EXHIBIT 10.29
INDEMNIFICATION
AGREEMENT
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This Indemnification Agreement, made and entered into this ___ day of May
1999 (the "Agreement"), by and between The Pantry, Inc., a Delaware corporation
(the "Company"), and _________________ (the "Indemnitee"):
WHEREAS, highly competent persons have become more reluctant to serve
corporations as directors or in other capacities unless they are provided with
adequate protection through insurance or adequate indemnification against
inordinate risks of claims and actions against them arising out of their service
to and activities on behalf of the corporation; and
WHEREAS, the uncertainties relating to such insurance and to
indemnification have increased the difficulty of attracting and retaining such
persons; and
WHEREAS, the Board of Directors of the Company (the "Board") has determined
that the increased difficulty in attracting and retaining such persons is
detrimental to the best interests of the Company's stockholders and that the
Company should act to assure such persons that there will be increased certainty
of such protection in the future; and
WHEREAS, it is reasonable, prudent and necessary for the Company
contractually to obligate itself to indemnify, and to advance expenses on behalf
of, such persons to the fullest extent permitted by applicable law so that they
will serve or continue to serve the Company free from undue concern that they
will not be so indemnified; and
WHEREAS, each of Section 145 of the General Corporation Law of the State of
Delaware and the Company's Bylaws is nonexclusive, and therefore contemplates
that contracts may be entered into with respect to indemnification of directors,
officers and employees; and
WHEREAS, Indemnitee is willing to serve, continue to serve and to take on
additional service for or on behalf of the Company on the condition that he be
so indemnified;
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, the Company and Indemnitee do hereby covenant and agree as
follows:
Section 1. Services by Indemnitee. Indemnitee agrees to serve as a
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director of the Company. Indemnitee may at any time and for any reason resign
or be removed from such position (subject to any other contractual obligation or
any obligation imposed by operation of law). This Agreement shall continue in
force after Indemnitee has ceased to serve as a director of the Company.
Section 2. Indemnification - General. The Company shall indemnify, and
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advance Expenses (as hereinafter defined) to, Indemnitee (a) as provided in this
Agreement and (b) subject to the provisions of this Agreement, to the fullest
extent permitted by applicable law in effect on the date hereof and as such law
may be amended from time to time. The rights of Indemnitee provided under the
preceding sentence shall include, but shall not be limited to, the rights set
forth in the other Sections of this Agreement.
Section 3. Proceedings Other Than Proceedings by or in the Right of the
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Company. Subject to the provisions of this Agreement, Indemnitee shall be
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entitled to the rights of indemnification provided in this Section 3 if, by
reason of his Corporate Status (as hereinafter defined), he is, or is threatened
to be made, a party to or a participant in any Proceeding (as hereinafter
defined), other than a Proceeding by or in the right of the Company. Pursuant
to this Section 3 but subject to the provisions of this Agreement, Indemnitee
shall be indemnified against all Expenses, judgments, penalties, taxes, fines
and amounts paid in settlement (including all interest assessments and other
charges paid or payable in connection therewith) actually and reasonably
incurred by him or on his behalf in connection with such Proceeding or any
claim, issue or matter therein, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the Company
and, with respect to any criminal Proceeding, had no reasonable cause to believe
his conduct was unlawful.
Section 4. Proceedings by or in the Right of the Company. Subject to
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the provisions of this Agreement, Indemnitee shall be entitled to the rights of
indemnification provided in this Section 4 if, by reason of his Corporate
Status, he is, or is threatened to be made, a party to or a participant in any
Proceeding brought by or in the right of the Company to procure a judgment in
its favor. Pursuant to this Section but subject to the provisions of this
Agreement, Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by him or on his behalf in connection with such Proceeding
if he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Company; provided, however, that, if
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applicable law so provides, no indemnification against such Expenses shall be
made in respect of any claim, issue or matter in such Proceeding as to which
Indemnitee shall have been adjudged to be liable to the Company unless and to
the extent that the Court of Chancery of the State of Delaware, or the court in
which such Proceeding shall have been brought or is pending, shall determine
that such indemnification may be made.
