INDEMNIFICATION AGREEMENT
THIS AGREEMENT entered into this 10th day of March, 1997, by and
between Xxxxxxx Federal Savings Bank, a federally chartered stock savings bank,
duly organized and existing under the laws of the United States of America (the
"BANK"), with its principal place of business situated in Xxxxxxx, Xxxxx County,
Oklahoma, and Xxxxx X. Xxxxxx, Xxxxxxx X. Xxxxxxxxxx, Xxxxx Xxxxxxx, Xxxxx X.
Xxxxxx, Xx., and H. Xxxxxxx Xxxx, (collectively referred to as the "Directors"),
and Xxxxxxx X. Xxxxxxxxxx, H. Xxxxxxx Xxxx, Xxxxxxxx Xxxxxx, Xxxxxxx X. Xxxxxxx,
Xxxxxxxx Xxxxxx, Xxxxxxx Xxxxxxx (collectively referred to as the "Officers",
and individually as "Officer").
NOW THEREFORE, in consideration of the mutual covenants and promises
herein contained, the parties hereto do hereby agree as follows:
1. DEFINITION. For purposes of this Agreement, the following terms
shall have the following meaning:
a) Qualified Action. The term "qualified action" means any judicial or
administrative proceeding, or threatened proceeding, whether civil, criminal, or
otherwise, including any appeal or other proceeding for review;
b) Court. The term "court" includes, without limitation, any court to
which or in which any appeal or any proceeding for review is brought.
c) Final Judgment. The term "final judgment" means a judgment, decree
or order which is not appealable or as to which the period for appeal has
expired with no appeal taken.
d) Settlement. The term "settlement" includes entry of a judgment by
consent or confession or a plea of guilty or nolo contendere.
References in this section to any individual or other persons,
including any association, shall include legal representatives, successors, and
assigns thereof.
2. INDEMNITY. The BANK, in consideration of, and as an inducement to
the Directors to serve on the BANK'S Board of Directors, and to the Officers of
the BANK for their service, subject to the terms and conditions of this
Agreement, agrees to indemnify and hold harmless the Directors and Officers from
and against liability for the following:
a) Any amount for which a Director or Officer, becomes liable under a
judgment in a qualified action; and
b) Reasonable costs and expenses, including reasonable attorney's fees,
actually paid or incurred by a Director or Officer in defending or settling a
qualified action, or in enforcing his or her rights under this Agreement if he
or she attains a favorable judgment in such qualified enforcement action.
c) The BANK shall have the power to indemnify any Director or Officer
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative, or investigative by reason of the fact that he/she is or was a
director of the BANK, against expenses (incurred but not limited to attorneys
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he/she
acted in good faith and in a manner he/she reasonably believed to be in or not
opposed to the best interests of the BANK, and, with respect to any criminal
action or proceeding had no reasonable cause to believe his/her conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea or nolo contendere or its equivalent
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which he/she reasonably believed to be in or not opposed o
the best interest of the BANK, and with respect to any criminal action or
proceeding, has reasonable cause to believe that his/her conduct was unlawful.
d) The BANK shall have the power to indemnify any Director or Officer
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the BANK to procure a
judgment in its factor by reason of the fact that he/she is or was a director of
the BANK, against expenses (including but not limited to attorney fees) actually
and reasonably incurred by him/her in connection with the defense or settlement
of such action or suit if he/she acted in good faith and in a manner reasonably
believed to be in or not opposed to the best interests of the BANK and except
that no indemnification shall be made in respect of any claim, issue or matter
as to which such Director shall have been adjudged to be liable for negligence
or misconduct in the performance of his/her duty to the corporation unless and
only to the extent that the court in which such action or suit was brought shall
determine upon application, that despite the adjudication or liability but in
view of all circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such court shall deem proper.
3. CONDITIONS PRECEDENT. THE BANK shall indemnify a Director or Officer
as provided herein, only if:
a) Final judgment on the merits is entered in favor of the Director or
Officer seeking indemnification; or
b) In case of:
1) Settlement,
2) Final judgment against him or her, or
3) Final judgment in his or her favor, other than on the
merits, if a majority of the disinterested Directors
of the BANK determine that he or she was acting in
good faith within the scope of his or her employment
or authority as he or she could reasonably have
perceived it under the circumstances and for a
purpose he or she could have believed under the
circumstances was in the best interests of the BANK
or its depositors or shareholders.
