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EXHIBIT 10.3
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement"), dated as of January 1,
2000, is between WEST COAST BANCORP ("Corporation") and Xxxxxx X. Xxxxxxxx
("Indemnitee").
RECITALS
A. Indemnitee, as member of the board of directors or an officer of the
Corporation and/or, one or more of its affiliate corporations, performs
valuable services for the Corporation.
B. The Corporation's Articles of Incorporation ("Articles") and Bylaws
("Bylaws") provide for the indemnification of the officers, directors,
agents and employees of the Corporation to the maximum extent authorized
by the Oregon Business Corporation Act ("Act").
C. The Articles, Bylaws and the Act, by their non-exclusive nature, permit
contracts between the Corporation and its directors and officers to
indemnify those directors and officers.
D. The Corporation has purchased and 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 duties.
E. Due to changes in the terms, scope and availability of D & 0 Insurance,
uncertainty exists as to the extent of protection afforded directors and
officers under such D & O Insurance or under the indemnification
provisions of the Act, Articles, or Bylaws.
F. To induce Indemnitee to continue service as a director or officer of the
Corporation and/or one or more of its affiliate corporations, the
Corporation desires to enter this contract with Indemnitee.
Therefore, in consideration of Indemnitee's continued service as a
director or officer, the parties agree as follows:
AGREEMENT
1. INDEMNITY. The Corporation agrees to hold harmless and indemnify
Indemnitee:
(a) to the fullest extent permitted under each of the Articles, the
Bylaws, and the Act, as each may be amended from time to time;
and
(b) against any and all expenses (including attorneys' fees),
witness fees, judgments, fines, ERISA excise taxes, and amounts
paid in settlement actually and reasonably incurred by
Indemnitee in connection with any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (including an action by or in
the right of the Corporation) to which Indemnitee is, was or at
any time becomes a party, or is threatened to be made a party,
by reason of the fact that Indemnitee is, was or at any time
becomes a director, officer, employee or agent of the
Corporation, or is or was serving or at any time serves at the
request of the Corporation as a
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director, officer, employee or agent of another (i) corporation,
including without limitation a corporate affiliate of the
Corporation, (ii) partnership, (iii) joint venture, (iv) trust,
(v) employee benefit plan or (vii) other enterprise.
2. LIMITATIONS ON ADDITIONAL INDEMNITY. No indemnity under Section 1 will
be paid by the Corporation:
(a) for expenses or liabilities paid to the Indemnitee under any D &
O Insurance purchased and maintained by the Corporation;
(b) on account of any action, suit or proceeding brought by or on
behalf of the Corporation in which judgment is rendered holding
the Indemnitee liable to the Corporation;
(c) on account of Indemnitee's conduct which is finally adjudged to
be willful misconduct or knowing violation of law;
(d) on account of Indemnitee's conduct which is the subject of an
action, suit or proceeding described in Section 6 (c)(ii);
(e) on account of any action, claim or proceeding (other than a
proceeding referred to in Section 7(b)) initiated by the
Indemnitee unless such action, claim or proceeding is
specifically authorized by action of the Corporation's board of
directors;
(f) on account of any action, claim or proceeding referred to in
Section 7(b) which action is finally adjudged to be frivolous or
made not in good faith;
(g) if a final decision by a Court having jurisdiction in the matter
determines that such indemnification is not lawful.
3. MUTUAL ACKNOWLEDGMENT. Both Corporation and Indemnitee acknowledge that,
in certain instances, federal law or public policy may override
applicable state law and prohibit the Corporation from indemnifying its
directors and officers. For example, the Corporation and Indemnitee
acknowledge that the Securities and Exchange Commission (the "SEC")
takes the position that indemnification is not permitted for liabilities
arising under certain federal securities laws, and federal legislation
prohibits indemnification for certain ERISA violations.
4. CONTINUATION OF OBLIGATIONS. Under this Agreement the Corporation is
obligated to Indemnitee for any period Indemnitee is or was a director,
officer, employee or agent of the Corporation (or is or was serving at
the request of the Corporation as a director, officer, employee or agent
of another (i) corporation, including without limitation, a corporate
affiliate of Corporation, (ii) partnership, (iii) joint venture, (iv)
trust, (v) employee benefit plan or (vi) other enterprise). Furthermore,
this obligation will continue after Indemnitee's service as a director
or officer terminates and so long as Indemnitee may 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 Indemnitee was a director or an officer of the Corporation or
was serving at the Corporation's request as a director, officer,
employee or agent of another (i) corporation, including
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without limitation, a corporate affiliate of Corporation, (ii)
partnership, (iii) joint venture, (iv) trust, (v) employee benefit plan
or (vi) other enterprise.
5. NOTIFICATION AND DEFENSE OF CLAIM. Within 30 after Indemnitee receives
any notice of the commencement of any action, suit, or proceeding,
Indemnitee will notify the Corporation of it, if a claim with respect to
the action may be made against the Corporation under this Agreement. The
failure to so notify the Corporation will not relieve the Corporation
from any liability it may have to Indemnitee under authority other than
this Agreement. With respect to any action, suit or proceeding of which
Indemnitee timely notifies the Corporation:
(a) the Corporation is entitled to participate at its own expense;
(b) except as otherwise provided below, the Corporation (jointly
with any other indemnifying party similarly notified) is
entitled to assume the defense of the action with counsel
reasonably satisfactory to Indemnitee; and
(c) the Corporation is not liable to indemnify Indemnitee under this
Agreement for any amounts paid in settlement of any action or
claim that is effected without its written consent.
