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EXHIBIT 10.16
INDEMNITY AGREEMENT
This Agreement is made as of April 8, 2007 by and between
Merix Corporation, an Oregon corporation (the "Corporation"), and
Francis Yuen ("Indemnitee"), a director and/or officer of the
Corporation.
WHEREAS, it is essential to the Corporation to retain and
attract as directors and officers of the Corporation and its
subsidiaries the most capable persons available; and
WHEREAS, corporate litigation subjects directors and officers to
expensive litigation risks at the same time that adequate coverage
of directors’ and officers’ liability insurance may be
unavailable; and
WHEREAS, the Articles of Incorporation of the Corporation
require indemnification of the officers and directors of the
Corporation to the fullest extent permitted by law. The Articles
and the Oregon Business Corporation Act (the "Act") expressly
provide that the indemnification provisions set forth in the Act
are not exclusive, and thereby contemplate that contracts may be
entered into between the Corporation and members of the Board of
Directors and officers with respect to indemnification of directors
and officers; and
WHEREAS, Indemnitee does not regard the protection available
under the Corporation’s Articles of Incorporation, Bylaws and
insurance adequate in the present circumstances, and may not be
willing to serve or continue to serve as a director or officer
without adequate protection, and the Corporation desires Indemnitee
to serve in such capacity.
NOW THEREFORE, the Corporation and Indemnitee agree as
follows:
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1.
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Agreement to Serve.
Indemnitee agrees to serve or continue to serve as a director
and/or officer of the Corporation and/or one or more of its
subsidiaries for so long as Indemnitee is duly elected or appointed
or until such time as Indemnitee tenders a resignation in
writing.
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2.
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Definitions. As used in
this Agreement:
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(a)
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The term "Proceeding" shall include
any threatened, pending or completed action, suit or proceeding,
whether brought in the right of the Corporation or otherwise,
whether of a civil, criminal, administrative or investigative
nature, and whether formal or informal, in which Indemnitee may be
or may have been involved as a party or otherwise, by reason of the
fact that Indemnitee is or was a director and/or officer of the
Corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, whether or
not serving in such capacity at the time any liability or expense
is incurred for which indemnification or reimbursement can be
provided under this Agreement.
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(b)
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The term "Expenses" includes,
without limitation thereto, expense of investigations, judicial or
administrative proceedings or appeals, amounts paid in settlement
by Indemnitee, attorneys’ fees and disbursements and any
expenses of establishing a right to indemnification under
Section 7 of this Agreement, but shall not include the amount
of judgments or fines against Indemnitee.
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(c)
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References to "other enterprises"
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
corporation" shall include any service as a director, officer,
employee or agent of the Corporation 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; and a person who acted in good faith and in a manner
reasonably believed to be in the interest of an employee benefit
plan shall be deemed to have acted in a manner "not opposed to the
best interests of the Corporation" as referred to in this
Agreement.
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3.
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Indemnity in Third Party
Proceedings. The Corporation shall indemnify Indemnitee in
accordance with the provisions of this Section 3 if Indemnitee
is a party to or threatened to be made a party to any Proceeding
(other than a
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Proceeding by or in the right of the
Corporation to procure a judgment in its favor) against all
Expenses, judgments and fines actually and reasonably incurred by
Indemnitee in connection with such Proceeding, but only if
Indemnitee acted in good faith and in a manner which Indemnitee
reasonably believed to be in or not opposed to the best interests
of the Corporation and, in the case of a criminal proceeding, in
addition, had no reasonable cause to believe that
Indemnitee’s conduct was unlawful. The termination of any
such Proceeding by judgment, order of court, settlement, conviction
or upon a plea of nolo contendere, or its equivalent, shall not, of
itself, create a presumption that Indemnitee did not act in good
faith and in a manner which Indemnitee reasonably believed to be in
the best interest of the Corporation, and with respect to any
criminal proceeding, that such person had reasonable cause to
believe that Indemnitee’s conduct was unlawful.
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Pursuant to this Agreement, the Corporation
specifically will, and hereby does, indemnify, to the fullest
extent permitted by law, Indemnitee against any and all losses,
claims, damages, liabilities and expenses, joint or several, (or
actions or proceedings, whether commenced or threatened, in respect
thereof) to which Indemnitee may become subject, as a result of
serving as a director and/or officer of Merix, under the Securities
Act or any other statute or common law, including any amount paid
in settlement of any litigation, commenced or threatened, and to
reimburse them for any legal or other expenses incurred by them in
connection with investigating any claims and defending any actions,
insofar as any such losses, claims, damages, liabilities, expenses
or actions arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact regarding Merix, or the
omission or alleged omission to state a material fact required to
be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made,
not misleading.
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4.
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Indemnity in Proceedings by or in
the Right of the Corporation. The Corporation shall
indemnify Indemnitee in accordance with the provisions of this
Section 4 if Indemnitee is a party to or threatened to be made
a party to any Proceeding by or in the right of the Corporation to
procure a judgment in its favor against all Expenses actually and
reasonably incurred by Indemnitee in connection with the defense or
settlement of such Proceeding, but only if Indemnitee acted in good
faith and in a manner which Indemnitee reasonably believed to be in
or not opposed to the best interests of
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