INDEMNIFICATION AGREEMENT
THIS AGREEMENT is made on this ____ day of ____________, ____ between
Magellan Petroleum Corporation, a Delaware corporation ("Corporation") and
_______________ ("Agent").
W I T N E S S E T H:
WHEREAS, Agent is a director and/or officer of Corporation and in such
capacity is performing a valuable service for Corporation; and
WHEREAS, Corporation's Certificate of Incorporation provides for the
indemnification of the officers, directors, agents and employees of Corporation
to the maximum extent authorized by the Delaware General Corporation Laws, as
amended to date (the "State Statutes"); and
WHEREAS, the Certificate of Incorporation contemplates and requires
that contracts be entered into between Corporation and its directors and
officers with respect to the advance of expenses and indemnification; and
WHEREAS, Corporation has purchased and presently maintains a policy or
policies of Directors and Officers Liability Insurance ("D & O Insurance"),
covering certain liabilities which may be incurred by its directors and officers
in the performance of their services for Corporation; and
WHEREAS, Corporation desires to hold harmless and indemnify Agent to
the full extent authorized or permitted by the provisions of the State Statutes,
or by any amendment thereof or other statutory provisions authorizing or
permitting such indemnification which may be adopted hereafter; and
WHEREAS, Corporation has entered into this Agreement and assumed the
obligations imposed on Corporation hereby in order to induce Agent to continue
as a director of Corporation, and acknowledges that Agent is relying upon this
Agreement in continuing in such capacity; and
WHEREAS, on August 19, 1987, Corporation's Board of Directors first
authorized Corporation to enter into this Indemnification Agreement with
Corporation's directors and/or officers; and
WHEREAS, on ________ ___, ____, this agreement was entered into between
Corporation and Agent; and
WHEREAS, since the execution of this Indemnification Agreement,
Corporation has purchased additional D & O Insurance coverage and other events
in the development of Corporation have occurred, and
WHEREAS, Corporation now seeks to confirm, update and restate this
Indemnification Agreement.
NOW, THEREFORE, in consideration of Agent's continued service as a
director and/or officer after the date hereof the parties hereto agree as
follows:
1. Maintenance of Insurance and Self Insurance.
(a) Corporation represents that it presently has in force and
effect policies of D & O Insurance in insurance companies and amounts as follows
(the "Insurance Policies").
Insurer Policy No. Amount Deductible
Subject only to the provisions of Section l(b) hereof, Corporation hereby agrees
that, so long as Agent shall continue to serve as a director or officer of
Corporation (or shall continue at the request of Corporation to serve as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise) and thereafter so long as Agent shall be
subject to any possible claim or threatened, pending or completed action, suit
or proceeding, whether civil, criminal or investigative by reason of the fact
that Agent was a director of Corporation (or served in any of said other
capacities), Corporation will purchase and maintain in effect for the benefit of
Agent one or more valid, binding and enforceable policy or policies of D & O
Insurance providing, in all respects, coverage at least comparable to that
presently provided pursuant to the Insurance Policies.
(b) Corporation shall not be required to maintain said policy
or policies of D & O Insurance in effect if said insurance is not reasonably
available or if, in the reasonable business judgment of the then directors of
Corporation, either (i) the premium cost for such insurance is substantially
disproportionate to the amount of coverage or (ii) the coverage provided by such
insurance is so limited by exclusions that there is insufficient benefit from
such insurance.
(c) In the event Corporation does not purchase and maintain in
effect said policy or policies of D & O Insurance pursuant to the provisions of
Section 1(b) hereof, Corporation agrees to hold harmless and indemnify Agent to
the full extent of the coverage which would otherwise have been provided for the
benefit of Agent pursuant to the Insurance Policies.
2. Additional Indemnity. Subject only to the exclusions set forth in
Section 3 hereof, Corporation hereby further agrees to hold harmless and
indemnify Agent:
(a) Against any and all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by Agent in connection with any threatened, pending or completed action, suit,
claim, counterclaim or proceeding, whether civil, criminal, administrative or
investigative (including an action by or in the right of Corporation) to which
Agent is, was or at any time becomes a party, or is threatened to be made a
party, by reason of the fact that Agent is, was or at any time becomes a
director or officer of Corporation, or is or was serving or at any time serves
at the request of Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
(collectively, "other entity" or "another entity"). Each such indemnifiable
event, subject to the limitations of Section 3 hereof, shall be hereinafter
referred to as a "Claim."