After notice from the Corporation to Indemnitee of its election to
assume the defense of the action, the Corporation will not be liable to
Indemnitee under this Agreement for any legal or other expenses
subsequently incurred by Indemnitee in connection with the defense of
the action, other than reasonable costs of investigation or as otherwise
provided below. Indemnitee may employ its counsel in such action but the
fees and expenses of such counsel incurred after notice from the
Corporation of its assumption of the defense will be at the expense of
Indemnitee unless (i) Indemnitee's employment of counsel is authorized
by the Corporation, (ii) Indemnitee reasonably concludes that there may
be a conflict of interest between the Corporation and Indemnitee in the
conduct of the defense of such action or (iii) the Corporation has not
employed counsel to assume the defense of such action, in each of which
cases the fees and expenses of Indemnitee's separate counsel will be at
the expense of the Corporation. The Corporation is not entitled to
assume the defense of any action, suit, or proceeding brought by or on
behalf of the Corporation or as to which Indemnitee has made the
conclusion provided for in (ii) above.
The Corporation is permitted to settle any action except that it may not
settle any action or claim in any manner which would impose any penalty
or limitation on Indemnitee without Indemnitee's written consent.
Neither the Corporation nor Indemnitee will unreasonably withhold its
consent to any proposed settlement.
6. ADVANCEMENT AND REPAYMENT OF EXPENSES.
(a) If Indemnitee employs his/her own counsel, the cost of which is
to be indemnified by the Corporation under Section 5, the
Corporation will advance to Indemnitee any and all reasonable
expenses (including legal fees and expenses) incurred in
investigating or defending any such action, suit or proceeding.
These expenses must be advanced before any final disposition of
any threatened or pending
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action, suit or proceeding, whether civil, criminal,
administrative or investigative and within 10 days after
receiving copies of invoices presented to Indemnitee for such
expenses.
(b) Indemnitee agrees that Indemnitee will reimburse the Corporation
for all reasonable expenses paid by the Corporation in defending
any civil or criminal action, suit or proceeding against
Indemnitee if, and only to the extent that, it is ultimately
determined by a final judicial decision (from which there is no
right of appeal) that Indemnitee is not entitled to be
indemnified by the Corporation for such expenses.
(c) The Corporation is not required to advance expenses to
Indemnitee if Indemnitee (i) commences any action, suit or
proceeding as a plaintiff, unless such advance is specifically
approved by a majority of the Corporation's board of directors
or (ii) is a party to an action, suit or proceeding brought by
the Corporation and approved by a majority of the Corporation's
board which alleges willful misappropriation of corporate assets
by Indemnitee, disclosure of confidential information in
violation of Indemnitee's fiduciary or contractual obligations
to the Corporation, or any other willful and deliberate breach
in faith of Indemnitee's duty to the Corporation, its
affiliates, or its shareholders.
7. ENFORCEMENT.
(a) The Corporation confirms that it has entered into this Agreement
to induce Indemnitee to continue as a director or an officer of
the Corporation or one or more of its affiliates, and
acknowledges that Indemnitee is relying upon this Agreement in
continuing in such capacity.
(b) If Indemnitee successfully brings any action to enforce rights
or to collect moneys due under this Agreement, the Corporation
will reimburse Indemnitee for all Indemnitee's reasonable fees
and expenses in bringing and pursuing such action.
8. SUBROGATION. If the Corporation pays Indemnitee under this Agreement,
the Corporation will be subrogated to the extent of such payment to all
of the rights of recovery of Indemnitee, who agrees to execute all
documents required and to do all acts necessary to secure such rights
and to enable the Corporation effectively to bring suit to enforce such
rights.
9. NON-EXCLUSIVITY OF RIGHTS. The rights conferred on Indemnitee by this
Agreement are not exclusive of any other right which Indemnitee may have
or hereafter acquire under any statute, provision of the Articles,
Bylaws, agreement, vote of shareholders or directors, or otherwise, both
as to action in his/her official capacity and as to action in another
capacity while holding office.
10. SURVIVAL OF RIGHTS. The rights conferred on Indemnitee by this Agreement
continue after Indemnitee ceases to be a director, officer, employee, or
other agent of the Corporation and will inure to the benefit of
Indemnitee's heirs, executors, and administrators.
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11. SEPARABILITY. Each provision of this Agreement is a separate and
distinct agreement independent of others. If any provision is held to be
invalid or unenforceable for any reason, such invalidity or
unenforceability will not affect the validity or enforceability of the
other provisions or the obligation of the Corporation to indemnify the
Indemnitee to the full extent provided by the Articles, Bylaws or the
Act.
12. GOVERNING LAW. This Agreement is interpreted and enforced in accordance
with the laws of the State of Oregon.
13. BINDING EFFECT. This Agreement is binding upon Indemnitee and upon the
Corporation, its successors and assigns, and inures to the benefit of
Indemnitee, his/her heirs, personal representatives, and assigns and to
the benefit of the Corporation, its successors and assigns.
14. AMENDMENT AND TERMINATION. No amendment, modification, termination, or
cancellation of this Agreement is effective unless in writing signed by
both parties.
Signed as of January 1, 2000:
WEST COAST BANCORP
By: Xxxx X. Xxxxxx
Chairman
INDEMNITEE
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Xxxxxx X. Xxxxxxxx