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OPTIONS MEDIA GROUP HOLDINGS, INC.
FORM OF DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT
This
Director and Officer Indemnification Agreement, dated as of
June __, 2008 (this “Agreement”
), is made by and between Options Media Group Holdings, Inc.,
a Nevada corporation (the “Company”
), and _____________ (the “Indemnitee”
).
RECITALS:
A. Chapter
78.115 of the Nevada Revised Statutes provides that the
business and affairs of a corporation shall be managed by or
under the direction of its board of directors.
B. By
virtue of the managerial prerogatives vested in the directors
and officers of a Nevada corporation, directors and officers
act as fiduciaries of the corporation and its
shareholders.
C. Thus,
it is critically important to the Company and its shareholders
that the Company be able to attract and retain the most
capable persons reasonably available to serve as directors and
officers of the Company.
D. In
recognition of the need for corporations to be able to induce
capable and responsible persons to accept positions in
corporate management, Nevada law authorizes (and in some
instances requires) corporations to indemnify their directors
and officers, and further authorizes corporations to purchase
and maintain insurance for the benefit of their directors and
officers.
E. Indemnitee
is, or will be, a director and/or officer of the Company and
his or her willingness to serve in such capacity is
predicated, in substantial part, upon the Company’s
willingness to indemnify him or her to the fullest extent
permitted by the laws of the State of Nevada, and upon the
other undertakings set forth in this Agreement.
F. Therefore,
in recognition of the need to provide Indemnitee with
substantial protection against personal liability, in order to
procure Indemnitee’s service (or continued service) as a
director and/or officer of the Company and to enhance
Indemnitee’s ability to serve the Company in an
effective manner, and in order to provide such protection
pursuant to express contract rights (intended to be
enforceable irrespective of, among other things, any amendment
to the Company’s articles of incorporation or bylaws
(collectively, the “Constituent
Documents” ), any change in the composition of
the Company’s Board of Directors (the “Board”
) or any change-in-control or business combination transaction
relating to the Company), the Company wishes to provide in
this Agreement for the indemnification and advancement of
Expenses to Indemnitee on the terms, and subject to the
conditions, set forth in this Agreement.
G. In
light of the considerations referred to in the preceding
recitals, it is the Company’s intention and desire that
the provisions of this Agreement be construed liberally,
subject to their express terms, to maximize the protections to
be provided to Indemnitee hereunder.
AGREEMENT:
NOW,
THEREFORE, the parties hereby agree as follows:
1.
Certain Definitions . In addition to terms
defined elsewhere herein, the following terms have the following
meanings when used in this Agreement with initial capital
letters:
(a)
“Change in Control” shall have occurred at such
time, if any, as Incumbent Directors cease for any reason to
constitute a majority of Directors. For purposes of this
Section 1(a), “Incumbent
Directors” means the individuals who, as of the date
hereof, are Directors of the Company and any individual becoming a
Director subsequent to the date hereof whose election, nomination
for election by the Company’s shareholders, or appointment,
was approved by a vote of at least a majority of the then Incumbent
Directors (either by a specific vote or by approval of the proxy
statement of the Company in which such person is named as a nominee
for director, without objection to such nomination); provided, however,
that an individual shall not be an Incumbent Director if such
individual’s election or appointment to the Board occurs as a
result of an actual or threatened election contest (as described in
Rule 14a-12(c) of the Securities Exchange Act of 1934, as amended)
with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board.
(b)
“Claim” means (i) any threatened, asserted,
pending or completed claim, demand, action, suit or proceeding,
whether civil, criminal, administrative, arbitrative, investigative
or other, and whether made pursuant to federal, state or other law;
and (ii) any inquiry or investigation, whether made, instituted or
conducted by the Company or any other Person, including, without
limitation, any federal, state or other governmental entity, that
Indemnitee reasonably determines might lead to the institution of
any such claim, demand, action, suit or proceeding. For
the avoidance of doubt, the Company intends indemnity to be
provided hereunder in respect of acts or failure to act prior to,
on or after the date hereof.
(c)
“Controlled Affiliate” means any corporation,
limited liability company, partnership, joint venture, trust or
other entity or enterprise, whether or not for profit, that is
directly or indirectly controlled by the Company. For
purposes of this definition, “control”
means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of an
entity or enterprise, whether through the ownership of voting
securities, through other voting rights, by contract or otherwise;
provided
that direct or indirect beneficial ownership of capital stock or
other interests in an entity or enterprise entitling the holder to
cast 15% or more of the total number of votes generally entitled to
be cast in the election of directors (or persons performing
comparable functions) of such entity or enterprise shall be deemed
to constitute control for purposes of this definition.