Section 5. Indemnification for Expenses of a Party Who is Wholly or
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Partly Successful. Notwithstanding any other provision of this Agreement, to the
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extent that Indemnitee is, by reason of his Corporate Status, a party to (or a
participant in) and is successful, on the merits or otherwise, in any
Proceeding, he shall be indemnified to the maximum extent permitted by law
against all Expenses actually and reasonably incurred by him or on his behalf in
connection therewith. If Indemnitee is not wholly successful in such Proceeding
but is successful, on the merits or otherwise, as to one or more but less than
all claims, issues or matters in such Proceeding, the Company shall indemnify
Indemnitee against all Expenses actually and reasonably incurred by him or on
his behalf in connection with each successfully resolved claim, issue or matter.
For purposes of this Section
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and without limitation, the termination of any claim, issue or matter in such a
Proceeding by dismissal, with or without prejudice, shall be deemed to be a
successful result as to such claim, issue or matter.
Section 6. Indemnification for Expenses of a Witness. Notwithstanding
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any other provision of this Agreement, to the extent that Indemnitee is, by
reason of his Corporate Status, a witness in any Proceeding to which Indemnitee
is not a party, he shall be indemnified against all Expenses actually and
reasonably incurred by him or on his behalf in connection therewith.
Section 7. Advancement of Expenses. Notwithstanding any provision of
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this Agreement to the contrary, the Company shall advance all reasonable
Expenses incurred by or on behalf of Indemnitee in connection with any
Proceeding in which Indemnitee is involved with by reason of Indemnitee's
Corporate Status within fifteen (15) days after the receipt by the Company of a
statement or statements from Indemnitee requesting such advance or advances from
time to time, whether prior to or after final disposition of such Proceeding.
Such statement or statements shall reasonably evidence the Expenses incurred by
Indemnitee and shall include or be preceded or accompanied by an undertaking by
or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately
be determined that Indemnitee is not entitled to be indemnified against such
Expenses. Any advance and undertakings to repay pursuant to this Section 7 shall
be unsecured and interest free.
Section 8. Procedure for Determination of Entitlement to
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Indemnification..
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(a) To obtain indemnification under this Agreement, Indemnitee shall
submit to the Chief Executive Officer of the Company a written request,
including therein or therewith such documentation and information as is
reasonably available to Indemnitee and is reasonably necessary to determine
whether and to what extent Indemnitee is entitled to indemnification. The
Company shall, promptly upon receipt of such a request for indemnification,
advise the Board in writing that Indemnitee has requested indemnification.
(b) Upon written request by Indemnitee for indemnification pursuant to
Section 8(a) hereof, a determination with respect to Indemnitee's entitlement
thereto shall be made in the specific case: (i) if a Change in Control (as
hereinafter defined) shall have occurred, by Independent Counsel (as hereinafter
defined) in a written opinion to the Board of Directors, a copy of which shall
be delivered to Indemnitee; or (ii) if a Change in Control shall not have
occurred, (A) by a majority vote of the Disinterested Directors (as hereinafter
defined), even though less than a quorum of the Board, or (B) if there are no
such Disinterested Directors or, if such Disinterested Directors so direct, by
Independent Counsel in a written opinion to the Board, a copy of which shall be
delivered to Indemnitee or (C) if so directed by the Board, by the stockholders
of the Company; and, if it is so determined that Indemnitee is entitled to
indemnification, payment to Indemnitee shall be made within thirty (30) days
after such determination. Indemnitee shall cooperate with the person, persons
or entity making such determination with respect to Indemnitee's entitlement to
indemnification, including providing to such person, persons or entity upon
reasonable advance request any
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documentation or information which is not privileged or otherwise protected from
disclosure and which is reasonably available to Indemnitee and reasonably
necessary to such determination. Any costs or expenses (including attorneys'
fees and disbursements) incurred by Indemnitee in so cooperating with the
person, persons or entity making such determination shall be borne by the
Company (irrespective of the determination as to Indemnitee's entitlement to
indemnification) and the Company hereby indemnifies and agrees to hold
Indemnitee harmless therefrom.
