EXHIBIT 10.10(a)
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT, made and executed as of the 15th day of April,
2004 (this "Agreement"), by and between Xxxx Xxxxxxx Corporation, a Delaware
corporation (the "Company"), and _______________, an individual resident of the
State of Colorado (the "Indemnitee").
WHEREAS, the Company is aware that, in order to induce highly competent
persons to serve the Company as directors or officers or in other capacities,
the Company must provide such persons with adequate protection through insurance
and indemnification against inordinate risks of claims and actions against them
arising out of their service to and activities on behalf of the Company;
WHEREAS, the Company recognizes that the increasing difficulty in obtaining
directors' and officers' liability insurance, the increasing cost of such
insurance and the general reductions in coverage of such insurance have made
attracting and retaining such persons more difficult;
WHEREAS, the Company recognizes the substantial increase in corporate
litigation in general, subjecting directors and officers to expensive litigation
risks at the same time as the availability and coverage of liability insurance
has been severely limited;
WHEREAS, the Board of Directors of the Company has determined that it is in
the best interests of the Company's stockholders that the Company act to assure
such persons that there will be increased certainty of such protection in the
future;
WHEREAS, it is reasonable, prudent and necessary for the Company to
contractually obligate itself to indemnify such persons to the fullest extent
permitted by applicable law so that they will continue to serve the Company free
from undue concern that they will not be so indemnified; and
WHEREAS, the Indemnitee is willing to serve, continue to serve and take on
additional service for or on behalf of the Company or any of its direct or
indirect wholly-owned subsidiaries on the condition that he/she be so
indemnified.
NOW, THEREFORE, in consideration of the premises and the mutual promises
and covenants contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company and
the Indemnitee do hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement:
(a) "Change in Control" shall mean:
(i) a "change in control" of the Company of a nature that would be
required to be reported in response to Item 6(e) of Schedule
14A for a proxy statement filed under Section 14(a) of the
Securities Exchange Act of 1934, as amended (the "Act"), as in
effect on the date of this Agreement;
(ii) a "person" (as that term is used in 14(d)(2) of the Act)
becomes the beneficial owner (as defined in Rule 13d-3 under
the Act) directly or indirectly of securities representing 30%
or more of the combined voting power for election of directors
of the then outstanding securities of the Company unless (1)
such person is a signatory to the Stockholders' Agreement for
the Company and (2) such person becomes such a beneficial
owner of such securities as a result of a transaction with
one, or more than one, other person who is also a signatory to
such Stockholders' Agreement;
(iii) the individuals who at the beginning of any period of two
consecutive years or less (starting on or after the date of
this Agreement) constitute the Company's Board of Directors
cease for any reason during such period to constitute at least
a majority of the Company's Board of Directors, unless the
election or nomination for election of each new member of the
Board of Directors was approved in advance by vote of a
majority of the members of such Board of Directors then still
in office who were members of such Board of Directors at the
beginning of such period;
(iv) the stockholders of the Company approve any reorganization,
merger, consolidation or share exchange as a result of which
the common stock of the Company shall be changed, converted or
exchanged into or for securities of another organization or
any dissolution or liquidation of the Company or any sale or
the disposition of 50% or more of the assets or business of
the Company; or
(v) the stockholders of the Company approve any reorganization,
merger, consolidation or share exchange with another
corporation unless (1) the persons who were the beneficial
owners of the outstanding shares of the common stock of the
Company immediately before the consummation of such
transaction beneficially own more than 60% of the outstanding
shares of the common stock of the successor or survivor
corporation in such transaction immediately following the
consummation of such transaction and (2) the number of shares
of the common stock of such successor or survivor corporation
beneficially owned by the persons described in Section
1(a)(v)(1) immediately following the
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consummation of such transaction is beneficially owned by each
such person in substantially the same proportion that each
such person had beneficially owned shares of the Company
common stock immediately before the consummation of such
transaction, provided (3) the percentage described in Section
1(a)(v)(1) of the beneficially owned shares of the successor
or survivor corporation and the number described in Section
1(a)(v)(2) of the beneficially owned shares of the successor
or survivor corporation shall be determined exclusively by
reference to the shares of the successor or survivor
corporation which result from the beneficial ownership of
shares of common stock of the Company by the persons described
in Section 1(a)(v)(1) immediately before the consummation of
such transaction.
