Exhibit 10.11
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT (this "Agreement"), is dated as of November
10th, 2003, and is between GenTek Inc., a Delaware corporation (the "Company"),
and ______________ ("Indemnitee").
WHEREAS, on October 11, 2002, the Company and certain of its subsidiaries
and affiliates (collectively, the "Debtors") filed petitions for relief under
Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the
District of Delaware (the "Bankruptcy Court");
WHEREAS, on August 28, 2003, the Debtors filed their Joint Plan of
Reorganization under Chapter 00, Xxxxx 00, Xxxxxx Xxxxxx Code of GenTek Inc., et
al. and Noma Company, Debtors (as amended, supplemented or modified from time to
time, the "Plan");
WHEREAS, on October 7, 2003, the Bankruptcy Court entered an order
confirming the Plan;
WHEREAS, the Plan provides, among other things, that the Company will enter
into separate written agreements providing for the indemnification of each
person who is a director, officer or member of management of the Company as of
the Effective Date (as such term is defined in the Plan);
WHEREAS, Indemnitee is a director, officer or member of management of the
Company; and
WHEREAS, the Company and Indemnitee desire to enter into this Agreement to
provide for the indemnification of Indemnitee, on the terms and conditions
contained herein, and to comply with the terms of the Plan.
NOW, THEREFORE, in consideration of the foregoing and of Indemnitee
continuing to serve the Company directly or, at the Company's request, another
entity, and intending to be legally bound hereby, the parties hereto agree as
follows:
1. Certain Definitions:
(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
(the "Act")), other than a trustee or other fiduciary
holding securities under an employee benefit plan of the
Company 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, is
or becomes the "beneficial owner" (as defined in
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Rule 13d-3 under the Act), directly or indirectly, of
securities of the Company representing 35% or more of the
total voting power represented by the Company's then
outstanding Voting Securities, or
(ii) during any period of two consecutive years, individuals who
at the beginning of such period constitute the Board of
Directors of the Company (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 (2/3) of the directors then still 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 50% 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 of (in
one transaction or a series of transactions) all or
substantially all the Company's assets.
(b) Claim: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation, whether instituted
by or in the right of the Company or any other party, that
Indemnitee in good faith believes might lead to the institution
of any such action, suit or proceeding, whether civil, criminal,
administrative, investigative or other.
(c) Expenses: include 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 to defend, be a witness in or
participate in, any Claim relating to any Indemnifiable Event.
(d) Indemnifiable Event: any actual or asserted event or occurrence
related to the fact that Indemnitee is or was a director,
officer, member of management, employee, agent or fiduciary of
the Company, or is or was serving at the written request of the
Company as a director, officer, member of management, employee,
trustee, agent or fiduciary of another
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corporation, partnership, joint venture, employee benefit plan,
trust or other entity, or by reason of anything done or not done
by Indemnitee in any such capacity.
(e) Independent Legal Counsel: an attorney or firm of attorneys,
selected in accordance with the provisions of Section 3, who
shall not have otherwise performed services for the Company or
Indemnitee within the last two years (other than with respect to
matters concerning the rights of Indemnitee under this Agreement,
or of other indemnitees under similar indemnity agreements).
(f) Reviewing Party: any appropriate person or body consisting of a
member or members of the Board or any other person or body
appointed by the Board who is not a party to the particular Claim
for which Indemnitee is seeking indemnification, or Independent
Legal Counsel.
(g) Voting Securities: any securities of the Company which vote
generally in the election of directors.
2. Basic Indemnification Arrangement.
(a) In the event Indemnitee was, 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, a Claim by reason of (or
arising in whole or in part out of) an Indemnifiable Event, the
Company shall indemnify Indemnitee to the fullest extent
permitted by law as soon as practicable but in any event no later
than fifteen (15) days after written demand is presented to the
Company, against any and all Expenses, judgments, fines,
penalties and amounts paid in settlement (including all interest,
assessments and other charges paid or payable in connection with
or in respect of such Expenses, judgments, fines, penalties or
amounts paid in settlement) of such Claim and the Company will
pay Indemnitee for any and all Expenses incurred by Indemnitee in
connection with a Claim prior to final disposition of the Claim,
to the fullest extent permitted by law but without requiring any
preliminary determination of the ultimate entitlement of
Indemnitee to indemnification, as soon as practicable, but in any
event within two (2) business days, after a request by
Indemnitee; provided, however, that
(i) except for proceedings to enforce rights to indemnification,
the Company shall not be obligated to indemnify Indemnitee
(or Indemnitee's heirs, executors, administrators or
personal representatives) in connection with a proceeding
(or part thereof) initiated by such person unless such
proceeding (or part thereof) was authorized or consented to
by the Board and
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(ii) to the extent permitted by law, no indemnification shall be
made with respect to Indemnitee's conduct prior to the
Effective Date if such conduct is finally adjudicated by a
court of law of competent jurisdiction to have involved
willful misconduct or gross negligence.