(c) In the event the determination of entitlement to indemnification
is to be made by Independent Counsel pursuant to Section 8(b) hereof, the
Independent Counsel shall be selected as provided in this Section 8(c). If a
Change in Control shall not have occurred, the Independent Counsel shall be
selected by the Disinterested Directors or, if there are no such Disinterested
Directors, by the Board of Directors, and the Company shall give written notice
to Indemnitee advising him of the identity of the Independent Counsel so
selected. If a Change in Control shall have occurred, the Independent Counsel
shall be selected by Indemnitee (unless Indemnitee shall request that such
selection by made by the Board of Directors, in which event the preceding
sentence shall apply), and Indemnitee shall give written notice to the Company
advising it of the identity of the Independent Counsel so selected. In either
event, Indemnitee or the Company, as the case may be, may, within ten (10) days
after such written notice of selection shall have been given, deliver to the
Company or to Indemnitee, as the case may be, a written objection to such
selection; provided; however, that such objection may be asserted only on the
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ground that the Independent Counsel so selected does not meet the requirements
of "Independent Counsel" as defined in Section 17 of this Agreement, and the
objection shall set forth with particularity the factual basis of such
assertion. Absent a proper and timely objection, the person so selected shall
act as Independent Counsel. If such written objection is so made and
substantiated, the Independent Counsel so selected may not serve as Independent
Counsel unless and until such objection is withdrawn or the Court of Chancery of
the State of Delaware or other court of competent jurisdiction has determined
that such objection is without merit. If, within twenty (20) days after
submission by Indemnitee of a written request for indemnification pursuant to
Section 8(a) hereof, no Independent Counsel shall have been selected and not
objected to, either the Company or Indemnitee may petition the Court of Chancery
of the State of Delaware or other court of competent jurisdiction for resolution
of any objection which shall have been made by the Company or Indemnitee to the
other's selection of Independent Counsel and/or for the appointment as
Independent Counsel of a person selected by the Court or by such other person as
the Court shall designate, and the person with respect to whom all objections
are so resolved or the person so appointed shall act as Independent Counsel
under Section 8(b) hereof. Upon the due commencement of any judicial proceeding
or arbitration pursuant to Section 10(a) of this Agreement, Independent Counsel
shall be discharged and relieved of any further responsibility in such capacity
(subject to the applicable standards of professional conduct then prevailing).
(d) The Company shall not be required to obtain the consent of the
Indemnitee to the settlement of any Proceeding which the Company has undertaken
to defend if the Company assumes full and sole responsibility for such
settlement and the settlement grants the Indemnitee a complete and unqualified
release in respect of the potential liability. The Indemnitee shall not
unreasonably withhold his consent to any proposed settlement; provided, however,
that the Company
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shall not settle any proceeding in any manner that would impose any penalty or
limitation on the Indemnitee without his written consent. The Company shall not
be liable for any amount paid by the Indemnitee in settlement of any Proceeding
unless the Company has consented to such settlement, which consent shall not be
unreasonably withheld.
Section 9. Presumptions and Effect of Certain Proceedings; Limitations
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on Indemnification.
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(a) In making a determination with respect to entitlement to
indemnification under this Agreement, the person or persons or entity making
such determination shall presume that Indemnitee is entitled to indemnification
under this Agreement if Indemnitee has submitted a request for indemnification
in accordance with Section 8(a) of this Agreement, and the Company shall have
the burden of proof to overcome that presumption in connection with the making
by any person, persons or entity of any determination contrary to that
presumption. Neither the failure of the Company (including by its directors or
Independent Counsel) to have made a determination prior to the commencement of
any action pursuant to this Agreement that indemnification is proper in the
circumstances because Indemnitee has met the applicable standard of conduct, nor
an actual determination by the Company (including by its directors or
Independent Counsel) that Indemnitee has not met such applicable standard of
conduct, shall be a defense to the action or create a presumption that
Indemnitee has not met the applicable standard of conduct.