(b) "Disinterested Director" shall mean a director of the Company who is
not or was not a party to the action, suit, investigation or proceeding in
respect of which indemnification is being sought by the Indemnitee.
(c) "Expenses" shall include all attorneys' fees, retainers, court
costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, and all other disbursements or expenses incurred in
connection with prosecuting, defending, preparing to prosecute or defend,
investigating or being or preparing to be a witness in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative in nature.
(d) "Independent Counsel" shall mean a law firm or a member of a law
firm that neither is presently nor in the past five years has been retained
to represent (i) the Company or the Indemnitee in any matter material to
either such party or (ii) any other party to the action, suit,
investigation or 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 the Indemnitee in an action to determine
the Indemnitee's right to indemnification under this Agreement.
(e) "Stockholders' Agreement" shall mean the agreement, dated March 28,
2002, by and among the Company and the investors named therein, as may be
amended from time to time.
2. SERVICE BY THE INDEMNITEE. The Indemnitee agrees to serve as a director
or officer of the Company and will discharge his/her duties and responsibilities
to the best of his/her ability so long as the Indemnitee is duly elected or
qualified in accordance with the provisions of the Certificate of Incorporation,
as amended (the "Certificate"), and the Bylaws, as amended (the "Bylaws"), of
the Company and the General Corporation Law of the State of Delaware, as amended
(the "DGCL"), or until his/her earlier death, retirement, resignation or
removal. The
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Indemnitee may at any time and for any reason resign from such position (subject
to any other obligation, whether contractual or imposed by operation of law), in
which event this Agreement shall continue in full force and effect after such
resignation. Nothing in this Agreement shall confer upon the Indemnitee the
right to continue in the employ of the Company or as a director of the Company,
or affect the right of the Company to terminate, in the Company's sole
discretion (with or without cause) and at any time, the Indemnitee's employment,
in each case, subject to any contractual rights of the Indemnitee created or
existing otherwise than under this Agreement.
3. INDEMNIFICATION. The Company shall indemnify the Indemnitee and advance
Expenses to the Indemnitee as provided in this Agreement to the fullest extent
permitted by the Certificate, the Bylaws in effect as of the date hereof and the
DGCL or other applicable law in effect on the date hereof and to any greater
extent that the DGCL or applicable law may in the future from time to time
permit. Without diminishing the scope of the indemnification provided by this
Section 3, the rights of indemnification of the Indemnitee provided hereunder
shall include, but shall not be limited to, those rights hereinafter set forth,
except that no indemnification shall be paid to the Indemnitee:
(a) on account of any action, suit or proceeding in which judgment is
rendered against the Indemnitee for disgorgement of profits made from the
purchase or sale by the Indemnitee of securities of the Company pursuant to
the provisions of Section 16(b) of the Act or similar provisions of any
federal, state or local statutory law;
(b) on account of conduct of the Indemnitee which is finally adjudged by
a court of competent jurisdiction to have been knowingly fraudulent or to
constitute willful misconduct;
(c) in any circumstance where such indemnification is expressly
prohibited by applicable law;
(d) with respect to liability for which payment is actually made to the
Indemnitee under a valid and collectible insurance policy or under a valid
and enforceable indemnity clause, Bylaw or agreement (other than this
Agreement), except in respect of any liability in excess of payment under
such insurance, clause, Bylaw or agreement;
(e) if a final decision by a court having jurisdiction in the matter
shall determine that such indemnification is not lawful (and, in this
respect, both the Company and the Indemnitee have been advised that it is
the position of the Securities and Exchange Commission that indemnification
for liabilities arising under the federal securities laws is against public
policy and is, therefore, unenforceable, and that claims for
indemnification should be submitted to the appropriate court for
adjudication); or
(f) in connection with any action, suit or proceeding by the Indemnitee
against the Company or any of its direct or indirect wholly-owned
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subsidiaries or the directors, officers, employees or other Indemnitees of
the Company or any of its direct or indirect wholly-owned subsidiaries, (i)
unless such indemnification is expressly required to be made by law, (ii)
unless the action, suit or proceeding was previously authorized by a
majority of the Board of Directors of the Company, (iii) unless such
indemnification is provided by the Company, in its sole discretion,
pursuant to the powers vested in the Company under applicable law or (iv)
except as provided in Sections 12 and 14 hereof.