(b) Subject to such bonds or other provisions for securing repayment,
if any, as may be determined to be appropriate by (i) the Board,
(ii) if more than half of the members of the Board are involved
in a Claim, by a majority vote of a committee of one or more
members of the Board who are not parities to such Claim, even if
less than a quorum or (iii) if directed by the Board, by
Independent Legal Counsel in a written opinion, if so requested
by Indemnitee, the Company shall advance (within two (2) business
days of such request) any and all Expenses to Indemnitee (an
"Expense Advance").
(c) Notwithstanding anything in this Section 2 to the contrary,
(i) the obligations of the Company under Section 2(a) hereof
shall be subject to the condition that the Reviewing Party
shall not have determined that Indemnitee would not be
permitted to be entitled to indemnification under this
Agreement, and
(ii) the obligation of the Company to make an Expense Advance
pursuant to Section 2(b) hereof shall be subject to the
condition that the Company shall have received an
undertaking from Indemnitee to reimburse the Company (and
Indemnitee hereby agrees to reimburse the Company) for all
such amounts theretofore paid if, when and to the extent
that Indemnitee shall be adjudicated or determined not to be
entitled to indemnification under this Agreement; 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 this Agreement, any
determination made by the Reviewing Party that Indemnitee
would not be entitled to be indemnified under this Agreement
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). If there has not been a Change in Control, the
Reviewing Party shall be selected by the Board, and if there
has been a Change in Control, the Reviewing Party shall be
the Independent Legal Counsel referred to in Section 3
hereof. If there has been no determination by the Reviewing
Party or if the Reviewing Party determines that Indemnitee
substantively would not be entitled to be indemnified in
whole or in part under this
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Agreement, Indemnitee shall have the right to commence
litigation in any court having subject matter jurisdiction
thereof and in which venue is proper 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 therefore, 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.
3. Change in Control. The Company agrees that if there is a Change in
Control of the Company then with respect to all matters thereafter
arising concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement,
provision of the Company's Certificate of Incorporation or provision
of the Company's By-laws now or hereafter in effect relating to Claims
for Indemnifiable Events, the Company shall seek legal advice only
from Independent Legal Counsel selected by Indemnitee and approved by
the Company (which approval shall not be unreasonably withheld). Such
counsel, among other things, shall render its written opinion to the
Company and Indemnitee as to whether and to what extent Indemnitee
would be entitled to be indemnified under this Agreement. The Company
agrees to pay the reasonable fees and expenses of the Independent
Legal Counsel referred to above and to indemnify fully such counsel
against any and all expenses (including attorneys' fees), claims,
liabilities and damages arising out of or relating to this Agreement
or its engagement pursuant hereto.
4. Indemnification for Additional Expenses. The Company shall indemnify
Indemnitee against any and all reasonable expenses (including
attorneys' fees) and, if requested by Indemnitee, shall (within two
(2) business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with any
action brought in good faith by Indemnitee for (i) indemnification or
advance payment of Expenses by the Company under this Agreement or any
other agreement, provision of the Company's Certificate of
Incorporation or provision of the Company's By-laws now or hereafter
in effect relating to Claims for Indemnifiable Events and/or (ii)
recovery under any directors' and officers' liability insurance
policies maintained by the Company, regardless of whether Indemnitee
ultimately is determined to be entitled to such indemnification,
advance expense payment or insurance recovery, as the case may be.
5. Partial Indemnity, Etc. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a
portion of the Expenses, judgments, fines, penalties and amounts paid
in settlement of a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the
portion thereof to which Indemnitee is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the
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extent that Indemnitee has been successful on the merits or otherwise
in defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein,
including dismissal without prejudice, Indemnitee shall be indemnified
against all Expenses incurred in connection therewith.