(b) If the person, persons or entity empowered or selected under
Section 8 of this Agreement to determine whether Indemnitee is entitled to
indemnification shall not have made a determination within sixty (60) days after
receipt by the Company of the request therefor, the requisite determination of
entitlement to indemnification shall be deemed to have been made and Indemnitee
shall be entitled to such indemnification, absent (i) a misstatement by
Indemnitee of a material fact, or an omission of a material fact necessary to
make Indemnitee's statement not materially misleading, in connection with the
request for indemnification, or (ii) a prohibition of such indemnification under
applicable law; provided, however, that such sixty (60) day period may be
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extended for a reasonable time, not to exceed an additional thirty (30) days, if
the person, persons or entity making the determination with respect to
entitlement to indemnification in good faith requires such additional time for
the obtaining or evaluating of documentation and/or information relating
thereto; and provided, further, that the foregoing provisions of this Section
9(b) shall not apply (i) if the determination of entitlement to indemnification
is to be made by the stockholders pursuant to Section 8(b) of this Agreement and
if (A) within fifteen (15) days after receipt by the Company of the request for
such determination the Board of Directors has resolved to submit such
determination to the stockholders for their consideration at an annual meeting
thereof to be held within seventy-five (75) days after such receipt and such
determination is made thereat, or (B) a special meeting of stockholders is
called within fifteen (15) days after such receipt for the purpose of making
such determination, such meeting is held for such purpose within sixty (60) days
after having been so called and such determination is made thereat, or (ii) if
the determination of entitlement to indemnification is to be made by Independent
Counsel pursuant to Section 8(b) of this Agreement.
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(c) The termination of any Proceeding or of any claim, issue or matter
therein, by judgment, order, settlement or conviction, or upon a plea of nolo
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contendere or its equivalent, shall not (except as otherwise expressly provided
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in this Agreement or as otherwise required by law) of itself adversely affect
the right of Indemnitee to indemnification or create a presumption that
Indemnitee did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Company or, with
respect to any criminal Proceeding, that Indemnitee had reasonable cause to
believe that his conduct was unlawful.
(d) For purposes of any determination of Good Faith, Indemnitee shall
be deemed to have acted in Good Faith if Indemnitee's action is based on the
records or books of account of the Company, including financial statements, or
on information supplied to Indemnitee by the officers of the Company in the
course of their duties, or on the advice of legal counsel for the Company or on
information or records given or reports made to the Company by an independent
certified public accountant or by an appraiser or other expert selected with the
reasonable care by the Company. The provisions of this Section 9(d) shall not
be deemed to be exclusive or to limit in any way the other circumstances in
which the Indemnitee may be deemed to have met the applicable standard of
conduct set forth in this Agreement.
(e) The knowledge and/or actions, or failure to act, of any director,
officer, agent or employee of the Company shall not be imputed to Indemnitee for
purposes of determining the right to indemnification under this Agreement.
(f) Notwithstanding any other provision of this Agreement, no
indemnification shall be paid or Expenses reimbursed under this Agreement on
account of any judgment rendered against the Indemnitee (i) in a matter for
which indemnification is not permitted under applicable law (federal or state)
or (ii) for an accounting of profits made from the purchase and sale of
securities of the Company under Section 1b of the Securities Exchange Act of
1934, as amended. Any provision herein to the contrary notwithstanding, the
Company shall not be obligated pursuant to the terms of this Agreement to
indemnify the Indemnitee or otherwise act in violation of any undertaking
appearing in and required by the rules and regulations promulgated under the
Securities Act in any registration statement filed with the Securities and
Exchange Commission under the Securities Act. The Indemnitee acknowledges that
paragraph (h) of Item 512 of Regulation S-K currently generally requires the
Company to undertake in connection with any registration statement filed under
the Act to submit the issue of the enforceability of the Indemnitee's rights
under this Agreement in connection with any liability under the Securities Act
on public policy grounds to a court of appropriate jurisdiction and to be
governed by any final adjudication of such issue. The Indemnitee specifically
agrees that any such undertaking shall supersede the provisions of this
Agreement and to be bound by any such undertaking.
Section 10. Remedies of Indemnitee.
