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Exhibit 10.9
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (the " Agreement ") is
made as of November 30, 2006, by and between SM&A, a Delaware
corporation (the " Company "), and Cathy L. McCarthy (the "
Indemnitee ").
RECITALS
A.
The Company and Indemnitee recognize the increasing
difficulty in obtaining liability insurance for directors, officers
and key employees, 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 and key employees to expensive litigation risks
at the same time as the availability and coverage of liability
insurance has been severely limited.
C.
Indemnitee does not regard the current protection
available as adequate under the present circumstances, and
Indemnitee and agents of the Company may not be willing to continue
to serve as agents of the Company without additional
protection.
D.
The Company desires to attract and retain the
services of highly qualified individuals, such as Indemnitee, and
to indemnify its directors, officers and key employees so as to
provide them with the maximum protection permitted by
law.
AGREEMENT
In consideration of the mutual promises made in this Agreement,
and for other good and valuable consideration, receipt of which is
hereby acknowledged, the Company and Indemnitee hereby agree as
follows:
(a)
Third Party Proceedings . The
Company shall indemnify Indemnitee if Indemnitee is or was a party
or is threatened to be made a party to any threatened, pending or
completed action, suit, proceeding, or investigation whether civil,
criminal, administrative or investigative (other than an action by
or in the right of the Company) by reason of the fact that
Indemnitee is or was a director, officer, employee or agent of the
Company, or any subsidiary of the Company, by reason of any action
or inaction on the part of Indemnitee while an officer or director
or by reason of the fact that Indemnitee is or was serving at the
request of the Company as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys’ fees),
judgments, fines and amounts paid in settlement (if such settlement
is approved in advance by the Company, which approval shall not be
unreasonably withheld) actually and reasonably incurred by
Indemnitee in connection with such action, suit or proceeding if
Indemnitee acted in good faith and in a manner Indemnitee
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 Indemnitee’s
conduct was unlawful. The
termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a
presumption that Indemnitee did not act in good faith and in a
manner which Indemnitee reasonably believed to be in or not opposed
to the best interests of the Company, or, with respect to any
criminal action or proceeding, that Indemnitee had reasonable cause
to believe that Indemnitee’s conduct was unlawful.
(b)
Proceedings By or in the Right of the
Company . The Company shall indemnify Indemnitee if
Indemnitee was or is a party or is threatened to be made a party to
any threatened, pending or completed action or proceeding by or in
the right of the Company or any subsidiary of the Company to
procure a judgment in its favor by reason of the fact that
Indemnitee is or was a director, officer, employee or agent of the
Company, or any subsidiary of the Company, by reason of any action
or inaction on the part of Indemnitee while an officer or director
or by reason of the fact that Indemnitee is or was serving at the
request of the Company as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys’ fees) and,
to the fullest extent permitted by law, amounts paid in settlement
(if such settlement is approved in advance by the Company, which
approval shall not be unreasonably withheld), in each case to the
extent actually and reasonably incurred by Indemnitee in connection
with the defense or settlement of such action or suit if Indemnitee
acted in good faith and in a manner Indemnitee reasonably believed
to be in or not opposed to the best interests of the Company and
its stockholders, except that no indemnification shall be made in
respect of any claim, issue or matter as to which Indemnitee shall
have been finally adjudicated by court order or judgment to be
liable to the Company in the performance of Indemnitee’s duty
to the Company and its stockholders unless and only to the extent
that the court in which such action or proceeding is or was pending
shall determine upon application that, in view of all the
circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnity for such expenses which such court shall deem
proper.
(c)
Mandatory Payment of Expenses . To
the extent that Indemnitee has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to
in Section 1(a) or Section 1(b) or the defense of any claim, issue
or matter therein, Indemnitee shall be indemnified against expenses
(including attorneys’ fees) actually and reasonably incurred
by Indemnitee in connection therewith.
(d)
Exceptions . Any other provision herein to
the contrary notwithstanding, the Company shall not be obligated
pursuant to the terms of this Agreement:
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(i)
Claims Initiated by Indemnitee . To
indemnify or advance expenses to Indemnitee with respect to
proceedings or claims initiated or brought voluntarily by
Indemnitee and not by way of defense, except with respect to
proceedings brought to establish or enforce a right to
indemnification under this Agreement or any other statute or law or
otherwise as required under Section 145 of the Delaware General
Corporation Law, but such indemnification or advancement of
expenses
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may be provided by the Company in specific cases
if the Board of Directors finds it to be appropriate; or
(ii)
Claims under Section 16(b) . To
indemnify Indemnitee for expenses or the payment of profits arising
from the purchase and sale by Indemnitee of securities in violation
of Section 16(b) of the Securities Exchange Act of 1934, as
amended, or any similar successor statute.
2.
No Employment Rights. Nothing
contained in this Agreement is intended to create in Indemnitee any
right to continued employment.
3.
Expenses; Indemnification
Procedure.
(a)
Advancement of Expenses . The
Company shall advance all expenses incurred by Indemnitee in
connection with the investigation, defense, settlement or appeal of
any civil or criminal action, suit or proceeding referred to in
Section 1(a) or Section 1(b) hereof (including amounts actually
paid in settlement of any such action, suit or proceeding).
Indemnitee hereby undertakes to repay such amounts advanced only
if, and to the extent that, it shall ultimately be determined that
Indemnitee is not entitled to be indemnified by the Company as
authorized hereby.
(b)
Notice/Cooperation by Indemnitee .
Indemnitee shall, as a condition precedent to his or her 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
President or the Chief Executive Officer of the Company and shall
be given in accordance with the provisions of Section 11(d)
below. 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)
Procedure . Any indemnification and
advances provided for in Section 1 and this Section 3 shall be
made no later than thirty (30) days after receipt of the written
request of Indemnitee. If a claim under this Agreement, under
any statute, or under any provision of the Company’s
Certificate of Incorporation or Bylaws providing for
indemnification, is not paid in full by the Company within thirty
(30) days after a written request for payment thereof has first
been received by the Company, Indemnitee may, but need not, at any
time thereafter bring an action against the Company to recover the
unpaid amount of the claim and, subject to Section 10 of this
Agreement, Indemnitee shall also be entitled to be paid for the
expenses (including attorneys’ fees) of bringing such
action. It shall be a defense to any such action (other than
an action brought to enforce a claim for expenses incurred in
connection with any action, suit or proceeding in advance of its
final disposition) that Indemnitee has not met the standards of
conduct which make it permissible under applicable law for the
Company to indemnify Indemnitee for the amount claimed, but the
burden of proving such defense shall be on the Company and
Indemnitee shall be entitled to receive interim payments of
expenses
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