6. Burden of Proof. 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 and
the burden of persuasion shall be by clear and convincing evidence, to
establish that Indemnitee is not so entitled.
7. No Presumptions. For purposes of this Agreement, the termination of
any claim, action, suit or proceeding, 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 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 this Agreement 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.
8. Nonexclusivity, Etc. The rights of the Indemnitee hereunder shall not
be exclusive of any right which Indemnitee may have or hereafter
acquire under any statute, provision of the Company's Certificate of
Incorporation, provision of the Company's By-laws, agreement, vote of
stockholders or disinterested directors or otherwise; provided,
however, that in the event any provision of this Agreement in any
respect conflicts with the terms of the Company's Certificate of
Incorporation or By-laws or any other agreement between the Company or
any of its subsidiaries and Indemnitee, then the provision which is
more favorable to Indemnitee shall govern.
9. Liability Insurance. Any reductions to the amount of director and
officer liability coverage maintained by the Company as of the date
hereof shall be subject to the approval of the Board of Directors to
the extent Indemnitee is an officer or director of the Company or a
subsidiary of the Company, Indemnitee shall be covered by such policy
or policies, in accordance with its or their terms. The Company must
maintain with the coverage amount to be determined by the Board,
unless Board determines such insurance is not reasonably available
because of high premium costs.
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10. Amendments, Etc. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the
parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provisions
hereof (whether or not similar) nor shall such waiver constitute a
continuing waiver.
11. Subrogation. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights
of recovery of Indemnitee, who shall execute all papers required and
shall take all reasonable actions (at the Company's expense) to secure
such rights, including the execution of such documents necessary to
enable the Company effectively to bring suit to enforce such rights.
12. Certain Amendments; Enforcement.
(a) In the event the Company enters into an indemnification agreement
with another director or officer, as the case may be, containing
terms more favorable to the Indemnitee than the terms contained
herein (and absent special circumstances justifying more
favorable terms), Indemnitee shall be afforded the benefit of
such more favorable terms and such more favorable terms shall be
deemed incorporated by reference herein as if set forth in full
herein. Promptly following the execution thereof, the Company
shall
(i) send a copy of the agreement containing more favorable terms
to Indemnitee, and
(ii) prepare, execute and deliver to Indemnitee an amendment to
this Agreement containing such more favorable terms.
(b) The Company expressly confirms and agrees that it has entered
into this Agreement and assumed the obligations imposed on the
Company hereunder to induce Indemnitee to serve as a director of
the Company, and acknowledges that Indemnitee is relying upon
this Agreement in continuing in such capacity.
13. No Duplication of Payments. The Company shall not be liable under this
Agreement to make any payment in connection with any Claim made
against Indemnitee to the extent Indemnitee has otherwise actually
received payment (under any insurance policy, provision of the
Company's Certificate of Incorporation, By-law or otherwise) of the
amounts otherwise indemnifiable hereunder.
14. Binding Effect, Etc. This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the parties hereto and their
respective successors, assigns, including any direct or indirect
successor by purchase, merger,
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consolidation or otherwise to all or substantially all of the business
and/or assets of the Company, spouses, heirs, executors and personal
and legal representatives. All agreements and obligations of the
Company contained herein shall continue during the period Indemnitee
is an officer or director of the Company or any of its subsidiaries
(or is or was serving at the request of the Company as a director,
officer, employee or agent of another entity) and shall continue
thereafter so long as Indemnitee shall be subject to any Claim (or any
proceeding under Section 4 hereof) by reason of his acting in such
capacity, whether or not Indemnitee is acting or serving in any such
capacity at the time any liability or expense is incurred for which
indemnification can be provided under this Agreement. This Agreement
shall continue in effect regardless of whether Indemnitee continues to
serve as an officer, director or member of management of the Company
or of any other entity at the Company's request.
15. Severability. The provisions of this Agreement shall be severable in
the event that any of the provisions hereof (including any provision
within a single section, paragraph or sentence) are held by a court of
competent jurisdiction to be invalid, void or otherwise unenforceable
in any respect, and the validity and enforceability of any such
provision in every other respect and of the remaining provisions
hereof shall not be in any way impaired and shall remain enforceable
to the fullest extent permitted by law.
16. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and date first written above.
GENTEK INC.
By:
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Name: Xxxxxxx X. Xxxxx
Title: Vice President and Chief Financial Officer
By:
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Name:
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