-Licensee to any Competent Authority resulting from applicable laws and regulations in any regulated market the Licensee and/or Sub-licensee is licensed to operate;
  
 “GGR” or “Gross Gaming Revenue” means the total of all Players’ wagers actually received by the Licensee generated on its Website/s less the total of all sums actually paid as winnings to Players.
  
 “GSP” means a third-party gaming service provider that supplies gaming content, and which may be contracted either by the Supplier and/or the Licensee to deliver such content;
  
  
 	 
	3
	

	 

 
 
  
 
 “Intellectual Property” and “Intellectual Property Rights” means all intellectual property rights including, but not limited to, patents, designs, trademarks, Marks, trade names, copyrights, know-how and inventions, whether registered, unregistered or pending, relating to the Marks, the Licensed Software, the Supplier Platform and/or any other intellectual property belonging to the Supplier, Licensee or any of their Related Companies;
  
 “Launch” means the first day of public availability of the Licensed Software on Licensee Services whereby Players may wage real money on the Licensed Games;
  
 “Licensee Services” means any access service offered by Licensee and/or Sub-Licensee used for the purpose of integration, distribution and display of the Supplier Services, irrespective of the medium or electronic communications network over which the said access service is provided; “Licensed Games” (as applicable) means solely the Supplier games, provided in Supplier Platform, detailed in Schedule A to this Agreement as updated over time to be licensed to the Licensee and subsequently made available to End Users via the Licensee and where applicable Sub-licensee Websites;
  
 “Licensed Software” shall mean the Supplier Platform, Licensed Games, GSP content as well as the Supplier software hosting services;
  
 “Marks” means the logo and the words pertaining to the business of or the services offered by the Supplier or the Licensee;
  
 “New Release/s” means a new, enhanced, improved or updated version of the Supplier Platform that may add new games, change the utility, efficiency or operating performance of the Supplier Platform;
  
 “Permits” means any and all licenses, approvals and/or other permits, decisions by regulatory authorities, certifications or other allowances required by the Applicable Law in each part of the Territory in order for the Licensee to legally provide the Games to Players in each part of the Territory;
  
 “Permitted Regulated Market/s” means any State which requires a local Permit or license for the Licensee to be able to promote or offer the Licensed Games in that Jurisdiction or otherwise to accept wagers from that jurisdiction and in which the Parties hold the required Permits; “Player/s or End User/s” shall mean a registered person on the Licensee’s and where applicable the Sub-licensee’s Websites;
  
 “Progressive Balance” means the balance of the Initial Progressive Deposit less the Progressive Contribution;
  
 “Progressive Jackpot Contributions” (as applicable) means the percentage of the bet/stake contributed to the jackpot pool(s) for one and each bet/wager placed by an End User on the Jackpot Games required to establish, maintain or grow the progressive jackpot(s) on the Jackpot Games;
  
 “Progressive Jackpot Games(s)” (as applicable) means those Licensed Games which are connected to, and contribute a percentage of bets/stakes to the progressive jackpot pool, and which a Licensee and where applicable a Sub-licensee has elected to offer to End Users; 
   
 “Progressive Seed Contribution” means all Seed Amounts that the Licensee was liable for during that calendar month and comprises the Seed Amount less the Seed Contribution; 
    
  
 	 
	4
	

	 

 
 
  
 
 “Seed Amount” means the amount required to restart a particular Progressive Jackpot Game following the Progressive Jackpot being won in respect of that Progressive Jackpot Game; 
   
 “Prohibited Jurisdictions” shall mean those countries, states, provinces, territories or other geographic and/or governmental areas other than the Territory. Prohibited Jurisdictions shall include Permitted Regulated Markets where the appropriate permits are not held to offer the Licensed Games to Players, any jurisdiction which may be added and designated as Prohibited Jurisdiction(s) by the Supplier (at its sole discretion) from time to time by written notice to the Licensee (email being sufficient); 
   
 “Related Company” shall mean any company connected to the Parties, directly or indirectly, via either upward or downward majority ownership, e.g. having a joint owner;
  
 “Sub-licensee/s” means third party operators who are Related Companies with the Licensee and granted the sub-license to use and exploit the Licensed Games in the operation of their interactive gaming business strictly in accordance with the terms of this Agreement;
  
 “Supplier Platform” means the Supplier’s proprietary casino gaming platform on which the Licensed Games reside and operate;
  
 “Territory” means all territories where the Licensee may legally provide the Licensed Games to Players under the Parties valid Permits provided that, they are not Prohibited Jurisdictions as set out in Schedule C;
  
 “Value Added Tax” or “VAT” (as applicable) means value added tax as commonly understood and any other tax similar or equivalent to value added tax imposed by any country whether provided for in primary, secondary or purported legislation and whether delegated or otherwise and any similar to turnover tax replacing or introduced in addition to any of the same; and “Website” means any access service offered by the Licensee, and where applicable Sublicensees, used for the purpose of integration, distribution and display of the Licensed Games, irrespective of the medium or electronic communications network over which the said access service is provided.
  
 Unless the context requires otherwise, words denoting the singular shall include the plural and vice versa, references to one gender shall refer to either gender and references to any person shall include corporate bodies (wherever incorporated), unincorporated associations, partnerships and statutory bodies, as well as any legal or natural person.
  
 The words “other”, “include” and “including” do not connote limitation in any way.
  
 2. License 
  
 2.1. Rights Granted 
  
 2.1.1. As of the Effective Date, the Supplier hereby grants to the Licensee a nonexclusive, non-licensable, non-sublicensable, non-assignable and non-transferable license for the use and further distribution of Licensed Games to be used solely for the purpose of running an online Blockchain Casino Enterprise and in accordance with the provisions set out herein.
  
  
 	 
	5
	

	 

 
 
  
 
 2.1.2. Provide the Supplier with any company information and due diligence documentation as requested by the Supplier.
  
 2.1.3. The Supplier may transfer any or all of its rights and obligations under this Agreement to any other party after having obtained the express written consent of the Licensee. The Licensee shall not unreasonably withhold such consent.
  
