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Exhibit 10.28
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this "Agreement") is made and
entered into as of the ____ day of May 1999, by and between The Xxxxxxx
Xxxxx Group, Inc., a Delaware corporation ("GS Inc.") and each of the
Indemnitees listed on the signature pages to this agreement (each, an
"Indemnitee", and collectively, the "Indemnitees") as such signature pages may
be amended and supplemented from time to time.
WITNESSETH
WHEREAS, GS Inc. has become party to a plan for the
incorporation of the business of The Xxxxxxx Sachs Group, L.P. ("GS Group") and
the related reorganization of the business of GS Group, which plan was approved
by The Xxxxxxx Xxxxx Corporation ("GS Corp.") in its capacity as general partner
of GS Group and by the Schedule II Limited Partners of GS Group in March 1999
(such plan of incorporation together with all exhibits thereto as it or they may
be amended from time to time, the "Plan of Incorporation");
WHEREAS, as part of the Plan of Incorporation, GS Inc. has
filed and proposes to file registration statements (the "Registration
Statements") with the Securities and Exchange Commission for the public offering
and sale of shares of its common stock (including shares issuable in connection
with employee benefit plans) and debt securities (including medium-term notes);
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WHEREAS, GS Inc. has requested and will request certain of the
Indemnitees to execute the Registration Statements in the capacity or capacities
listed and to be listed in such Registration Statements; and
WHEREAS, each Indemnitee is one or more of the following: (i)
an officer or director of GS Inc., (ii) an officer or director of GS Corp.,
(iii) a person requested or authorized by the board of directors of GS Inc. or
GS Corp. to take actions on behalf of GS Group, GS Inc. or GS Corp. in
connection with the Registration Statements or the Plan of Incorporation or (iv)
a member of the Management Committee or Partnership Committee of GS Inc. or the
former Executive Committee of GS Group.
NOW, therefore, in consideration of each Indemnitee's acting
and agreeing to act in the capacities referred to above, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties do hereby agree as follows:
1. General. GS Inc. (A) will indemnify and hold harmless each
Indemnitee against any Losses (as hereinafter defined), joint or several, to
which such Indemnitee may become subject, under the Securities Act of 1933, as
amended (the "Act") or otherwise, insofar as such Losses (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the Registration Statements or any
related Rule 462(b) Registration Statements or any preliminary prospectus or
prospectus comprising a part thereof, or any amendment or supplement thereto, or
arise out of or are based upon the omission or
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alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading; provided, however,
that GS Inc. shall not be liable in any such case to the extent that any such
Losses arise out of or are based upon an untrue statement or alleged untrue
statement or omission or alleged omission relating to such Indemnitee made in
any preliminary prospectus, any registration statement or any prospectus or any
amendment or supplement in reliance upon and in conformity with written
information relating to such Indemnitee furnished to GS Inc. by such Indemnitee
expressly for use therein; and (B) will indemnify and hold harmless each
Indemnitee against any Losses (or actions in respect thereof) which otherwise
arise out of or are based upon or asserted against such Indemnitee in connection
with such Indemnitee's acting in the capacities referred to above in connection
with the transactions contemplated by the Plan of Incorporation, except to the
extent any such Losses referred to in this clause (B) arise out of or are based
upon the type of conduct for which (x) a director would not be exempt from
liability or (y) the indemnification of a director would be limited in respect
of such Losses, in the case of (x) and (y), within the meaning of Article
Twelfth of the Amended and Restated Certificate of Incorporation of GS Inc. or
Section 102(b)(7) of the Delaware General Corporation Law (whether or not such
Indemnitee is a director).
Notwithstanding the foregoing provisions of this Section 1, GS
Inc. and each Indemnitee agree that insofar as indemnification for liabilities
arising under the Act may be permitted under this Agreement to an Indemnitee who
is a director, officer or
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controlling person of GS Inc., in the event that a claim for indemnification
against such liabilities is made by such an Indemnitee (other than the payment
by GS Inc. of expenses incurred or paid by such Indemnitee in the successful
defense of any action, suit or proceeding) in connection with a Registration
Statement, GS Inc. will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act, and GS Inc. and such Indemnitee will be governed
by the final adjudication of such question.
