Exhibit 10.74
INDEMNIFICATION AGREEMENT
This AGREEMENT is made and entered into this 17th day
of July, 2000, by and between Xxxxxxx Companies, Inc., an
Oklahoma corporation, (the "Company"), and [name of director]
(the "Indemnitee").
WHEREAS, it is essential to the Company and its mission
to retain and attract as directors the most capable persons
available;
WHEREAS, Indemnitee is a director of the Company;
WHEREAS, both the Company and Indemnitee recognize the
omnipresent risk of litigation and other claims that are
routinely asserted against directors of companies operating in
the public arena in today's environment, and the attendant costs
of defending even wholly frivolous claims;
WHEREAS, it has become increasingly difficult to obtain
insurance against the risk of personal liability of directors on
terms providing reasonable protection to the individual at
reasonable cost to the companies;
WHEREAS, the Bylaws of the Company provide certain
indemnification rights to the directors of the Company, and its
directors have relied on this assurance of indemnification, as
provided by Oklahoma law;
WHEREAS, in recognition of 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 increasing difficulty in obtaining and
maintaining satisfactory insurance coverage, and Indemnitee's
reliance on assurance of indemnification, the Company wishes to
provide in this Agreement for the indemnification of and the
advancing of expenses to Indemnitee to the fullest extent
permitted by law (whether partial or complete) 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, the
mutual covenants and agreements contained herein and Indemnitee's
continuing to serve as a director of the Company, the parties
hereto agree as follows:
1. Certain Definitions:
(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 such 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,
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 (b) 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 (in
one transaction or a series of transactions) all or substantially
all the Company's assets.
(b) Claim: any threatened, pending or completed action, suit or
proceeding, whether instituted by the Company or any other party,
or any inquiry or investigation that Indemnitee in good faith
believes might lead to the institution of any such action, suit
or proceeding, whether civil (including intentional and
unintentional tort claims), criminal, administrative,
investigative or other.
(c) Expenses: include attorneys' fees and all other
costs, expenses 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.
(d) Indemnifiable Event: any event or occurrence related
to the fact that Indemnitee is or was a director, officer, employee,
agent or fiduciary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation, 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.
(e) Independent Legal Counsel: an attorney or firm of
attorneys, selected in accordance with the provisions of Section
3, who shall not have otherwise performed services for the
Company or Indemnitee within the last five years (other than with
respect to matters concerning the rights of Indemnitee under this
Agreement, or of other indemnitees under similar indemnification
agreements).
(f) Reviewing Party: any appropriate person or body
consisting of a member or members of the Company's Board of Directors
or any other person or body appointed by the Company's Board of
Directors who is not a party to the particular Claim for which
Indemnitee is seeking indemnification, or Independent Legal
Counsel.
2. Basic Indemnification Arrangement.
(a) 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
as soon as practicable but in any event no later than thirty days
after written demand is presented to the Company, against any and
all Expenses, judgments, fines, penalties and amounts paid in
settlement (including all interest, assessments and other charges
paid or payable in connection with or in respect of such
Expenses, judgments, fines, penalties or amounts paid in
settlement) of such Claim. If so requested by Indemnitee, the
Company shall advance (within two business days of such request)
any and all Expenses to Indemnitee (an "Expense Advance").
(b) Notwithstanding the foregoing, (i) 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 Independent Legal Counsel
referred to in Section 3 hereof is involved) that Indemnitee
would not be permitted to be indemnified under applicable law,
and (ii) the obligation of the Company to make an Expense Advance
pursuant to Section 2(a) shall be subject to the condition that,
if, when and to the extent that the Reviewing Party determines
that Indemnitee would not be permitted to be so indemnified under
applicable law, the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees to reimburse the Company) for all
such amounts theretofore paid; provided, however, that if
Indemnitee has commenced or thereafter commences 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 and Indemnitee shall not be
required to reimburse the Company for any Expense Advance until a
final judicial determination is made with respect thereto (as to
which all rights of appeal therefrom have been exhausted or
lapsed). If there has not been a Change in Control, the
Reviewing Party shall be selected by the Board of Directors, and
if there has been such a Change in Control (other than a Change
in Control which has been approved by a majority of the Company's
Board of Directors who were directors immediately prior to such
Change in Control), the Reviewing Party shall be the Independent
Legal Counsel referred to in Section 3 hereof. If there has been
no determination by the Reviewing Party or if the Reviewing Party
determines that Indemnitee substantively 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 Oklahoma 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, including the legal or factual bases
therefor, and the Company hereby consents to service of process
and agrees to appear in any such proceeding. Any determination
by the Reviewing Party otherwise shall be conclusive and binding
on the Company and Indemnitee.