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(a) In the event that (i) a determination is made pursuant to Section
8 of this Agreement that Indemnitee is not entitled to indemnification under
this Agreement, (ii) advancement
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of Expenses is not timely made pursuant to Section 7 of this Agreement, (iii) no
determination of entitlement to indemnification shall have been made pursuant to
Section 8(b) of this Agreement within ninety (90) days after receipt by the
Company of the request for indemnification, (iv) payment of indemnification
required under Section 5, 6, the last sentence of Section 8(b) or the last
sentence of Section 17(h) of this Agreement is not made within fifteen (15) days
after receipt by the Company of a written request therefor, or (v) payment of
indemnification pursuant to Section 3 or 4 of this Agreement is not made within
thirty (30) days after a determination has been made that Indemnitee is entitled
to indemnification, Indemnitee shall be entitled to an adjudication by the Court
of Chancery of the State of Delaware of his entitlement to such indemnification
or advancement of Expenses. Alternatively, in accordance with this Section 10,
Indemnitee, at his option, may seek an award in arbitration to be conducted by a
single arbitrator pursuant to the Commercial Arbitration rules of the American
Arbitration Association. Indemnitee shall commence such proceeding seeking an
adjudication or an award in arbitration within one hundred eighty (180) days
following the date on which Indemnitee first has the right to commence such
proceeding pursuant to this Section 10(a); provided, however, that the foregoing
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clause shall not apply in respect of a proceeding brought by Indemnitee to
enforce his rights under Section 5 of this Agreement. The Company shall not
oppose Indemnitee's right to seek any such adjudication or award in arbitration.
(b) In the event that a determination shall have been made pursuant to
Section 8(b) of this Agreement that Indemnitee is not entitled to
indemnification, any judicial proceeding or arbitration commenced pursuant to
this Section 10 shall be conducted in all respects as a de novo trial, or
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arbitration, on the merits and Indemnitee shall not be prejudiced by reason of
that adverse determination.
(c) If a determination shall have been made pursuant to Section 8(b)
of this Agreement that Indemnitee is entitled to indemnification, the Company
shall be bound by such determination in any judicial proceeding or arbitration
commenced pursuant to this Section 10, absent (i) a misstatement by Indemnitee
of a material fact, or an omission of a material fact necessary to make
Indemnitee's statement not materially misleading, in connection with the request
for indemnification, or (ii) a prohibition of such indemnification under
applicable law.
(d) In the event that Indemnitee, pursuant to this Section 10, seeks a
judicial adjudication of or an award in arbitration to enforce his rights under,
or to recover damages for breach of, this Agreement, Indemnitee shall be
entitled to recover from the Company, and shall be indemnified by the Company
against, any and all expenses (of the types described in the definition of
Expenses in Section 17 of this Agreement) actually and reasonably incurred by
him in such judicial adjudication or arbitration, but only if (and only to the
extent) he prevails therein. If it shall be determined in said judicial
adjudication or arbitration that Indemnitee is entitled to receive part but not
all of the indemnification or advancement of Expenses sought, the expenses
incurred by Indemnitee in connection with such judicial adjudication or
arbitration shall be appropriately prorated.
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(e) The Company shall be precluded from asserting in any judicial
preceding or arbitration commenced pursuant to this Section 10 that the
procedures and presumptions of this Agreement are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator
that the Company is bound by all the provisions of this Agreement.
Section 11. Non-Exclusivity; Survival of Rights; Insurance; Subrogation.
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(a) The rights of indemnification and to receive advancement of
Expenses as provided by this Agreement shall not be deemed exclusive of any
other rights to which Indemnitee may at any time be entitled under applicable
law, the Company's Certificate of Incorporation, the Company's Bylaws, any other
agreement, a vote of stockholders or a resolution of directors, or otherwise.
No amendment, alteration or repeal of this Agreement or of any provision hereof
shall limit or restrict any right of Indemnitee under this Agreement in respect
of any action taken or omitted by such Indemnitee in his Corporate Status prior
to such amendment, alteration or repeal. To the extent that a change in the
General Corporation Law of the State of Delaware, whether by statute or judicial
decision, permits greater indemnification or advancement of Expenses than would
be afforded currently under the Company's Bylaws and this Agreement, it is the
intent of the parties hereto that Indemnitee shall enjoy by this Agreement the
greater benefits so afforded by such change. No right or remedy herein conferred
is intended to be exclusive of any other right or remedy, and every other right
and remedy shall be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other right or
remedy.