2. Losses. As used in this Agreement, the term "Losses" shall
include, without limitation, damages, losses, claims, judgments, liabilities,
fines, penalties, excise taxes, settlements, and costs, attorneys' fees,
accountants' fees, and disbursements and costs of attachment or similar bonds,
investigation costs, defense preparation costs, costs of preparing for and
presenting evidence or testimony, and any expenses of establishing a right to
indemnification under this Agreement. The term "Losses" shall not include taxes
except to the extent taxes are imposed in respect of payments otherwise made
pursuant to this Agreement, in which case such Indemnitee's Losses shall include
an amount not greater than the net taxes payable (taking into account any
deductions or other tax benefits available to such Indemnitee as a result of the
Losses in respect of which such payment is made).
3. Enforcement. Subject to the provisions of the second
paragraph of Section 1 hereof, if a claim or request by an Indemnitee under this
Agreement is not paid
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by GS Inc. or on its behalf, within thirty (30) days after a written claim or
request has been received by GS Inc. and, if applicable, the affirmation in
Section 5 hereof has been received by GS Inc., such Indemnitee may at any time
thereafter commence an arbitration proceeding in accordance with Section 9
hereof against GS Inc. to recover the unpaid amount of the claim or request and,
if successful in whole or in part, such Indemnitee shall be entitled to be paid
also the expenses of prosecuting such proceeding. It shall be a defense to any
such proceeding (other than a proceeding commenced to enforce a claim for
expenses incurred in defending any actual or threatened proceeding in advance of
its final disposition where the required affirmation and undertaking, if any is
required, have been tendered to GS Inc.) that such Indemnitee has not met the
standards of conduct for GS Inc. to indemnify such Indemnitee herein for the
amount claimed, but the burden of proving such defense shall be on GS Inc.
Neither the failure of GS Inc. (including its Board of Directors, legal counsel
or shareholders) to have made a determination prior to the commencement of such
proceeding that indemnification of such Indemnitee is proper in the
circumstances because such Indemnitee has met the applicable standard of conduct
set forth herein, nor an actual determination by GS Inc. (including its Board of
Directors, legal counsel or shareholders) that such Indemnitee has not met such
applicable standard of conduct, shall be a defense to the proceeding or create a
presumption that such Indemnitee has not met the applicable standard of conduct.
4. Partial Indemnification. If an Indemnitee is entitled under
any provision of this Agreement to indemnification by GS Inc. for some or a
portion of any
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Losses, but not for the total amount thereof, GS Inc. shall nevertheless
indemnify such Indemnitee for the portion of such Losses to which such
Indemnitee is entitled.
5. Expenses. Expenses incurred by an Indemnitee in connection
with any proceeding shall be paid by GS Inc. upon request of such Indemnitee
that GS Inc. pay such expenses, but only upon receipt by GS Inc. of (i) a
written affirmation of such Indemnitee's good faith belief that the applicable
standard of conduct necessary for indemnification by GS Inc. has been met, (ii)
a written undertaking by or on behalf of such Indemnitee to reimburse GS Inc.
for expenses if and to the extent that it is ultimately determined that the
applicable standard of conduct has not been met and (iii) satisfactory evidence
of the amount of such expenses.
6. Notice of Claim. Each Indemnitee shall promptly notify GS
Inc. in writing of any claim against such Indemnitee for which indemnification
will or could be sought under this Agreement. In addition, each Indemnitee shall
give GS Inc. such information and cooperation as it may reasonably require and
as shall be within such Indemnitee's power and at such times and places as are
not unduly burdensome for such Indemnitee.
7. Defense of Claim. With respect to any proceeding as to
which an Indemnitee notifies GS Inc. of the commencement thereof:
(a) GS Inc. will be entitled to participate at its own
expense;
(b) subject to Section 7(c) hereof, GS Inc. shall not, in
connection with any proceeding or related proceedings in the same
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jurisdiction against any Indemnitee and any other Indemnitees, be
liable to such Indemnitee and such other Indemnitees for the fees and
expenses of more than one separate law firm (in addition to a single
firm of local counsel);
(c) except as otherwise provided below, to the extent that it
may wish, GS Inc. will be entitled to assume the defense thereof, with
counsel reasonably satisfactory to such Indemnitee, which in GS Inc.'s
sole discretion may be regular counsel to GS Inc. and may be counsel to
other Indemnitees. The Indemnitees also shall have the right to employ
one separate counsel for such Indemnitees in such action, suit or
proceeding if such Indemnitees reasonably conclude that if they did not
there would be a conflict of interest between GS Inc. and such
Indemnitees, and under such circumstances the fees and expenses of such
counsel shall be paid by GS Inc.; and
(d) GS Inc. shall not be liable to indemnify an Indemnitee
under this Agreement for any amounts paid in settlement of any action
or claim effected without GS Inc.'s written consent. GS Inc. shall not
settle any action or claim in any manner which would impose any cost or
limitation on an Indemnitee without such Indemnitee's written consent.