(d)
“Disinterested Director” means a director of the
Company who is not and was not a party to the Claim in respect of
which indemnification is sought by Indemnitee.
(e)
“Expenses” means attorneys’ and
experts’ fees and expenses and all other costs and expenses
paid or payable in connection with investigating, defending, being
a witness
in
or participating in (including on appeal), or preparing to
investigate, defend, be a witness in or participate in (including
on appeal), any Claim.
(f)
“Indemnifiable Claim” means any Claim based
upon, arising out of or resulting from (i) any actual, alleged or
suspected act or failure to act by Indemnitee in his or her
capacity as a director, officer, employee or agent of the Company
or as a director, officer, employee, member, manager, trustee or
agent of any other corporation, limited liability company,
partnership, joint venture, trust or other entity or enterprise,
whether or not for profit, as to which Indemnitee is or was serving
at the request of the Company, (ii) any actual, alleged or
suspected act or failure to act by Indemnitee in respect of any
business, transaction, communication, filing, disclosure or other
activity of the Company or any other entity or enterprise referred
to in clause (i) of this sentence, or (iii) Indemnitee’s
status as a current or former director, officer, employee or agent
of the Company or as a current or former director, officer,
employee, member, manager, trustee or agent of the Company or any
other entity or enterprise referred to in clause (i) of this
sentence or any actual, alleged or suspected act or failure to act
by Indemnitee in connection with any obligation or restriction
imposed upon Indemnitee by reason of such status. In
addition to any service at the actual request of the Company, for
purposes of this Agreement, Indemnitee shall be deemed to be
serving or to have served at the request of the Company as a
director, officer, employee, member, manager, trustee or agent of
another entity or enterprise if Indemnitee is or was serving as a
director, officer, employee, member, manager, agent, trustee or
other fiduciary of such entity or enterprise and (i) such entity or
enterprise is or at the time of such service was a Controlled
Affiliate, (ii) such entity or enterprise is or at the time of such
service was an employee benefit plan (or related trust) sponsored
or maintained by the Company or a Controlled Affiliate, or (iii)
the Company or a Controlled Affiliate (by action of the Board, any
committee thereof or the Company’s Chief Executive Officer
(“CEO”) (other than as the CEO him or herself)) caused
or authorized Indemnitee to be nominated, elected, appointed,
designated, employed, engaged or selected to serve in such
capacity.
(g)
“Indemnifiable Losses” means any and all Losses
relating to, arising out of or resulting from any Indemnifiable
Claim; provided,
however, that Indemnifiable Losses shall not include Losses
incurred by Indemnitee in respect of any Indemnifiable Claim (or
any matter or issue therein) as to which Indemnitee shall have been
adjudged liable to the Company, unless and only to the extent that
a court of competent jurisdiction in which such Indemnifiable Claim
was brought shall have determined 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 the court shall deem
proper.
(h)
“Independent Counsel” means a nationally
recognized law firm, or a member of a nationally recognized law
firm, that is experienced in matters of Nevada corporate law and
neither presently is, nor in the past five years has been, retained
to represent: (i) the Company (or any subsidiary) or
Indemnitee in any matter material to either such party (other than
with respect to matters concerning the Indemnitee under this
Agreement, or of other indemnitees under similar indemnification
agreements) or (ii) any other named (or, as to a threatened matter,
reasonably likely to be named) party to the Indemnifiable Claim
giving rise to a claim for indemnification
hereunder. Notwithstanding the foregoing, the term
“Independent Counsel” shall not include any person who,
under the applicable standards of professional
conduct
then prevailing, would have a conflict of interest in representing
either the Company or Indemnitee in an action to determine
Indemnitee’s rights under this Agreement.
(i)
“Losses” means any and all Expenses, damages,
losses, liabilities, judgments, fines, penalties (whether civil,
criminal or other) and amounts paid or payable in settlement,
including, without limitation, all interest, assessments and other
charges paid or payable in connection with or in respect of any of
the foregoing.
(j)
“Person” means any individual, entity or group,
within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended.