 2.1.4. The Parties agree that the Licensed Games are provided by remote server access only. Players may only be granted access to the Licensed Games via the Websites using their personal account therein. The Licensed Games will reside solely on the Supplier’s or third-party content provider servers and no copies thereof will be made or made available to either the Licensee or the Players, save for any parts thereof that are required to be downloaded to the Player’s equipment to be able to play the Licensed Games as intended.
  
 2.1.5. The addition of any other Website beyond the Website currently anticipated www.maxibet.com shall require the Supplier’s prior written approval and any such Websites.
  
 2.2. Restriction of License 
  
 2.2.1. Licensee shall not copy, modify, sublicense, distribute, transfer, reverse engineer or reverse compile the Licensed Software or part thereof (or any Intellectual Property or Intellectual Property Rights of the Supplier or any GSP’s or third parties as may be applicable), nor shall Licensee prepare derivative works incorporating the Supplier Platform or part thereof. Neither Licensee, Sub-Licensees nor its personnel may use the Supplier Platform or the documentation or part thereof (in each case) to design substantially similar or identical software.
  
 2.2.2. The Supplier grants no other rights than those expressly specified as granted to the Licensee in this Agreement. In particular, no rights of ownership or any other rights than the right to use the Gaming Platform (or any Intellectual Property or Intellectual Property Rights of the Supplier) to carry out the Enterprise as specified in this Agreement are hereby granted.
  
 2.3. Updates, Upgrades and New Games 
  
 2.3.1. The Licensee is entitled to, and the Supplier may make available to the Licensee New Releases as they may become available from time to time. Upon being made available to the Licensee, these New Releases shall be deemed to automatically become part of the Supplier Platform and the Licensed Games. Unless stated otherwise, any New Releases are subject to the same conditions as those for the Licensed Games and the Supplier Platform as set out in this Agreement.
  
  
 	 
	6
	

	 

 
 
  
 
 2.3.2. Where the Supplier New Releases include and require changes to API, the Licensee may decide not to implement such change as indicated by the Supplier. The Licensee understands that game releases are sometimes tied to New Releases and understands and agrees that the Supplier shall not be able to provide the game releases specific to this and future releases if the update or upgrade is not implemented during this time.
  
 2.3.3. Bespoke releases are not part of the Agreement scope and any bespoke releases tailor made for the Licensee shall be regulated in accordance with an additional instrument in writing which will be agreed upon by the Parties.
  
 2.4. Ownership 
  
 2.4.1. All rights and interest in and to the Licensed Games and Supplier Platform or any other Licensed Software or any part thereof including Intellectual Property Rights, any copies thereof, and all documentation, code and logic, which describes and/or comprises the Licensed Software, and any updates or upgrades remain the sole property of the Supplier and/or its respective affiliates and/or third parties such as GSP’s, as applicable.
  
 2.4.2. All Intellectual Property Rights, title and interest in and to the Supplier Platform and Licensed Games, including New Releases, whether or not developed at the request of Licensee or paid for by Licensee, shall at all times remain with the Supplier and/or its respective affiliates. Licensee agrees not to challenge any Intellectual Property Rights which are subject to this Agreement.
  
 2.4.3. The Licensee acknowledges and accepts that any use or disclosure of the Supplier Platform and/or Licensed Games, or of its/their algorithms, protocols or interfaces, other than as expressly authorized by the Supplier or in accordance with this Agreement, constitutes an infringement of the Supplier’s Intellectual Property Rights and/or other rights.
  
 2.4.4. The Licensee undertakes to notify the Supplier immediately if the Licensee becomes aware of any unauthorized use of the Supplier Platform and/or Licensed Games or of any potential infringements of the Supplier’s Intellectual Property Rights and/or other rights by any person in the Supplier’s organization.
  
 2.4.5. The Licensee warrants, and shall ensure that the Sub-licensee(s), hold all necessary licenses certificates or permissions for any and all content displayed on its Website and shall not hold the Supplier for any third-party related claims.
  
 2.4.6. The Parties grant each other a revocable, non-exclusive and non-transferable world-wide right to incorporate the Marks into the Licensee Services and into their marketing material for the duration of this Agreement.
  
  
 	 
	7
	

	 

 
 
  
 
 3. Term and Termination of Agreement 
  
 3.1. Subject to clause 3.2., this Agreement shall enter into force on the Effective Date and shall thereafter, remain in force for a fixed period of 24 months commencing from the Go-Live Date (the ‘Initial Term’). Following the expiration of the Initial Term, the Agreement shall be prolonged indefinitely unless terminated in writing by either Party providing 6 months’ prior written notice of termination to the other Party. 
  
 3.2. Notwithstanding anything contained in Clause 3.1., each Party shall have the right to immediately terminate this Agreement by written notice if:
  
 3.2.1. the other Party commits a material breach (or several breaches that jointly may be deemed material) of this Agreement, including without limitation the failure to duly pay invoices, and such breach (or breaches), if capable of remedy, remain unremedied upon the expiry of fifteen (15) days from the defaulting Party having received a written notice requesting remedy thereof;
  
 3.2.2. The other Party becomes insolvent or starts negotiations about a composition with its creditors or a petition in bankruptcy is filed by or against it or it makes an assignment for the benefit of its creditors or the company otherwise enters into voluntary or involuntary liquidation, has a receiver appointed over all or parts of its assets or it becomes evident that the other Party is, or will be unable to perform its obligations under this Agreement; or
  
 3.2.3. The Licensee forfeits any of the Permits required to provide the Licensed Games to Players in a part of the Territory or the Territory as a whole or;
  
 3.2.4. If a Party by its acts or omissions jeopardise the Permits of the non-defaulting Party.
  
 3.3. Supplier may immediately terminate this Agreement, if:
  
 3.3.1. the Licensee is unable to comply with the due diligence requirements as set forth by the Supplier in any stipulated timeframe.
  
 3.3.2. a Competent Authority threatens or instigates enforcement proceedings or actions against Supplier in connection with this Agreement;
  
 3.3.3. a Competent Authority orders, notifies or recommends that Supplier should prevent Licensee from using the Licensed Games;
  
 3.3.4. the continuation of this Agreement will have a detrimental impact on Supplier and/or any of Supplier’s Related Company.
  
