|
<PAGE>
INDEMNIFICATION AGREEMENT (the
"Agreement") dated as of April 2, 2002
ROBOTIC VISION SYSTEMS INC., a Delaware
corporation (including any successors
thereto, the "Company") and PAT V. COSTA
("Indemnitee").
The Company, Indemnitee and another person have been named as
defendants
in certain purported class actions stemming from the Company's
May 2001
restatement of certain of its consolidated financial statements
(the
"Restatement"). Under the Company's Amended and Restated
Certificate of
Incorporation, the Company may provide its executive officers
with
indemnification against claims and actions against them arising
out of their
service to, and activities on behalf of, the Company. The
parties desire that
the Company obligate itself contractually to indemnify
Indemnitee to the fullest
extent permitted by applicable law.
NOW, THEREFORE, in consideration of the foregoing premises and
the
covenants contained in this Agreement, the Company and
Indemnitee hereby
covenant and agree as follows:
1. CERTAIN DEFINITIONS. For purposes of this Agreement:
(a) Change of Control shall mean the occurrence of any of
the
following events:
(i) The acquisition after the date hereof by 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 (the
"Exchange
Act")) (a "Person") of beneficial ownership (within the meaning
of
Rule 13d-3 promulgated under the Exchange Act) of 15% or more
of
either (x) the then outstanding shares of common stock of
the
Company (the "Outstanding Company Common Stock") or (y) the
combined
voting power of the then outstanding voting securities of
the
Company entitled to vote generally in the election of directors
(the
"Outstanding Company Voting Securities"); provided, however,
that
for purposes of this paragraph (i), the following acquisitions
shall
not constitute a Change of Control: any acquisition directly
from
the Company or any Subsidiary thereof; any acquisition by
the
Company or any Subsidiary thereof; any acquisition by any
employee
benefit plan (or related trust) sponsored or maintained by
the
Company or any Subsidiary of the Company; or any acquisition by
any
entity or its security holders pursuant to a transaction
which
complies with clauses (A), (B), and (C) of paragraph (iii)
below;
(ii) Individuals who, as of the Agreement Date, constitute
the
Board (the "Incumbent Board"), cease for any reason to
constitute at
least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the Agreement
Date
whose election or appointment by the Board or nomination for
election by the Company's stockholders was approved by a vote of
at
least a majority of the directors then comprising the
Incumbent
Board shall be
<PAGE>
considered as though such individual were a member of the
Incumbent
Board, but excluding, for this purpose, any such individual
whose
initial assumption of office occurs as a result of an actual
or
threatened election contest 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;
(iii) Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or
substantially
all of the assets of the Company or an acquisition of assets
of
another corporation (a "Business Combination"), in each case
unless,
following such Business Combination, (A) all or substantially
all of
the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to
such
Business Combination beneficially own, directly or indirectly,
more
than 50% of the combined voting power of the then outstanding
voting
securities entitled to vote generally in the election of
directors
of the corporation resulting from such Business Combination
(including, without limitation, a corporation which as a result
of
such transaction owns the Company or all or substantially all of
the
Company's assets either directly or indirectly or through one
or
more subsidiaries) in substantially the same proportions as
their
ownership, immediately prior to such Business Combination of
the
Outstanding Company Voting Securities, (B) no Person (excluding
any
employee benefit plan or related trust) of the Company, or
the
corporation resulting from such Business Combination,
beneficially
owns, directly or indirectly, 15% or more of the combined
voting
power of the then outstanding voting securities of such
corporation
except to the extent that such ownership of the Company
existed
prior to the Business Combination and (C) at least a majority of
the
members of the Board of Directors of the corporation resulting
from
such Business Combination were the members of the Incumbent
Board at
the time of the execution of the initial agreement, or of the
action
of the Board, providing for such Business Combination;
(iv) Approval by the stockholders of the Company of a
complete
liquidation or dissolution of the Company; or
(v) The Indemnitee ceasing to serve as the Company's
Chairman,
President and Chief Executive Officer for any reason.