4. ACTIONS OR PROCEEDINGS OTHER THAN AN ACTION BY OR IN THE RIGHT OF THE
COMPANY. The Indemnitee shall be entitled to the indemnification rights provided
in this Section 4 if the Indemnitee was or is a party or is threatened to be a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative in nature, other than
an action by or in the right of the Company, by reason of the fact that the
Indemnitee is or was a director, officer, employee, agent or fiduciary of the
Company, or any of its direct or indirect wholly-owned subsidiaries, or is or
was serving at the request of the Company, or any of its direct or indirect
wholly-owned subsidiaries, as a director, officer, employee, agent or fiduciary
of any other entity, including, but not limited to, another corporation,
partnership, limited liability company, employee benefit plan, joint venture,
trust or other enterprise, or by reason of any act or omission by him/her in
such capacity. Pursuant to this Section 4, the Indemnitee shall be indemnified
against all Expenses, judgments, penalties (including excise and similar taxes),
fines and amounts paid in settlement which were actually and reasonably incurred
by the Indemnitee in connection with such action, suit or proceeding (including,
but not limited to, the investigation, defense or appeal thereof), if the
Indemnitee acted in good faith and in a manner the Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
his/her conduct was unlawful.
5. ACTIONS BY OR IN THE RIGHT OF THE COMPANY. The Indemnitee shall be
entitled to the indemnification rights provided in this Section 5 if the
Indemnitee was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding brought by or in the
right of the Company to procure a judgment in its favor by reason of the fact
that the Indemnitee is or was a director, officer, employee, agent or fiduciary
of the Company, or any of its direct or indirect wholly-owned subsidiaries, or
is or was serving at the request of the Company, or any of its direct or
indirect wholly-owned subsidiaries, as a director, officer, employee, agent or
fiduciary of another entity, including, but not limited to, another corporation,
partnership, limited liability company, employee benefit plan, joint venture,
trust or other enterprise, or by reason of any act or omission by him/her in any
such capacity. Pursuant to this Section 5, the Indemnitee shall be indemnified
against all Expenses actually and reasonably incurred by him/her in connection
with the defense or settlement of such action, suit or proceeding (including,
but not limited to the investigation, defense or appeal thereof), if the
Indemnitee acted in good faith and in a manner the Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company; provided,
however, that no such indemnification shall be made in respect of any claim,
issue or matter as to which the Indemnitee shall have been adjudged to be liable
to the Company, unless and only to the extent that the Court of Chancery of the
State of Delaware or the court in which such action, suit or proceeding was
brought shall determine upon application that, despite the adjudication of
liability but in
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view of all the circumstances of the case, the Indemnitee is fairly and
reasonably entitled to indemnity for such Expenses which such court shall deem
proper.
6. GOOD FAITH DEFINITION. For purposes of this Agreement, the Indemnitee
shall be deemed to have acted in good faith and in a manner the Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any criminal action or proceeding, to have had no
reasonable cause to believe the Indemnitee's conduct was unlawful, if such
action was based on any of the following: (a) the records or books of the
account of the Company or other enterprise, including financial statements; (b)
information supplied to the Indemnitee by the officers of the Company or other
enterprise in the course of his/her duties; (c) the advice of legal counsel for
the Company or other enterprise; or (d) information or records given in reports
made to the Company or other enterprise by an independent certified public
accountant or by an appraiser or other expert selected with reasonable care by
the Company or other enterprise.
