Exhibit 10.37
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT
(“ Agreement ”) is made and entered into this 9
th day
of October, 2007 (the “ Effective Date ”), by
and between GSC Investment Corp., a Maryland Corporation (the
“ Company ”), and David Rice (“
Indemnitee ”).
WHEREAS, Indemnitee currently serves
as a disclosure committee member of the Company and may, therefore,
be subjected to claims, suits or proceedings arising as a result of
his service; and
WHEREAS, as an inducement to
Indemnitee to continue to serve as an disclosure committee member
of the Company, the Company has agreed to indemnify and to advance
expenses and costs incurred by Indemnitee in connection with any
such claims, suits or proceedings, to the fullest extent permitted
by law; and
WHEREAS, the parties by this
Agreement desire to set forth their agreement regarding
indemnification and advance of expenses.
NOW, THEREFORE, in consideration of
the premises and the covenants contained herein, the Company and
Indemnitee do hereby covenant and agree as follows:
Section 1 .
Definitions. For purposes of this Agreement:
(a) “ Change in
Control ” means a change in control of the Company
occurring after the Effective Date of a nature that would be
required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A (or in response to any
similar item on any similar schedule or form) promulgated under the
Securities Exchange Act of 1934, as amended (the “ Act
”), whether or not the Company is then subject to such
reporting requirement; provided, however, that, without limitation,
such a Change in Control shall be deemed to have occurred if after
the Effective Date (i) any “ person ” (as
such term is used in Sections 13(d) and 14(d) of the Act) is or
becomes the “ beneficial owner ” (as defined in
Rule 13d-3 under the Act), directly or indirectly, of
securities of the Company representing 15% or more of the combined
voting power of the Company’s then outstanding securities
without the prior approval of at least two-thirds of the members of
the Board of Directors of the Company in office immediately prior
to such person attaining such percentage interest; (ii) there
occurs a proxy contest, or the Company is a party to a merger,
consolidation, sale of assets, plan of liquidation or other
reorganization not approved by at least two-thirds of the members
of the Board of Directors of the Company then in office, as a
consequence of which members of the Board of Directors of the
Company in office immediately prior to such transaction or event
constitute less than a
majority
of the Board of Directors of the Company thereafter; or
(iii) during any period of two consecutive years, other than
as a result of an event described in clause (a)(ii) of this
Section 1, individuals who at the beginning of such period
constituted the Board of Directors of the Company (including for
this purpose any new director whose election or nomination for
election by the Company’s stockholders was approved by a vote
of at least two-thirds of the directors then still in office who
were directors at the beginning of such period) cease for any
reason to constitute at least a majority of the Board of Directors
of the Company.
(b) “ Corporate
Status ” means the status of a person who provides or
provided advisory services to the Company in his capacity as a
disclosure committee member of the Company.
(c) “ Disinterested
Director ” means a director of the Company who is not and
was not a party to the Proceeding in respect of which
indemnification is sought by Indemnitee.
(d) “ Effective
Date ” has the meaning set forth in the first paragraph
of this Agreement.
(e) “ Expenses
” shall include all reasonable and out-of-pocket
attorneys’ fees, retainers, court costs, transcript costs,
fees of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery
service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending,
preparing to prosecute or defend, investigating, or being or
preparing to be a witness in a Proceeding.
(f) “ Independent
Counsel ” means a law firm, or a member of a law firm,
that is experienced in matters of corporation law and neither is,
nor in the past five years has been, retained to represent:
(i) the Company or Indemnitee in any matter material to either
such party, or (ii) any other party to or witness in the
Proceeding giving rise to a claim for indemnification hereunder.
Notwithstanding the foregoing, the term “ Independent
Counsel ” shall not include any person who, under the
applicable standards of professional conduct then prevailing, would
have a conflict of interest in representing either the Company or
Indemnitee in an action to determine Indemnitee’s rights
under this Agreement. If a Change of Control has not occurred,
Independent Counsel shall be selected by the Board of Directors of
the Company, with the approval of Indemnitee, which approval will
not be unreasonably withheld. If a Change of Control has occurred,
Independent Counsel shall be selected by Indemnitee, with the
approval of the Board of Directors of the Company, which approval
will not be unreasonably withheld.
