1
EXHIBIT 10.15
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT, dated as of June ___, 1999, is
between AMERICAN NATIONAL CAN COMPANY, a Delaware corporation ("ANC") and
PECHINEY, a corporation (societe anonyme) organized and existing under the laws
of the Republic of France ("Pechiney").
WHEREAS, in contemplation of an initial public offering
("IPO") of common stock of American National Can Group, Inc., a Delaware
corporation ("ANC Group"), (i) ANC has transferred to Pechiney Plastic
Packaging, Inc., a Delaware corporation ("Pechiney Plastics"), all of ANC's
assets and liabilities relating to flexible packaging, plastic bottles and
laminated and plastic tube operations conducted by ANC (the "Plastic Packaging
and Tube Operations"), and (ii) Pechiney has transferred, or caused to be
transferred, all of the beverage can operations conducted by its direct and
indirect subsidiaries to ANC Group;
WHEREAS, in connection with the IPO, Pechiney has agreed to
provide indemnification to ANC for and against any direct losses incurred in
respect of certain potential and unidentified environmental liabilities relating
to its past and present operations and facilities (other than its beverage
operations or the Plastic Packaging and Tube Operations transferred to Pechiney
Plastics), as set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
mutual agreements and covenants contained herein, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. The following terms
shall have the meanings defined for such terms in the Sections of this Agreement
set forth below:
"Affiliate" means, with respect to any specified Person, any
other Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.
"Law" means any federal, state, local or foreign statute, law
ordinance, regulation, rule, code, order requirement or rule of common law.
"Person" means any individual, partnership, limited liability
company, firm, corporation, association, trust, unincorporated organization or
other entity, as well as any
1
2
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.
["Tax" or "Taxes" means any and all taxes, fees, levies,
duties, tariffs, imposts, and other charges of any kind (together with any and
all interest, penalties, additions to tax and additional amounts imposed with
respect thereto) imposed by any government or taxing authority.]
SECTION 1.02. Other Defined Terms. The following terms shall
have meanings defined for such terms in the Sections of this Agreement set forth
below:
Term Section
AAA Rules 3.09
ANC Preamble
ANC Group Recitals
Indemnitee 2.01(a)
IPO Recitals
Loss 2.01(a)
Pechiney Preamble
Pechiney Plastics Recitals
Plastic Packaging and Tube Operations Recitals
Third Party Claims 2.03
ARTICLE II
INDEMNIFICATION
SECTION 2.01. Indemnification by Pechiney. (a) Subject to the
terms and conditions of this Agreement, Pechiney agrees to indemnify, defend and
hold harmless ANC, its officers, directors, employees, agents, successors and
permitted assigns (each, an "Indemnitee") from and against any and all
liabilities, losses, damages, claims, costs (including the costs of any
investigation, testing, compliance or remedial action) and expenses, interest,
awards, judgments, fines and penalties (including, without limitation,
reasonable attorney's fees and expenses) actually suffered or incurred by them
(each, a "Loss") resulting directly from, based directly upon, or arising
directly out of any environmental matter or condition related to the business,
assets or operations of ANC (other than the Plastic Packaging and Tube Business,
assets and operations transferred to Pechiney Plastics and ANC's beverage can
business, assets and operations) that has not been identified on or prior to the
date of the IPO.
(b) Notwithstanding anything to the contrary contained in this
Agreement, Pechiney shall not be required to indemnify, defend or hold harmless
any Indemnitee against or reimburse any Indemnitee for any Losses with respect
to any claim (i) unless such claim involves
2
3
Losses in excess of $500,000 (which amount will not be applied to or considered
for purposes of calculating the aggregate amount that Pechiney shall be required
to indemnify), (ii) unless such claim or demand is notified to Pechiney in
accordance with Section 2.03 on or before the tenth anniversary of the date of
the IPO, and (iii) the procedures set out in Section 2.04(a) have been complied
with; provided, however, that, in each case, Pechiney's indemnification
obligations shall not exceed 80% of the amount of any Loss claimed.