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c) Any indemnification under subsections (a) or (b) (unless ordered by
a court) shall be made by the BANK only as authorized in the specific case upon
a determination that indemnification of the Director or Officer is proper in the
circumstances because he/she has met the applicable standard of conduct set
forth in subsections (a) or (b). Such determination shall be made (1) by the
Board of Directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceedings, or (2) by the
shareholders.
d) The indemnification provided by this section shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any bylaw, agreement, vote of shareholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office, and shall continue as to a person
who has ceased to be a director or officer and shall inure to the benefit of the
heirs, executors and administrators of such a person.
4. INSURANCE. The BANK may obtain insurance to protect it and its
Directors and Officers from potential losses arising from claims against either
of them for alleged wrongful acts, or wrongful acts, committed in their capacity
as Directors or Officers. However, no right exists to secure insurance providing
for payment of losses of any Director or Officer incurred as a consequence of
his or her willful or criminal misconduct.
5. PAYMENT OF EXPENSES. If a majority of the Directors of the BANK
conclude that, in connection with a qualified action, a Director or Officer
ultimately may become entitled to indemnification under this Agreement, the
Directors or Officers may authorize payment of reasonable costs and expenses,
including reasonable attorneys' fees, arising from the defense or settlement of
such qualified action. Nothing in this paragraph shall prevent the Directors or
Officers of the BANK from imposing such conditions on a payment of expenses as
they deem warranted and in the interests of the BANK. Prior to making any
advance payment of expenses under this paragraph, the BANK shall obtain a
written agreement from the affected Director or Officer that the BANK will be
repaid if the Director or Officer on whose behalf payment is made is later
determined not to be entitled to such indemnification. The BANK may also require
an undertaking of the Director or Officer by or on behalf of the Director or
Officer to repay such amount unless it shall ultimately be determined that he or
she is entitled to be indemnified by the BANK as provided in this Agreement.
6. EXCLUSIONS. A Director or Officer shall not be entitled to
indemnification in connection with any action, suit, or proceeding, arising out
of or relating to conduct of the director or Officer which constitutes:
a) A breach of the Director's or Officer's duty of loyalty to the BANK
or its shareholders;
b) An act or omission not in good faith or which involves intentional
misconduct or a violation of law; or
c) Any transaction from which the Director or Officer seeking
indemnification derived an improper personal benefit.
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7. REGULATORY LIMITATIONS.
a) Notwithstanding anything herein to the contrary, no indemnification
shall be made in accordance with this Agreement unless the BANK gives the Office
Of Thrift Supervision ("OTS") at least 60 days' notice of its intention to make
such indemnification in accordance with OTS regulations at 12 CFR 545.121. Such
notice shall state the facts on which the action arose, the terms of any
settlement, and any disposition of the action by a court. Such notice, a copy
thereof, and a certified copy of the resolution containing the required
determination by the Board of Directors shall be sent to the Regional Director
of the OTS, who shall promptly acknowledge receipt thereof. The notice period
shall run from the date of such receipt. No such indemnification shall be made
if the Regional Director of the OTS advises the BANK in writing, within such
notice period, of its objection thereto.
(b) Notwithstanding anything herein to the contrary, the
indemnification provided for in accordance with this Agreement is subject to and
qualified by the limitations as contained at 12 U.S.C. 1821(k).
8. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of such
together shall constitute one and the same instrument.
9. HEADINGS AND CONSTRUCTION. The headings contained in this Agreement
are inserted for convenience only, and shall not constitute a part hereof.
10. BINDING EFFECT. This agreement shall be binding upon all parties
signatory hereto and their respective heirs, legal representatives, successors
and assigns.
11. INVALIDITY. If any one or more of the provisions of this Agreement
shall for any reason be held to be invalid, illegal, or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect the
remaining provisions of this Agreement, and this document shall be construed as
if such invalid, illegal or unenforceable provision had never been contained
herein.
12. ENTIRE PURCHASE CONTRACT. This Agreement constitutes the entire
Agreement between the parties hereto and supersedes any and all prior and
contemporaneous negotiations, agreements and understandings between the parties
hereto pertaining to the subject matter hereof.
13. EXAMINATION. The parties' signatory hereto hereby state and
acknowledge that they have heretofore examined, reviewed and inspected all
books, records, documents and related data regarding the BANK. Pursuant to such
exercise, each party's signatory hereto states and acknowledges that it is
satisfied in all respects regarding the assets, liabilities, claims, rights,
duties and business affairs of the BANK. Each of the undersigned further
acknowledges that he/she has read this Agreement, understands the contents
thereof, and has had the opportunity for an independent attorney of his/her
choosing who is not a party hereto, to review this Agreement on his/her behalf
and has been advised accordingly by such independent attorney.
14. GOVERNING LAW. It is agreed between the parties hereto that this
Agreement shall be construed by the laws of the State of Oklahoma, except to the
extent that federal law shall be deemed to preempt such state law.
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