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(g) “ Proceeding
” includes any threatened, pending or completed action, suit,
arbitration, alternate dispute resolution mechanism, investigation,
administrative hearing or any other proceeding, whether civil,
criminal, administrative or investigative (including on appeal),
except one pending or completed on or before the Effective Date,
unless otherwise specifically agreed in writing by the Company and
Indemnitee.
Section 2 . Services
by Indemnitee. Indemnitee will provide advisory services to the
Company in his capacity as a disclosure committee member of the
Company. However, this Agreement shall not impose any obligation on
Indemnitee or the Company to continue Indemnitee’s service to
the Company beyond any period otherwise required by law or by other
agreements or commitments of the parties, if any.
Section 3 .
Indemnification—General. The Company shall indemnify, and
advance Expenses to, Indemnitee as provided in this
Agreement.
Section 4 .
Proceedings Other Than Proceedings By Or In The Right Of The
Company. Indemnitee shall be entitled to the rights of
indemnification provided in this Section 4 if, by reason of
his Corporate Status, he is, or is threatened to be, made a party
to or a witness in any threatened, pending, or completed
Proceeding, other than a Proceeding by or in the right of the
Company. Pursuant to this Section 4, Indemnitee shall be
indemnified against all judgments, penalties, fines and amounts
paid in settlement and all Expenses actually and reasonably
incurred by him or on his behalf in connection with a Proceeding by
reason of his Corporate Status unless it is established that
(i) the act or omission of Indemnitee was material to the
matter giving rise to the Proceeding and (a) was committed in
bad faith or (b) was the result of active and deliberate
dishonesty, (ii) Indemnitee actually received an improper personal
benefit in money, property or services, or (iii) in the case of any
criminal Proceeding, Indemnitee had reasonable cause to believe
that his conduct was unlawful.
Section 5 .
Proceedings by or in the Right of the Company. Indemnitee shall
be entitled to the rights of indemnification provided in this
Section 5 if, by reason of his Corporate Status, he is, or is
threatened to be, made a party to or a witness in any threatened,
pending or completed Proceeding brought by or in the right of the
Company to procure a judgment in its favor. Pursuant to this
Section 5, Indemnitee shall be indemnified against all amounts
paid in settlement and all Expenses actually and reasonably
incurred by him or on his behalf in connection with such Proceeding
unless it is established that (i) the act or omission of
Indemnitee was material to the matter giving rise to such a
Proceeding and (a) was committed in bad faith or (b) was
the result of active and deliberate dishonesty or
(ii) Indemnitee actually received an improper personal benefit
in money, property or services.
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Section 6 .
Court-Ordered Indemnification. Notwithstanding any other
provision of this Agreement, a court of appropriate jurisdiction,
upon application of Indemnitee and such notice as the court shall
require, may order indemnification in the following
circumstances:
(a) if it determines Indemnitee
is entitled to reimbursement under Section 2-418(d)(1) of the
Maryland General Corporation Law (the “ MGCL ”),
the court shall order indemnification, in which case Indemnitee
shall be entitled to recover the expenses of securing such
reimbursement; or
(b) if it determines that
Indemnitee is fairly and reasonably entitled to indemnification in
view of all the relevant circumstances, whether or not Indemnitee
(i) has met the standards of conduct set forth in
Section 2-418(b) of the MGCL or (ii) has been adjudged
liable for receipt of an improper personal benefit under
Section 2-418(c) of the MGCL, the court may order such
indemnification as the court shall deem proper. However,
indemnification with respect to any Proceeding by or in the right
of the Company or in which liability shall have been adjudged in
the circumstances described in Section 2-418(c) of the MGCL
shall be limited to Expenses actually and reasonably incurred by
him or on his behalf in connection with a Proceeding.
