EXHIBIT 10.WW
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (this "Agreement") is made and delivered
this _____ day of _____________, _____, (the "Effective Date") by El Paso
Corporation (the "Company"), to and for the benefit of _______________
("Participant").
RECITALS
WHEREAS, in order to induce Participant to continue as an officer of
the Company (an "Officer") and/or in the capacity of a fiduciary under certain
of the Company's employee benefit plans (a "Fiduciary"), the Company is
executing and delivering to Participant this Indemnification Agreement.
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company hereby agrees as
follows:
SECTION 1. RIGHT TO INDEMNIFICATION
If Participant is made a party or is threatened to be made a party to
or is involved (including, without limitation, as a witness) in any actual or
threatened action, suit or proceeding, whether civil, criminal, administrative
or investigative (hereinafter a "proceeding"), by reason of the fact that he is
or was an Officer and/or Fiduciary or, while an Officer and/or Fiduciary, is or
was serving as an officer, director, employee or agent of any subsidiary of the
Company (or otherwise is or was serving at the request of the Company including
service with respect to any employee benefit plan), whether the basis of such
proceeding is alleged action in an official capacity as an Officer or Fiduciary
or in any other capacity while serving as an Officer and/or Fiduciary, he shall
be indemnified and held harmless by the Company to the full extent permitted by
the General Corporation Law of the State of Delaware, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Company to provide broader indemnification
rights than said law permitted the Company to provide prior to such amendment),
or by other applicable law as then in effect, against all expense, liability and
loss (including attorneys' fees, judgments, fines, ERISA excise taxes or
penalties and amounts to be paid in settlement) actually and reasonably incurred
or suffered by him in connection therewith and such indemnification shall
continue after Participant has ceased to be an Officer and/or a Fiduciary and
shall inure to the benefit of Participant's heirs, executors and administrators;
provided, however, that except as provided in Section 2 of this Agreement with
respect to proceedings seeking to enforce rights to indemnification or to
advancement of expenses, the Company shall be required to indemnify Participant
in connection with a proceeding (or part thereof) initiated by Participant only
if such proceeding (or part thereof) was authorized by the Board of Directors of
the Company (the "Board"). The right to indemnification conferred in this
Agreement shall include the right to be
paid by the corporation the reasonable expenses (including attorneys' fees)
incurred in defending any such proceeding in advance of its final disposition
(hereinafter an "advancement of expenses"); further provided, however, that, if
the General Corporation Law of the State of Delaware requires, an advancement of
expenses incurred by Participant in his capacity as an Officer and/or a
Fiduciary (and not in any other capacity in which service was or is rendered by
Participant while an Officer and/or a Fiduciary, including, without limitation,
service to an employee benefit plan) shall be made only upon delivery to the
Company of an undertaking, if permitted by Federal Law, by or on behalf of
Participant, to repay all amounts so advanced if it shall ultimately be
determined that he is not entitled to be indemnified under this Agreement, or
otherwise, and provided further that except as provided in Section 2 of this
Agreement with respect to proceedings seeking to enforce rights to
indemnification or an advancement of expenses, the Company shall be required to
advance expenses to Participant in connection with a proceeding initiated by him
only if such proceeding was authorized by the Board.
SECTION 2. RIGHT TO BRING SUIT
If a claim under Section 1 of this Agreement is not paid in full by the
Company (following the final disposition of the proceeding) within sixty (60)
days after a written claim has been received by the Company, except in the case
of a claim for an advancement of expenses, in which case final disposition of
the proceeding is not required and the applicable period shall be twenty (20)
days, Participant may at any time thereafter bring suit against the Company to
recover the unpaid amount of the claim and, to the extent successful in whole or
in material part, Participant shall be entitled to be paid the expense of
prosecuting such suit. Participant shall be presumed to be entitled to
indemnification under this Agreement upon submission of a written claim (and, in
an action brought to enforce a claim for an advancement of expenses, where the
required undertaking, if any is required, has been tendered to the Company), and
thereafter the Company shall have the burden of proof to overcome the
presumption that Participant is not so entitled. Neither the failure of the
Company (including its Board, independent legal counsel, or its stockholders),
to have made a determination prior to the commencement of such suit that
indemnification of Participant is proper in the circumstances, nor an actual
determination by the Company (including its Board, independent legal counsel or
its stockholders) that Participant is not entitled to indemnification, shall be
a defense to the suit or create a presumption that Participant is not so
entitled.
SECTION 3. NONEXCLUSIVITY OF RIGHTS
The rights to indemnification and to the advancement of expenses
conferred in this Agreement are in addition to and shall not be exclusive of any
other right Participant may have or hereafter acquire under any statute,
provision of the Restated Certificate of Incorporation of the Company or its
By-laws, or under any other plan, program, arrangement, agreement, vote of
stockholders or disinterested Directors or otherwise.
