Exhibit 10.1
INDEMNIFICATION AGREEMENT FOR
WORLD HEALTH ALTERNATIVES, INC.
OFFICERS, DIRECTORS AND
EMPLOYEES
This Indemnification Agreement (this
“AGREEMENT”) is entered into as of the 23rd day of
August, 2005, by and between World Health Alternatives, Inc. and
its subsidiaries (collectively, the “Company”) and the
officer, director or employee of the Company identified on the
signature page hereto (the “INDEMNITEE”).
RECITALS
A. The Company recognizes the continued
difficulty in obtaining liability insurance for its directors,
officers, employees, fiduciaries and other agents and affiliates,
the significant increases in the cost of such insurance and the
general reductions in the coverage of such insurance.
B. The Company further recognizes the
substantial increase in corporate litigation in general, subjecting
directors, officers, employees, fiduciaries and other agents and
affiliates to expensive litigation risks at the same time as the
availability and coverage of liability insurance has been severely
limited.
C. The current protection available to
directors, officers, employees, fiduciaries and other agents and
affiliates of the Company may not be adequate under the present
circumstances, and directors, officers, employees, fiduciaries and
other agents and affiliates of the Company (or persons who may be
alleged or deemed to be the same), including the Indemnitee, may
not be willing to continue to serve or be associated with the
Company in such capacities without additional
protection.
D. The Company (i) desires to retain the
involvement of highly qualified persons, such as the Indemnitee, to
serve and be associated with the Company, and (ii) accordingly,
wishes to provide for the indemnification and advancement of
expenses to the Indemnitee to the maximum extent permitted by
law.
NOW, THEREFORE, in consideration of continued
services from the Indemnitee to the Company, the Company and the
Indemnitee hereby agree as follows:
1. Indemnification.
(a) Indemnification of
Expenses . In the event that the Indemnitee or any Affiliated
Person of the Indemnitee was or 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 any Claim by reason of, or arising
in part out of, the occurrence of any Indemnification Event, the
Company shall indemnify and hold harmless the Indemnitee and
his/her such Affiliated Person to the fullest extent permitted by
law, including without limitation the provisions of F.S. 607.0850,
against any and all Expenses. The Company shall make the
indemnification payment as soon as practicable but in any event no
later than ten (10)
days after written demand by the Indemnitee
therefor is presented to the Company; provided that customary
documentation supporting such payment, in a form reasonably
acceptable to the Company in accordance with its internal
accounting procedures, must be provided to the Company before any
indemnification payment is made.
(b) Contribution . If the
indemnification provided for in Section 1(a) above for any reason
is held by a court of competent jurisdiction to be unavailable to
the Indemnitee in respect of any losses, claims, damages, expenses
or liabilities referred to therein, then the Company, in lieu of
indemnifying the Indemnitee, shall contribute to the amount paid or
payable by the Indemnitee as a result of such losses, claims,
damages, expenses or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the
Company (including its Subsidiaries and Consolidated Entities) and
the Indemnitee from the transaction or occurrence that the action
or inaction leading to the Indemnification Event related to, or
(ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company (including its
Subsidiaries and Consolidated Entities) and the Indemnitee in
connection with the action or inaction which resulted in such
losses, claims, damages, expenses or liabilities, as well as any
other relevant equitable considerations. In connection with the
registration of securities of the Company or any of its
Subsidiaries, the relative benefits received by the Company
(including its Subsidiaries and Consolidated Entities) and the
Indemnitee shall be deemed to be in the same respective proportions
that the net proceeds from the offering (before deducting expenses)
received by the Company (including its Subsidiaries and
Consolidated Entities) and the Indemnitee, in each case as set
forth in the table contained in the applicable prospectus, bear to
the aggregate public offering price of the securities so offered.
In connection with the registration of securities of the Company or
any of its Subsidiaries, the relative fault of the Company
(including its Subsidiaries and Consolidated Entities) and the
Indemnitee shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact
relates to information supplied by the Company (including its
Subsidiaries and Consolidated Entities) or the Indemnitee and the
parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or
omission.
The Company and the Indemnitee agree
that it would not be just and equitable if contribution pursuant to
this Section 1(b) were determined by pro rata or per capita
allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the
immediately preceding paragraph. No person found guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act of 1933, as amended (the “SECURITIES
ACT”)) shall be entitled to contribution from any person who
was not found guilty of such fraudulent
misrepresentation.
(c) Survival Regardless of
Investigation . The indemnification and contribution provided
for in this Section 1 will remain in full force and effect
regardless of any investigation made by or on behalf of the
Indemnitee.
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(d) Change in Control . The
Company agrees that, if there is a Change in Control of the
Company, the Company shall, as a condition to consummate any such
Change in Control transactions, take necessary actions to ensure
that the Indemnitee stands in the same position under this
Agreement with respect to the resulting, surviving or changed
corporation as the Indemnitee would have with respect to the
Company if its separate existence had continued or if there had
been no Change in Control of the Company.
(e) Mandatory Payment of
Expenses . Notwithstanding any other provision of this
Agreement other than Section 8 hereof, to the extent that the
Indemnitee has been successful on the merits or otherwise,
including, without limitation, the dismissal of an action without
prejudice, in the defense of any action, suit, proceeding, inquiry
or investigation referred to in Section (1)(a) hereof or in the
defense of any claim, issue or matter therein, the Indemnitee shall
be indemnified against all Expenses incurred by the Indemnitee in
connection therewith; provided that customary documentation
supporting such indemnification, in a form reasonably acceptable to
the Company in accordance with its internal accounting procedures,
must be provided to the Company before any indemnification payment
is made.