  
 	 
	8
	

	 

 
 
  
 
 3.4. Upon termination (howsoever occasioned) or expiry of this Agreement:
  
 3.4.1. The Supplier shall promptly shut down any use of or access to the Licensed Games on its Websites and shall be obliged to ensure that where applicable Sublicensees shut down any use of or access to the Licensed Games on their Website/s;
  
 3.4.2. Licensee shall destroy any and all copies of the Supplier Platform and/or Licensed Games which for any reason cannot be delivered to the Supplier;
  
 3.4.3. An officer of the Licensee shall declare in writing to the Supplier that all proprietary material relating to the Supplier Platform and/or Licensed Games and its documentation has been either delivered to the Supplier or destroyed;
  
 3.4.4. all outstanding sums payable to the Supplier shall immediately become due;
  
 3.4.5. In case where this Agreement is only partially terminated in relation to particular Websites, the above provisions of Clause 3.4.3. shall apply only in relation to the terminated Websites.
  
 4. Supplier Deliverables and Obligations 
  
 4.1. The Supplier will use reasonable commercial efforts to ensure that the Licensed Games and Licensed Platform will, from the Go Live Date, operate materially in accordance with their specifications.
  
 4.2. The Supplier shall maintain all necessary Permits for the duration of this Agreement and be compliant as per the applicable laws, rules, regulations, guidelines, and certification standards as may be applicable, as well as any updates or changes in regulations or guides that may apply from time to time.
  
 4.3. The Supplier shall undertake all necessary commercially reasonable arrangements for the proper implementation of the Licensed Software.
  
  
 	 
	9
	

	 

 
 
  
 
 4.4. The Supplier Platform will be operated by the Supplier. These services comprise of the following:
  
 4.4.1. Using the Casino Engine platform to integrate third party GSP’s subject to a written agreement between the Parties.
  
 4.4.2. Provision of Standard 2nd line technical e-mail support to the Licensee for the Licensed Games and the Supplier Platform during normal business hours GMT+8.
  
 4.4.3. Technical integration support, including guidance during set-up and help in reviewing code. Integration support is recommended by the Supplier as it is imperative for a successful integration and quick launch. The Licensee is responsible for its own costs and expenses in connection with the Integration.
  
 4.4.4. Provision of one (1) day of systems operations training to the Licensee’s staff if requested by the Licensee at least thirty (30) days’ in advance.
  
 4.5. The Supplier undertakes to provide the Licensed Games and the Supplier Platform in accordance with the service levels set forth in Schedule E Service Level Agreement.
  
 5. Licensee’s Rights and Obligations 
  
 5.1. The Licensee shall integrate the Licensed Games and/or other parts of the Licensed Software (as may be applicable securely into the Websites using full functionality of the APIs so that the Licensed Games will appear to Players as an integral part of the Website/s. The Licensee is responsible for the integration between the Website(s) and the respective Licensed Software and that the integration is conducted in accordance with the integration manual provided by the Supplier.
  
 5.2. The Licensee and the Sub-licensee where applicable is responsible for testing prior to the Go Live Date.
  
 5.3. The Licensee shall make the Licensed Games available in a clearly visible manner and shall be easily accessible by the Players accessing the Website/s.
  
 5.4. The Licensee and (where applicable) Sub-licensee shall be solely responsible for providing Players with 1st line customer support.
  
 5.5. The Licensee shall be responsible for maintaining strict fraud control to ensure that Chargebacks and other fraudulent behaviour is minimised. Such measures shall include but shall not be limited to, limiting deposits, obtaining verification of Player’s details and the Licensee verifying the game rounds with the Supplier prior to allowing the Player’s to withdraw.
  
  
 	 
	10
	

	 

 
 
  
 
 5.6. The Licensee and (where applicable) the Sub-licensee shall be responsible for the dayto-day operational activities in relation to the Website and the Supplier’s Games made available on it, including game marketing, customer support and care, fraud screening, payment management and setting up of tournaments/Bonuses.
  
 5.7. The Licensee shall procure that Sub-licensees will at all times make available any rules provided by the Supplier available to End Users including any change and update thereto and clearly and visibly display the game rules as may reasonably be deemed appropriate by the Supplier.
  
 5.8. The Licensee acknowledges and accepts that the Supplier reserves the right to refuse any request by the Licensee to amend the Licensed Software configuration outside of the default setting described in the documentation of the Licensed Games and/or Licensed Software. Any request sent by the Licensee must be done in writing by a duly authorised representative of the Licensee. The Licensee acknowledges that such amendments may increase risk and the Licensee understands that where a change request has been accepted by the Supplier and shall result in an increased risk, the Licensee shall assume the full responsibility for such increased risk.
  
 5.9. The Licensee shall inform the Supplier in advance regarding any promotional activities which are expected to generate significant additional business volumes such that Supplier can take any necessary precautions.
  
 5.10. The Licensee shall promote all of the Supplier’s promotional campaigns related to the Licensed Games as made available from time to time by the Supplier on the Websites.
  
 5.11. The Licensee shall maintain all necessary Permits for the duration of this Agreement and be compliant as per the Applicable Laws, rules, regulations, guidelines, and certification standards as may be applicable, as well as any updates or changes in regulations or guides that may apply from time to time.
  
 5.12. The Licensee shall notify the Supplier when there is a change to the domain names of websites or additional websites that wish to use the Licensed Software.
  
  
 	 
	11
	

	 

 
 
  
 
 5.13. Licensee shall not:
  
 5.13.1. assert of imply that title or ownership rights in the Supplier Platform, Licensed Games and/or GSP content (as applicable) belong to it;
  
 5.13.2. remove or obscure any copyright, trademark notice or restrictive legend of the Supplier and/or its respective affiliates, and/or GSP as applicable;
  
 5.13.3. include and/or otherwise associate or permit the association of the Supplier Platform and/or Licensed Games with any form of malware (including, but not limited to viruses, worms, Trojan horses and spyware) or other code that may be deemed to be malicious.
  