7. INDEMNIFICATION FOR EXPENSES OF SUCCESSFUL PARTY. Notwithstanding the
other provisions of this Agreement, to the extent that the Indemnitee has served
on behalf of the Company, or any of its direct or indirect wholly-owned
subsidiaries, as a witness or other participant in any class action or
proceeding, or has been successful, on the merits or otherwise, in defense of
any action, suit or proceeding referred to in Sections 4 and 5 hereof, or in
defense of any claim, issue or matter therein, including, but not limited to,
the dismissal of any action without prejudice, the Indemnitee shall be
indemnified against all Expenses actually and reasonably incurred by the
Indemnitee in connection therewith.
8. PARTIAL INDEMNIFICATION. If the Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of the Expenses, judgments, fines and amounts paid in settlement
actually and reasonably incurred by the Indemnitee in connection with the
investigation, defense, appeal or settlement of such suit, action, investigation
or proceeding described in Sections 4 and 5 hereof, but is not entitled to
indemnification for the total amount thereof, the Company shall nevertheless
indemnify the Indemnitee for the portion of such Expenses, judgments, penalties,
fines and amounts paid in settlement actually and reasonably incurred by the
Indemnitee to which the Indemnitee is entitled.
9. PROCEDURE FOR DETERMINATION OF ENTITLEMENT TO INDEMNIFICATION. (a) To
obtain indemnification under this Agreement, the Indemnitee shall submit to the
Company a written request, including documentation and information which is
reasonably available to the Indemnitee and is reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to indemnification. The
Secretary of the Company shall, promptly upon receipt of a request for
indemnification, advise the Board of Directors in writing that the Indemnitee
has requested indemnification. Any Expenses incurred by the Indemnitee in
connection with the Indemnitee's request for indemnification hereunder shall be
borne by the Company. The Company hereby indemnifies and agrees to hold the
Indemnitee harmless for any Expenses incurred by the Indemnitee under the
immediately preceding sentence irrespective of the outcome of the determination
of the Indemnitee's entitlement to indemnification.
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(b) Upon written request by the Indemnitee for indemnification pursuant to
Sections 4 and 5 hereof, the entitlement of the Indemnitee to indemnification
pursuant to the terms of this Agreement shall be determined by the following
person or persons, who shall be empowered to make such determination: (i) if a
Change in Control shall have occurred, by Independent Counsel (unless the
Indemnitee shall request in writing that such determination be made by the Board
of Directors (or a committee thereof) in the manner provided for in clause
(b)(ii) of this Section 9) in a written opinion to the Board of Directors, a
copy of which shall be delivered to the Indemnitee; (ii) if a Change in Control
shall not have occurred, (A) by the Board of Directors of the Company, by a
majority vote of a quorum consisting of Disinterested Directors, or (B) if a
quorum consisting of Disinterested Directors is not obtainable, or if a majority
vote of a quorum consisting of Disinterested Directors so directs, by
Independent Counsel in a written opinion to the Board of Directors, a copy of
which shall be delivered to the Indemnitee. The Independent Counsel shall be
selected by the Board of Directors and approved by the Indemnitee. Upon failure
of the Board of Directors to so select, or upon failure of the Indemnitee to so
approve, the Independent Counsel shall be selected by the Chancellor of the
State of Delaware or such other person as the Chancellor shall designate to make
such selection. Such determination of entitlement to indemnification shall be
made not later than 45 days after receipt by the Company of a written request
for indemnification. If the person making such determination shall determine
that the Indemnitee is entitled to indemnification as to part (but not all) of
the application for indemnification, such person shall reasonably prorate such
part of indemnification among such claims, issues or matters. If it is so
determined that Indemnitee is entitled to indemnification, payment to Indemnitee
shall be made within 10 days after such determination.
10. PRESUMPTIONS AND EFFECT OF CERTAIN PROCEEDINGS. (a) In making a
determination with respect to entitlement to indemnification, the Indemnitee
shall be presumed to be entitled to indemnification hereunder and the Company
shall have the burden of proof in the making of any determination contrary to
such presumption.
