Exhibit 10.1
INDEMNIFICATION
AGREEMENT
This INDEMNIFICATION AGREEMENT (this
“ Agreement ”) is made and entered into as of
(the “ Effective Date ”) by and between Image
Entertainment, Inc., a Delaware corporation (the “
Company ”), and
(the “ Indemnitee ”).
RECITALS
1.
The Company believes it is essential
to retain and attract qualified officers and directors.
2.
The Indemnitee is an officer or
director of the Company.
3.
Both the Company and the Indemnitee
recognize the increased risk of litigation and other claims being
asserted against officers and directors of public
companies.
4.
The Company’s certificate of
incorporation and bylaws (the “Charter Documents”)
require the Company to indemnify and advance expenses to its
officers and directors to the extent permitted by the DGCL (as
defined below).
5.
The Indemnitee intends to continue
serving as an officer or director of the Company, in part in
reliance on the Charter Documents and this Agreement.
6.
In recognition of the
Indemnitee’s need for (i) substantial protection against
personal liability based on the Indemnitee’s reliance on the
Charter Documents, (ii) specific contractual assurance that the
protection set forth in the Charter Documents will be available to
the Indemnitee, regardless of, among other things, any amendment to
or revocation of the Charter Documents or any change in the
composition of the Company’s board of directors (the
“Board”) or acquisition transaction relating to the
Company, and (iii) an inducement to continue to provide effective
services to the Company as an officer or director thereof, the
Company wishes to provide for the indemnification of the Indemnitee
and to advance expenses to the Indemnitee to the fullest extent
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained by the Company, to provide for the
continued coverage of the Indemnitee under the Company’s
directors’ and officers’ liability insurance
policies.
AGREEMENT
In consideration of the premises and
of the Indemnitee continuing to serve the Company, and intending to
be legally bound hereby, the parties hereto agree as
follows:
1.
Definitions
.
(a)
A “ 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, and the rules and regulations thereunder
(the “ Exchange Act ”), other than (a) a trustee
or other fiduciary
1
holding securities under an employee
benefit plan of the Company; (b) a corporation owned, directly or
indirectly, by the stockholders of the Company in substantially the
same proportions as their ownership of stock of the Company; or (c)
any current beneficial stockholder or group, as defined by Rule
13d-5 of the Exchange Act, including the heirs, assigns and
successors thereof, of beneficial ownership, within the meaning of
Rule 13d-3 of the Exchange Act, of securities possessing more than
50% of the total combined voting power of the Company’s
outstanding securities; hereafter becomes the “beneficial
owner,” as defined in Rule 13d-3 of the Exchange Act,
directly or indirectly, of securities of the Company representing
30% or more of the total combined voting power represented by the
Company’s then outstanding Voting Securities;
(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 stockholders was
approved by a vote of at least two-thirds of the directors then in
office who either were directors at the beginning of the period or
whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof;
or
(iii)
the stockholders of the Company
approve a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which 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 70% 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 the stockholders 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.
(b)
“ DGCL ” means
the General Corporation Law of the State of Delaware, as the same
exists or may hereafter be amended or interpreted; provided,
however, that 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.
(c)
“ Expense ” means
attorneys’ fees 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 for any of the foregoing, any Proceeding relating to any
Indemnifiable Event.
(d)
“ Indemnifiable Event
” means any event or occurrence that takes place either prior
to or after the execution of this Agreement, related to the fact
that the 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
2
or of a partnership, joint venture,
trust or other enterprise, including service with respect to
employee benefit plans, or by reason of anything done or not done
by the Indemnitee in any such capacity.
(e)
“ Potential Change in
Control ” shall be deemed to occur 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 which, 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, directly or indirectly, by the stockholders of
the Company in 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, increases his
or her 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.
(f)
“ Proceeding ”
means any threatened, pending or completed action, suit,
investigation or proceeding, and any appeal thereof, whether civil,
criminal, administrative or investigative and/or any inquiry or
investigation, whether conducted by the Company or any other party,
that the Indemnitee in good faith believes might lead to the
institution of any such action.
(g)
“ Reviewing Party
” means any appropriate person or body consisting of a member
or members of the Company’s Board or any other person or body
appointed by the Board (including the special independent counsel
referred to in Section 6) who is not a party to the particular
Proceeding with respect to which the Indemnitee is seeking
indemnification.
(h)
“ Voting Securities
” means the common stock and any other securities of the
Company which vote generally in the election of
directors.
2.
Indemnification
. In the event the Indemnitee
was or is a party to or is involved (as a party, witness, or
otherwise) in any Proceeding by reason of (or arising in part out
of) an Indemnifiable Event, whether the basis of the Proceeding is
the Indemnitee’s alleged action in an official capacity as a
director or officer or in any other capacity while serving as a
director or officer, the Company shall indemnify the Indemnitee to
the fullest extent permitted by the DGCL against any and all
Expenses, liability, and loss (including judgments, fines, ERISA
excise taxes or penalties, and amounts paid or to be paid in
settlement, and any interest, assessments, or other charges imposed
thereon, and any federal, state, local, or foreign taxes imposed on
any director or officer as a result of the actual or deemed receipt
of any payments under this Agreement) (collectively, “
Liabilities ”) reasonably incurred or suffered by such
person in connection with such Proceeding. The Company shall
provide indemnification pursuant to this Section 2 as soon as
practicable, but in no event later than 30 days after it receives
written demand from the Indemnitee. Notwithstanding anything
in this Agreement to the contrary and except as provided
3
in Section 5 below, the Indemnitee shall not be
entitled to indemnification pursuant to this Agreement (i) in
connection with any Proceeding initiated by the Indemnitee against
the Company or any director or officer of the Company unless the
Company has joined in or consented to the initiation of such
Proceeding or (ii) on account of any suit in which judgment is
rendered against the Indemnitee pursuant to Section 16(b) of the
Exchange Act for an accounting of profits made from the purchase or
sale by the Indemnitee of securities of the Company.
3.
Advancement of
Expenses . The
Company shall advance Expenses to the Indemnitee within 30 business
days of such request (an “ Expense Advance ”);
provided, however, that if required by applicable corporate laws
such Expenses shall be advanced only upon delivery to the Company
of an undertaking by or on behalf of the Indemnitee to repay such
amount if it is ultimately determined that the Indemnitee is not
entitled to be indemnified by the Company; and provided further,
that the Company shall make such advances only to the extent
permitted by law. Expenses incurred by the Indemnitee while
not acting in his/her capacity as a director o