 5.13.4. wilfully carry out or attempt to carry out any procedure in respect of the Supplier Platform and/or Licensed Games which would circumvent any copy or other protection device or software other than to the extent strictly permitted by Applicable Law.
  
 5.14. Progressive Jackpot Games Compliance. Licensee shall fully comply with the terms of the Progressive Jackpot Games Compliance Terms attached as Schedule D hereto.
  
 6. Liability 
  
 6.1. The Supplier and/or its Related Company or any of their directors, officers, employees, agents or consultants shall not be liable in any event for:
  
 6.1.1. any indirect or consequential loss or damages except when caused by the Supplier, whether or not the Supplier has been advised of the possibility of such damages;
  
 6.1.2. any loss of opportunity, reputation, goodwill, profit or anticipated savings, business or contracts arising out of or in any way in connection with this Agreement or the use or performance of the Licensed Games and/or Supplier Platform.
  
 6.1.3. For the purpose of this Agreement actual damages shall never include loss of profit or other similar consequential damages.
  
 6.2. Without prejudice to clause 6.3., either Party’s total aggregate liability under this Agreement and that of its directors, officers, employees, consultants and Related Companies, howsoever it should arise, will in no circumstances whatsoever exceed the amount of one hundred thousand EUR (€ 100,000).
  
  
 	 
	12
	

	 

 
 
  
 
 6.3. Nothing in this clause 6 shall limit either Party’s liability for death, personal injury, wilful intent, fraud, breaches of the Supplier’s Intellectual Property Rights and Confidential information or any other liability which it is illegal to limit or exclude.
  
 6.4. The Licensed Software is a software-based service and the Licensee acknowledges that such software will not run error free or without interruption. The Supplier takes all reasonable precautions against software errors and bugs, but it does not warrant that
  
 the Licensed Games nor other Licensed Software (as may be provided an applicable) will meet any special requirements of condition quality, performance, merchantability or fitness for purpose of the Licensee, or that the Licensed Games or any other software provided to the Licensee by the Supplier will generate particular revenues or profits in use by the Licensee or by Sub-licensees.
  
 7. Indemnification 
  
 7.1. Either Party agrees to indemnify the other Party and to hold it harmless against all third party claims, damages, losses, liabilities, suits and legal expenses arising out of or in connection with such Party’s breach of any of the undertakings and/or warranties set out herein. The indemnified party shall give the indemnifying party prompt written notice of any such claim and shall provide the indemnifying party with all reasonable information and assistance. This indemnification shall apply to the other Party’s respective successors, assigns, parents, subsidiaries, affiliates, co-ventures and Related Companies; and their respective directors, officers, employees and agents, during and after the term hereof.
  
 7.2. The Supplier warrants that:
  
  
 	 a.
	 It owns the Intellectual Property rights to the Licensed Games and has the right to offer them to the Licensee pursuant to this Agreement; and/or

	  
	  

	 b.
	 has procured all permits and/or licenses to the Intellectual Property Rights of the Licensed Games, necessary for their offering to the Licensee pursuant to the terms of this Agreement

 
 
  
  
 7.3. Both Parties agree that neither Party will, at any time during or after the term of this Agreement, disclose to any third party, particulars of any Intellectual Property Rights or infringe any of the Intellectual Property Rights of the other Party.
  
  
 	 
	13
	

	 

 
 
  
 
 8. Notices 
  
 Notices and other communications required or permitted to be given under this Agreement shall be in writing and shall be given by email to the following addresses:
  
 For Supplier: 
  
  
 	 Communication 
	 Email Address 

	 Maintenance and technical issues 
	 Support@elraygaming.com 

	 Compliance and other issues 
	 info@elraygaming.com 

 
 
  
 
 9. General Provisions 
  
 9.1. This Agreement constitutes the entire agreement and understanding between the Parties relating to the subject matter hereof and supersedes any previous agreement or understanding between the Parties in relation to such subject matter and the Parties have not relied on and will have no remedy in respect of any statement, representation, warranty, understanding, undertaking, promise or assurance (whether negligently or innocently made) of any person other than as expressly set out in this Agreement. 
  
 9.2. Either Party may assign, license, sub-license or otherwise transfer its rights and/or obligations to any third party only with the express written consent of the other Party. Provided always that where the Party wishes to transfer any or all of its rights and obligations under this Agreement to a third party which forms part of the same group as that Party, then consent shall not be unreasonably withheld. 
  
 9.3. Amendments to this Agreement shall be agreed in writing and signed by both Parties. The Supplier retains the right to update the Agreement during the term in its entirety if required to do so by the relevant licensing authority and/or Applicable Law. 
  
 9.4. Nothing in this Agreement shall imply any exclusivity demands on the Supplier by the Licensee for the supply of Licensed Games and vice versa. 
  
 9.5. It is hereby recognised by both Parties that their respective ability to carry out their obligations under this Agreement are subject to applicable legislation and policy. Neither Party shall be held liable for damages of whatever kind that may result from changes in government legislation or policy. The Parties shall promptly endeavour to implement such changes promptly in order to ensure continuation of the Agreement under the changed legal framework. 
   
  
 	 
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 9.6. It is agreed that the relationship between Parties is that of independent contractors, and nothing contained in this Agreement shall be construed or implied to create a relationship of joint ventures, agent and principal, employer and employee, or any relationship other than that of independent contractors. At no time shall either Party make any commitments or incur any charges or expenses for or in the name of the other Party, save and except as set out herein. 
  
 9.7. The headings in this Agreement shall not be interpreted as having any legal or other meaning apart from giving guidance about the content of each paragraph/section. 
  
 9.8. Clauses 6 and 10 shall survive termination of this Agreement. 
  
 10. Confidentiality  
  
 10.1. The Parties acknowledge and agree that during the course of the relationship contemplated in this Agreement they are likely to come into contact and gain knowledge and access to information and materials that the other Party deems to be confidential, proprietary or of strategic importance. The Parties each agree that they shall maintain the strictest confidentiality of all such materials that they receive concerning the other Party hereto and/or its Related Companies. They shall not disclose such Confidential Information to any other Party, shall not use such Confidential Information for their own purposes, and they shall protect such Confidential Information from disclose using the same or higher standards as they use to protect their own Confidential Information. 
  