(b) To the extent that the Company maintains an insurance policy or
policies providing liability insurance for directors, officers, employees, or
agents of the Company or of any other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise which such person serves at the
request of the Company, Indemnitee shall be covered by such policy or policies
in accordance with its or their terms to the maximum extent of the coverage
available for any such director, officer, employee or agent under such policy or
policies.
(c) In the event of any payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee, and Indemnitee shall execute all papers required and
take all action necessary to secure such rights, including execution of such
documents as are necessary to enable the Company to bring suit to enforce such
rights.
(d) The Company shall not be liable under this Agreement to make any
payment of amounts otherwise indemnifiable (or for which advancement is provided
hereunder) hereunder if and to the extent that Indemnitee has otherwise actually
received such payment under any insurance policy, contract, agreement or
otherwise.
(e) The Company's obligation to indemnify or advance Expenses
hereunder to Indemnitee who is or was serving at the request of the Company as a
director, officer, employee or
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agent of any other corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise shall be reduced by any amount Indemnitee has
actually received as indemnification or advancement of expenses from such other
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise.
Section 12. Duration of Agreement; Successors and Assigns. This
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Agreement shall continue until and terminate upon the later of: (a) ten (10)
years after the date that Indemnitee shall have ceased to serve as a director of
the Company or as a director of any enterprise which Indemnitee served at the
request of the Company; or (b) the final termination of any Proceeding then
pending in respect of which Indemnitee is granted rights of indemnification or
advancement of Expenses hereunder and of any proceeding commenced by Indemnitee
pursuant to Section 10 of this Agreement relating thereto. This Agreement shall
be binding upon the Company and its successors and assigns (including any direct
or indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business or assets of the Company) and shall inure to
the benefit of Indemnitee and his heirs, executors and administrators. In the
event that the Company shall be a constituent corporation in a consolidation,
merger or other reorganization, the Company, if it shall not be the surviving,
resulting or acquiring company therein, shall require as a condition thereto
that the surviving, resulting or acquiring company agree to indemnify the
Indemnitee to the full extent provided herein. Whether or not the Company is
the resulting, surviving or acquiring company in any such transaction, the
Indemnitee shall also stand in the same position under this Agreement with
respect to the resulting, surviving or acquiring company as he or she would have
with respect to the Company if its separate existence had continued. The
Company shall require and cause any successor (whether direct or indirect, by
purchase, merger, consolidation, or otherwise) to all, substantially all, or a
substantial part of the business and/or assets of the Company, by written
agreement in form and substance satisfactory to Indemnitee, expressly to assume
and agree to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform if no such succession had taken
place.
Section 13. Severability. If any provision or provisions of this
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Agreement shall be held to be invalid, illegal or unenforceable for any reason
whatsoever: (a) the validity, legality and enforceability of the remaining
provisions of this Agreement (including without limitation, each portion of any
Section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby and shall remain
enforceable to the fullest extent permitted by law; (b) such provision or
provisions shall be deemed reformed to the extent necessary to conform to
applicable law and to give the maximum effect to the intent of the parties
hereto; and (c) to the fullest extent possible, the provisions of this Agreement
(including, without limitation, each portion of any Section of this Agreement
containing any such provision held to be invalid, illegal or unenforceable, that
is not itself invalid, illegal or unenforceable) shall be construed so as to
give effect to the intent manifested thereby.
Section 14. Exception to Right of Indemnification or Advancement of
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Expenses. Notwithstanding any other provision of this Agreement, but subject to
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Section 10(d) hereof,
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Indemnitee shall not be entitled to indemnification or advancement of Expenses
under this Agreement with respect to any Proceeding brought by Indemnitee, or
any claim therein, unless the bringing of such Proceeding or making of such
claim shall have been approved by the Board of Directors.
Section 15. Identical Counterparts. This Agreement may be executed in
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one or more counterparts, each of which shall for all purposes be deemed to be
an original but all of which together shall constitute one and the same
Agreement. Only one such counterpart signed by the party against whom
enforceability is sought needs to be produced to evidence the existence of this
Agreement.
Section 16. Headings. The headings of the paragraphs of this Agreement
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are inserted for convenience only and shall not be deemed to constitute part of
this Agreement or to affect the construction thereof.