(b) Claim shall mean any threatened, pending, or completed
action,
suit, or proceeding (including, without limitation, securities
laws actions,
suits, and proceedings and also any cross claim or counterclaim
in any action,
suit, or proceeding), whether civil, criminal, arbitral,
administrative, or
investigative in nature, or any inquiry or investigation
(including discovery),
whether conducted by the Company or another Person, that
Indemnitee in good
faith believes could reasonably be expected to lead to the
institution of any
action, suit, or proceeding.
(c) Expenses shall mean all costs, expenses (including
attorneys'
and expert witnesses' fees), and obligations paid or incurred in
connection with
investigating, defending, (including affirmative defenses and
counterclaims),
being a witness in, or participating in
2
<PAGE>
(including on appeal), or preparing to defend, be a witness in,
or participate
in, any Claim relating to any Indemnifiable Event.
(d) Indemnifiable Event shall mean any actual or alleged
act,
omission, statement, misstatement, event, or occurrence related
to the fact that
Indemnitee is or was a director, officer, agent, or fiduciary of
the Company, or
is or was serving at the request of the Company as a director,
officer, trustee,
agent, or fiduciary of another corporation, partnership, joint
venture, employee
benefit plan, trust, or other enterprise, or by reason of an
actual or alleged
thing done or not done by Indemnitee in any such capacity,
arising out of or in
connection with the Restatement or in the events which gave rise
to the need for
the Company to make the Restatement. For purposes of this
Agreement, the Company
agrees that Indemnitee's service on behalf of or with respect to
any Subsidiary
or employee benefit plan of the Company or any Subsidiary of the
Company shall
be deemed to be at the request of the Company.
(e) Indemnifiable Liabilities shall mean all Expenses and
all
other liabilities, damages (including, without limitation,
punitive, exemplary,
and the multiplied portion of any damages), judgments, payments,
fines,
penalties, amounts paid in settlement, and awards paid or
incurred that arise
out of, or in any way relate to, any Indemnifiable Event.
(f) Person shall mean any individual, corporation,
partnership,
limited liability company, joint venture, trust, unincorporated
association, or
other form of business or legal entity or governmental
entity.
(g) Potential Change of Control shall be deemed to have
occurred
if: (i) the Company enters into an agreement, the consummation
of which would
result in the occurrence of a Change of Control, (ii) any Person
(including the
Company) publicly announces an intention to take or to consider
taking actions
that, if consummated, would constitute a Change of Control and
the success and
consummation of such intention reasonably appears to be more
likely than not, or
(iii) the Board adopts a resolution to the effect that, for
purposes of this
Agreement, a Potential Change of Control has occurred, except in
each case for a
transaction in which an Indemnitee is participating as an active
principal and
not solely as a result of such Indemnitee's position as a
director or officer.
(h) Reviewing Party shall mean those members of the Board who
are
not parties to the particular Claim for which Indemnitee is
seeking
indemnification or if a Change of Control has occurred or if
there is a
Potential Change of Control and Indemnitee so requests, or if
such members of
the Board so elect, or if all of the members of the Board are
parties to such
Claim, Special Counsel.
(i) Special Counsel shall mean special, independent legal
counsel
selected by Indemnitee and approved by the Company (which
approval shall not be
unreasonably withheld), and who has not otherwise performed
material services
for the Company or for Indemnitee within the last three years
(other than as
Special Counsel under this Agreement or similar agreements).
Notwithstanding the
foregoing, Skadden, Arps, Slate, Meagler & Flom LLP may
serve as Special
Counsel.
(j) Subsidiary shall mean, with respect to any Person, any
corporation or other entity of which a majority of the voting
power of the
voting equity securities or equity interest is owned, directly
or indirectly, by
that Person.
3
<PAGE>
2. INDEMNIFICATION AND EXPENSE ADVANCEMENT.
(a) The Company shall indemnify Indemnitee and hold
Indemnitee
harmless to the fullest extent permitted by law, as soon as
practicable, but in
no event later than 30 days after written demand is presented to
the Company,
from and against any and all Indemnifiable Liabilities.
Notwithstanding the
foregoing, the obligations of the Company under this Section
2(a) shall be
subject to the condition that the Reviewing Party shall not have
determined (in
a written opinion, in any case in which Special Counsel is
involved) that
Indemnitee is not permitted to be indemnified under applic
| 