 10.2. The Parties agree that Confidential Information shall be limited to disclosure within the organization of the recipient to those top management personnel and developers with a bona fide need to know such information as a necessary part of their contribution to the performance under this Agreement. 
  
 10.3. The Parties further agree that subject to the approval of both Parties, they shall be allowed to jointly issue a press release, for marketing and advertising purposes, announcing the relationship entered into by the Parties  
   
  
 	 
	15
	

	 

 
 
  
 
 11. Force Majeure 
  
 11.1. Except for Licensee’s payment responsibilities under Schedule B of this Agreement, neither Party shall be liable for any delay or failure to perform any material obligation under this Agreement, if the failure is due to an event of Force Majeure.  
  
 11.2. If a Force Majeure Event continues and so prevents the performance by the affected Party of its obligations hereunder for more than sixty (60) days or sixty (60) days in aggregate in any continuous period in excess of ninety (90) days, either Party shall be entitled to terminate this Agreement immediately by written notice to the other Party. 
  
 12. Non-Solicitation 
  
 Neither Party shall during the term of this Agreement and for a period of one (1) year thereafter solicit any of each other’s employees or any employees of the subsidiaries or Related Companies forming part of their group of companies, for the purpose of offering them to become employees and/or to procure services from them.  
  
 13. Governing Law and Disputes 
  
 This Agreement and the rights and obligations of the Parties hereunder shall be governed by and construed in all respects in accordance with the Laws of USA and any dispute related to the present Agreement shall be the exclusive jurisdiction of the Courts of USA.  
   
  
 	 For and on behalf of 
		 For and on behalf of
	
	 Supplier 
		 Licensee
	
	 Golden Matrx Group Inc. 
		 Elray Resources Inc. 
	
	 		 	
	 /s/ Anthony Brian Goodman
		 /s/ Weiting Feng
	
	 12/7/2022 
	  
	 12/7/2022 
	  

	 Authorised Signatory 
	  
	 Authorised Signatory  
	  

	 Name: Anthony B Goodman 
		 Name: Weiting Feng.
	
	 Title: Director   
	  
	 Title: Director
	  

 
 
  
  
  
 	 
	16
	

	 

 
 
  
 
 Schedule A 
  
 SOFTWARE DESCRIPTION AND SPECIFICATIONS 
  
 The Software shall consist of the following Branded Games, and any other games which Supplier may make available from time to time. 
  
 A. Slot Games 
  
 Playtech  
 Skywind  
 Net Entertainment  
 Microgaming  
 Endorphina  
 Fantasma  
 Funfair  
 GameArt  
 Gamefish 
 Habanero 
 Revolver  
 Rubyplay 
 Vivo 
   
  
 	 
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 Schedule B
  
 SOFTWARE LICENSE FEES AND PAYMENTS 
  
 A.  License Fees 
  
 The License Fees shall be payable by Licensee to Supplier as follows: 
  
 1. Monthly License Fee 
  
 1.1 A Monthly License Fee will be charged by the Supplier to the Licensee as consideration for the rights granted to it under this Agreement. The Monthly License Fee shall be a percentage of Gross Gaming Revenue generated on the Licensed Games through the Website/s and shall be calculated as follows: 
  
 Commercials applicable to Asia: 
  
  
 	 Game Type 
	 Monthly License Fee Rate 

	  Slot Games 
	 Supplier Cost plus a markup of 25 %  
  

	 Live Games 
	 Supplier Cost plus a markup of 25 %  
  

 
 
  
  
 All calculations shall be based on the total monthly GGR, with no regard to how this is split between the Licensee and Sub-licensees. 
  
 1.2 For the avoidance of doubt, no carry over of negative Monthly GGR from month to month should be permitted. Negative Monthly GGR should be deemed as nil in the event of calculation for Monthly License Fee. 
  
 1.3 To avoid any ambiguity, the applicable percentage shall be calculated monthly from the GGR generated by the Licensee as set forth exclusively by the reports provided by the Supplier. 
  
 1.4 The License Fee is subject to review after twelve (12) months. 
  
 2. Deposit for the Agreement implementation 
  
 A deposit of ten thousand EUR (€10,000) should be paid by the Licensee no later than the initiation of integration of Licensed Software. 
  
 The deposit is refundable on the termination of the agreement. The refundable amount should be total deposit less Monthly Licence Fee, indemnity and other amount payable to the Supplier. 
  
 3. Monthly Maintenance Fee 
  
 3.1 Supplier will provide and maintain all relevant technical means to ensure smooth and undisrupted services includes servers and CDN solution. 
  
 3.2 It is agreed by the Parties that commencing on Commercial Launch Date, Licensee will pay a Monthly Maintenance Fee of five hundred EUR (€ 500) per month, plus any applicable Value Added Tax (VAT). This fee is waived. 
  
 3.3 The maintenance fee is subject to review after twelve (12) months. 
   
  
 	 
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 4. Setup Fee 
  
 4.1 A setup fee is payable upon signature of this Agreement of five thousand EUR (€ 5,000). 
  
 4.2 The setup fee is waived. 
  
 5. Progressive Jackpot Games Fee 
  
 5.1 For participation in the Progressive Jackpot Games, the Licensee is required to make an advance payment five thousand EUR (€ 5,000) in advance of Progressive Share Contribution. Refer details to Schedule D. 
  
 5.2 Each progressive credit contributed to Progressive Jackpot Pool by player/EndUser will be beard on the Licensee. E.g., Licensee has to pay one dollar (at its own currency depends on the country) for each Progressive Contribution Amount used by player/End-User. 
  
 B. Payment 
  
 The Supplier shall invoice the Licensee the License Fees and any Additional Costs on a monthly basis within ten (10) days of the end of each calendar month. All payment should be made in Euro or Euro equivalent in USD ($) (Exchange rate detemrniend on Oanda on the date of Invoice)  
  
 1. Terms of Payment 
  
 All payments under the terms of this Agreement are to be made no later than ten (10) days from receipt of invoice. 
  
