Exhibit 10.4
INDEMNIFICATION AGREEMENT
AGREEMENT between Xxxxxxx Denver, Inc., a Delaware corporation (the
"Company") and (the "Indemnitee").
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WHEREAS, it is essential to the Company to retain and attract as
directors, officers and representatives the most capable persons available;
and
WHEREAS, Indemnitee is a director, officer or representative of the
Company; and
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors,
officers and representatives of public companies in today's environment; and
WHEREAS, in recognition of the Indemnitee's need for substantial
protection against personal liability in order to enhance Indemnitee's
continued service to the Company in an effective manner, the Company wishes
to provide in this Agreement for the indemnification of and the advancing of
expenses to Indemnitee to the full extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the extent
insurance is maintained, for the continued coverage of Indemnitee under the
Company's directors' and officers' liability insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee
continuing to serve the Company directly or, at its request, with another
enterprise, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
(a) Change in Control shall be deemed to have occurred if
(i) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended), other than a
trustee or other fiduciary holding securities under an employee
benefit plan of the Company or 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, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly, of securities of the Company
representing 20% or more of the total voting power represented by
the Company's then outstanding Voting Securities without the prior
approval of the Board of Directors, or (ii) during any period of
two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose
election or nomination for election was previously so approved,
cease for any reason to constitute a majority thereof, or (iii) the
stockholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than a merger or
consolidation which would result in the Voting Securities of the
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into Voting Securities of the surviving entity) at least 80% of the
total voting power represented by the Voting Securities of the
Company or such surviving entity outstanding immediately after such
merger or consolidation, or the stockholders of the Company approve
a plan of complete liquidation of the Company or an agreement for
the sale or disposition by the Company of all or substantially all
the Company's assets.
(b) Claim shall mean any threatened, pending or completed
action, suit or proceeding, or any inquiry or investigation,
whether conducted by the Company or any other party, that
Indemnitee in good faith believes might lead to the institution of
any such action, suit or proceeding, whether civil, criminal,
administrative, investigative or other.
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(c) Expenses shall mean all costs, expenses (including
attorneys' fees) and obligations paid or incurred in connection
with investigating, defending, being a witness in or participating
in (including on appeal) or preparing to defend, be a witness in or
participate in any Claim relating to any Indemnifiable Event
(including all interest, assessments and other charges paid or
payable in connection with or in respect of any of the foregoing).
(d) Judgments shall mean judgments, fines, penalties and
amounts paid in settlement that are paid or payable in connection
with any Claim relating to any Indemnifiable Event (including all
interest, assessments and other charges paid or payable in
connection with or in respect of any of the foregoing).
(e) Indemnifiable Event shall mean any event or occurrence
related to the fact that Indemnitee is or was a director, director
nominee, officer or representative of the Company, or is or was
serving at the request of the Company as a director, trustee,
officer, employee, agent or representative of another corporation,
domestic or foreign, nonprofit or for profit, partnership, joint
venture, employee benefit plan, trust or other enterprise, or by
reason of anything done or not done by Indemnitee in any such
capacity.
(f) Reviewing Party shall mean any appropriate person or
body under Section 145 of the Delaware General Corporation Law,
including a body consisting of a member or members of the Company's
Board of Directors or any other person or body appointed by the
Board (including the special, independent counsel referred to in
Section 3) who is not a party to the particular Claim for which
Indemnitee is seeking indemnification.
(g) Voting Securities shall mean any securities of the
Company that vote generally in the election of directors.
2. Scope of Indemnification.
(a) Indemnification for Judgments and Expenses. In the
event Indemnitee was, is or becomes a party to or witness or other
participant in, or is threatened to be made a party to or witness
or other participant in, a Claim by reason of (or arising in part
out of) an Indemnifiable Event, the Company shall indemnify
Indemnitee to the fullest extent permitted by law against any and
all Expenses and Judgments arising from or relating to such Claim.
Except as otherwise provided in Section 2(b), such indemnification
shall be made as soon as practicable, but in any event not later
than thirty (30) days, after written demand therefor is presented
to the Company by or on behalf of the Indemnitee.
(b) Indemnification and Advance Payment of Expenses. Any
and all Expenses and any and all expenses referred to in Section
2(c) shall be paid by the Company promptly as they are incurred by
Indemnitee (any such payment of expenses by the Company is
hereinafter referred to as an "Expense Advance"). Indemnitee shall
be obligated, and hereby agrees, to repay the amount of Expenses so
paid in the event that Indemnitee shall have been adjudged to be
liable to the Company, unless and only to the extent that the
Delaware Court of Chancery or the court in which such action or
suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Delaware Court of Chancery or
such other court shall deem proper. Indemnitee hereby further
agrees to cooperate reasonably with the Company concerning any
Claim.