Section 17. Definitions. For purposes of this Agreement:
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(a) "Change of Control" means a change in control of the Company
occurring after the Effective Date of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in
response to any similar item on any similar schedule or form) promulgated under
the Securities Exchange Act of 1934 (the "Act"), whether or not the Company is
then subject to such reporting requirement; provided, however, that, without
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limitation, such a Change in Control shall be deemed to have occurred if after
the Effective Date (i) any "person" (as such term is used in Section 13(d) and
14(d) of the Act)(other than (A) a trustee or other fiduciary holding securities
under an employee benefit plan of the Company, (B) 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, or (C) FS Equity
Partners III, L.P., FS Equity Partners IV, L.P. or any of their affiliates) is
or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Act),
directly or indirectly, of securities of the Company representing 30% or more of
the combined voting power of the Company's then outstanding securities without
the prior approval of at least two-thirds of the members of the Board in office
immediately prior to such person attaining such percentage interest; (ii) there
occurs a proxy contest, or the Company is a party to a merger, consolidation,
sale of assets, plan of liquidation or other reorganization not approved by at
least two-thirds of the members of the Board then in office, as a consequence of
which members of the Board in office immediately prior to such transaction or
event constitute less than a majority of the Board thereafter; or (iii) during
any period of two consecutive years, other than as a result of an event
described in clause (a)(ii) of this Section 17, individuals who at the beginning
of such period constituted the Board (including for this purpose any new
director whose election or nomination for election by the Company's stockholders
was approved by a vote of at least two-thirds of the directors then still in
office who were directors at the beginning of such period) cease for any reason
to constitute at least a majority of the Board.
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(b) "Corporate Status" describes the status of a person who is or was
a director of the Company, of any Subsidiary of the Company or of any other
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise which such person is or was serving at the request of the Company.
(c) "Disinterested Director" means a director of the Company who is
not and was not a party to the Proceeding in respect of which indemnification is
sought by Indemnitee.
(d) "Effective Date" means May __, 1999.
(e) "Expenses" shall include all reasonable attorneys' fees,
retainers, court costs, transcript costs, fees or experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees, and all other disbursements or expenses of the
types customarily incurred in connection with prosecuting, defending, preparing
to prosecute or defend, investigating, being or preparing to be a witness in, or
otherwise participating in, a Proceeding.
(f) "Good Faith" shall mean Indemnitee having acted in good faith and
in a manner Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company, and, with respect to any criminal Proceeding, having
had no reasonable cause to believe Indemnitee's conduct was unlawful.
(g) "Independent Counsel" means a law firm, or a member of a law firm,
that is experienced in matters of corporation law and neither presently is, nor
in the past five (5) years has been, retained to represent: (i) the Company or
Indemnitee in any matter material to either such party (other than with respect
to matters concerning the Indemnitee under this Agreement, or of other
indemnitees under similar indemnification agreements), or (ii) any other party
to the Proceeding giving rise to a claim for indemnification hereunder.
Notwithstanding the foregoing, the term "Independent Counsel" shall not include
any person who, under the applicable standards of professional conduct then
prevailing, would have a conflict of interest in representing either the Company
or Indemnitee in an action to determine Indemnitee's rights under this
Agreement. The Company agrees to pay the reasonable fees and expenses of the
Independent Counsel referred to above and to fully indemnify such counsel
against any and all Expenses, claims, liabilities and damages arising out of or
relating to this Agreement or its engagement pursuant hereto.
(h) "Proceeding" includes any threatened, pending or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation,
inquiry, administrative hearing or any other actual, threatened or completed
proceeding, whether brought by or in the right of the Company or otherwise,
including any counterclaims therein, and whether civil, criminal, administrative
or investigative, in which Indemnitee was, is or will be involved as a party or
otherwise, by reason of the fact of Indemnitee's Corporate Status, by reason of
any action taken by him or of any inaction on his part while acting as director
of the Company or any subsidiary of the Company or by reason of the fact that he
is or was serving at the request of the Company as a
11
director, officer, employee or agent of any other corporation, partnership,
joint venture, trust or other enterprise, in each case whether or not (i) the
claim arose, or is based on facts occurring, before or after the Effective Date
and (ii) he is acting or serving in any such capacity at the time any liability
or expense is incurred for which indemnification or advancement of expenses can
be provided under this Agreement.