 2. Terms of Pricing 
  
 All prices are given in EUR (€) excluding value added tax and expenses. License Fees due to Supplier exclude all taxes (including Value Added Tax or any withholding tax, where applicable), charges, duties, fees, excesses and/or tariffs (the “Taxes”) and the Taxes shall be paid by Licensee to the extent they may apply. The License Fees represent the benefit to be received by Supplier net of any Taxes.  
  
 3. Overdue Payments 
  
 3.1 Interest shall be due on all late payments at the rate of two percent (2%) per annum above the base rate for the time being of Barclays Bank Plc, accruing on a daily basis from the due date until the date of actual full and complete payment. 
  
 3.2 Payments shall not be subject to any deductions or withholdings, such as bank or exchange fees. 
  
 3.3 In the case of late payment, the Supplier has the right to and its sole discretion and by providing the Licensee with at least three (3) day’s prior written notice of its intention to do so, suspend the Licensee’s access to the Licensed Games until full payment has been duly received by the Supplier. Once full payment has been received the Supplier shall restore access to the Licensee in any event not later than 48 hours as of receipt of such payment.        
   
  
 	 
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 Schedule C
  
 TERRITORIES AND PROHIBITED JURISDICTIONS 
  
 Authorised Territories
  
  
 	 ★
	 The Licensee is authorized by the Supplier to use the Licensed Games in the following any territories that the Licensee has legal authority and that are not contained in the prohibited territories listed below

	  
	  

	 ★ 
	 The Licensee will be configured to operate in the following currency/ies: USD

 
 
  
 
 AML/CTF Prohibited Territories
  
 Afghanistan, American Samoa, Burundi, Central African Republic, Congo (Democratic Republic Of), Cuba, Guam, Guinea, Guinea-Bissau, Haiti, Iran, Iraq, Dem. People’s Rep. of Korea North, Lebanon, Libya, Mali, Myanmar, Nicaragua, Pakistan, Panama, Samoa, Somalia, South Sudan, Sudan, Syria, Trinidad and Tobago, US Virgin Islands, Venezuela, Yemen, Zimbabwe.
  
 Restricted Territories
  
 (1) Australia, Belgium, Bulgaria*, Denmark*,Estonia*, France (and its territories), Georgia*, Greece*, Italy*, Isle of Man, Israel, Kahnawake*, Morocco, Latvia*, Portugal*, Puerto Rico, Spain*, the Philippines, United Kingdom, the USA (and its territories,) unless the Parties hold the applicable licenses and certifications for that jurisdiction;
  
 (2) any other territories which may be added and designated as Restricted Territory by the Supplier (at its sole discretion) from time to time by written notice to the Licensee.
  
 *Provided that the Licensed Games are certified for these jurisdictions and may be offered if the Licensee’s Platform is compliant for this jurisdiction. 
  
 If the Licensed Games are to be offered in a territory, in which the Supplier, the Licensee and/or Licensee Website (as applicable) does not hold the required license/s and/or certification/s, then such territory shall also be deemed to be a Restricted Territory.
   
  
 	 
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 Schedule D 
   
 PROGRESSIVE JACKPOT GAMES COMPLIANCE TERMS 
  
  
 	 1. 
	The Progressive Jackpot Games may not be available in all territories, languages and/or currencies and may be updated by the Supplier from time to time.
	  
	  

	 2. 
	End Users shall be entitled to participate in the Progressive Jackpot Games as long as the Progressive Balance is a positive number amount and is in excess of its marginal Progressive Contribution (for example only, if the Progressive Balance indicates 3 and the last player’s Progressive Contribution is 4, then the remainder is a negative amount and the Licensee must top up the Progressive Balance in order for this transaction to be executed). Such top up amount shall be as reasonably advised by the Supplier taking into account historical and expected play of the Progressive Jackpot Games by the End Users. The Licensee shall monitor its level of progressive spending on an ongoing basis to ensure that the Progressive Balance amount shall not fall below the amount set out in Section 3 below.
	  
	  

	 3. 
	The Licensee shall transfer to the Supplier the Initial Progressive Deposit in an amount as set forth above. Should the Progressive Balance equal zero or a negative amount, then the Supplier shall be entitled, but not obligated to immediately suspend and/or terminate all End Users from participating in the Progressive Jackpot Games.
	  
	  

	 4. 
	The Supplier shall monitor at all times the Progressive Balance as per End Users’ proportionate participation in the Progressive Jackpot Games and shall further supervise and manage the ongoing operation of the online progressive jackpot network and its Progressive Jackpot within such network.
	  
	  

	 5. 
	The Licensee undertakes that it shall be responsible to pay, in a single lump sum payment (i.e., not in installments or under any other form of payment scheme), the Progressive Payouts to any of the End Users who shall be entitled to receive such payment upon winning following completion of the Licensee’s own verification exercise and Supplier’s verifications exercise. For the avoidance of doubt, the Licensee undertakes that it shall be not pay Progressive Payouts to any of the End Users winners prior to Supplier’s confirmation in writing, following Supplier’s verification exercise.
	  
	  

	 6. 
	Following the completion of the Supplier’s verifications exercise, Supplier shall transfer to the Licensee the relevant Jackpot Payouts less the Progressive Seed Contribution no later than 30 days following the completion of the verification exercise by the Supplier that such sums are due.
	  
	  

	 7. 
	If the Licensee is required to pay any money to the Supplier (e.g. the Licensee to increase its Progressive Balance according to the provisions set out in Section 2 above), the Licensee shall promptly send the required amount by way of: (i) a wire transfer to a designated account which shall be provided by the Supplier or (ii) any other payment transfer method at the Supplier’s discretion. Only upon receipt of confirmation from the bank that a wire transfer was accepted or other payment method resulted in the Supplier receiving the amounts concerned shall the relevant payment be deemed to be made under this Agreement.

 
 
  
  
  
 	 
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 Schedule E
  
 SERVICE LEVEL AGREEMENT 
  
 1. Incident Management Process 
  
 A basic incident report and tracking system will be implemented between the Parties in order to monitor the progression of all incident reports from their initial logging to their ultimate resolution. For the avoidance of doubt, Supplier utilizes email correspondence as the primary method of reporting and tracking incidents and prioritizes the quick turnaround and resolution of incidents above their practical administration. 
  
