FOLDERA, Inc.
INDEMNIFICATION AGREEMENT
This Indemnification Agreement
(“Agreement”) is effective as of this first day of
April, 2006, by and between FOLDERA, Inc., a Nevada corporation
(the “Company”), and ________
(“Indemnitee”).
WHEREAS, 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;
WHEREAS, the Company and Indemnitee further
recognize the substantial increase in corporate litigation in
general, subjecting directors, officers, employees, agents and
fiduciaries to expensive litigation risks at the same time as the
availability and coverage of liability insurance has been severely
limited;
WHEREAS, Indemnitee does not regard the current
protection available as adequate under the present circumstances,
and the 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;
and
WHEREAS, 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.
NOW, THEREFORE, the Company and Indemnitee
hereby agree as follows:
(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 an
“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 the 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), 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), 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, 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, 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 or
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 the 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 have 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
the Indemnitee in connection therewith.
2.
Expenses; Indemnification
Procedure .
(a) Advancement of Expenses . The Company shall advance all Expenses
incurred by the 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 the 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 of presumption that Indemnitee did not meet any particular
standard of conduct or have any 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 the 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 the 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 I