Neither GS Inc. nor an Indemnitee will unreasonably withhold or delay
its consent to any proposed settlement.
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8. Non-exclusivity. The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its final
disposition conferred in this Agreement shall not be exclusive of or affected in
any way by any other right which an Indemnitee may have or hereafter may acquire
under any statute, certificate of incorporation, by-laws, agreement,
arrangement, resolution or instrument providing indemnification or expense
payment, except that any payments otherwise required to be made by GS Inc.
hereunder shall be offset by any and all amounts received by an Indemnitee from
any other indemnitor or under one or more liability insurance policies
maintained by an indemnitor or otherwise and shall not be duplicative of any
other payments received by an Indemnitee from GS Inc. in respect of the matter
giving rise to the indemnity hereunder. When an Indemnitee is entitled to
indemnification, expense advancement or reimbursement under this Instrument and
any other agreement, arrangement, resolution or instrument of GS Inc. or The
Xxxxxxx Sachs Group, L.P., the Indemnitee may choose to pursue its rights under
one or more, but less than all, of such applicable agreements, arrangements,
resolutions or instruments, in which case such Indemnitee need only comply with
the standards and procedures of the agreements, arrangements, resolutions or
instruments under which it chooses to pursue its rights. Without limiting the
foregoing, the rights of any indemnified person under the resolution of the
Executive Committee of GS Group, adopted on May 12, 1997 (the "Resolution")
shall remain in full force and effect insofar as an indemnified person has any
rights thereunder with respect to the acts, omissions and status of such person
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through the date of this Agreement. The execution and delivery of this
Instrument shall constitute notice, effective as of the date of this Instrument,
that the Resolution is rescinded insofar as it relates to the acts, omissions
and status of such person after the date of this Instrument.
9. Arbitration. (a) Subject to the provisions of the second
paragraph of Section 1 and Section 9(b) hereof, any dispute, controversy or
claim between an Indemnitee and GS Inc. arising out of or relating to or
concerning the provisions of this Agreement shall be finally settled by
arbitration in New York City before, and in accordance with the rules then
obtaining of, the New York Stock Exchange, Inc. ("NYSE") or, if the NYSE
declines to arbitrate the matter, the American Arbitration Association (the
"AAA") in accordance with the commercial arbitration rules of the AAA.
(b) Notwithstanding the provision of Section 9(a) and in
addition to its right to submit any dispute or controversy to arbitration, GS
Inc. may bring an action or special proceeding in a state or federal court of
competent jurisdiction sitting in the State of Delaware, whether or not an
arbitration proceeding has theretofore been or is ever initiated, for the
purpose of temporarily, preliminarily or permanently enforcing the provisions of
this Agreement or to enforce an arbitration award, and, for the purposes of this
Section 9(b), each Indemnitee (i) expressly consents to the application of
Section 9(c) hereof to any such action or proceeding, (ii) agrees that proof
shall not be required that monetary damages for breach of the provisions of this
Agreement would be difficult to
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calculate and that remedies at law would be inadequate and (iii) irrevocably
appoints each General Counsel of GS Inc., c/o The Corporation Trust Company,
Corporation Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 as such
Indemnitee's agent for service of process in connection with any such action or
proceeding, who shall promptly advise such Indemnitee of any such service of
process.
(c) (i) EACH INDEMNITEE HEREBY IRREVOCABLY SUBMITS TO THE
EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN THE
STATE OF DELAWARE OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO OR CONCERNING THIS AGREEMENT THAT IS NOT OTHERWISE
ARBITRATED ACCORDING TO THE PROVISIONS OF SECTION 9(a) HEREOF. This
includes any suit, action or proceeding to compel arbitration or to
enforce an arbitration award. The parties acknowledge that the forum
designated by this Section 9(c) has a reasonable relation to this
Agreement, and to the parties' relationship with one another.
