ALLIED HEALTHCARE INTERNATIONAL
INC.
INDEMNITY AGREEMENT
This
Indemnity Agreement, effective as of January 14, 2008, is made
by and between Allied Healthcare International Inc. , a New
York corporation (the “ Company ”), and
, an officer and/or director of the Company (the “
Indemnitee ”).
A.
The Company is aware that competent and experienced persons are
increasingly reluctant to serve as directors or officers of
corporations unless they are protected by comprehensive liability
insurance and/or indemnification, due to increased exposure to
litigation costs and risks resulting from their service to such
corporations, and due to the fact that the exposure frequently
bears no reasonable relationship to the compensation of such
directors and officers;
B.
Based upon their experience as business managers, the Board of
Directors of the Company (the “ Board ”) has
concluded that, to retain and attract talented and experienced
individuals to serve as officers and directors of the Company, and
to encourage such individuals to take the business risks necessary
for the success of the Company, it is necessary for the Company to
contractually indemnify officers and directors, and to assume for
itself maximum liability for expenses and damages in connection
with claims against such officers and directors in connection with
their service to the Company;
C.
Section 722 of the Business Corporation Law of the State of
New York, under which the Company is organized (“
Section 722 ”), empowers the Company to indemnify
by agreement its officers, directors, employees and agents, and
persons who serve, at the request of the Company, as directors,
officers, employees or agents of other corporations or enterprises;
in addition, Section 721 of the Business Corporation Law expressly
provides that the indemnification provided by Section 722 is not
exclusive; and
D.
The Company desires and has requested the Indemnitee to serve or
continue to serve as a director or officer of the Company free from
undue concern for claims for damages arising out of or related to
such services to the Company.
NOW, THEREFORE , the parties hereto, intending to be legally
bound, hereby agree as follows:
1.1
Agent . For the purposes of this Agreement,
“agent” of the Company means any person who is or was a
director or officer of the Company or a subsidiary of the Company;
or is or was serving at the request of, for the convenience of, or
to represent the interest of the Company or a subsidiary of the
Company as a director or officer of another foreign or domestic
corporation, partnership, joint venture, trust or other enterprise
or an affiliate
of the Company;
or was a director or officer of a foreign or domestic corporation
which was a predecessor corporation of the Company or a subsidiary
of the Company, or was a director or officer of another enterprise
or affiliate of the Company at the request of, for the convenience
of, or to represent the interests of such predecessor corporation.
The term “enterprise” includes any employee benefit
plan of the Company, its subsidiaries, affiliates and predecessor
corporations.
1.2
Expenses . For purposes of this Agreement,
“expenses” includes all direct and indirect costs of
any type or nature whatsoever (including, without limitation, all
attorneys’ fees and related disbursements and other
out-of-pocket costs) actually and reasonably incurred by the
Indemnitee in connection with either the investigation, defense or
appeal of a proceeding or establishing or enforcing a right to
indemnification under this Agreement, Section 722 or
otherwise; provided, however , that expenses shall not
include any judgments, fees, ERISA excise taxes or penalties or
amounts paid in settlement of a proceeding.
1.3
Proceeding . For the purposes of this Agreement,
“proceeding” means any threatened, pending, or
completed action, suit or other proceeding, whether civil,
criminal, administrative, investigative or any other type
whatsoever.
1.4
Subsidiary . For purposes of this Agreement,
“subsidiary” means any corporation of which more than
50% of the outstanding voting securities is owned directly or
indirectly by the Company, by the Company and one or more other
subsidiaries, or by one or more other subsidiaries.
2.
Agreement to Serve . The Indemnitee agrees to serve and/or
continue to serve as an agent of the Company, at the will of the
Company (or under separate agreement, if such agreement exists), in
the capacity Indemnitee currently serves as an agent of the
Company, faithfully and to the best of his ability so long as he is
duly appointed or elected and qualified in accordance with the
applicable provisions of the Bylaws or charter documents of the
Company or any subsidiary of the Company; provided, however
, that Indemnitee may at any time and for any reason resign from
such position (subject to any contractual obligation that
Indemnitee may have assumed apart from this Agreement) and that the
Company or any subsidiary shall have no obligation under this
Agreement to continue Indemnitee in any such position.
3.
Mandatory Indemnification . The Company shall indemnify the
Indemnitee:
3.1
Third Party Actions . If the Indemnitee is a person who was
or is a party or is threatened to be made a party to any proceeding
(other than an action by or in the right of the Company) by reason
of the fact that he is or was an agent of the Company, or by reason
of anything done or not done by him in any such capacity, against
any and all expenses and liabilities of any type whatsoever
(including, but not limited to, judgments, fines, ERISA excise
taxes or penalties, and amounts paid in settlement) actually and
reasonably incurred by him in connection with the investigation,
defense, settlement or appeal of such proceeding if he acted in
good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to
any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful; and
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3.2
Derivative Actions . If the Indemnitee is a person who was
or is a party or is threatened to be made a party to any proceeding
by or in the right of the Company to procure a judgment in its
favor by reason of the fact that he is or was an agent of the
Company, or by reason of anything done or not done by him in any
such capacity, against any amounts paid in settlement of any such
proceeding and all expenses actually and reasonably incurred by him
in connection with the investigation, defense, settlement, or
appeal of such proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best
interests of the Company; except that no indemnification under this
subsection shall be made in respect of any claim, issue or matter
as to which such person shall have been finally adjudged to be
liable to the Company by a court of competent jurisdiction due to
willful misconduct of a culpable nature in the performance of his
duty to the Company, unless and only to the extent that the court
in which such proceeding was brought shall determine upon
application that, despite the adjudication of liability but in view
of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such amounts which such court
shall deem proper; and
3.3
Exception for Amounts Covered by Insurance . Notwithstanding
the foregoing, the Company shall not be obligated to indemnify the
Indemnitee for expenses or liabilities of any type whatsoever
(including, but not limited to, judgments, fines, ERISA excise
taxes or penalties, and amounts paid in settlement) which have been
paid directly to Indemnitee by directors’ and officers’
liability insurance (“ D&O Insurance
”).
4.
Partial Indemnification . If the Indemnitee is entitled
under any provision of this Agreement to indemnification by the
Company for some or a portion of any expenses or liabilities of any
type whatsoever (including, but not limited to, judgments, fines,
ERISA excise taxes or penalties, and amounts paid in settlement)
incurred by him in the investigation, defense, settlement or appeal
of a proceeding but not entitled, however, to indemnification for
all of the total amount thereof, the Company shall nevertheless
indemnify the Indemnitee for such total amount except as to the
portion thereof to which the Indemnitee is not entitled.
5.
Mandatory Advancement of Expenses . Subject to
Section 8 below, the Company shall advance all expenses
incurred by the Indemnitee in connection with the investigation,
defense, settlement or appeal of any proceeding to which the
Indemnitee is a party or is threatened to be made a party by reason
of the fact that the Indemnitee is or was an agent of the Company
or by reason of anything done or
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