WELLCARE HEALTH PLANS, INC.
INDEMNIFICATION AGREEMENT
This
INDEMNIFICATION AGREEMENT (this “Agreement”) is
entered into as of April 1, 2008, by and between WellCare
Health Plans, Inc., a Delaware corporation (the
“Company”), and Thomas F. O’Neil III,
(“Indemnitee”). Capitalized terms used
and not otherwise defined in this Agreement have the meanings
set forth in Section 10 hereof.
RECITALS
A. The
Company and Indemnitee recognize the continued difficulty in
obtaining liability insurance for the directors, officers,
employees, agents and fiduciaries of the Company and its
Subsidiaries, the significant increases in the cost of such
insurance and the general reductions in the coverage of such
insurance.
B. The
Company and Indemnitee further recognize the substantial
increase in corporate litigation in general, subjecting
directors, officers, employees, agents and fiduciaries to
expensive litigation risks at the same time as the
availability and coverage of liability insurance has been
severely limited.
C. Indemnitee
does not regard the current protection available as adequate
under the present circumstances, and Indemnitee and other
directors, officers, employees, agents and fiduciaries of the
Company may not be willing to continue to serve in such
capacities without additional protection.
D. The
Company desires to attract and retain the services of highly
qualified individuals, such as Indemnitee, to serve the
Company and/or one or more of its Subsidiaries and, in order
to induce Indemnitee to provide or to continue to provide
services to the Company and/or one or more of its
Subsidiaries, wishes to provide for the indemnification and
advancing of expenses to Indemnitee to the maximum extent
permitted by law.
E. In
view of the considerations set forth above, the Company
desires that Indemnitee be indemnified by the Company as set
forth herein.
NOW,
THEREFORE, the Company and Indemnitee hereby agree as
follows:
1.
Indemnification
(a)
Indemnification of Expenses
. The Company shall indemnify Indemnitee to the fullest extent
permitted by law if 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 Proceeding,
against any and all Expenses, including all interest, assessments
and other charges paid or payable in connection with or in respect
of such Expenses. Subject to Section 1(b) hereof,
such payment of Expenses shall be made by the Company as soon as
practicable but in any event no later than thirty (30) days after
written demand by Indemnitee therefor is presented to the
Company.
(b)
Reviewing Party. Notwithstanding
anything to the contrary in Sections 1(a) or 2(a)
hereof:
(i) the
indemnification obligations of the Company under
Section 1(a) hereof shall be subject to the condition
that the Reviewing Party shall not have determined that
Indemnitee would not be permitted to be indemnified under
applicable law; and
(ii) the
obligation of the Company to make an advance payment of
Expenses to Indemnitee pursuant to Section 2(a) hereof
(an “Expense Advance”) shall be subject to the
condition that, if, when and to the extent that the Reviewing
Party determines that Indemnitee would not be permitted to be
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
by Company to Indemnitee; provided
, however ,
that if Indemnitee has commenced or thereafter commences legal
proceedings in a court of competent jurisdiction to secure a
determination that Indemnitee should be indemnified under
applicable law, 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 lapsed).
Indemnitee’s
obligation to reimburse the Company for any Expense Advance
shall be unsecured and no interest shall be charged
thereon. If there has not been a Change in Control,
or it there has been a Change in Control which has been
approved by a majority of the directors of the Company who
were directors immediately prior to the Change in Control (the
“Incumbent Directors”), the Reviewing Party shall
be selected by the Board of Directors of the Company, and if
there has been a Change in Control which has not been approved
by a majority of the Incumbent Directors, the Reviewing Party
shall be the Independent Legal Counsel. If there
has been no determination by the Reviewing Party or if the
Reviewing Party determines that Indemnitee would not be
permitted to be indemnified in whole or in part under
applicable law, Indemnitee shall have the right to commence
litigation seeking an initial determination by the court or
challenging any such determination by the Reviewing Party or
any aspect thereof, including the legal or factual bases
therefor, and the Company hereby consents to service of
process and to appear in any such proceeding. Any
determination by the Reviewing Party otherwise shall be
conclusive and binding on the Company and
Indemnitee.
(c)
Contribution
. If the indemnification obligations of the Company
under Section 1(a) hereof shall be held by a court of
competent jurisdiction for any reason other than that set
forth in Section 8(a) hereof to be unavailable to Indemnitee
in respect of any Expense, then the Company, in lieu of
indemnifying Indemnitee thereunder, shall contribute to the
amount paid or payable by Indemnitee as a result of such
Expense (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company and Indemnitee,
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 and Indemnitee in connection with the action or
inaction which resulted in such Expense, as well as any other
relevant equitable considerations. The Company and
Indemnitee agree that it would not be just and equitable if
contribution pursuant to this Section 1(c) 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
sentence.
(d)
Mandatory Payment of
Expenses. Notwithstanding any other
provision of this Agreement, to the extent that Indemnitee has
been successful on the merits or otherwise, including, without
limitation, the dismissal of an action without prejudice, in
defense of any Proceeding or in the defense of any claim,
issue or matter therein, Indemnitee shall be indemnified
against all Expenses incurred by Indemnitee in connection
therewith.