(c) Indemnification for Additional Expenses. The Company
shall indemnify Indemnitee against any and all expenses (including
attorneys' fees) that are incurred by Indemnitee in connection with
any claim asserted against or action brought by Indemnitee for
(i) indemnification of Expenses or Judgments or advance payment of
Expenses by the Company under this Agreement or under any other
agreement, the Company's Certificate of Incorporation, statute or
rule of law now or hereafter in effect relating to Claims for
Indemnifiable Events and (ii) recovery under any directors' and
officers' liability insurance policy or policies maintained by the
Company, regardless of whether Indemnitee ultimately is determined
to be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
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(d) Partial Indemnity. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for
some or a portion of the Judgments and Expenses arising from or
relating to a Claim but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for
the portion thereof to which Indemnitee is entitled.
(e) Indemnification of Successful Defense Expenses.
Notwithstanding any other provision of this Agreement, to the
extent that Indemnitee has been successful on the merits or
otherwise in defense of any or all Claims relating in whole or in
part to an Indemnifiable Event or in defense of any issue or matter
therein, including dismissal without prejudice, Indemnitee shall be
indemnified against all Expenses incurred in connection therewith.
3. Reviewing Party Determinations.
(a) General Rules. Notwithstanding the provisions of
Section 2, the obligations of the Company under Section 2(a) shall
be subject to the condition that the Reviewing Party shall not have
determined (in a written opinion, in any case in which the special,
independent counsel referred to in Section 4 hereof is involved)
that Indemnitee would not be permitted to be indemnified under
applicable law; provided, however, that if Indemnitee has commenced
legal proceedings in a court of competent jurisdiction to secure a
determination that Indemnitee should be indemnified under
applicable law, any determination made by the Reviewing Party that
Indemnitee would not be permitted to be indemnified under
applicable law shall not be binding until a final judicial
determination is made with respect thereto (as to which all rights
of appeal therefrom have been exhausted or lapsed) and any such
determination by the Reviewing Party shall be modified, to the
extent necessary, to conform to such final judicial determination.
(b) Selection of Reviewing Party. If there has not been a
Change in Control, the Reviewing Party shall be selected by the
Board of Directors. If there has been such a Change in Control, the
Reviewing Party shall be the special, independent counsel referred
to in Section 4 hereof.
(c) Judicial Review. If there has been no determination by
the Reviewing Party or if the Reviewing Party determines that
Indemnitee substantially would not be permitted to be indemnified
in whole or in part under applicable law, Indemnitee shall have the
right to commence litigation in any court in the State of Delaware
having subject matter jurisdiction thereof and in which venue is
proper seeking an initial determination by the court or challenging
any such determination by the Reviewing Party or any aspect
thereof, and the Company hereby consents to service of process and
to appear in any such proceeding. Any determination by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and Indemnitee.
(d) Burden of Proof. In connection with any determination
by the Reviewing Party pursuant to Section 3(a), or by a court of
competent jurisdiction pursuant to Section 3(c) or otherwise, as to
whether Indemnitee is entitled to be indemnified hereunder, the
burden of proof shall be on the Company to establish by clear and
convincing evidence that Indemnitee is not so entitled.
4. Change in Control. The Company agrees that if there is a
Change in Control of the Company then with respect to all matters thereafter
arising concerning the rights of Indemnitee to indemnity payments under this
Agreement or under any other agreement, the Company's Certificate of
Incorporation, statute or rule of law now or hereafter in effect relating to
Claims for Indemnifiable Events, the Company shall seek legal advice only
from special, independent counsel selected by Indemnitee and approved by the
Company (which approval shall not be unreasonably withheld), and who has not
otherwise performed services for the Company or Indemnitee within the last
five years (other than in connection with such matters); provided, however,
a majority of the Company's Board of Directors, which majority were
directors immediately prior to such Change in Control, may waive this
requirement. The Company agrees to pay the reasonable fees of the special,
independent counsel referred to above and to indemnify fully such counsel
against any and all expenses (including attorneys' fees), claims,
liabilities and damages arising out of or relating to this Agreement or its
engagement pursuant hereto.
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5. No Presumption. For purposes of this Agreement, the
termination of any claim, action, suit or proceeding, by judgment, order,
settlement (whether with or without court approval) or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not create a presumption
that Indemnitee did not meet any particular standard of conduct or have any
particular belief or that a court has determined that indemnification is not
permitted by applicable law.