(c) Notwithstanding anything to the contrary contained in this
Agreement, the maximum aggregate amount of indemnifiable Losses which may be
recovered from Pechiney pursuant to this Agreement shall not exceed
U.S.$75,000,000.
(d) Notwithstanding anything to the contrary contained in this
Agreement, Pechiney shall not be liable for any indirect or consequential Loss.
[SECTION 2.02. Adjustments for Taxes. The amount of any Loss
shall be: (i) increased to take into account any net Tax cost actually incurred
by the Indemnitee arising from any payments received from Pechiney (grossed up
to take into account the net Tax cost actually incurred by the Indemnitee
arising from such increase), and (ii) reduced to take account of any net Tax
benefit actually realized by the Indemnitee arising from the incurrence or
payment of any such Loss. In computing the amount of such Tax cost or Tax
benefit, the Indemnitee shall be deemed to recognize all other items of income,
gain, loss, deduction or credit before recognizing any item arising for the
receipt of any payment with respect to an Loss or the incurrence or payment of
any Loss.]
SECTION 2.03. Notice of Claims. An Indemnitee shall give
Pechiney notice of any matter which an Indemnitee determines has given or could
give rise to a right of indemnification under this Agreement, within 60 days of
such determination, stating the amount of the Loss, if known, and method of
computation thereof.
SECTION 2.04. Defense of Third Party Claims. The obligations
and liabilities of Pechiney under this Agreement with respect to Losses arising
from claims of any third party which are subject to the indemnification provided
for in this Agreement ("Third Party Claims") shall be governed by the following
additional terms and conditions:
(a) if an Indemnitee shall receive notice of any
Third Party Claim, the Indemnitee shall give Pechiney notice of such
Third Party Claim within 30 days of the receipt by the Indemnitee of
such notice; provided, however, that the failure to provide such notice
shall not release Pechiney from any of its obligations under this
Agreement, except to the extent Pechiney is materially prejudiced by
such failure;
(b) if Pechiney acknowledges in writing its
obligation to indemnify the Indemnitee hereunder against any Losses
that may result from such Third Party Claim, then Pechiney shall be
entitled to assume and control the defense of such Third Party Claim,
at its expense and through counsel of its choice, upon notice of its
intention to do
3
4
so to the Indemnitee within 30 days of the receipt of
such notice from the Indemnitee; provided, however, that if there
exists or is reasonably likely to exist a conflict of interest that
would make it inappropriate in the judgment of the Indemnitee for the
same counsel to represent both the Indemnitee and Pechiney, then the
Indemnitee shall be entitled to retain its own counsel (which shall not
in any way limit or restrict the right of Pechiney to assume and
control such Third Party Claim), in each jurisdiction for which the
Indemnitee determines counsel is required, at its own expense;
(c) in the event Pechiney exercises the right to
undertake any such defense against any such Third Party Claim, the
Indemnitee shall cooperate with Pechiney in such defense and make
available to Pechiney, at Pechiney's expense, all witnesses, pertinent
records, materials and information in the Indemnitee's possession or
under the Indemnitee's control relating thereto as is reasonably
required by Pechiney;
(d) in the event the Indemnitee is, directly
conducting or participating in the defense against any such Third Party
Claim, Pechiney shall cooperate with the Indemnitee in such defense and
make available to the Indemnitee, at the Indemnitee's expense, all such
witnesses, records, materials and information in Pechiney's possession
or under Pechiney's control relating thereto as is reasonably required
by the Indemnitee; and
(e) no Third Party Claim may be settled by Pechiney
without the written consent of the Indemnitee, unless the settlement
only requires payment of money damages which trigger Pechiney's
indemnification obligations under this Agreement.
ARTICLE III
MISCELLANEOUS PROVISIONS
SECTION 3.01. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of Illinois,
applicable to contracts executed in and to be performed entirely within that
state.
SECTION 3.02. Currency. Unless otherwise specified in this
Agreement, all references to currency, monetary values and dollars set forth
herein mean United States (U.S.) Dollars and all payments hereunder shall be
made in United States Dollars.
