Exhibit 10.36 INDEMNIFICATION AGREEMENT This
INDEMNIFICATION AGREEMENT (“Agreement”) is entered into
effective as of June 5, 2008 by and between Material Technologies,
Inc., a Delaware corporation (the “Company”), and
Marybeth Miceli Newton (“Indemnitee”) (individually, a
“Party”; collectively, the “Parties”).
RECITALS WHEREAS, it is essential to the
Company to retain and attract as officers the most capable persons
available; WHEREAS, Indemnitee is an officer of
the Company; WHEREAS, both the Company and
Indemnitee recognize the increased risk of litigation and other
claims currently being asserted against directors and officers of
corporations; and WHEREAS, in recognition of
Indemnitee’s need for substantial protection against personal
liability in order to enhance Indemnitee’s continued and
effective service to the Company, and in order to induce Indemnitee
to provide services to the Company as an officer, the Company
wishes to provide in this Agreement for the indemnification of and
the advancing of expenses to Indemnitee to the fullest extent
(whether partial or complete) permitted by California law and as
set forth in this Agreement, and, to the extent insurance is
maintained, for the coverage of Indemnitee under the
Company’s directors’ and officers’ liability
insurance policies. NOW, THEREFORE, in
consideration of the above premises and of Indemnitee’s
continuing to serve the Company directly or, at its request, with
another enterprise, and intending to be legally bound hereby, the
Parties agree as follows:
1. Certain
Definitions:
(a) Board: the
Board of Directors of the Company.
(b) Change
in Control: shall be deemed to have occurred if (i) any
“person” (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
“Act”), other than a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or a
corporation owned directly or indirectly by the shareholders of the
Company in substantially the same proportions as their ownership of
stock of the Company, is or becomes the “Beneficial
Owner” (as defined in Rule 13d-3 under the Act), directly or
indirectly, of securities of the Company representing 30% or more
of the total voting power represented by the Company’s then
outstanding Voting Securities, or (ii) during any period of two
consecutive years, individuals who at the beginning of such period
constitute the Board and any new director whose election by the
Board or nomination for election by the Company’s
shareholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were
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directors at the beginning of the period of whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority of the Board, or, or (iii) the
shareholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than a merger or
consolidation that would result in the Voting Securities of the
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into Voting Securities of the surviving entity) at least 80% of the
total voting power represented by the Voting Securities of the
Company or such surviving entity outstanding immediately after such
merger or consolidation, or (iv) the shareholders of the Company
approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the
Company (in one transaction or a series of transactions) of all or
substantially all of the Company’s assets.
(c) Expenses:
any expense, liability, or loss, including attorneys’ fees,
judgments, fines, ERISA excise taxes and penalties, amounts paid or
to be paid in settlement, any interest, assessments, or other
charges imposed thereon, and any federal, state, local, or foreign
taxes imposed as a result of the actual or deemed receipt of any
payments under this Agreement, paid or incurred in connection with
investigating, defending, being a witness in, or participating in
(including on appeal), or preparing for any of the foregoing in,
any Proceeding relating to any Indemnifiable Event.
(d) Indemnifiable
Event: any event or occurrence that takes place either
prior to or after the execution of this Agreement, related to the
fact that Indemnitee is or was a director or an officer of the
Company, or while a director or officer is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent, or fiduciary of another foreign or domestic corporation,
partnership, joint venture, employee benefit plan, trust, or other
enterprise, or was a director, officer, employee, or agent of a
foreign or domestic corporation that was a predecessor corporation
of the Company or of another enterprise at the request of such
predecessor corporation, or related to anything done or not done by
Indemnitee in any such capacity, whether or not the basis of the
Proceeding is alleged action in an official capacity as a director,
officer, employee, or agent or in any other capacity while serving
as a director, officer, employee, or agent of the Company, as
described above.
(e) Independent
Counsel: the person or body appointed in connection with
Section 3.
