Exhibit 10.2
INDEMNIFICATION
AGREEMENT
This Indemnification Agreement
(“ Agreement ”) is made as of this [
—
] day of [ —
], 2008, between ModusLink Global
Solutions, Inc., a Delaware corporation (together with its
subsidiaries, the “ Company ”), and [
—
] (the “ Indemnitee
”).
WITNESSETH THAT:
WHEREAS, it is essential to the
Company to attract and retain as Directors and executive Officers
the most capable people available; and
WHEREAS, the Indemnitee is a
director or officer of the Company or serves as a director,
officer, trustee, partner, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise
or non-profit entity at the express written request of the Company
(each a “ Director ” or “ Officer
”, as applicable) and in such capacities provides valuable
services to the Company; and
WHEREAS, both the Company and the
Indemnitee recognize that the Indemnitee, while serving as a
Director or Officer of the Company is exposed to a substantial risk
of expensive litigation at a time when liability insurance may not
continue to be available to insure adequately against such risk,
and at a time when the Company and the Indemnitee recognize that
the Indemnitee is not being paid sufficient compensation by the
Company to compensate for such risk; and
WHEREAS, it is now and has always
been the express policy of the Company to indemnify its Directors
and Officers; and
WHEREAS, the Restated Certificate of
Incorporation (as amended from time to time, the “
Certificate ”) and Second Amended and Restated By-Laws
(as amended from time to time, the “ By-Laws ”)
adopted by the Company provide for the indemnification of Officers
and Directors of the Company as authorized by Section 145 of
the Delaware General Corporation Law; and
WHEREAS, such Articles and By-Laws
and the Delaware General Corporation Law specifically provide that
they are not exclusive, and thereby contemplate that individual
indemnification agreements may be entered into between the Company
and its Directors and Officers; and
WHEREAS, in accordance with the
authorization provided by law, the Company intends to purchase and
maintain a policy or policies of Directors and Officers Liability
Insurance (“ D&O Insurance ”), providing
certain basic protection against risk of personal liability of
Directors and Officers at a reasonable cost, and Indemnitee has
relied on the availability of such coverage, but such coverage may
become increasingly difficult to obtain on terms providing
reasonable protection at a reasonable cost for all risks;
and
WHEREAS, to induce Indemnitee to
continue to serve as a Director or Officer of the Company and to
provide Indemnitee with specific contractual assurance of
substantial protection
against personal liability (regardless of, among
other things, any amendment to or revocation of any provision of
the Company’s Certificate or By-Laws concerning
indemnification or any change in the composition of the
Company’s Board of Directors or any acquisition of the
Company), the Company desires to enter into this
Agreement;
WHEREAS, in order to induce
Indemnitee to remain in Indemnitee’s present position as a
Director or Officer of the Company and in consideration of
Indemnitee’s so remaining, the Company desires to indemnify
Indemnitee according to the terms and conditions set forth below;
and
NOW, THEREFORE, in consideration of
the foregoing premises and of the Indemnitee’s continuing to
serve the Company, and for other good and valuable consideration,
receipt of which is hereby acknowledged, the parties hereto, for
themselves, their successors and assigns, hereby agree as
follows:
1. Agreement to Serve
. Indemnitee agrees to serve or to continue to serve as a
Director or Officer of the Company for so long as he is duly
elected or until such time as he tenders his resignation in writing
or his status as a Director or Officer is terminated. This
Agreement shall not be deemed an employment contract between the
Company (or any of its subsidiaries) and Officer Indemnitee. Each
Officer Indemnitee specifically acknowledges that
Indemnitee’s employment with the Company (or any of its
subsidiaries), if any, is at will, and the Indemnitee may be
discharged at any time for any reason, with or without cause,
except as may be otherwise provided in any written employment
contract between Indemnitee and the Company (or any of its
subsidiaries), other applicable formal severance policies duly
adopted by the Board, or, with respect to services as an Officer of
the Company, by the Company’s Certificate, the
Company’s By-laws, and the General Corporation Law of the
State of Delaware. The foregoing notwithstanding, the Agreement
shall continue in force after Indemnitee has ceased to serve as a
Director or Officer of the Company.
2. Definitions . For
purposes of this Agreement, the following terms shall have the
meanings set forth below:
(a) “Change in Control”
shall be deemed to have occurred when (i) there has been a
change in control of the Company, not approved by a resolution of
the Company’s Board of Directors, of a nature that would be
required to be reported in response to Item 6(e) of Schedule
14A of Regulation 14A promulgated under the Securities Exchange Act
of 1934, as amended (the “ Exchange Act ”),
including in any event the acquisition by any “person”
(as such term is used in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act) of beneficial ownership, directly or indirectly, of
securities of the Company representing 25% or more of the combined
voting power of the Company’s then outstanding securities,
(ii) followed within a period of not more than two years by a
change in the identity of a majority of the members of the
Company’s Board of Directors otherwise than through death,
disability or retirement in accordance with the Company’s
retirement policies.