Section 18. Enforcement.
-----------
(a) The Company expressly confirms and agrees that it has entered into
this Agreement and assumed the obligations imposed on it hereby in order to
induce Indemnitee to continue to serve as a director of the Company, and the
Company acknowledges that Indemnitee is relying upon this Agreement in serving
as a director of the Company.
(b) This Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings, oral, written and implied, between the
parties hereto with respect to the subject matter hereof.
Section 19. Modification and Waiver. 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.
Section 20. Notice by Indemnitee. Indemnitee agrees promptly to notify
--------------------
the Company in writing upon being served with any summons, citation, subpoena,
complaint, indictment, information or other document relating to any Proceeding
or matter which may be subject to indemnification or advancement of Expenses
covered hereunder. The failure of Indemnitee to so notify the Company shall not
relieve the Company of any obligation which it may have to the Indemnitee under
this Agreement or otherwise, except to the extent the Company is materially
prejudiced by such failure.
Section 21. Notices. All notices, requests, demands and other
-------
communications hereunder shall be in writing and shall be deemed to have been
duly given if (i) delivered by hand and receipted for by the party to whom said
notice or other Communication shall have been directed, or (ii) mailed by
certified or registered mail with postage prepaid, on the third business day
after the date on which it is so mailed:
(a) If to Indemnitee, to:
(b) If to the Company, to:
12
The Pantry, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Executive Officer
or to such other address as may have been furnished to Indemnitee by the Company
or to the Company by Indemnitee, as the case may be.
Section 22. Contribution. To the fullest extent permissible under
------------
applicable law, if the indemnification provided for in this Agreement is
unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of
indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee,
whether for judgments, fines, penalties, excise taxes, amounts paid or to be
paid in settlement and/or for Expenses, in connection with any claim relating to
an indemnifiable event under this Agreement, in such proportion as is deemed
fair and reasonable in light of all of the circumstances of such Proceeding in
order to reflect (i) the relative benefits received by the Company and
Indemnitee as a result of the event(s) and/or transaction(s) giving cause to
such Proceeding; and/or (ii) the relative fault of the Company (as its
directors, officers, employees and agents) and Indemnitee in connection with
such event(s) and/or transactions(s).
Section 23. Governing Law; Submission to Jurisdiction; Appointment of
---------------------------------------------------------
Agent for Service of Process. This Agreement and the legal relations among the
----------------------------
parties shall be governed by, and construed and enforced in accordance with, the
laws of the State of Delaware, without regard to its conflict of laws rules.
Except with respect to any arbitration commenced by Indemnitee pursuant to
Section 10(a) of this Agreement, the Company and Indemnitee hereby irrevocably
and unconditionally (i) agree that any action or proceeding arising out of or in
connection with this Agreement shall be brought only in the Chancery Court of
the State of Delaware (the "Delaware Court"), and not in any other state or
federal court in the United States of America or any court in any other country,
(ii) consent to submit to the exclusive jurisdiction of the Delaware Court for
purposes of any action or proceeding arising out of or in connection with this
Agreement, (iii) appoint, to the extent such party is not a resident of the
State of Delaware, irrevocably RL&F Service Corp., One ▇▇▇▇▇▇ Square, 10th
Floor, 10th and King Streets, Wilmington, Delaware 19801 as its agent in the
State of Delaware as such party's agent for acceptance of legal process in
connection with any such action or proceeding against such party with the same
legal force and validity as if served upon such party personally within the
State of Delaware, (iv) waive any objection to the laying of venue of any such
action or proceeding in the Delaware Court, and (v) waive, and agree not to
plead or to make, any claim that any such action or proceeding brought in the
Delaware Court has been brought in an improper or otherwise inconvenient forum.
Section 24. Miscellaneous. Use of the masculine pronoun shall be deemed
-------------
to include usage of the feminine pronoun where appropriate.
13
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
THE PANTRY, INC.
By:_______________________________________________
Name:_____________________________________________
Title:____________________________________________
__________________________________________________
Indemnitee:
Address: __________________________________________________
__________________________________________________
14