2. Expenses; Indemnification
Procedure.
(a) Advancement of Expenses .
The Company shall advance all Expenses incurred by the Indemnitee.
The advancement to be made hereunder shall be paid by the Company
to the Indemnitee as soon as practicable but in any event no later
than ten (10) days after written demand by the Indemnitee therefor
is presented to the Company; provided that customary documentation
supporting such advancement, in a form reasonably acceptable to the
Company in accordance with its internal accounting procedures, must
be provided to the Company before any advancement is
made.
(b) Notice/Cooperation by
Indemnitee . The Indemnitee shall, as a condition precedent to
the Indemnitee’s right to be indemnified under this
Agreement, give the Company a notice in writing as soon as
practicable of any Claim made against the Indemnitee for which
indemnification will or could be sought under this Agreement. In
addition, the Indemnitee shall give the Company such information
and cooperation as it may reasonably require and as shall be within
the Indemnitee’s power.
(c) No Presumptions; Burden of
Proof . For purposes of this Agreement, the termination of any
Claim by judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere, or its
equivalent, shall not create a presumption that the Indemnitee did
not meet any particular standard of conduct or have any particular
belief or that a court has determined that indemnification is not
permitted by applicable law. In connection with any determination
as to whether the Indemnitee is entitled to be indemnified
hereunder, the burden of proof shall be on the Company to establish
that the Indemnitee is not so entitled.
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(d) Notice to Insurers . If,
at the time of the receipt by the Company of a notice of a Claim
pursuant to Section 2(b) hereof, the Company has liability
insurance in effect which may cover such Claim, the Company shall
give prompt notice of the commencement of such Claim to the
insurers in accordance with the procedures set forth in the
respective policies. The Company shall thereafter take all
reasonable actions to cause such insurers to pay, on behalf of the
Indemnitee, all amounts payable as a result of such action, suit,
proceeding, inquiry or investigation in accordance with the terms
of such policies.
(e) Assumption of Defense;
Selection of Counsel . In the event the Company shall be
obligated hereunder to pay the Expenses of any Claim, the Company
shall be entitled to assume and control the defense of such Claim
upon the delivery to the Indemnitee of written notice of its
election to do so. After delivery of such notice, the Company will
not be liable to the Indemnitee under this Agreement for any fees
of counsel subsequently incurred by the Indemnitee with respect to
the same Claim; provided that, (i) the Indemnitee shall have the
right to employ his/her own counsel in any such Claim at his/her
own expense and (ii) if (A) the employment of counsel by the
Indemnitee has been previously authorized by the Company, (B) the
Indemnitee shall have reasonably concluded that there is a material
conflict of interest between the Company and the Indemnitee in the
conduct of any such defense, or (C) the Company shall not continue
to defend such Claim, then the fees and expenses of the
Indemnitee’s counsel shall be at the expense of the Company.
The Company shall have the right to conduct such defense as it sees
fit in its sole discretion, including the right to settle any
claim, action or proceeding against the Indemnitee without the
consent of the Indemnitee, provided such settlement includes a full
release of the Indemnitee by the claimant from all liabilities or
potential liabilities under such Claim.
3. Additional Indemnification
Rights; Nonexclusivity.
(a) Scope . The Company
hereby agrees to indemnify the Indemnitee to the fullest extent
permitted by law, notwithstanding that such indemnification may not
be specifically authorized by other provisions of this Agreement or
the Company’s By-Laws, Charter, Articles of Incorporation,
other corporate organizational provisions (collectively,
“Corporate Provisions”) or by statute. In the event of
any change after the date of this Agreement in any applicable law,
statute or rule which expands the right of the Company to indemnify
a member of its Board of Directors or an officer, employee, agent
or fiduciary, it is the intent of the parties hereto that the
Indemnitee shall enjoy by this Agreement the greater benefits
afforded by such change. In the event of any change in any
applicable law, statute or rule which narrows the right of the
Company to indemnify a member of its Board of Directors or an
officer, employee, agent or fiduciary, such change, to the extent
not otherwise required by such law, statute or rule to be applied
to this Agreement, shall have no affect on this Agreement or the
parties’ rights and obligations hereunder except as set forth
in Section 8(a) hereof.
(b) Nonexclusivity . The
indemnification provided by this Agreement shall be in addition to
any rights to which the Indemnitee may be entitled under the
Company’s
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Corporate Provisions, any agreement, any vote of
shareholders or disinterested directors, the corporation law of
Florida or any other state, or otherwise. The indemnification
provided under this Agreement shall continue as to the Indemnitee
for any action the Indemnitee took or did not take while serving in
an indemnified capacity even though the Indemnitee may have ceased
to serve in such capacity.
4. No Duplication of Payments. The
Company shall not be liable under this Agreement to make any
payment in connection with any Claim made against the Indemnitee to
the extent the Indemnitee has otherwise actually received payment
(under any insurance policy, the Company’s Corporate
Provisions or otherwise) of the amounts otherwise indemnifiable
hereunder.
5. Partial Indemnification. If the
Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for any portion of Expenses incurred
in connection with any Claim, but not, however, for all of the
total amount thereof, the Company shall nevertheless indemnify the
Indemnitee for the portion of such Expenses to which t