(b) The term “Claim”
shall include any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation, whether brought by or
in the right of the Company or by any other party and whether of a
civil, criminal, administrative or
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investigative nature, including any inquiry or
investigation which the Indemnitee in good faith believes might
lead to the institution of any action, suit or proceeding, in which
Indemnitee may be or may have been involved as a party, witness or
otherwise, by reason of the fact that Indemnitee is or was a
Director or Officer of the Company, by reason of any action taken
by him or of any inaction on his part while acting as such a
Director or Officer, or by reason of the fact that he 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; in each case whether or not he
is acting or serving in any such capacity at the time any liability
or expense is incurred for which indemnification or reimbursement
can be provided under this Agreement.
(c) The term “Expenses”
shall include, without limitation, expenses of investigations,
judicial or administrative proceedings or appeals, amounts paid in
settlement of any Claim by or on behalf of Indemnitee, attorneys
fees and disbursements, any expenses of establishing a right to
indemnification or Expense Advances under Sections 9 and
10 of this Agreement, and all other costs, expenses and
obligations paid or 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 participant in,
any Claim, but shall not include the amount of judgments, fines or
penalties against Indemnitee.
(d) References to “other
enterprise” shall include employee benefit plans; references
to “fines” shall include any excise tax assessed with
respect to any employee benefit plan; references to “serving
at the request of the Company” shall include any service as a
director, officer, employee or agent of the Company which imposes
duties on, or involves services by, such director, officer,
employee, or agent with respect to an employee benefit plan, its
participants or beneficiaries.
(e) “Potential Change in
Control” shall be deemed to have occurred if (i) any
person publicly announces an intention to take or to consider
taking such actions which if consummated might result in a Change
in Control, (ii) any “person” (as such term is
used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act)
acquires beneficial ownership, directly or indirectly, of
securities of the Company representing 25% or more of the combined
voting power of the Company’s then outstanding securities, or
(iii) the Company’s Board of Directors in its sole
discretion adopts a resolution to the effect that, for purposes of
this Agreement, a Potential Change in Control has
occurred.
3. Basic Indemnification
. The Company hereby agrees to hold harmless and indemnify
Indemnitee and Indemnitee’s successors referred to in
Section 18 hereof to the fullest extent authorized or
permitted by the General Corporation Law of the State of Delaware,
or any other applicable law, or by any amendment thereof or other
statutory provision authorizing or permitting such indemnification
which is adopted after the date hereof.
4. Indemnity in Third-Party
Claims . The Company shall indemnify Indemnitee in
accordance with the provisions of this Section 4 if
Indemnitee is a party or witness to, or threatened to be made a
party or witness to, or otherwise involved in any Claim (other than
a Claim by or in the right of the Company to procure a judgment in
its favor) by reason of the fact that Indemnitee is or was a
Director or Officer of the Company, or is or was serving at the
request of the Company as a director, officer, employee or agent of
another corporation,
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partnership, joint venture, trust or other
enterprise, against all Expenses, judgments, fines and penalties,
actually incurred by Indemnitee in connection with such Claim;
provided that such indemnification shall not apply to any Claim
(i) in which Indemnitee shall have been finally adjudged to
have engaged in willful misconduct or to have acted in a manner
which was knowingly fraudulent or deliberately dishonest, or
(ii) in the case of a criminal proceeding, in which Indemnitee
had reasonable cause to believe that his conduct was unlawful. The
Indemnitee shall be presumed to be entitled to indemnification
hereunder to the fullest extent possible, and the burden of proving
otherwise shall be on the party claiming to diminish such
indemnification. The termination of any Claim by judgment, order of
court, settlement, conviction or upon a plea of nolo contendre, or
its equivalent, shall not create a presumption that Indemnitee
engaged in willful misconduct or acted in a manner which was
knowingly fraudulent or deliberately dishonest, and with respect to
any criminal proceedings, shall not create a presumption that
Indemnitee had reasonable cause to believe that his conduct was
unlawful.
5. Indemnity in Claims by or
in the Right of the Company . The Company shall indemnify
Indemnitee in accordance with the provisions of this
Section 5 if Indemnitee is a party or witness to, or
threatened to be made a party or witness to, or otherwise involved
in any Claim by or in the right of the Company to procure a
judgment in its favor by reason of the fact that Indemnitee is or
was a Director or Officer of the Company, or 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 all Expenses actually incurred by
Indemnitee in connection with such Claim provided that such
indemnification for Expenses shall not apply to any Claim in which
Indemnitee shall have been finally adjudged to have engaged in
willful misconduct or to have acted in a manner which was knowingly
fraudulent or deliberately dishonest, unless (and only to the
extent that) any court in which such Claim was brought shall
determine upon application, that despite the adjudication of
liability but in view of all the circumstances of the case,
Indemnitee is fairly and reasonably entitled to indemnity for such
Expenses as such court shall deem proper. The Indemnitee shall be
presumed to be entitled to indemnification hereunder to the fullest
extent possible and the burden of proving otherwise shall be on the
party claiming to diminish such indemnification.
6. Insurance . In the
event the Company’s D&O Insurance shall terminate or the
scope or amount of coverage of the Company’s D&O
Insurance shall be reduced from the scope and coverage in effect
during the first year of this Agreement, the Company agrees to hold
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