SECTION 3.03. Specific Performance. Each of the parties
acknowledges that money damages would not be a sufficient remedy for any breach
of this Agreement and that irreparable harm would result if this Agreement were
not specifically enforced. Therefore, the rights and obligations of the parties
under this Agreement shall be enforceable by a decree of specific performance
issued by any court of competent jurisdiction, and appropriate injunctive relief
may be applied for and granted in connection therewith. A party's right to
specific performance shall be in addition to all other legal or equitable
remedies available to such party.
4
5
SECTION 3.04. Waiver of Jury Trial. Each of the parties
irrevocably waives to the extent permitted by law all rights to trial by jury in
any action, proceeding or counterclaim arising out of or relating to this
Agreement.
SECTION 3.05. Headings. The article and section headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.
SECTION 3.06. Entire Agreement. This Agreement embodies the
entire agreement and understanding of the parties hereto in respect of the
subject matter contained herein and therein and supersede all prior agreements
and understandings between the parties with respect to the subject matter hereof
and thereof.
SECTION 3.07. Severability. If any one or more provisions
contained in 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 any other provision of this Agreement, but
this Agreement shall be construed as if such invalid, illegal, or unenforceable
provision had never been contained herein.
SECTION 3.08. No Third Party Beneficiaries. This Agreement
shall be binding upon and inure solely to the benefit of the parties hereto and
their permitted assigns and nothing herein, express or implied, is intended to
or shall confer upon any other Person any legal or equitable right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.
SECTION 3.09. Arbitration. (a) Any controversy, claim or
dispute arising out of or in connection with this Agreement or the breach,
termination, enforceability or validity hereof, including without limitation the
determination of the scope or applicability of the agreement to arbitrate set
forth in this Section 3.09, shall be fully and finally determined exclusively by
binding arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association (the "AAA Rules"). The seat of the arbitration
shall be the City of Chicago, State of Illinois. The arbitral tribunal shall be
comprised of three arbitrators appointed in accordance with the AAA Rules.
(b) No provision of, nor the exercise of any rights under,
this Section 3.09 shall limit the right of any party to request and obtain from
a court of competent jurisdiction in the City of Chicago, State of Illinois
(which shall have exclusive jurisdiction for purposes of this Section 3.09(b))
before, during or after the pendency of any arbitration, solely for the purpose
of seeking provisional or conservatory remedies in aid of the arbitration,
including, but not limited to, injunctive relief, in accordance with the AAA
Rules. The institution and maintenance of an action or judicial proceeding for,
or pursuit of, provisional or conservatory remedies shall not constitute a
waiver of the right of any party, even if it is the plaintiff, to submit the
dispute to arbitration if such party would otherwise have such right.
5
6
(c) Judgment upon the award rendered may be entered in any
court having jurisdiction. The parties hereby expressly consent to the
nonexclusive jurisdiction of the state and federal courts situated in the City
of Chicago, State of Illinois for this purpose and waive objection to the venue
of any proceeding in such court or that such court provides an inconvenient
forum.
(d) Each of the parties shall, subject to the award of the
arbitrators, pay an equal share of the arbitrators' fees.
SECTION 3.10. Assignment. This Agreement or any rights or
obligations arising hereunder may not be assigned by operation of Law or
otherwise without the express written consent of ANC and Pechiney (which consent
may be granted or withheld in the sole discretion of ANC and Pechiney);
provided, however, that (i) Pechiney may assign this Agreement, in whole and not
in part, or any of its rights hereunder, to an Affiliate of Pechiney, without
the consent of ANC (provided that Pechiney shall nevertheless remain obligated
to perform its obligations hereunder following any such assignment), and (ii)
ANC may assign this Agreement, in whole and not in part, to a Person who
acquires all or substantially all of the assets and liabilities of ANC, without
the consent of Pechiney.
SECTION 3.11. Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument and shall become a
binding Agreement when one or more of the counterparts have been signed by each
of the parties and delivered to the other party.
6
7
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
PECHINEY
By:
----------------------------
Name:
Title:
AMERICAN NATIONAL CAN COMPANY
By:
---------------------------
Name:
Title:
