Exhibit 10.16
CSG SYSTEMS INTERNATIONAL,
INC.
INDEMNIFICATION
AGREEMENT
This Indemnification Agreement
(“Agreement”) is made and entered into as of the 16th
day of November, 2006, by and between CSG SYSTEMS INTERNATIONAL,
INC., a Delaware corporation, and its wholly-owned subsidiary, CSG
SYSTEMS, INC. (such two corporations being collectively referred to
herein as the “Company”), and RONALD COOPER
(“Indemnitee”).
RECITALS:
A. The Company and Indemnitee
recognize the continued difficulty in obtaining liability insurance
for its directors, officers, employees, agents, and fiduciaries,
the significant increases in the cost of such insurance and the
general reductions in the coverage of such insurance.
B. The Company and Indemnitee
further recognize the substantial increase in corporate litigation
in general, subjecting directors, officers, employees, agents, and
fiduciaries to extensive litigation risks at the same time as the
availability and coverage of liability insurance has been severely
reduced.
C. Indemnitee does not regard the
current protection available as adequate under the present
circumstances, and Indemnitee and other directors, officers,
employees, agents, and fiduciaries of the Company may not be
willing to continue to serve in such capacities without additional
protection.
D. The Company desires to attract
and retain the services of highly qualified individuals, such as
Indemnitee, to serve the Company and, in part, in order to induce
Indemnitee to continue to provide services to the Company, wishes
to provide for the indemnification and advancing of expenses to
Indemnitee to the maximum extent permitted by law.
E. In view of the considerations set
forth above, the Company desires that Indemnitee be indemnified by
the Company as set forth herein.
NOW, THEREFORE, the Company and
Indemnitee hereby agree as follows:
1. Indemnification
.
(a) Indemnification of
Expenses . The Company shall indemnify Indemnitee to the
fullest extent permitted by law if Indemnitee was or is or becomes
a party to or witness or other participant in, or is threatened to
be made a party to or witness or other participant in, any
threatened, pending, or completed action, suit, proceeding, or
alternative dispute resolution mechanism, or any hearing, inquiry,
or investigation that Indemnitee in good faith believes might lead
to the institution of any such action, suit, proceeding, or
alternative dispute resolution
mechanism, whether civil, criminal,
administrative, investigative, or other (hereinafter a
“Claim”) by reason of (or arising in part out of) any
event or occurrence related to the fact that Indemnitee is or was a
director, officer, employee, agent, or fiduciary of the Company, or
any subsidiary of the Company, or is or was serving at the request
of the Company as a director, officer, employee, agent, or
fiduciary of another corporation, partnership, joint venture,
trust, or other enterprise, or by reason of any action or inaction
on the part of Indemnitee while serving in such capacity
(hereinafter as “Indemnifiable Event”) against any and
all expenses (including attorneys' fees and all other costs,
expenses, and obligations incurred in connection with
investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, be a witness in, or
participate in, any such action, suit, proceeding, alternative
dispute resolution mechanism, hearing, inquiry, or investigation),
judgments, fines, penalties and amounts paid in settlement (if such
settlement is approved in advance by the Company, which approval
shall not be unreasonably withheld) of such Claim and 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
(collectively, hereinafter “Expenses”), including all
interest, assessments, and other charges paid or payable in
connection with or in respect of such Expenses. Such payment of
Expenses shall be made by the Company as soon as practicable but in
any event no later than five days after written demand by
Indemnitee therefor is presented to the Company.
(b) Reviewing Party .
Notwithstanding the foregoing, (i) the obligations of the
Company under Section 1(a) shall be subject to the condition
that the Reviewing Party (as described in Section 10(e)
hereof) shall not have determined (in a written opinion, in any
case in which the Independent Legal Counsel referred to in
Section 1(c) hereof is involved) that Indemnitee would not be
permitted to be indemnified under applicable law, and (ii) the
obligation of the Company to make an advance payment of Expenses to
Indemnitee pursuant to Section 2(a) (an “Expense
Advance”) shall be subject to the condition that, if, when,
and to the extent that the Reviewing Party determines that
Indemnitee would not be permitted to be so indemnified under
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees to reimburse the Company) for all
such amounts theretofore paid; provided, however, that if
Indemnitee has commenced or thereafter commences legal proceedings
in a court of competent jurisdiction to secure a determination that
Indemnitee should be indemnified under applicable law, any
determination made by the Reviewing Party that Indemnitee would not
be permitted to be indemnified under applicable law shall not be
binding and Indemnitee shall not be required to reimburse the
Company for any Expense Advance until a final judicial
determination is made with respect thereto (as to which all rights
of appeal therefrom have been exhausted or lapsed). Indemnitee's
obligation to reimburse the Company for any Expense Advance shall
be unsecured, and no interest shall be charged thereon. If there
has not been a Change in Control (as defined in Section 10(c)
hereof), then the Reviewing Party shall be selected by the Board of
Directors; and if there has been such a Change in Control (other
than a Change in Control which has been approved by a majority of
the Company’s Board of Directors who were directors
immediately prior to such Change in Control), then the Reviewing
Party shall be the Independent Legal Counsel referred to in
Section 1(c) hereof. If there has been no determination by the
Reviewing Party or if the Reviewing Party determines that
Indemnitee substantively would not be permitted to be indemnified
in whole or in part under applicable law, then Indemnitee shall
have the right to commence litigation seeking an initial
determination by the court or challenging any such determination by
the Reviewing Party or any aspect thereof,
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including the legal or factual bases
therefor, and the Company hereby consents to service of process and
to appear in any such proceeding. Any determination by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and Indemnitee.