3. Change in Control. The Company agrees that if there
is a Change in Control of the Company (other than a Change in Control
which has been approved by a majority of the Company's Board of
Directors who were directors immediately prior to such Change in
Control) then with respect to all matters thereafter arising
concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or
Company Bylaw now or hereafter in effect relating to Claims for
Indemnifiable Events, the Company shall seek legal advice only
from Independent Legal Counsel selected by Indemnitee and
approved by the Company (which approval shall not be unreasonably
withheld). Such counsel, among other things, shall render its
written opinion to the Company and Indemnitee as to whether and
to what extent Indemnitee would be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable
fees of the Independent Legal Counsel referred to above and to
fully indemnify 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.
4. Indemnification for Additional Expenses. The Company
shall indemnify Indemnitee against any and all expenses (including
attorneys' fees) and, if requested by Indemnitee, shall (within
two business days of such request) advance such expenses to
Indemnitee, which are incurred by Indemnitee in connection with
any action brought by Indemnitee (whether pursuant to Section 17
of this Agreement or otherwise) for (i) indemnification or
advance payment of Expenses by the Company under this Agreement
or any other agreement or Company Bylaw now or hereafter in
effect relating to Claims for Indemnifiable Events or (ii)
recovery under any directors' and officers' liability insurance
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.
5. Partial Indemnity. If Indemnitee is entitled under
any provision of this Agreement to indemnification by the Company for
some or a portion of the Expenses, judgments, fines, penalties
and amounts paid in settlement of 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. Moreover, 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.
6. Burden of Proof. In connection with any determination
by the Reviewing Party or otherwise as to whether Indemnitee is
entitled to be indemnified hereunder, the burden of proof shall
be on the Company to establish that Indemnitee is not so entitled.
7. No Presumptions. 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. In addition,
neither the failure of the Reviewing Party to have made a
determination as to whether Indemnitee has met any particular
standard of conduct or had any particular belief, nor an actual
determination by the Reviewing Party that Indemnitee has not met
such standard of conduct or did not have such belief, prior to
the commencement of legal proceedings by Indemnitee to secure a
judicial determination that Indemnitee should be indemnified
under applicable law shall be a defense to Indemnitee's claim or
create a presumption that Indemnitee has not met any particular
standard of conduct or did not have any particular belief.
8. Nonexclusivity; Subsequent Change in Law. The rights
of the Indemnitee hereunder shall be in addition to any other rights
Indemnitee may have under the Company's Bylaws or under Oklahoma
law, or otherwise. To the extent that a change in Oklahoma law
(whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently
under the Company's Bylaws and this Agreement, it is the intent
of the parties hereto that Indemnitee shall enjoy by this
Agreement the greater benefits so afforded by such change.
9. Liability Insurance. To the extent the Company main-
tains 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
or officer.
10. Amendments; 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.
11. Subrogation. In the event of payment under this Agree-
ment, 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.
12. 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,
Bylaw or otherwise) of the amounts otherwise indemnifiable hereunder.
13. 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 (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all
or substantially all of the business or assets of the Company),
assigns, spouses, heirs, executors and personal and legal
representatives. This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as a director
of the Company or of any other enterprise at the Company's request.
14. 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) is held by a court of competent jurisdiction to be
invalid, void or otherwise unenforceable in any respect, and the
validity and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in
any way impaired and shall remain enforceable to the fullest
extent permitted by law.
15. Effective Date. This Agreement shall be effective as
of the date hereof and shall apply to any claim for indemnification by
the Indemnitee on or after such date.
16. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State
of Oklahoma applicable to contracts made and to be performed in
such state without giving effect to the principles of conflicts
of laws.
17. Injunctive Relief. The parties hereto agree that
Indemnitee may enforce this Agreement by seeking specific
performance hereof, without any necessity of showing irreparable
harm or posting a bond, which requirements are hereby waived, and
that by seeking specific performance, Indemnitee shall not be
precluded from seeking or obtaining any other relief to which he
may be entitled.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date set forth above.
XXXXXXX COMPANIES, INC.
By:
Title:
INDEMNITEE
[name of director]