(b) If the Board of Directors, or such other person or persons empowered
pursuant to Section 9 to make the determination of whether the Indemnitee is
entitled to indemnification, shall have failed to make a determination as to
entitlement to indemnification within 45 days after receipt by the Company of
such request, the requisite determination of entitlement to indemnification
shall be deemed to have been made and the Indemnitee shall be absolutely
entitled to such indemnification, absent actual and material fraud in the
request for indemnification or a prohibition of indemnification under applicable
law. The termination of any action, suit, investigation or proceeding described
in Sections 4 or 5 hereof by judgment, order, settlement or conviction, or upon
a plea of nolo contendere or its equivalent, shall not, of itself: (i) create a
presumption that the Indemnitee did not act in good faith and in a manner which
he/she reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any criminal action or proceeding, that the
Indemnitee has reasonable cause to believe that the Indemnitee's conduct was
unlawful; or (ii) otherwise adversely affect the rights of the Indemnitee to
indemnification, except as may be provided herein.
11. ADVANCEMENT OF EXPENSES. Subject to applicable law, all reasonable
Expenses actually incurred by the Indemnitee in connection with any threatened
or pending action, suit or proceeding shall be paid by the Company in advance of
the final disposition of such action, suit
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or proceeding, if so requested by the Indemnitee, within 20 days after the
receipt by the Company of a statement or statements from the Indemnitee
requesting such advance or advances. The Indemnitee may submit such statements
from time to time. The Indemnitee's entitlement to such Expenses shall include
those incurred in connection with any proceeding by the Indemnitee seeking an
adjudication or award in arbitration pursuant to this Agreement. Such statement
or statements shall reasonably evidence the Expenses incurred by the Indemnitee
in connection therewith and shall include or be accompanied by a written
affirmation by the Indemnitee of the Indemnitee's good faith belief that the
Indemnitee has met the standard of conduct necessary for indemnification under
this Agreement and an undertaking by or on behalf of the Indemnitee to repay
such amount if it is ultimately determined that the Indemnitee is not entitled
to be indemnified against such Expenses by the Company pursuant to this
Agreement or otherwise. Each written undertaking to pay amounts advanced must be
an unlimited general obligation but need not be secured, and shall be accepted
without reference to financial ability to make repayment.
12. REMEDIES OF THE INDEMNITEE IN CASES OF DETERMINATION NOT TO INDEMNIFY
OR TO ADVANCE EXPENSES. In the event that a determination is made that the
Indemnitee is not entitled to indemnification hereunder or if the payment has
not been timely made following a determination of entitlement to indemnification
pursuant to Sections 9 and 10, or if Expenses are not advanced pursuant to
Section 11, the Indemnitee shall be entitled to a final adjudication in an
appropriate court of the State of Delaware or any other court of competent
jurisdiction of the Indemnitee's entitlement to such indemnification or advance.
Alternatively, the Indemnitee may, at the Indemnitee's option, seek an award in
arbitration to be conducted by a single arbitrator chosen by the Indemnitee and
approved by the Company, which approval shall not be unreasonably withheld or
delayed. If the Indemnitee and the Company do not agree upon an arbitrator
within 30 days following notice to the Company by the Indemnitee that it seeks
an award in arbitration, the arbitrator will be chosen pursuant to the rules of
the American Arbitration Association (the "AAA"). The arbitration will be
conducted pursuant to the rules of the AAA and an award shall be made within 60
days following the filing of the demand for arbitration. The arbitration shall
be held in Denver, Colorado. The Company shall not oppose the Indemnitee's right
to seek any such adjudication or award in arbitration or any other claim. Such
judicial proceeding or arbitration shall be made de novo, and the Indemnitee
shall not be prejudiced by reason of a determination (if so made) that the
Indemnitee is not entitled to indemnification. If a determination is made or
deemed to have been made pursuant to the terms of Section 9 or Section 10 hereof
that the Indemnitee is entitled to indemnification, the Company shall be bound
by such determination and shall be precluded from asserting that such
determination has not been made or that the procedure by which such
determination was made is not valid, binding and enforceable. The Company
further agrees to stipulate in any such court or before any such arbitrator that
the Company is bound by all the provisions of this Agreement and is precluded
from making any assertions to the contrary. If the court or arbitrator shall
determine that the Indemnitee is entitled to any indemnification hereunder, the
Company shall pay all reasonable Expenses actually incurred by the Indemnitee in
connection with such adjudication or award in arbitration (including, but not
limited to, any appellate proceedings).