 2. Incident Categories 
  
 All incidents shall be graded against this scale by Supplier based on severity and impact: 
    
  
 	 ·
	 Category 1 - Critical Business Impact — A complete loss of service, or the operational teams are unable to operationally manage the Licensed Games due to unavailability of key management tools. 

	  
	  

	 ·
	Category 2 - Serious Business Impact - The significant or degraded loss of service. By way of example only, no End Users can access more than 50% of the Licensed Game catalogues due to a category 2 incident.
	  
	  

	 ·
	Category 3 - Medium Business Impact - A minor loss of service or function. e.g. a minor product flaw is exposed that requires a work around.
	  
	  

	 ·
	Category 4 - Minor Business Impact - The system is working largely as normal, but with a bug or issue related to a peripheral function.

 
 
  
   
 For the avoidance of doubt, the Licensed Games shall not be considered down where it is the local context (e.g. Internet failure affecting all Malta) catalogue that is down and inaccessible to End Users. 
  
 3. Incident Resolution 
  
 The target resolution times for all graded incidents shall be: 
  
  
 	 ·
	Category 1 – Supplier shall begin work on issue/error within 1 hour of report and will commit resources on a 24/7 basis including bank and public holidays until an acceptable resolution is achieved.
	  
	  

	 ·
	Category 2 - Supplier shall begin work on issue/error within 4 hours of report and will commit resources on a 24/7 basis including bank and public holidays until an acceptable resolution is achieved.
	  
	  

	 ·
	Category 3 - Supplier shall find and plan a resolution for issue within three (3) business days of reporting and will commit acceptable resources to ensuring an acceptable resolution is achieved as quickly as is reasonably possible thereafter.

 
 
  
   
 Where said resolution requires a new version of the relevant gaming application to be released, Supplier shall not be obliged to perform such a release as quickly as is reasonably possible, but shall inform Licensee of such circumstances and of its timing for resolving the incident by making the required release of a new version of the relevant gaming application. 
   
  
 	 
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 	 ·
	Category 4 - Supplier shall find and plan a resolution for issue within five (5) business days of reporting and shall inform Licensee of such plans. The Parties agree that the subsequent resolution of the issue shall occur within a future release of a new version of the relevant gaming application.

 
 
  
   
 Supplier shall categorize all incidents in the first instance. In circumstances where Licensee disagrees with the specific categorization of an incident it shall be discussed as quickly as is reasonably possible by the relevant managers of the Parties and escalated thereafter to senior management should said discussion not resolve the disparity of opinion. 
  
 4. Incident Escalation 
  
 If any incident is not adequately resolved to the satisfaction of either the Licensee or the Supplier within twenty four (24) hours of report or is designated as a Category I or Category 2 incident, then all such incidents shall be escalated as follows: 
  
  
 	 ·
	Category 1 - Immediate escalation after report to duty manager and to senior management of the Parties.
	  
	  

	 ·
	Category 2 - Immediate escalation after report to duty manager, two (2) hours after report, also escalated to senior management of the Parties.
	  
	  

	 ·
	Category 3 – Twenty four (24) hours after report, escalated to duty manager and to senior management of the Parties.
	  
	  

	 ·
	Category 4 - Never escalated, but it is recorded and notified.

 
 
  
  
 5. Unscheduled Downtime 
  
 5.1. Supplier shall use its best commercial efforts to ensure that total cumulative unscheduled downtime in any three (3) month period for all Licensed Games, should not cause availability to fall below 99.00%. For the sake of clarity, unscheduled downtime is only counted when the Licensed Games and Supplier Platform, or a substantial part thereof, key functions, or other essential features thereof is nonoperational for a significant amount of Players and excludes insignificant or minor inconveniences for the Players and scheduled downtime. The Licensed Games and Supplier Platform shall, however, not be considered unavailable in any of the following circumstances, and such time shall be disregarded when calculating the availability of the Licensed Games and Supplier Platform during any given calendar month: 
  
 5.1.1. Planned maintenance of the Licensed Games and Supplier Platform, provided the Supplier will use its best reasonable effort to complete it as quick as possible and to notify the Licensee in writing at least forty-eight (48) hours in advance; 
   
  
 	 
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 5.1.2. Planned updates and upgrades of the Licensed Games and Supplier Platform, including but not limited to new Licensed Games and Supplier Platform releases, or with the aim of addressing and/or resolving any software errors, conflicts, technical short comings and/or bugs, provided the Supplier will use its best reasonable effort to complete it as quick as possible and to notify the Licensee in writing at least forty-eight (48) hours in advance; 
  
 5.1.3. Emergency shutdowns necessary to protect the Licensed Games and Supplier Platform from malware, including but not limited to viruses, and any form of so called “denial of service” attacks or similar, including minor downtime due to “hotfixes” of the Licensed Games and Supplier Platform, provided that any such emergency shutdown takes no longer than is strictly necessary to complete and where possible is notified by Supplier to Licensee in advance; 
  
 5.1.4. Errors or failures to access the Licensed Games and Supplier Platform caused as a result of failures or communication problems beyond Supplier’s reasonable control attributable to the Internet or any other public or private networks (including without limitation mobile phone networks) used by Licensee or its Players to access the Licensed Games; 
  
 5.1.5. Any Force Majeure event beyond the control of either of the Parties.  
  
 5.2. The tracking and the calculation of unscheduled downtime shall continue through the term. At the end of each calendar month, upon request by the Licensee, the Supplier agrees to provide the Licensee with accurate figures showing the levels of unscheduled downtime in the most recent month and in the most recent three (3) months on a cumulative basis for the Licensed Games. 
  
 6. Scheduled downtime 
  
 No more than twenty (20) hours per month and per product group of scheduled downtime shall be utilized by Supplier during the term. All such scheduled downtime shall be notified in advance to Licensee, with a minimum of one (1) weeks’ written notice and shall be scheduled for periods of minimal Player’s use of the gaming products, that is for periods such as very early on during week days (for example Tuesday or Wednesday mornings from approximately 03:00 to 08:00 GMT+8). 
  
