Exhibit (h)(6)
FORM OF INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT is made this 14th day of October, 2003
("Agreement"), by and between Xxxxxxx Investments, a Massachusetts business
trust (the "Company"), and __________________________ ("Indemnitee").
WHEREAS, Indemnitee currently serves as a trustee and/or officer of the
Company and may, therefore, be subjected to claims, suits or proceedings arising
as a result of his service; and
WHEREAS, as an inducement to Indemnitee to continue to serve as such
trustee and/or officer, the Board of Trustees, pursuant to power and authority
granted by Article III of the Declaration of Trust, including, but not limited
to, Sections 3.1 and 3.10 thereof, have authorized the Company to indemnify
Indemnitee against expenses and costs incurred by Indemnitee in connection with
any such claims, suits or proceedings, to the fullest extent that is lawful; and
WHEREAS, the parties by this Agreement desire to set forth their
agreement regarding indemnification;
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. Definitions. For purposes of this Agreement:
(a) "Board of Trustees" means the Board of Trustees of the
Company.
(b) "Change in 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.
(c) "Corporate Status" means the status of a person as a
trustee, officer, employee or agent 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.
(d) "Disinterested Trustee" means a trustee of the Company who
is not and was not a party to the Proceeding in respect of which indemnification
or advance of Expenses is sought by Indemnitee.
(e) "Effective Date" means October 14, 2003.
(f) "Expenses" shall include all reasonable 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 of the
types customarily incurred in connection with prosecuting, defending,
preparing to prosecute or defend, investigating, or being or preparing to be a
witness in a Proceeding.
(g) "Independent Counsel" means a law firm, or a member of a
law firm, other than a law firm or a member of a law firm that has previously
served as Independent Counsel pursuant to the terms of this Agreement, selected
by the Board of Trustees by vote as set forth in Section 8(b)(ii), that is
experienced in matters of corporation law and neither presently is, nor in the
past five years has been, retained to represent: (i) the Company or Indemnitee
in any matter material to either such party, 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.
(h) "Proceeding" includes any threatened, pending or completed
action, suit, arbitration, alternate dispute resolution mechanism,
investigation, administrative hearing or any other proceeding, whether civil,
criminal, administrative or investigative.
Section 2. Services by Indemnitee. Indemnitee agrees to continue to
serve as a trustee and/or officer of the Company; provided, however, that
Indemnitee may at any time and for any reason resign from such position (subject
to any other contractual obligation or any obligation imposed by operation of
law), in which event the Company shall have no obligation under this Agreement
to continue Indemnitee in such position.
Section 3. Indemnification - General. The Company shall indemnify,
and advance Expenses to, Indemnitee (a) as provided in this Agreement and (b) to
the fullest extent permitted by Massachusetts law in effect on the date hereof
and as amended from time to time; provided, however, that no change in
Massachusetts law shall have the effect of reducing the benefits available to
Indemnitee hereunder based on Massachusetts law as in effect on the date hereof.
The rights of Indemnitee provided in this Section shall include, but shall not
be limited to, the rights set forth in the other Sections of this Agreement.
Provided further, however, that the Company shall not indemnify, nor advance
Expenses to, Indemnitee if doing so is not permitted by the Investment Company
Act of 1940, the rules and regulations thereunder or published releases and no
action letters of the Securities and Exchange Commission.
Section 4. Proceedings Other Than Proceedings by or in the Right of
the Company. 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 any Proceeding, other than a Proceeding by or
in the right of the Company. Pursuant to this Section 4, Indemnitee shall be
indemnified against all Expenses, judgments, penalties, fines and amounts paid
in settlement actually and reasonably incurred by him or on his behalf in
connection with a Proceeding by reason of his Corporate Status unless, with
respect to such Proceeding, he shall have been adjudicated not to have acted in
good faith in the reasonable belief that his action was in the best interest of
the Company.
Section 5. Proceedings by or in the Right of the Company. Indemnitee
shall be entitled to the rights of indemnification provided in this Section 5
if, by reason of his Corporate
2
Status, he is, or is threatened to be, made a party to any Proceeding brought by
or in the right of the Company to procure a judgment in its favor. Pursuant to
this Section 5, Indemnitee shall be indemnified against all amounts paid in
settlement and all Expenses actually and reasonably incurred by him or on his
behalf in connection with such Proceeding unless, with respect to such
Proceeding, he shall have been adjudicated not to have acted in good faith in
the reasonable belief that his action was in the best interest of the Company.
