EXHIBIT 10.20
[LOGO] XXXXXXXX XXXXXXX CORPORATION
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT is made as of the ____ day of _____________,
______, by and between Xxxxxxxx Xxxxxxx Corporation, a Delaware corporation (the
"Corporation"), and the individual whose name appears on the signature page
hereof (such individual being referred to herein as the "Indemnified
Representative" and, together with other persons who may execute similar
agreements, as "Indemnified Representatives").
WHEREAS, the Indemnified Representative currently is and will be in the
future serving in one or more capacities as a director, officer, employee or
agent of the Corporation or, at the request of the Corporation, as a director,
officer, employee, agent fiduciary or trustee of, or in a similar capacity for,
another corporation, partnership, joint venture, trust, employee benefit plan or
other entity, and in so doing is and will be performing a valuable service to or
on behalf of the Corporation;
WHEREAS, the Board of Directors of the Corporation has determined that, in
order to attract and retain qualified individuals, the Corporation will attempt
to maintain, at its sole expense, liability insurance to protect persons serving
the Corporation and its subsidiaries from certain liabilities. Although the
furnishing of such insurance has been a customary and widespread practice among
United States-based corporations and other business enterprises, the Corporation
believes that, given current market conditions and trends, such insurance may be
available to it in the future only at higher premiums and with more exclusions.
At the same time, directors, officers and other persons in service to
corporations or business enterprises are being increasingly subjected to
expensive and time-consuming litigation relating to, among other things, matters
that traditionally would have been brought only against the Corporation or
business enterprise itself;
WHEREAS, the Indemnified Representative is willing to continue to serve and
to undertake additional duties and responsibilities for and on behalf of the
Corporation on the condition that he be indemnified contractually by the
Corporation; and
WHEREAS, as an inducement to the Indemnified Representative to continue to
serve the Corporation, and in consideration for such continued service, the
Corporation has agreed to indemnify the Indemnified Representative upon the
terms set forth herein.
NOW, THEREFORE, in consideration of the promises and mutual covenants
contained herein, and intending to be legally bound hereby, the Corporation and
the Indemnified Representative agree as follows:
1. AGREEMENT TO SERVE. The Indemnified Representative agrees to serve or
continue to serve for or on behalf of the Corporation in each Official
Capacity (as hereinafter defined) held now or in the future for so long as
the Indemnified Representative is duly elected or appointed or until such
time as the Indemnified Representative tenders a resignation in
writing. This Agreement shall not be deemed an employment contract between
the Corporation or any of its subsidiaries and any Indemnified
Representative who is an employee of the Corporation or any of its
subsidiaries. The Indemnified Representative specifically acknowledges
that the Indemnified Representative's employment with the Corporation or
any of its subsidiaries, if any, is at will, and that the Indemnified
Representative may be discharged at any time for any reason, with or
without cause, except as may be otherwise provided in any written
employment contract between the Indemnified Representative and the
Corporation or any of its subsidiaries, other applicable formal severance
policies duly adopted by the board of directors of the Indemnified
Representative's employer or, with respect to service as a director of the
Corporation, by the Corporation's Certificate of Incorporation, By-Laws and
the Delaware General Corporation Law. The foregoing notwithstanding, this
Agreement shall continue in force after the Indemnified Representative has
ceased to serve in any Official Capacity for or on behalf of the
Corporation or any of its subsidiaries.
2. INDEMNIFICATION.
a. Except as provided in Sections 3 and 5 hereof, the Corporation shall
indemnify the Indemnified Representative against any Liability (as
hereinafter defined) incurred by or assessed against the Indemnified
Representative in connection with any Proceeding (as hereinafter
defined) in which the Indemnified Representative may be involved, as a
party or otherwise, by reason of the fact that the Indemnified
Representative is or was serving in any Official Capacity held now or
in the future, including, without limitation, any Liability resulting
from actual or alleged breach or neglect of duty, error, misstatement,
misleading statement, omission, negligence, act giving rise to strict
or product liability, act giving rise to liability for environmental
contamination, or other act or omission, whether occurring prior to or
after the date of this Agreement. As used in this Agreement:
(1) "Liability" means any damage, judgment, amount paid in
settlement, fine, penalty, punitive damage or expense of any
nature (including attorneys' fees and expenses);
(2) "Proceeding" means any threatened, pending or completed action,
suit, appeal, arbitration or other proceeding of any nature,
whether civil, criminal, administrative or investigative, whether
formal or informal, and whether brought by or in the right of the
Corporation, a class of its security holders, or any other party;
and
(3) "Official Capacity" means service to the Corporation as a
director or officer or, at the request of the Corporation, as a
director, officer, employee, agent, fiduciary or trustee of, or
in a similar capacity for another corporation, partnership, joint
venture, trust, employee benefit plan (including a plan qualified
under the Employee Retirement Income Security Act of 1974), or
other entity.
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b. Notwithstanding Section 2a hereof, except for a Proceeding brought
pursuant to Section 5d of this Agreement, the Corporation shall not
indemnify the Indemnified Representative under this Agreement for any
Liability incurred in a Proceeding initiated by the Indemnified
Representative unless the Proceeding is authorized, either before or
after commencement of the Proceeding, by the majority vote of a quorum
of the Board of Directors of the Corporation. An affirmative defense
or counterclaim of an Indemnified Representative shall not be deemed
to constitute a Proceeding initiated by the Indemnified
Representative.
3. EXCLUSIONS.
a. The Corporation shall not be liable under this Agreement to make any
payment in connection with any Liability incurred by the Indemnified
Representative:
(1) to the extent payment for such Liability is made to the
Indemnified Representative under an insurance policy obtained by
the Corporation;
(2) to the extent payment is made to the Indemnified Representative
for such Liability by the Corporation under its Certification of
Incorporation, By-Laws, the Delaware General Corporation Law or
otherwise than pursuant to this Agreement;
(3) to the extent such Liability is determined in a final
determination pursuant to Section 5d hereof to be based upon or
attributable to the Indemnified Representative gaining any
personal profit to which such Indemnified Representative was not
legally entitled;
(4) for any claim by or on behalf of the Corporation for recovery of
profits resulting from the purchase and sale or sale and purchase
by such Indemnified Representative of equity securities of the
Corporation pursuant to Section 16(b) of the Securities Exchange
Act of 1934, as amended;
(5) for which the conduct of the Indemnified Representative has been
determined in a final determination pursuant to Section 5d hereof
to constitute bad faith or active and deliberate dishonesty, in
either such case material to the cause of action or claim at
issue in the Proceeding; or
(6) to the extent such indemnification has been determined in a final
determination pursuant to Section 5d hereof to be unlawful.
b. Any act, omission, liability, knowledge or other fact of or relating
to any other person, including any other person who is also an
Indemnified Representative, shall not be imputed to the Indemnified
Representative for the purposes of determining the applicability of
any exclusion set forth herein.
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c. The termination of a proceeding by judgment, order, settlement,
conviction or upon a plea of NOLO CONTENDERE or its equivalent shall
not, of itself, create a presumption that the Indemnified
Representative is not entitled to indemnification under this
Agreement.
4. ADVANCEMENT OF EXPENSES. The Corporation shall pay any Liability in the
nature of an expense (including attorneys' fees and expenses) incurred in
good faith by the Indemnified Representative in advance of the final
disposition of a Proceeding within 30 days of receipt of a demand for
payment by the Indemnified Representative; provided, however, that the
Indemnified Representative shall repay such amount if it shall ultimately
be determined, pursuant to Section 5d hereof, that the Indemnified
Representative is not entitled to be indemnified by the Corporation
pursuant to this Agreement. The financial ability of the Indemnified
Representative to repay an advance shall not be a prerequisite to the
making to such advance.
5. INDEMNIFICATION PROCEDURE.
a. The Indemnified Representative shall use his best efforts to notify
promptly the Secretary of the Corporation of the commencement of any
Proceeding or the occurrence of any event which might give rise to a
Liability under this Agreement, but the failure to so notify the
Corporation shall not relieve the Corporation of any obligation which
it may have to the Indemnified Representative under this Agreement or
otherwise.
b. The Corporation shall be entitled, upon notice to the Indemnified
Representative, to assume the defense of any Proceeding with counsel
reasonably satisfactory to the Indemnified Representative involved in
such Proceeding or, if there be more than one Indemnified
Representative involved in such Proceeding, to a majority of the
Indemnified Representatives involved in such Proceeding. If, in
accordance with the foregoing, the Corporation defends the Proceeding,
the Corporation shall not be liable for the expenses (including
attorneys' fees and expenses) of the Indemnified Representative
incurred in connection with the defense of such Proceeding subsequent
to the required notice, unless (i) such expenses (including attorneys'
fees) have been authorized by the Corporation or (ii) the Corporation
shall not in fact have employed counsel reasonably satisfactory to
such Indemnified Representative, or to the majority of Indemnified
Representatives if more than one is involved, to assume the defense of
such Proceeding. The foregoing notwithstanding, the Indemnified
Representative may elect to retain counsel at the Indemnified
Representative's own cost and expense to participate in the defense of
such Proceeding.