(k)
“Standard of Conduct” means the standard for
conduct by Indemnitee that is a condition precedent to
indemnification of Indemnitee hereunder against Indemnifiable
Losses relating to, arising out of or resulting from an
Indemnifiable Claim. The Standard of Conduct is good
faith and a reasonable belief by Indemnitee that his action was in
or not opposed to the best interests of the Company and, with
respect to any criminal action or proceeding, that Indemnitee had
no reasonable cause to believe that his conduct was
unlawful.
2.
Indemnification Obligation . Subject only to
Section 7 and to the proviso in this Section, the Company shall
indemnify, defend and hold harmless Indemnitee, to the fullest
extent permitted or required by the laws of the State of Nevada in
effect on the date hereof or as such laws may from time to time
hereafter be amended to increase the scope of such permitted
indemnification, against any and all Indemnifiable Claims and
Indemnifiable Losses; provided, however,
that, except as provided in Section 5, Indemnitee shall not be
entitled to indemnification pursuant to this Agreement in
connection with (i) any Claim initiated by Indemnitee against the
Company or any director or officer of the Company unless the
Company has joined in or consented to the initiation of such Claim,
or (ii) the purchase and sale by Indemnitee of securities in
violation of Section 16(b) of the Securities Exchange Act of 1934,
as amended. The Company acknowledges that the foregoing
obligation may be broader than that now provided by applicable law
and the Company’s Constituent Documents and intends that it
be interpreted consistently with this Section and the recitals to
this Agreement.
3.
Advancement of Expenses . Indemnitee shall
have the right to advancement by the Company prior to the final
disposition of any Indemnifiable Claim of any and all actual and
reasonable Expenses relating to, arising out of or resulting from
any Indemnifiable Claim paid or incurred by
Indemnitee. Without limiting the generality or effect of
any other provision hereof, Indemnitee’s right to such
advancement is not subject to the satisfaction of any Standard of
Conduct. Without limiting the generality or effect of
the foregoing, within five business days after any request by
Indemnitee that is accompanied by supporting documentation for
specific reasonable Expenses to be reimbursed or advanced, the
Company shall, in accordance with such request (but without
duplication), (a) pay such Expenses on behalf of Indemnitee, (b)
advance to Indemnitee funds in an amount sufficient to pay such
Expenses, or (c) reimburse Indemnitee for such Expenses;
provided
that Indemnitee shall repay, without interest, any amounts actually
advanced to Indemnitee that, at the final disposition of the
Indemnifiable Claim to which the advance related, were in excess of
amounts paid or payable by Indemnitee in respect of Expenses
relating to, arising out of or resulting from such Indemnifiable
Claim. In connection with any such payment, advancement
or reimbursement, at the request of the Company, Indemnitee
shall
execute
and deliver to the Company an undertaking, which need not be
secured and shall be accepted without reference to
Indemnitee’s ability to repay the Expenses, by or on behalf
of the Indemnitee, to repay any amounts paid, advanced or
reimbursed by the Company in respect of Expenses relating to,
arising out of or resulting from any Indemnifiable Claim in respect
of which it shall have been determined, following the final
disposition of such Indemnifiable Claim and in accordance with
Section 7, that Indemnitee is not entitled to indemnification
hereunder.
4.
Indemnification for Additional Expenses . Without limiting
the generality or effect of the foregoing, the Company shall
indemnify and hold harmless Indemnitee against and, if requested by
Indemnitee, shall reimburse Indemnitee for, or advance to
Indemnitee, within five business days of such request accompanied
by supporting documentation for specific Expenses to be reimbursed
or advanced, any and all actual and reasonable Expenses paid or
incurred by Indemnitee in connection with any Claim made,
instituted or conducted by Indemnitee for (a) indemnification or
reimbursement or advance payment of Expenses by the Company under
any provision of this Agreement, or under any other agreement or
provision of the Constituent Documents now or hereafter in effect
relating to Indemnifiable Claims, and/or (b) recovery under any
directors’ and officers’ liability insurance policies
maintained by the Company; provided, however, if
it is ultimately determined that the Indemnitee is not entitled to
such indemnification, reimbursement, advance or insurance recovery,
as the case may be, then the Indemnitee shall be obligated to repay
any such Expenses to the Company; provided further,
that, regardless in each case of whether Indemnitee ultimately is
determined to be entitled to such indemnification, reimbursement,
advance or insurance recovery, as the case may be, Indemnitee shall
return, without interest, any such advance of Expenses (or portion
thereof) which remains unspent at the final disposition of the
Claim to which the advance related.
5.
Partial Indemnity . If Ind
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