Section 6. Indemnification for Expenses of a Party Who is Wholly or
Partly Successful. Notwithstanding any other provision of this Agreement, to the
extent that Indemnitee is, by reason of his Corporate Status, made a party to
and is successful, on the merits or otherwise, in the defense of any Proceeding,
he shall be indemnified 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 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 7. Advance of Expenses. The Company shall advance all
reasonable Expenses incurred by or on behalf of Indemnitee in connection with
any Proceeding to which Indemnitee is, or is threatened to be, made a party,
within five 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 a written undertaking by or on
behalf of Indemnitee to repay any Expenses advanced if it shall ultimately be
adjudicated that Indemnitee is not entitled to indemnification under
Massachusetts law.
Section 8. Procedure for Determination of Entitlement to
Indemnification.
(a) To obtain indemnification under this Agreement, Indemnitee
shall submit to the Company a written request, along with an undertaking to
repay any indemnification payments to the Company if it is ultimately
adjudicated that Indemnitee is not entitled to indemnification under
Massachusetts law. The Secretary of the Company shall, promptly upon receipt of
such a request for indemnification, advise the Board of Trustees in writing that
Indemnitee has requested indemnification.
(b) Upon written request by Indemnitee for indemnification
pursuant to the first sentence of Section 8(a) hereof, a determination, but only
if required by applicable law, with respect to Indemnitee's entitlement thereto
shall promptly be made in the specific case: (i) if a Change in Control shall
have occurred, by Independent Counsel in a written opinion to the Board of
Trustees, a copy of which shall be delivered to Indemnitee; or (ii) if a Change
in Control shall not have occurred, (A) by the Board of Trustees by a majority
vote of a quorum consisting of Disinterested Trustees, or (B) if a quorum of the
Board of Trustees consisting of Disinterested Trustees is not obtainable or,
even if obtainable, such quorum of Disinterested Trustees so
3
directs, by Independent Counsel in a written opinion to the Board of Trustees, a
copy of which shall be delivered to Indemnitee or (C) if so directed by a
majority of the members of the Board of Trustees, by the stockholders of the
Company. If it is determined that Indemnitee is entitled to indemnification,
payment to Indemnitee shall be made within five days after such determination.
Indemnitee shall cooperate with the person making such determination with
respect to Indemnitee's entitlement to indemnification, including providing to
such person upon reasonable advance request any 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 reasonable attorneys' fees and
disbursements) incurred by Indemnitee in so cooperating with the person making
such determination, in response to a request by such person, shall be borne by
the Company (irrespective of the determination as to Indemnitee's entitlement to
indemnification).
Section 9. Presumptions and Effect of Certain Proceedings.
(a) If a Change in Control shall have occurred, in making a
determination with respect to entitlement to indemnification hereunder, (i) the
person 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 (ii) the
Company shall have the burden of proof to overcome that presumption in
connection with the making of any determination contrary to that presumption.
(b) The termination of any Proceeding by judgment, order,
settlement, conviction, a plea of nolo contendere or its equivalent, or an entry
of an order of probation prior to judgment, does not create a presumption that
the Indemnitee did not meet the requisite standard of conduct described herein
for indemnification.
Section 10. Remedies of Indemnitee.
(a) In the event that (i) a determination is made pursuant to
Section 8 that Indemnitee is not entitled to indemnification under this
Agreement, (ii) advancement of Expenses is not timely made pursuant to Section
7, (iii) no determination of entitlement to indemnification shall have been
made pursuant to Section 8(b) within 90 days after receipt by the Company of
the request for indemnification, (iv) payment of indemnification is not made
pursuant to Section 6 within five days after receipt by the Company of a
written request therefor, or (v) payment of indemnification is not made within
five days after a determination has been made that Indemnitee is entitled to
indemnification, Indemnitee shall be entitled to an adjudication in an
appropriate court of the State of Massachusetts, or in any other court of
competent jurisdiction, of his entitlement to such indemnification or
advancement of Expenses. Alternatively, Indemnitee, at his option, may seek an
award in arbitration to the fullest extent permitted by and in accordance with
the Investment Company Act of 1940, as amended, and the rules thereunder, to be
conducted by a single arbitrator pursuant to the commercial Arbitration Rules
of the American Arbitration Association. If the parties fail to agree on a
single arbitrator, within ten (10) days after the initiation of the arbitration
proceeding, the Indemnitee and the Company shall each select one arbitrator,
and the two arbitrators so selected shall select a third arbitrator. Indemnitee
shall commence such proceeding seeking an adjudication or an award in
arbitration within 180 days after the date on which Indemnitee first has the
right to commence such proceeding pursuant to this Section 10(a).