13. NOTIFICATION AND DEFENSE OF CLAIM. Promptly after receipt by the
Indemnitee of notice of the commencement of any action, suit or proceeding, the
Indemnitee will, if a claim in respect thereof is to be made against the Company
under this Agreement, notify the Company in
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writing of the commencement thereof. The omission by the Indemnitee to so notify
the Company will not relieve the Company from any liability that it may have to
the Indemnitee under this Agreement or otherwise, except to the extent that the
Company may suffer material prejudice by reason of such failure. Notwithstanding
any other provision of this Agreement, with respect to any such action, suit or
proceeding as to which the Indemnitee gives notice to the Company of the
commencement thereof:
(a) The Company will be entitled to participate therein at its own
expense.
(b) Except as otherwise provided in this Section 13(b), to the extent
that it may wish, the Company, jointly with any other indemnifying party
similarly notified, shall be entitled to assume the defense thereof with
counsel reasonably satisfactory to the Indemnitee. After notice from the
Company to the Indemnitee of its election to so assume the defense thereof,
the Company shall not be liable to the Indemnitee under this Agreement for
any legal or other Expenses subsequently incurred by the Indemnitee in
connection with the defense thereof other than reasonable costs of
investigation or as otherwise provided below. The Indemnitee shall have the
right to employ the Indemnitee's own counsel in such action, suit or
proceeding, but the fees and Expenses of such counsel incurred after notice
from the Company of its assumption of the defense thereof shall be at the
expense of the Indemnitee unless (i) the employment of counsel by the
Indemnitee has been authorized by the Company, (ii) the Indemnitee shall
have reasonably concluded that there may be a conflict of interest between
the Company and the Indemnitee in the conduct of the defense of such action
and such determination by the Indemnitee shall be supported by an opinion
of counsel, which opinion shall be reasonably acceptable to the Company, or
(iii) the Company shall not in fact have employed counsel to assume the
defense of the action, in each of which cases the fees and Expenses of
counsel shall be at the expense of the Company. The Company shall not be
entitled to assume the defense of any action, suit or proceeding brought by
or on behalf of the Company or as to which the Indemnitee shall have
reached the conclusion provided for in clause (ii) above.
(c) The Company shall not be liable to indemnify the Indemnitee under
this Agreement for any amounts paid in settlement of any action, suit or
proceeding affected without its written consent, which consent shall not be
unreasonably withheld. The Company shall not be required to obtain the
consent of the Indemnitee to settle any action, suit or proceeding which
the Company has undertaken to defend if the Company assumes full and sole
responsibility for such settlement and such settlement grants the
Indemnitee a complete and unqualified release in respect of any potential
liability.
(d) If, at the time of the receipt of a notice of a claim pursuant to
this Section 13, the Company has director and officer liability insurance
in effect, the Company shall give prompt notice of the commencement of such
proceeding to the insurers in accordance with the procedures set forth in
the respective policies.
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The Company shall thereafter take all necessary or desirable action to
cause such insurers to pay, on behalf of the Indemnitee, all amounts
payable as a result of such proceeding in accordance with the terms of the
policies.
14. OTHER RIGHT TO INDEMNIFICATION. The indemnification and advancement of
Expenses provided by this Agreement are cumulative, and not exclusive, and are
in addition to any other rights to which the Indemnitee may now or in the future
be entitled under any provision of the Bylaws or Certificate of the Company, the
Certificate or Bylaws or other governing documents of any direct or indirect
wholly-owned subsidiary of the Company, any vote of the stockholders or
Disinterested Directors, any provision of law or otherwise. Except as required
by applicable law, the Company shall not adopt any amendment to its Bylaws or
Certificate the effect of which would be to deny, diminish or encumber the
Indemnitee's right to indemnification under this Agreement.