Section 7 .
Indemnification for Expenses of a Party Who is Wholly or Partly
Successful. Notwithstanding any other provision of this
Agreement, and without limiting any such provision, to the extent
that Indemnitee is, by reason of his Corporate Status, made a party
to and is successful, on the merits or otherwise, in the defense of
any Proceeding, he shall be indemnified for all Expenses actually
and reasonably incurred by him or on his behalf in connection
therewith. If Indemnitee is not wholly successful in such
Proceeding but is successful, on the merits or otherwise, as to one
or more but less than all claims, issues or matters in such
Proceeding, the Company shall indemnify Indemnitee under this
Section 7 for all Expenses actually and reasonably incurred by
him or on his behalf in connection with each successfully resolved
claim, issue or matter, allocated on a reasonable and proportionate
basis. For purposes of this Section and without limitation, the
termination of any claim, issue or matter in such a Proceeding by
dismissal, with or without prejudice, shall be deemed to be a
successful result as to such claim, issue or matter.
Section 8 . Advance
of Expenses. The Company shall advance all reasonable Expenses
actually and reasonably incurred by or on behalf of Indemnitee in
connection with any Proceeding (other than a Proceeding brought to
enforce indemnification under (i) this Agreement,
(ii) applicable law, (iii) the organizational documents
of the Company, (iv) any agreement or (v) a resolution of
(A) the stockholders entitled to vote generally in the election of
directors or (B) the Board of Directors) of the Company to
which Indemnitee, by reason of his Corporate Status, is, or is
threatened to be, made a party or a witness, within ten
4
days
after the receipt by the Company of a statement or statements from
Indemnitee requesting such advance or advances from time to time,
whether prior to or after final disposition of such Proceeding.
Such statement or statements shall reasonably evidence the Expenses
incurred by Indemnitee and shall include or be preceded or
accompanied by a written affirmation by Indemnitee of
Indemnitee’s good faith belief that the standard of conduct
necessary for indemnification by the Company as authorized by law
and by this Agreement has been met and a written undertaking by or
on behalf of Indemnitee, in substantially the form attached hereto
as Exhibit A or in such form as may be required under
applicable law as in effect at the time of the execution thereof,
to reimburse the portion of any Expenses advanced to Indemnitee
relating to claims, issues or matters in the Proceeding as to which
it shall ultimately be established that the standard of conduct has
not been met and which have not been successfully resolved as
described in Section 7. For so long as the Company is subject
to the Investment Company Act, any advancement of Expenses shall be
subject to at least one of the following as a condition of the
advancement: (a) Indemnitee shall provide a security for his or her
undertaking, (b) the Company shall be insured against losses
arising by reason of any lawful advances or (c) a majority of
a quorum of the Disinterested Directors, or Independent Counsel, in
a written opinion, shall determine, based on a review of readily
available facts (as opposed to a full-trial-type inquiry), that
there is no reason to believe that Indemnitee ultimately will be
found to not be entitled to indemnification. To the extent that
Expenses advanced to Indemnitee do not relate to a specific claim,
issue or matter in the Proceeding, such Expenses shall be allocated
on a reasonable and proportionate basis. The undertaking required
by this Section 8 shall be an unlimited general obligation by
or on behalf of Indemnitee and shall be accepted without reference
to Indemnitee’s financial ability to repay such advanced
Expenses and without any requirement to post security
therefor.
Section 9 . Procedure
for Determination of Entitlement to Indemnification.
(a) To obtain indemnification
under this Agreement, Indemnitee shall submit to the Company a
written request, including therein or therewith such documentation
and information as is reasonably available to Indemnitee and is
reasonably necessary to determine whether and to what extent
Indemnitee is entitled to indemnification. The Secretary of the
Company shall, promptly upon receipt of such a request for
indemnification, advise the Board of Directors of the Company in
writing that Indemnitee has requested indemnification.
(b) Upon written request by
Indemnitee for indemnification pursuant to the firs
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