c. The Corporation shall not be required to obtain the consent of the
Indemnified Representative to the settlement of any Proceeding which
the Corporation has undertaken to defend if the Corporation assumes
full and sole responsibility for such settlement and the settlement
grants the Indemnified Representative a complete and unqualified
release in respect of the potential Liability. The Corporation shall
not be
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liable for any amount paid by an Indemnified Representative in
settlement of any Proceeding that is not defended by the Corporation,
unless the Corporation has consented to such settlement, which consent
shall not be unreasonably withheld.
d. Except as set forth herein, any dispute concerning the right to
indemnification under this Agreement and any other dispute arising
hereunder, including but not limited to matters of validity,
interpretation, application and enforcement, shall be determined
exclusively by and through final and binding arbitration in
Wilmington, Delaware, each party hereto expressly and conclusively
waiving its, his or her right to proceed to a judicial determination
with respect to such matter; provided, however, that in the event that
a claim for indemnification against liabilities arising under the
Securities Act of 1933 (the "Act") (other than the payment by the
Corporation of expenses incurred or paid by a director, officer or
controlling person of the Corporation in the successful defense of any
action, suit or proceeding) is asserted by a director, officer or
controlling person in connection with securities being registered
under the Act, the Corporation will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit
to a court of competent jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue. The
arbitration shall be conducted in accordance with the commercial
arbitration rules then in effect of the American Arbitration
Association before a panel of three arbitrators, one of whom shall be
selected by the Corporation, the second of whom shall be selected by
the Indemnified Representative, and the third of whom shall be
selected by the other two arbitrators. If for any reason arbitration
under the arbitration rules of the American Arbitration Association
cannot be initiated, the necessary arbitrator or arbitrators shall be
selected by the presiding judge of the state court of general
jurisdiction in Wilmington, Delaware. Each arbitrator selected as
provided herein is required to be serving or to have served as a
director or an executive officer of a corporation whose shares of
common stock, during at least one year of such service, were quoted in
the NASDAQ National Market System or listed on the New York Stock
Exchange or the American Stock Exchange. It is expressly understood
and agreed by the parties that a party may compel arbitration pursuant
to this Section 5d through an action for specific performance and that
any award entered by the arbitrators may be enforced, without further
evidence or proceedings, in any court of competent jurisdiction.
c. Upon a payment under this Agreement to the Indemnified Representative
with respect to any Liability, the Corporation shall be subrogated to
the extent of such payment to all of the rights of the Indemnified
Representative to recover against any person with respect to such
Liability, and the Indemnified Representative shall execute all
documents and instruments required and shall take such other actions
as may be necessary to secure such rights, including the execution of
such documents as may be necessary for the Corporation to bring suit
to enforce such rights.
6. FEES AND EXPENSES OF ENFORCEMENT. It is the intent of the Corporation that
the Indemnified Representative not be required to incur the expenses
associated with the enforcement of his
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rights under this Agreement by litigation, arbitration or other legal
action because the cost and expense thereof would substantially detract
from the benefits intended to be extended to the Indemnified Representative
hereunder. Accordingly, if it should appear to the Indemnified
Representative that the Corporation has failed to comply with any of its
obligations under this Agreement or in the event that the Corporation or
other person takes any action to declare this Agreement void or
unenforceable, or institutes any action, suit or proceeding designed (or
having the effect of being designed) to deny, or to recover from, the
Indemnified Representative the benefits intended to be provided to the
Indemnified Representative hereunder, the Corporation irrevocably
authorizes the Indemnified Representative from time to time to retain
counsel of his choice, at the expense of the Corporation as hereafter
provided, to represent the Indemnified Representative in connection with
the initiation or defense of any litigation, arbitration or other legal
action, whether by or against the Corporation or any director, officer,
stockholder or other person affiliated with the Corporation, in any
jurisdiction. Regardless of the outcome thereof, the Corporation shall pay
and be solely responsible for any and all costs, charges and expenses
including, without limitation, attorneys' and others' fees and expenses,
reasonably incurred by the Indemnified Representative (i) as a result of
the Corporation's failure to perform this Agreement or any provision
thereof or (ii) as a result of the Corporation or any person contesting the
validity or enforceability of this Agreement or any provision thereof as
aforesaid.