15. DIRECTOR AND OFFICER LIABILITY INSURANCE. The Company shall, from time
to time, make the good faith determination whether or not it is practicable for
the Company to obtain and maintain a policy or policies of insurance with
reputable insurance companies providing the officers and directors of the
Company, and any direct or indirect wholly-owned subsidiary of the Company, with
coverage for losses from wrongful acts, or to ensure the Company's performance
of its indemnification obligations under this Agreement. Among other
considerations, the Company will weigh the costs of obtaining such insurance
coverage against the protection afforded by such coverage. Notwithstanding the
foregoing, the Company shall have no obligation to obtain or maintain such
insurance if the Company determines in good faith that such insurance is not
necessary or is not reasonably available, if the premium costs for such
insurance are disproportionate to the amount of coverage provided, if the
coverage provided by such insurance is limited by exclusions so as to provide an
insufficient benefit or if the Indemnitee is covered by similar insurance
maintained by a direct or indirect wholly-owned subsidiary of the Company.
However, the Company's decision whether or not to adopt and maintain such
insurance shall not affect in any way its obligations to indemnify its officers
and directors under this Agreement or otherwise. In all policies of director and
officer liability insurance, the Indemnitee shall be named as an insured in such
a manner as to provide the Indemnitee the same rights and benefits as are
accorded to the most favorably insured of the Company's directors, if the
Indemnitee is a director; or of the Company's officers, if the Indemnitee is not
a director of the Company, but is an officer. The Company agrees that the
provisions of this Agreement shall remain in effect regardless of whether
liability or other insurance coverage is at any time obtained or retained by the
Company; except that any payments made to, or on behalf of, the Indemnitee under
an insurance policy shall reduce the obligations of the Company hereunder.
16. SPOUSAL INDEMNIFICATION. The Company will indemnify the Indemnitee's
spouse to whom the Indemnitee is legally married at any time the Indemnitee is
covered under the indemnification provided in this Agreement (even if the
Indemnitee did not remain married to him or her during the entire period of
coverage) against any pending or threatened action, suit, proceeding or
investigation for the same period, to the same extent and subject to the same
standards, limitations, obligations and conditions under which the Indemnitee is
provided indemnification herein, if the Indemnitee's spouse (or former spouse)
becomes involved in a pending or threatened action, suit, proceeding or
investigation solely by reason of his or her
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status as the Indemnitee's spouse, including, without limitation, any pending or
threatened action, suit, proceeding or investigation that seeks damages
recoverable from marital community property, jointly-owned property or property
purported to have been transferred from the Indemnitee to his/her spouse (or
former spouse). The Indemnitee's spouse or former spouse also may be entitled to
advancement of Expenses to the same extent that the Indemnitee is entitled to
advancement of Expenses herein. The Company may maintain insurance to cover its
obligation hereunder with respect to the Indemnitee's spouse (or former spouse)
or set aside assets in a trust or escrow funds for that purpose.
17. INTENT. This Agreement is intended to be broader than any statutory
indemnification rights applicable in the State of Delaware and shall be in
addition to any other rights the Indemnitee may have under the Company's
Certificate, Bylaws, applicable law or otherwise. To the extent that a change in
applicable law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the
Company's Certificate, Bylaws, applicable law or this Agreement, it is the
intent of the parties that the Indemnitee enjoy by this Agreement the greater
benefits so afforded by such change.
18. ATTORNEY'S FEES AND OTHER EXPENSES TO ENFORCE AGREEMENT. In the event
that the Indemnitee is subject to or intervenes in any proceeding in which the
validity or enforceability of this Agreement is at issue or seeks an
adjudication or award in arbitration to enforce the Indemnitee's rights under,
or to recover damages for breach of, this Agreement the Indemnitee, if he/she
prevails in whole or in part in such action, shall be entitled to recover from
the Company and shall be indemnified by the Company against any actual expenses
for attorneys' fees and disbursements reasonably incurred by the Indemnitee.
19. SUBROGATION. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of the Indemnitee, who shall execute all documents required and shall
do all acts that may be necessary to secure such rights and to enable the
Company effectively to bring suit to enforce such rights.
20. EFFECTIVE DATE. The provisions of this Agreement shall cover claims,
actions, suits or proceedings whether now pending or hereafter commenced and
shall be retroactive to cover acts or omissions or alleged acts or omissions
which heretofore have taken place. The Company shall be liable under this
Agreement, pursuant to Sections 4 and 5 hereof, for all acts of the Indemnitee
while serving as a director and/or officer, notwithstanding the termination of
the Indemnitee's service, if such act was performed or omitted to be performed
during the term of the Indemnitee's service to the Company.