Notwithstanding the foregoing, nothing herein shall preclude GS Inc.
from bringing any action or proceeding in any other court for the
purpose of enforcing the provisions of this Section 9.
(ii) The agreement of an Indemnitee as to forum is independent
of the law that may be applied in the action, and each Indemnitee
agrees to this forum even if the forum may under applicable law choose
to apply non-forum law. Each Indemnitee hereby waives, to the fullest
extent permitted by applicable law, any objection which such Indemnitee
now or hereafter may have to personal
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jurisdiction or to the laying of venue of any such suit, action or
proceeding in any court referred to in Section 9(c)(i). The parties
undertake not to commence any action arising out of or relating to this
Agreement in any forum other than the forum described in this Section
9(c). The parties agree that, to the fullest extent permitted by
applicable law, a final and non-appealable judgment in any such suit,
action or proceeding in any such court shall be conclusive and binding
upon the parties.
10. Binding Effect. 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
merger or consolidation), heirs, executors and administrators.
11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
12. Amendment. Each party understands that from time to time
certain other persons may become Indemnitees and certain Indemnitees will cease
to be Indemnitees to the extent provided in this Section 12. Accordingly, this
Agreement may be amended by action of GS Inc. from time to time to add
additional Indemnitees, without the approval of any other person other than such
proposed Indemnitees, each of whom shall execute a counterpart of the signature
page of this Agreement. This Agreement may also be amended by action of GS Inc.
and without the approval of any
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other person to remove an Indemnitee; provided that such amendment shall not be
effective unless GS Inc. has provided 30 days prior written notice to the
Indemnitee and, in any event, such amendment shall not affect any rights of such
Indemnitee to be indemnified in respect of Losses associated with the acts,
omissions or status of such Indemnitee through the effective date of such
termination (including the right to subsequent indemnification and expense
advancement and reimbursement relating to such acts, omissions or status).
13. Waiver of Breach. The failure or delay of a party at any
time to require performance by any other party of any provision of this
Agreement, even if known, shall not affect the right of such party to require
performance of that provision or to exercise any right, power, or remedy
hereunder, and any waiver by any party of any breach of any provision of this
Agreement shall not be construed as a waiver of any continuing or succeeding
breach of such provision, a waiver of the provision itself, or a waiver of any
right, power, or remedy under this Agreement. No notice to or demand on any
party in any case shall, of itself, entitle such party to other or further
notice or demand in similar or other circumstances.
14. Severability. GS Inc. and each Indemnitee agree that the
agreements and provisions contained in this Agreement are severable and
divisible, that each such agreement and provision does not depend upon any other
provision or agreement for its enforceability, and that each such agreement and
provision set forth herein constitutes an enforceable obligation between GS Inc.
and such Indemnitee.
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Consequently, GS Inc. and each Indemnitee hereto agrees that neither the
invalidity nor the unenforceability of any provision of this Agreement shall
affect the other provisions hereof, and this Agreement shall remain in full
force and effect and be construed in all respects as if such invalid or
unenforceable provision were omitted.
15. No Presumption. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that an
Indemnitee did not meet the applicable standard of conduct for indemnification
under this Agreement.
16. Notices. Any communication, demand or notice to be given
hereunder will be duly given when delivered in writing by hand or first class
mail to GS Inc. at its principal executive office or to an Indemnitee at its
last address appearing in the business records of GS Inc. (or to such other
addresses as a party may designate by written notice to GS Inc.).
17. No Assignments. No Indemnitee may assign its rights or
obligations under this Agreement without the prior written consent of GS Inc.
18. No Third Party Rights. Nothing expressed or referred to in
this Agreement will be construed to give any person other than the parties to
this Agreement any legal or equitable right, remedy or claim under or with
respect to this Agreement or any provision of this Agreement. This Agreement and
all of its provisions are for the sole and exclusive benefit of the parties to
this Agreement and their successors and permitted assigns.
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19. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement as of the date first written above.
THE XXXXXXX XXXXX GROUP, INC.
By:______________________________
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INDEMNITEES:
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