(c) Change in Control . The
Company agrees that if there is a Change in Control of the Company
(other than a Change in Control which has been approved by a
majority of the Company’s Board of Directors who were
directors immediately prior to such Change in Control) then, with
respect to all matters thereafter arising concerning the rights of
Indemnitee to payments of Expenses and Expense Advances under this
Agreement or any other agreement under the Company’s
Certificate of Incorporation or Bylaws as now or hereafter in
effect, Independent Legal Counsel (as defined in Section 10(d)
hereof) shall be selected by Indemnitee and approved by the Company
(which approval shall not be unreasonably withheld). Such counsel,
among other things, shall render its written opinion to the Company
and Indemnitee as to whether and to what extent Indemnitee would be
permitted to be indemnified under applicable law, and the Company
agrees to abide by such opinion. The Company agrees to pay the
reasonable fees of the Independent Legal Counsel referred to above
and to fully indemnify such counsel against any and all expenses
(including attorneys’ fees), claims, liabilities, and damages
arising out of or relating to this Agreement or its engagement
pursuant hereto.
(d) Mandatory Payment of
Expenses . Notwithstanding any other provision of this
Agreement other than Section 9 hereof, to the extent that
Indemnitee has been successful on the merits or otherwise,
including, without limitation, the dismissal of an action without
prejudice, in defense of any action, suit, proceeding, inquiry, or
investigation referred to in Section 1(a) hereof or in the
defense of any claim, issue, or matter therein, Indemnitee shall be
indemnified against all Expenses incurred by Indemnitee in
connection therewith.
2. Expenses; Indemnification
Procedure .
(a) Advancement of Expenses .
The Company shall advance all Expenses incurred by Indemnitee. The
advances to be made hereunder shall be paid by the Company to
Indemnitee as soon as practicable but in any event no later than
five days after written demand by Indemnitee therefor to the
Company.
(b) Notice/Cooperation by
Indemnitee . Indemnitee shall, as a condition precedent to
Indemnitee’s right to be indemnified under this Agreement,
give the Company notice in writing as soon as practicable of any
Claim made against Indemnitee for which Indemnification will or
could be sought under this Agreement. Notice to the Company shall
be directed to the Chief Executive Officer of the Company at the
address shown on the signature page of this Agreement (or such
other address as the Company shall designate in writing to
Indemnitee). In addition, Indemnitee shall give the Company such
information and cooperation as it may reasonably require and as
shall be within Indemnitee’s power.
(c) No Presumptions; Burden of
Proof . For purposes of this Agreement, the termination of any
Claim by judgment, order, settlement (whether with or without court
approval), or conviction, or upon a plea of nolo contendere
, or its equivalent, shall not create a presumption that Indemnitee
did not meet any particular standard of conduct or have
any
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particular belief or that a court
has determined that indemnification is not permitted by applicable
law. In addition, neither the failure of the Reviewing Party to
have made a determination as to whether Indemnitee has met any
particular standard of conduct or had any particular belief, nor an
actual determination by the Reviewing Party that Indemnitee has not
met such standard of conduct or did not have such belief, prior to
the commencement of legal proceedings by Indemnitee to secure a
judicial determination that Indemnitee should be indemnified under
applicable law, shall be a defense to Indemnitee's claim or create
a presumption that Indemnitee has not met any particular standard
of conduct or did not have any particular belief. In connection
with any determination by the Reviewing Party or otherwise as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall be on the Company to establish that
Indemnitee is not so entitled.
(d) Notice to Insurers . If,
at the time of the receipt by the Company of a notice of a Claim
pursuant to Section 2(b) hereof, the Company has liability
insurance in effect which may cover such Claim, the Company shall
give prompt notice of the commencement of such Claim 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
action, suit, proceeding, inquiry, or investigation in accordance
with the terms of such policies.
(e) Selection of Counsel . In
the event the Company shall be obligated hereunder to pay the
Expenses of any Claim, the Company, if appropriate, shall be
entitled to assume the defense of such Claim with counsel approved
by Indemnitee, upon the delivery to Indemnitee of written notice of
its election so to do. After delivery of such notice, approval of
such counsel by Indemnitee and the retention of such counsel by the
Company, the Company will not be liable to Indemnitee under this
Agreement for any fees of counsel subsequently incurred by
Indemnitee with respect to the same Claim; provided that,
(i) Indemnitee shall have the right to employ
Indemnitee’s counsel in any such Claim at Indemnitee’s
expense and (ii) if (A) the employment of counsel by
Indemnitee has been previously authorized by the Company,
(B) Indemnitee shall have reasonably concluded that there may
be a conflict of interest between the Company and