(b) If a Change in Control shall have occurred, in any
judicial proceeding or arbitration commenced pursuant to this Section 10 the
Company shall have the burden of proving
4
that Indemnitee is not entitled to indemnification or advancement of Expenses,
as the case may be.
(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 1) actually and reasonably incurred by him in such
judicial adjudication or arbitration, but only if 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.
Section 11. Non-Exclusivity; Insurance; Subrogation; Exclusions.
(a) The rights of indemnification and advance of Expenses as
provided by this Agreement have been authorized by the Trustees under Article
III of the Declaration of Trust and shall not be deemed exclusive of any other
rights to which Indemnitee may at any time be entitled under applicable law, the
Declaration of Trust or Bylaws of the Company, any agreement, a vote of
stockholders or a resolution of trustees, or otherwise and such rights shall not
apply to, or be deemed in any way to limit, the rights granted under this
Agreement. 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.
(b) To the extent that the Company maintains liability
insurance for trustees, 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
trustee, 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, who 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 hereunder if and to the
extent that Indemnitee has
5
otherwise actually received such payment under any insurance policy, contract,
agreement or otherwise.
(e) Notwithstanding any other provision of this Agreement to
the contrary, the Company shall not be liable for indemnification or advance of
Expenses in connection with any settlement or judgment for xxxxxxx xxxxxxx or
for disgorgement of profits pursuant to Section 16(b) of the Securities Exchange
Act of 1934.
Section 12. Duration of Agreement. This Agreement shall continue until
and terminate five years after the date that Indemnitee shall have ceased to
serve as a trustee, officer, employee, or agent of the Company or of any other
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise which Indemnitee served at the request of the Company; provided, that
the rights of Indemnitee hereunder shall continue until 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 relating thereto. This Agreement
may be assigned by the Company upon written consent of the Indemnitee and shall
be binding upon the Company and its successors and assigns (except for the
obligations set forth in Section 2 and Section 11(b)), and shall inure to the
benefit of Indemnitee and his heirs, executors and administrators. This
Agreement shall be binding on successors and assigns only for five years
following the succession or assignment subject to the proviso set forth in the
first sentence of this Section 12.
Section 13. Severability. If any provision or provisions of this
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 (b) 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
Expenses.
(a) Notwithstanding any other provision of this Agreement,
Indemnitee shall not be entitled to indemnification or advance of Expenses under
this Agreement with respect to any proceeding brought by Indemnitee, unless the
bringing of such proceeding or making of such claim (i) is pursuant to Section
10 hereof or (ii) shall have been approved by a vote of the Board of Trustees as
required by the Company's Bylaws.
(b) Notwithstanding any other provision of this Agreement, the
Company shall not indemnify or advance Expenses to Indemnitee if doing so would
protect Indemnitee against liability to the Company or its stockholders to which
Indemnitee would otherwise be subject by reason of willful misfeasance, bad
faith, or gross negligence, in the performance of Indemnitee's duties, or by
reason of Indemnitee's reckless disregard of his obligations and duties under
this Agreement.
6
Section 15. Identical Counterparts. This Agreement may be executed in
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
are inserted for convenience only and shall not be deemed to constitute part of
this Agreement or to affect the construction thereof.
Section 17. 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 18. Notice by Indemnitee. Indemnitee shall promptly 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 advance of Expenses covered
hereunder.
Section 19. 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:
Xxxx Xxxxxxx
Xxxx, Xxxx & Xxxxx LLC
00 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
(b) If to the Company to:
Xxxxxxx Investments
000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx, Chairman and Trustee
with a copy to:
Xxxxxx Xxxxxxx PLLC
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxxx
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.
7
Section 20. Governing Law. The parties agree that this Agreement shall
be governed by, and construed and enforced in accordance with, the laws of the
State of Massachusetts.
Section 21. Miscellaneous.
(a) Use of the masculine pronoun shall be deemed to include usage of
the feminine pronoun where appropriate.
(b) The property of the Company's shareholders, trustees, officers,
employees and agents shall not be subject to claims against or obligations of
the Company to any extent whatsoever. Neither the shareholders, the trustees,
the officers, the employees nor any agent of the Company is liable hereunder,
and the parties hereto shall look solely to the Company for the payment of any
claim thereunder or for the performance thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
ATTEST: XXXXXXX INVESTMENTS
___________________________________ By: _______________________________
Xxxxxx X. Xxxxxx, Secretary Xxxx X. Xxxxxxxx, Chairman
WITNESS: INDEMNITEE
___________________________________ ___________________________________
8