(b) Otherwise to the fullest extent as may be provided to
Agent by Corporation under the provisions of the Certificate of Incorporation
and the By-Laws of Corporation and the State Statutes, as they now or hereafter
may exist.
3. Limitations on Additional Indemnity. No indemnity pursuant to
Section 2 hereof shall be paid by Corporation:
(a) except to the extent the aggregate of losses to be
indemnified thereunder exceed the sum of $1,000 plus the amount of such losses
for which the Agent is indemnified either pursuant to Sections 1 or 2 hereof or
pursuant to any D & O Insurance purchased and maintained by Corporation;
(b) when Agent's claim for indemnification hereunder is by
reason of the fact that Agent is or was serving or at any time serves at the
request of Corporation as a director, officer, employee or agent of another
entity, except to the extent Agent is not indemnified by such other entity, and
to that extent only after Agent has used his best efforts to obtain
indemnification from the other entity.
(c) in respect to remuneration paid to Agent if it shall be
determined by a final judgment or other final adjudication that such
remuneration was in violation of law;
(d) on account of any suit in which judgment is rendered
against Agent for an accounting of profits made from the purchase or sale by
Agent of securities of Corporation pursuant to the provisions of Section 16(b)
of the Securities Exchange Act of 1934 and amendments thereto or similar
provision of any federal, State or local law;
(e) on account of Agent's conduct which is finally adjudged to
have been knowingly fraudulent, deliberately dishonest or willful misconduct;
(f) if a final decision by a court having jurisdiction in the
matter shall determine that such indemnification is not lawful.
4. Continuation of Indemnity. All agreements and obligations of
Corporation contained herein shall continue during the period Agent is a
director or officer of Corporation (or is or was serving at the request of
Corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise) and shall continue
thereafter so long as Agent shall be subject to any possible Claim.
5. Notification and Defense of Claim. Promptly after receipt by Agent
of notice of the commencement of any Claim, Agent shall, if indemnification or
advance of expenses in respect thereof is to be sought from Corporation pursuant
to this Agreement, give prompt and timely notification to Corporation of the
commencement thereof; but the omission so to notify Corporation will not relieve
it from any liability which it may have to Agent otherwise than under this
Agreement. With respect to any such Claim as to which Agent promptly and timely
notifies Corporation of the commencement thereof:
(a) Corporation shall be entitled to participate therein at
its own expense; and
(b) Except as otherwise provided below, to the extent that it
may wish, Corporation jointly with any other indemnifying party similarly
notified shall be entitled to assume the defense thereof, with counsel
satisfactory to Agent. After notice from Corporation to Agent of its election so
to assume the defense thereof, Corporation shall not be liable to Agent under
this Agreement for any legal or other expenses subsequently incurred by Agent in
connection with the defense thereof other than reasonable costs of investigation
or as otherwise provided below. Agent shall have the right to employ counsel in
such Claim but the fees and expenses of such counsel incurred after notice from
Corporation of its assumption of the defense thereof shall be at the expense of
Agent unless (i) the employment of counsel by Agent has been authorized by
Corporation, (ii) Agent shall have reasonably concluded that there may be a
conflict of interest between Corporation and Agent in the conduct of the defense
of such Claim or (iii) Corporation shall not in fact have employed counsel to
assume the defense of such Claim, in each of which cases the reasonable fees and
expenses of Agent's counsel shall be at the expense of Corporation. Corporation
shall not be entitled to assume the defense of any Claim brought by or on behalf
of Corporation or as to which Agent shall have reached the conclusion provided
for in (ii) above.
(c) Corporation shall not be liable to indemnify Agent under
this Agreement for any amounts paid in settlement of any Claim effected without
its written consent. Corporation shall not settle any Claim in any manner which
would impose any penalty or limitation on Agent without Agent's written consent.
