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Exhibit
10.17
INDEMNITY
AGREEMENT
This
Indemnity Agreement, dated as of July 11, 2006, is made by and
between PureDepth, Inc., a Delaware corporation (the
“
Company ”),
and _________________________ (the “
Indemnitee ”).
RECITALS
A.
The
Company is aware that competent and experienced persons are
increasingly reluctant to serve as directors, officers or
agents of corporations unless they are protected by
comprehensive liability insurance 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, officers and other
agents.
B.
The
statutes and judicial decisions regarding the duties of
directors and officers are often difficult to apply,
ambiguous, or conflicting, and therefore fail to provide such
directors, officers and agents with adequate, reliable
knowledge of legal risks to which they are exposed or
information regarding the proper course of action to
take.
C.
Plaintiffs
often seek damages in such large amounts and the costs of
litigation may be so enormous (whether or not the case is
meritorious), that the defense and/or settlement of such
litigation is often beyond the personal resources of
directors, officers and other agents.
D.
The
Company believes that it is unfair for its directors, officers
and agents and the directors, officers and agents of its
subsidiaries to assume the risk of huge judgments and other
expenses which may occur in cases in which the director,
officer or agent received no personal profit and in cases
where the director, officer or agent was not
culpable.
E.
The
Company recognizes that the issues in controversy in
litigation against a director, officer or agent of a
corporation such as the Company or its subsidiaries are often
related to the knowledge, motives and intent of such director,
officer or agent, that he is usually the only witness with
knowledge of the essential facts and exculpating circumstances
regarding such matters, and that the long period of time which
usually elapses before the trial or other disposition of such
litigation often extends beyond the time that the director,
officer or agent can reasonably recall such matters and may
extend beyond the normal time for retirement for such
director, officer or agent with the result that he, after
retirement or in the event of his death, his spouse, heirs,
executors or administrators, may be faced with limited ability
and undue hardship in maintaining an adequate defense, which
may discourage such a director, officer or agent from serving
in that position.
F.
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 directors, officers and agents of the
Company and its subsidiaries and to encourage such individuals to
take the business risks necessary for the success of the Company
and its subsidiaries, it is necessary for the Company to
contractually indemnify its directors, officers and agents and the
directors, officers and agents of its subsidiaries, and to assume
for itself maximum liability for expenses and damages in connection
with claims against such directors, officers and agents in
connection with their service to the Company and its subsidiaries,
and has further concluded that the failure to provide such
contractual indemnification could result in great harm to the
Company and its subsidiaries and the Company’s
stockholders.
G.
Section 145
of the General Corporation Law of Delaware, under which the
Company is organized (“
Section 145 ”),
empowers the Company to indemnify its directors, officers,
employees and agents by agreement and to indemnify persons who
serve, at the request of the Company, as the directors, officers,
employees or agents of other corporations or enterprises, and
expressly provides that the indemnification provided by
Section 145 is not exclusive.
H.
The
Company desires and has requested the Indemnitee to serve or
continue to serve as a director, officer or agent of the
Company and/or one or more subsidiaries of the Company free
from undue concern for claims for damages arising out of or
related to such services to the Company and/or one or more
subsidiaries of the Company.
I.
Indemnitee
is willing to serve, or to continue to serve, the Company
and/or one or more subsidiaries of the Company, provided that
he is furnished the indemnity provided for
herein.
AGREEMENT
NOW,
THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1.
Definitions .
(a)
Agent .
For the purposes of this Agreement, “agent” of the
Company means any person who is or was a director, officer,
employee or other agent 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 interests of the Company or a
subsidiary of the Company as a director, officer, employee or agent
of another foreign or domestic corporation, partnership, joint
venture, trust or other enterprise; or was a director, officer,
employee or agent of a foreign or domestic corporation which was a
predecessor corporation of the Company or a subsidiary of the
Company, or was a director, officer, employee or agent of another
enterprise at the request of, for the convenience of, or to
represent the interests of such predecessor
corporation.
(b)
Expenses .
For purposes of this Agreement, “expenses” include all
out-of-pocket costs of any type or nature whatsoever (including,
without limitation, all attorneys’ fees and related
disbursements), 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 or Section 145 or otherwise; provided,
however, that “expenses” shall not include any
judgments, fines, ERISA excise taxes or penalties, or amounts paid
in settlement of a proceeding.
(c)
Proceeding .
For the purposes of this Agreement, “proceeding” means
any threatened, pending, or completed action, suit or other
proceeding, whether civil, criminal, administrative, or
investigative.
(d)
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 agent of
the Company, at its will (or under separate agreement, if such
agreement exists), in the capacity Indemnitee currently serves as
an agent of the Company, so long as he is duly appointed or elected
and qualified in accordance with the applicable provisions of the
Bylaws of the Company or any subsidiary of the Company or until
such time as he tenders his resignation in writing; provided,
however, that nothing contained in this Agreement is intended to
create any right to continued employment by
Indemnitee.
3.
Liability Insurance .
(a)
Maintenance of D&O Insurance .
The Company hereby covenants and agrees that, so long as the
Indemnitee shall continue to serve as an agent of the Company and
thereafter so long as the Indemnitee shall be subject to any
possible proceeding by reason of the fact that the Indemnitee was
an agent of the Company, the Company, subject to Section 3(c),
shall promptly obtain and maintain in full force and effect
directors’ and officers’ liability insurance
(“
D&O Insurance ”)
in reasonable amounts from established and reputable
insurers.
(b)
Rights and Benefits .
In all policies of D&O Insurance, the Indemnitee shall be named
as an insured in such a manner as to provide the Indemnitee the
same rights and benefits as are accorded to the most favorably
insured of the Company’s directors, if the Indemnitee is a
director; or of the Company’s officers, if the Indemnitee is
not a director of the Company but is an officer; or of the
Company’s key employees, if the Indemnitee is not a director
or officer but is a key employee.
(c)
Limitation on Required Maintenance of D&O Insurance
.
Notwithstanding the foregoing, the Company shall have no obligation
to obtain or maintain D&O Insurance if the Company determines
in good faith that such insurance is not reasonably available, the
premium costs for such insurance are disproportionate to the amount
of coverage provided, the coverage provided by such insurance is
limited by exclusions so as to provide an insufficient benefit, or
the Indemnitee is covered by similar insurance maintained by a
subsidiary of the Company.
4.
Mandatory Indemnification .
Subject to Section 9 below, the Company shall indemnify the
Indemnitee as follows:
(a)
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, the Company shall
indemnify the Indemnitee against any and all expenses and
liabilities of any type whatsoever (including, but not limited to,
judgments, fines, ERISA excise taxes and penalties, and amounts
paid in settlement) actually and reasonably incurred by him in
connection with the investigation, defense, settlement or appeal of
such proceeding, provided the Indemnitee 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 its stockholders, and, with respect to
any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful.
(b)
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 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, the Company shall indemnify the Indemnitee
against all expenses actually and reasonably incurred by him in
connection with the investigation, defense, settlement, or appeal
of such proceeding, provided the Indemnitee 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 its stockholders; except that no
indemnification under this subsection 4(b) shall be made in
respect to 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 unless and only to the extent that the
court in which such proceeding was brought shall determine
upon
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