 7. Improvement Plan and Reporting 
  
 Supplier agrees to supply quarterly reports to the Licensee on all scheduled and unscheduled downtime, and performance of the Licensed Games, as well as response times to reported incidents. The Parties agree to work in good faith in the event that, KPIs or availability of the Supplier Platform/Licensed Games is not up to a satisfactory level according to the Licensee, acting in its reasonable commercial interest.  
   
  
 	 
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 8. General 
  
 The Supplier is solely responsible for procuring and maintaining its network connections and telecommunication links, and any loss or damage arising from or relating to the following shall not constitute Supplier’s liability: 
  
 8.1. all problems, conditions, delays, delivery failures connected or related to Supplier’s network and communication links and infrastructure failures; and 
  
 8.2. all problems, conditions, delays, delivery failures connected or related to errors or failures of the Licensed Games and Supplier Platform caused as a result of failures or communication problems beyond Supplier’s reasonable control attributable to the Internet or any other public or private networks (including without limitation mobile phone networks) used by Licensee and/or Players to access the Licensed Games and Supplier Platform; 
  
 8.3. any Force Majeure event that may in turn cause a software error leading to a Player taking advantage and winning; 
  
 8.4. The Parties agree that the Licensee will bear full responsibility and liability should the Licensee autonomously decide to make a payment of a win to a Player regardless of not having verified the win with the Supplier prior to allowing the Player to withdraw. 
  
 9. Software Errors 
  
 9.1. Supplier shall not be liable with respect to any payments made by the Licensee or by the Sub-licensee to a Player as a result of or in connection with errors/defects in the Licensed Games, in the Licensed Software or in Supplier Platform including, but not limited to, bugs, crashes, faulty code, loopholes and backdoors (“Software Error/s”), other than when the Licensee has duly complied with the procedure stipulated below (“Verification Procedure”), and in any case subject to the capping of clause 6.2 of the Agreement:   
  
 9.1.1. Upon Licensee/Sub-licensee becoming aware of withdrawal requests made by any Players equal or exceeding the amount of ten thousand EUR (€10,000) in aggregate over a period of twenty four (24) hours (the “Excessive Withdrawal”), the Licensee shall notify the Supplier of such, (by email sent with “high priority” to support@globaltllc.com, with email subject “BIG PAYMENT VERIFICATION),  providing sufficient information relating to the Excessive Withdrawal to enable Supplier to make its determination. The Licensee shall be obliged to report to the Supplier such Excessive Withdrawals within twenty (24) hours from the withdrawal request resulting in the Excessive Withdrawal. 
   
  
 	 
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 9.1.2. The Licensee (or the Sub-licensee, as applicable) shall not be allowed to pay (or to permit the Sub-licensee to pay) a Player any such Excessive Withdrawal before Supplier has verified the legitimacy thereof and reported the result of such verification to the Licensee.  Supplier shall use all reasonable endeavors to provide the Licensee with such a final result within forty eight (48) hours from Licensee’s report. 
  
 9.1.3. If the Licensee or the Sub-licensee (i) neglects to verify within the twenty four (24) hour period or has paid the Excessive Withdrawal without having received Supplier’s prior approval, or (ii) ignored the Supplier’s advice not to effect the payment in favour of the Player, or (iii) has made (or allowed) a payment to a Player which is not an Excessive Withdrawal,  the Supplier shall not be liable to any indemnity. Furthermore, the Supplier shall not be liable for any such erroneous payment to the extent that (i) such funds have not been withdrawn by the Player from its account and were accessible to the Licensee or the Sub-licensee upon Licensee or Sub-licensee becoming aware of a Software Error; or (ii) the Licensee or the Sub-licensee could have, using all reasonable endeavors, (including, without limitation, by virtue of relevant provisions in the Terms and Conditions), prevented such erroneous payment or mitigate its losses.   
  
 9.1.4. Notwithstanding the foregoing, both Parties agree to use their respective best efforts to immediately notify the other Party of any suspicious winning pattern(s) and the Licensee agrees to use its best efforts to cause the Sub-licensees not to pay out any Excessive Withdrawal to any Players as a result of such suspicious winning pattern(s) without first having requested the Supplier to verify and approve or disapprove payment of an Excessive Withdrawal in respect of such transaction in accordance with the procedure outlined in clause above. In the event that any Excessive Withdrawal is already paid to the Player, the Parties hereto shall cooperate to freeze or claw back such winnings and any payment made to the Player(s), if and when possible, in order to determine if the overpayment was caused due to a Software Error/s. 
  
 9.2. The Supplier is solely responsible for procuring and maintaining its network connections and telecommunication links, and any loss or damage arising from or relating to the following shall not constitute Supplier’s liability: 
  
 9.2.1. all problems, conditions, delays, delivery failures connected or related to Licensee’s network and communication links and infrastructure failures; and 
  
 9.2.2. all problems, conditions, delays, delivery failures connected or related to errors or failures of the Licensed Games and Licensed Software caused as a result of failures or communication problems beyond Supplier’s reasonable control attributable to the Internet or any other public or private networks (including without limitation mobile phone networks) used by Licensee and/or its Players to access the Games and Gaming System; 
  
 9.2.3. a failure of third party equipment, hardware and/or software; 
  
 9.2.4. any failure or fault in Customer’s or its Sub-Licensee’s systems; 
  
 9.2.5. fraud events (by Customer, Sub-Licensees and/or any third party engaged by them); 
  
 9.2.6. any DDOS (denial-of-service) attack; 
  
 9.2.7. any Force Majeure event that may in turn cause a software error leading to a Player taking advantage and winning; 
  
 10. Errors Due to Integration 
  
 Notwithstanding the procedure set out in this Schedule E, where an incident and/or an erroneous withdrawal is due to a software integration issue, the Parties agree to amicably discuss the responsibilities of such software integration issue and determine their respective share of the liability for any damages sustained as a result of the error in integration and always subject to clause 6.2 of the Agreement.
   
  
 	 
	26

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