2.
Expenses;
Indemnification Procedure
Advancement of Expenses . Subject
to the terms and conditions of Section 1(b) hereof and to the
extent not prohibited by applicable law, the Company shall advance
all Expenses incurred by Indemnitee. The advances to be
made hereunder shall be paid by the Company to Indemnitee as soon
as practicable but in any event no later than thirty (30) days
after written demand by Indemnitee therefor to the
Company.
(b)
Notice; Cooperation
by Indemnitee . Indemnitee shall, as a condition
precedent to Indemnitee’s right to be indemnified under
this Agreement, give the Company notice in writing as soon as
practicable of any Proceeding for which indemnification will
or could be sought under this Agreement. In
addition, Indemnitee shall give the Company such information
and cooperation as it may reasonably require and as shall be
within Indemnitee’s power.
(c)
No
Presumptions; Burden of Proof
(i) For
purposes of this Agreement, the termination of any Proceeding
by judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendre or
its equivalent, shall not create a presumption that 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 addition, neither the failure of the
Reviewing Party to have made a determination as to whether
Indemnitee has met any particular standard of conduct or had
any particular belief, nor an actual determination by the
Reviewing Party that Indemnitee has not met such standard of
conduct or did not have such belief, prior to the commencement
of legal proceedings by Indemnitee to secure a judicial
determination that Indemnitee should be indemnified under
applicable law, shall be a defense to Indemnitee’s claim
or create a presumption that Indemnitee has not met any
particular standard of conduct or did not have any particular
belief.
(ii) In
connection with any determination by the Reviewing Party or
otherwise as to whether Indemnitee is entitled to be
indemnified hereunder, the burden of proof shall be on the
Company to establish that Indemnitee is not so
entitled.
(d)
Notice to
Insurers. If,
at the time of the receipt by the Company of a notice of a
Proceeding pursuant to Section 2(b) hereof, the Company
has liability insurance in effect which may cover such
Proceeding, the Company shall give prompt notice of the
commencement of such Proceeding to the insurers in accordance
with the procedures set forth in the respective policies. The
Company shall thereafter take all necessary or desirable
action to cause such insurers to pay, on behalf of Indemnitee,
all amounts payable as a result of such action, suit,
proceeding, inquiry or investigation in accordance with the
terms of such policies.
(e)
Selection of
Counsel. In the event the Company
shall be obligated hereunder to pay the Expenses of a
Proceeding, the Company shall be entitled to assume the
defense of such Proceeding with counsel approved by
Indemnitee, which approval shall not be unreasonably withheld
or delayed, upon the delivery to Indemnitee of written notice
of its election so to do. After delivery of such notice,
approval of such counsel by Indemnitee and the retention of
such counsel by the Company, the Company will not be liable
to Indemnitee under this Agreement for any fees of counsel
subsequently incurred by Indemnitee with respect to the same
Proceeding; provided that
(i) Indemnitee shall have the right to employ
Indemnitee’s counsel in any such Proceeding at
Indemnitee’s expense and (ii) if (A) the
employment of counsel by Indemnitee has been previously
authorized by the Company, (B) Indemnitee shall have
reasonably concluded that there is a conflict of interest
between the Company and Indemnitee in the conduct of any such
defense, or (C) the Company shall not continue to retain
such counsel to defend such Proceeding, then the fees and
expenses of 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, provided that the Company has the right to settle
any claim against Indemnitee only with the consent of
Indemnitee, which shall not be unreasonably withheld or
delayed.
3.
Scope;
Nonexclusivity
Scope. It is understood that the parties to
this Agreement intend for this Agreement to be interpreted and
enforced so as to provide indemnification and advancement of
Expenses to Indemnitee to the fullest extent now or hereafter
permitted by law, subject only to the express exceptions and
limitations otherwise set forth in this Agreement. 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 the Board of Directors or an
officer, employee, agent or fiduciary of the Company or any
Subsidiary, as applicable, it is the intent of the parties hereto
that 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 the Board of Directors or an
officer, employee, agent or fiduciary of the Company or any
Subsidiary, as applicable, such change, to the extent not otherwise
required by such law, statute or rule to be applied to this
Agreement, shall have no effect on this Agreement or the
parties’ rights and obligations hereunder.
(b)
Nonexclusivity
. The indemnification and advancement of Expenses
provided by this Agreement shall be in addition to any rights
to which Indemnitee may be entitled under the charter
documents of the Company or any Subsidiary, any agreement, any
vote of stockholders or disinterested directors, the General
Corporation Law of the State of Delaware, or otherwise.
4.
No Duplication of
Payments . The Company shall not be liable under this
Agreement to make any payment in connection with any
Proceeding against Indemnitee to the extent Indemnitee has
otherwise actually received payment (under any insurance
policy, charter documents of the Company or any Subsidiary or
otherwise) of the amounts otherwise indemnifiable
hereunder.
5.
Partial
Indemnif