6. Nonexclusivity. The rights of the Indemnitee hereunder
shall be in addition to any other rights Indemnitee may now or hereafter
have to indemnification by the Company. More specifically, the Parties
intend that Indemnitee shall be entitled to indemnification to the maximum
extent permitted by any or all of the following:
(a) The fullest benefits provided by the Company's
Certificate of Incorporation in effect on the date hereof, a copy
of the relevant portions of which are attached hereto as Exhibit A;
(b) The fullest benefits provided by the Company's
Certificate of Incorporation and Bylaws or their equivalent of the
Company in effect at the time the Indemnifiable Event occurs or at
the time Expenses are incurred by Indemnitee;
(c) The fullest benefits allowable under Delaware law in
effect at the date hereof or as the same may be amended to the
extent that such benefits are increased thereby;
(d) The fullest benefits allowable under the law of the
jurisdiction under which the Company exists at the time the
Indemnifiable Event occurs or at the time Expenses are incurred by
the Indemnitee; and
(e) Such other benefits as are or may be otherwise
available to Indemnitee pursuant to this Agreement, any other
agreement or otherwise.
The parties intend that combination of two or more of the benefits
referred to in (a) through (e) shall be available to Indemnitee to the
extent that the document or law providing for such benefits does not require
that the benefits provided therein be exclusive of other benefits. The
Company hereby undertakes to use its best efforts to assist Indemnitee, in
all proper and legal ways, to obtain all such benefits to which Indemnitee
is entitled.
7. Liability Insurance. The rights of the Indemnitee
hereunder shall also be in addition to any other rights Indemnitee may now
or hereafter have under policies of insurance maintained by the Company or
otherwise. To the extent the Company maintains an insurance policy or
policies providing directors' and officers' liability insurance, 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 Company
director, officer or representative.
The Company shall maintain such insurance coverage for so long as
Indemnitee's services are covered hereunder, provided and to the extent that
such insurance is available on a basis acceptable to the Company. In the
event that such insurance becomes unavailable in the amount of the present
policy limits or in the present scope of coverage at premium costs and on
other terms acceptable to the Company, then the Company may forego
maintenance of all or a portion of such insurance coverage. However, in the
event of any reduction in (or cancellation of) such insurance coverage
(whether voluntary or involuntary), the Company shall, and hereby agrees to,
stand as a self-insurer with respect to the coverage, or portion thereof,
not retained, and shall indemnify the Indemnitee against any loss arising
out of the reduction in or cancellation of such insurance coverage.
8. Period of Limitations. No legal action shall be brought
and no cause of action shall be asserted by or on behalf of the Company or
any affiliate of the Company against Indemnitee, Indemnitee's spouse, heirs,
executors or personal or legal representatives after the expiration of two
years from the date of accrual of such cause of action, and any claim or
cause of action of the Company or its affiliate shall be extinguished and
deemed released unless asserted by the timely filing of legal action within
such two-year period; provided, however, that if any shorter period of
limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.
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9. Amendments. 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 thereof
(whether or not similar) nor shall such waiver constitute a continuing
waiver.
10. 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 Indemnitee, who shall execute all papers
required and shall do everything that may be necessary to secure such
rights, including the execution of such documents necessary to enable the
Company effectively to bring suit to enforce such rights.
11. No Duplication of Payments. The Company shall not be
liable under this Agreement to make any payment in connection with any claim
made against Indemnitee to the extent Indemnitee has otherwise actually
received payment (under any insurance policy, article or otherwise) of the
amounts otherwise indemnifiable hereunder.
12. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors, assigns, including any direct or indirect successor
by purchase, merger, consolidation or otherwise to all or substantially all
of the business and/or assets of the Company, spouses, heirs, and personal
and legal representatives. This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as a director, officer
or representative of the Company or any other enterprise at the Company's
request.
13. Severability. The provisions of this Agreement shall be
severable in the event that any of the provisions hereof (including any
provision within a single section, paragraph or sentence) are held by a
court of competent jurisdiction to be invalid, void or otherwise
unenforceable, and the remaining provisions shall remain enforceable to the
fullest extent permitted by law.
14. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed and effective as of this day of 2002.
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XXXXXXX DENVER, INC.
By:
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Name: Xxxx X. Xxxxxxxx
Title: Chairman, President and
Chief Executive Officer
INDEMNITEE:
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Name:
Title:
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