Neither Corporation nor Agent shall unreasonably withhold their consent to any
proposed settlement.
6. Advancement of Expenses. If Corporation does not assume Agent's
defense pursuant to the provisions of Section 5(b) hereof, then Corporation
shall advance the expenses of Agent in accordance with the following terms and
conditions:
Within 10 days after the receipt by Corporation from Agent of an
invoice from his legal counsel representing a retainer or legal fees
and expenses, or from another person or entity for expenses, actually
incurred or expected to be actually incurred by Agent in connection
with the defense or disposition of any Claim, including any appeals in
connection therewith, Corporation shall promptly pay to Agent, or to
such other person as Agent may instruct, the amount shown to be due on
such invoice as an advance in advance of the disposition of such Claim.
Any such invoice submitted by Agent shall be accompanied by a
certificate signed by Agent to the effect that (i) he reasonably
believes that the retainer or legal fees and expenses for which payment
is sought are or would be indemnifiable pursuant to applicable laws and
(ii) he will immediately use the funds so advanced by Corporation to
pay such invoice.
7. Obligation to Repay. Agent shall repay to Corporation promptly any
amounts paid by Corporation to Agent pursuant to this Agreement to the extent
that it shall be ultimately determined that Agent is not entitled to be
indemnified by Corporation pursuant to applicable law.
8. Separability. Each of the provisions of this Agreement is a separate
and distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason: (i) such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof, and (ii) such provision shall be deemed to be
restated to the extent necessary so that it is valid and enforceable to the
fullest extent permitted under applicable laws.
9. Governing Law; Binding Effect; Amendment and Termination.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to contracts made
and to be performed entirely within such State.
(b) This Agreement shall be binding upon Agent and upon
Corporation, its successors and assigns, and shall inure to the benefit of
Agent, his heirs and personal representatives and to the benefit of Corporation,
its successors and assigns.
(c) No amendment, modification, termination or cancellation of
this Agreement shall be effective unless in writing signed by both parties
hereto.
10. Specific Performance. The parties hereto agree and acknowledge that
money damages payable after the termination of any Claim would not be adequate
compensation in the event of a breach by either party of its obligations under
Section 6 hereof, and agree that the non-breaching party shall be entitled, in
addition to any other remedy which such party may otherwise have at law or in
equity, to injunctive or other equitable relief, including an order directing
the other party to make such payments as may be required, in the event of the
nonperformance of any of the obligations by the other party contained in Section
6 hereof. In the event that Corporation fails to perform any of its obligations
under Section 6 hereof, Corporation shall pay in advance, in accordance with the
procedures set forth in Section 6 hereof and subject to Agent's obligations set
forth in Section 7 hereof, the expenses of Agent incurred in connection with
seeking equitable or other relief from such failure by Corporation.
11. Notices. Notices or demands authorized by this Agreement to be
given or made to or by Agent or Corporation shall be sufficiently given or made
if delivered or if sent by first-class mail, postage prepaid, to such party at
the respective address set forth below or, in each such case, to such other
address as the addressee shall have given notice of in accordance with this
Section 11:
If to Corporation: Magellan Petroleum Corporation
000 Xxxxxx Xxxx
Xxx Xxxx - Xxxx 00
Xxxxxxx, XX 00000
Attn: President
with a copy to: Xxxxxxx X. Xxxxxx, Esq.
Murtha, Cullina, Xxxxxxx and Xxxxxx LLP
CityPlace I, 000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
If to Agent:
12. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
13. Section Headings. The Section headings contained in this Agreement
are inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
14. Construction. In this Agreement, where the context so requires,
words importing the singular shall include the plural, words importing the
plural shall include the singular, and words importing a particular gender or
the neuter shall include the other gender and/or the neuter.
15. Entire Agreement. This Agreement represents the entire agreement
between the parties relating to the subject matter hereof and supersedes all
prior written or oral agreements between them in respect thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
and as of the day and year first above written.
MAGELLAN PETROLEUM CORPORATION
By ___________________________________
Its
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Agent