(f) Potential
Change in Control: shall be deemed to have occurred
if: (i) the Company enters into an agreement or
arrangement, the consummation of which would result in the
occurrence of a Change in 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 in
Control; (iii) any person (other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company
acting in such capacity or a corporation owned, substantially the
same proportions as their ownership of stock of the Company), who
is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing 10% or more of the combined
voting power of the Company’s then outstanding Voting
Securities, increase his beneficial ownership of such securities by
5% or more over the percentage so owned by such person on the date
hereof, or (iv) the board adopts a resolution to the effect that,
for purposes of this Agreement, a Potential Change in Control has
occurred.
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(g) Proceeding: (i)
any threatened, pending, or completed action, suit, or proceeding,
or whether civil, criminal, administrative, investigative, or
other; (ii) any inquiry, hearing, or investigation, whether
conducted by the Company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such
action, suit, or proceeding.
(h) Reviewing
Party: the person or body appointed in accordance with Section 3.
(i) Voting
Securities: any securities of the Company that vote generally in
the election of officers.
2. Agreement
to Indemnify:
(a) General
Agreement. In the event Indemnitee was, 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, a Proceeding by
reason of (or arising in part out of) an Indemnifiable Event, the
Company shall indemnify Indemnitee from and against any and all
Expenses to the fullest extent permitted by law, as the same exists
or may hereafter be amended or interpreted (but in the case of any
such amendment or interpretation, only to the extent that such
amendment or interpretation permits the Company to provide broader
indemnification rights than were permitted prior
thereto). The Parties hereto intend that this Agreement
shall provide for indemnification in excess of that expressly
permitted by statute, including, without limitation, any
indemnification provided by the Company’s Articles of
Incorporation, its bylaws, vote of its shareholders or
disinterested directors, or applicable law.
(b) Initiation
of Proceeding. Notwithstanding anything in this Agreement to the
contrary, Indemnitee shall not be entitled to indemnification
pursuant to this Agreement in connection with any Proceeding
initiated by Indemnitee against the Company or any director or
officer of the Company unless: (i) the Company has
joined in or the Board has consented to the initiation of such
Proceeding; (ii) the Proceeding is one to enforce indemnification
rights under Section 5; or (iii) the Proceeding is instituted after
a Change in Control and Independent Counsel has approved its
initiation.
(c) Expense
Advances. If so requested by Indemnitee, the Company
shall advance (within ten business days of such request) any and
all Expenses to Indemnitee (an “Expense Advance”);
provided that, if 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. If
Indemnitee has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, as provided in Section 4, 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 have
lapsed). Indemnitee’s obligation to reimburse the
Company for Expense Advances shall be unsecured and no interest
shall be charged thereon.
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(d) Mandatory
Indemnification. Notwithstanding any other provision of
this Agreement (other than Section 2(f) below), to the extent that
Indemnitee has been successful on the merits in defense or any
Proceeding relating in whole or in part to an Indemnifiable Event
or in defense of any issue or matter therein, Indemnitee shall be
indemnified against all Expenses incurred in connection therewith.
(e) Partial
Indemnification. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for
some or a portion of Expense, but not, however, for the total
amount thereof, the Company shall nevertheless indemnify Indemnitee
for the portion thereof to which Indemnitee is entitled.
(f) Prohibited
Indemnification. No indemnification pursuant to this
Agreement shall be paid by the Company on account of any Proceeding
in which judgment is rendered against Indemnitee for an accounting
of profits made from the purchase or sale by Indemnitee of
securities of the Company pursuant to the provisions of Section
16(b) of the Act or similar provisions of any federal, state or
local laws.
3. Reviewing
Party: Prior to any Change in Control, the Reviewing
Party shall be any appropriate person or body consisting of a
member or members of the Board or any other person or body
appointed by the board who is not a party to the particular
Proceeding with respect to which Indemnitee is seeking
indemnification; after a Change in Control, the Reviewing Party
shall be the Independent Counsel referred to below. With
respect to all matters arising after a Change in Control (other
than a Change in Control approved by a majority of the directors on
the Board who were directors immediately prior to such Change in
Control) concerning the rights of Indemnitee to indemnity payments
and Expense Advances under
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