21. DURATION OF AGREEMENT. This Agreement shall continue until and
terminate upon the later of: (a) ten years after the Indemnitee has ceased to
occupy any of the positions or have any relationships described in Sections 4
and 5 of this Agreement and (b) the final termination of all pending or
threatened actions, suits, proceedings or investigations to which the Indemnitee
may be subject by reason of the fact that he/she is or was a director, officer,
employee, agent or fiduciary of the Company, or any direct or indirect
wholly-owned subsidiary of the Company, or is or was serving at the request of
the Company as a director, officer, employee, agent or fiduciary of any other
entity, including, but not limited to, another corporation, partnership, limited
liability company, employee benefit plan, joint venture, trust or
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other enterprise, or by reason of any act or omission by the Indemnitee in any
such capacity. The indemnification provided under this Agreement shall continue
as to the Indemnitee even though he/she may have ceased to be a director or
officer of the Company, or any direct or indirect wholly-owned subsidiary of the
Company. This Agreement shall be binding upon the Company and its successors and
assigns, including, without limitation, any corporation or other entity which
may have acquired all or substantially all of the Company's assets or business
or into which the Company may be consolidated or merged, and shall inure to the
benefit of the Indemnitee and his/her spouse, successors, assigns, heirs,
devisees, executors, administrators or other legal representations. The Company
shall require any successor or assignee (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company, by written agreement in form and
substance reasonably satisfactory to the Company and the 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 or
assignment had taken place.
22. DISCLOSURE OF PAYMENTS. Except as expressly required by any federal
securities laws or other federal or state law, neither party hereto shall
disclose any payments under this Agreement unless prior approval of the other
party is obtained.
23. SEVERABILITY. If any provision or provisions of this Agreement shall be
held invalid, illegal or unenforceable for any reason whatsoever, (a) the
validity, legality and enforceability of the remaining provisions of this
Agreement (including, but not limited to, all portions of any Sections of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable) shall not in any way be affected or impaired thereby and (b) to
the fullest extent possible, the provisions of this Agreement (including, but
not limited to, all portions of any paragraph of this Agreement containing any
such provision held to be invalid, illegal or unenforceable, that are not
themselves invalid, illegal or unenforceable) shall be construed so as to give
effect to the intent manifest by the provision held invalid, illegal or
unenforceable.
24. COUNTERPARTS. This Agreement may be executed by 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 shall
be required to be produced to evidence the existence of this Agreement.
25. CAPTIONS. The captions and headings used in this Agreement are inserted
for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.
26. ENTIRE AGREEMENT, MODIFICATION AND WAIVER. This Agreement constitutes
the entire agreement and understanding of the parties hereto regarding the
subject matter hereof, and no supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both 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. No supplement, modification or
amendment to this Agreement shall limit or restrict any right of the Indemnitee
under this Agreement in respect
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of any act or omission of the Indemnitee prior to the effective date of such
supplement, modification or amendment unless expressly provided therein.
27. NOTICES. All notices, requests, demands or other communications
hereunder shall be in writing and shall be deemed to have been duly given if (a)
delivered by hand with receipt acknowledged by the party to whom said notice or
other communication shall have been directed, (b) mailed by certified or
registered mail, return receipt requested with postage prepaid, on the date
shown on the return receipt or (c) delivered by facsimile transmission on the
date shown on the facsimile machine report:
(a) If to the Indemnitee to:
Facsimile:
(b) If to the Company to:
Xxxx Xxxxxxx Corporation
Attn: General Counsel
0000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
or to such other address as may be furnished to the Indemnitee by the Company or
to the Company by the Indemnitee, as the case may be.
28. GOVERNING LAW. The parties hereto agree that this Agreement shall be
governed by, and construed and enforced in accordance with, the laws of the
State of Delaware, applied without giving effect to any conflicts of law
principles.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
XXXX XXXXXXX CORPORATION:
By ________________________
Name:
Title:
INDEMNITEE:
By_________________________
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