7. CONTRIBUTION. If the indemnification provided for in this Agreement is
unavailable for any reason to hold harmless an Indemnified Representative
in respect of any Liability or portion thereof, the Corporation shall
contribute to such Liability or portion thereof in such proportion as is
appropriate to reflect the relative benefits received by the Corporation
and Indemnified Representative from the transaction giving rise to the
Liability.
8. NON-EXCLUSIVITY. The rights granted to the Indemnification Representative
pursuant to this Agreement shall not be deemed exclusive of any other
rights to which the Indemnified Representative may be entitled under
statute, the provisions of any certificate of incorporation, by-laws or
agreement, a vote of stockholders or directors, or otherwise, both as to
action in an Official Capacity and in any other capacity.
9. RELIANCE ON PROVISIONS. The Indemnified Representative shall be deemed to
be acting in any Official Capacity in reliance upon the rights of
indemnification provided by this Agreement. Without limiting the
generality of the foregoing, the Corporation and the Indemnified
Representative acknowledge the existence of Article V of the Corporation's
By-Laws as restated and adopted by the Board of Directors on September 12,
1996, and confirm that the Indemnified Representative is also acting in
reliance thereon.
10. SEVERABILITY AND REFORMATION. Any provision of this Agreement which is
determined to be invalid or unenforceable in any jurisdiction or under any
circumstances shall be ineffective only to the extent of such invalidity or
unenforceability and shall be deemed reformed to the extent necessary to
conform to the applicable law of such jurisdiction and still give maximum
effect to the intent of the parties hereto. Any such determination shall
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not invalidate or render unenforceable such provision in any other
jurisdiction or under any other circumstances.
11. NOTICES. Any notice, claim, request or demand required or permitted
hereunder shall be in writing and shall be deemed given if delivered
personally or sent by telegram or by registered or certified mail, first
class, postage prepaid: (i) if to the Corporation, to Xxxxxxxx Xxxxxxx
Corporation, P. O. Xxx 00, Xxxxx, Xxxxx 00000, Attention: Secretary, or
(ii) if to any Indemnified Representative, to the address of such
Indemnified Representative, to the address of such Indemnified
Representative listed on the signature page hereof, or to such other
address as any party hereto shall have specified in a notice duly given in
accordance with this Section 10.
12. AMENDMENTS; BINDING EFFECT. No amendment, modification, termination or
cancellation of this Agreement shall be effective as to the Indemnified
Representative unless signed in writing by the Corporation and the
Indemnified Representative. This Agreement shall be binding upon the
Corporation and its successors and assigns and shall inure to the benefit
of the Indemnified Representative's heirs, executors, administrators and
personal representatives.
13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to the
conflict of laws provisions thereof.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
day and year first set forth above.
(Corporate Seal) XXXXXXXX XXXXXXX CORPORATION
By
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Attest:
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INDEMNIFIED REPRESENTATIVE
By
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Witness:
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XXXXXXXX XXXXXXX CORPORATION
SCHEDULE OF INDEMNIFICATION AGREEMENTS
Name Date of Agreement
---- -----------------
Xxxxx X. Xxxxxxxxxx September 12, 1996
Xxxxxxx X. Xxxxxxx September 12, 1996
Xxxxx X. Xxxxxxx September 12, 0000
Xxxxxx X. Xxxxxx September 12, 1996
Xxxxxxx X. Xxxxx September 12, 1996
Xxxxx X. Xxxxxxxxx September 12, 1996
Xxxxxxx X. Xxxx September 12, 1996
Xxxxxxx X. Xxxxxxx September 12, 1996
Xxxxx X. XxXxxxxx October 1, 1996
Xxxxxx X. Xxxxxx, Xx. Xxxxxxxxx 00, 0000
Xxxx Xxxxxxxxx September 12, 1996
Xxxxxxx X. Xxxxx September 12, 0000
Xxxxx X. Xxxxx September 12, 1996
Xxxx X. Xxxxx September 12, 1996
Xxxxxxxx X. Xxxxxxxxx September 12, 1996
Xxxx X. Xxxx September 12, 0000
Xxxxxxx X. Xxxxxxx September 12, 1996
Xxxxxx X. Xxxxxxxx September 12, 1996
Xxxxxx X. Xxxxxxxxxx September 12, 1996
Xxxxxx X. Xxxxxx September 12, 1996
Indemnification Agreement - Page 8