-2-
SECTION 4. INSURANCE, CONTRACTS AND FUNDING
The Company may maintain insurance, at its expense, to protect itself
and Participant against any expense, liability or loss, whether or not the
Company would have the power to indemnify Participant against such expense,
liability or loss under the General Corporation Law of the State of Delaware.
The Company may enter into contracts with Participant in furtherance of the
provisions of this Agreement and may create a trust fund, grant a security
interest or use other means (including, without limitation, a letter of credit)
to ensure the payment of such amounts as may be necessary to effect
indemnification as provided in this Agreement. To the extent the Company
maintains an insurance policy or policies providing directors', officers' and
fiduciaries liability insurance, Participant 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 fiduciary.
SECTION 5. CHANGE OF CONTROL
(a) A "Change in Control" shall mean the occurrence of any of the
following:
(I) An acquisition (other than directly from the Company) of any voting
securities of the Company (the "Voting Securities") by any "Person" (as
the term "person" is used for purposes of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")),
immediately after which such Person has "Beneficial Ownership" (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of more
than twenty percent (20%) of (1) the then-outstanding shares of common
stock of the Company (or any other securities into which such shares of
common stock are changed or for which such shares of common stock are
exchanged) (the "Shares") or (2) the combined voting power of the
Company's then-outstanding Voting Securities; provided, however, that
in determining whether a Change in Control has occurred pursuant to
this paragraph (I), the acquisition of Shares or Voting Securities in a
"Non-Control Acquisition" (as hereinafter defined) shall not constitute
a Change in Control. A "Non-Control Acquisition" shall mean an
acquisition by (i) an employee benefit plan (or a trust forming a part
thereof) maintained by (A) the Company or (B) any corporation or other
Person the majority of the voting power, voting equity securities or
equity interest of which is owned, directly or indirectly, by the
Company (for purposes of this definition, a "Related Entity"), (ii) the
Company or any Related Entity, or (iii) any Person in connection with a
"Non-Control Transaction" (as hereinafter defined);
(II) The individuals who, as of the Effective Date, are members of the
board of directors of the Company (the "Incumbent Board"), cease for
any reason to constitute at least a majority of the members of the
board of directors of the Company or, following a Merger (as
hereinafter defined), the board of directors of (x) the corporation
resulting from such Merger (the "Surviving Corporation"), if fifty
percent (50%) or more of the combined voting power of the
then-outstanding voting securities of the Surviving Corporation is not
Beneficially Owned, directly or indirectly, by another Person (a
"Parent Corporation") or (y) if there is one or more than one Parent
Corporation, the ultimate Parent Corporation; provided, however, that,
if the election, or nomination for election by the Company's common
stockholders, of any new director was approved by a
-3-
vote of at least two-thirds of the Incumbent Board, such new director
shall, for purposes of the Plan, be considered a member of the
Incumbent Board; and provided, further, however, that no individual
shall be considered a member of the Incumbent Board if such individual
initially assumed office as a result of an actual or threatened
solicitation of proxies or consents by or on behalf of a Person other
than the board of directors of the Company (a "Proxy Contest"),
including by reason of any agreement intended to avoid or settle any
Proxy Contest; or
(III) The consummation of:
(i) A merger, consolidation or reorganization (1)
with or into the Company or (2) in which securities of the Company are
issued (a "Merger"), unless such Merger is a "Non-Control Transaction."
A "Non-Control Transaction" shall mean a Merger in which:
(A) the stockholders of the Company immediately
before such Merger own directly or indirectly immediately
following such Merger at least fifty percent (50%) of the
combined voting power of the outstanding voting securities of
(x) the Surviving Corporation, if there is no Parent
Corporation or (y) if there is one or more than one Parent
Corporation, the ultimate Parent Corporation;
(B) the individuals who were members of the Incumbent
Board immediately prior to the execution of the agreement
providing for such Merger constitute at least a majority of
the members of the board of directors of (x) the Surviving
Corporation, if there is no Parent Corporation, or (y) if
there is one or more than one Parent Corporation, the ultimate
Parent Corporation; and
(C) no Person other than (1) the Company, (2) any
Related Entity, or (3) any employee benefit plan (or any trust
forming a part thereof) that, immediately prior to the Merger,
was maintained by the Company or any Related Entity, or (4)
any Person who, immediately prior to the Merger had Beneficial
Ownership of twenty percent (20%) or more of the then
outstanding Shares or Voting Securities, has Beneficial
Ownership, directly or indirectly, of twenty percent (20%) or
more of the combined voting power of the outstanding voting
securities or common stock of (x) the Surviving Corporation,
if fifty percent (50%) or more of the combined voting power of
the then outstanding voting securities of the Surviving
Corporation is not Beneficially Owned, directly or indirectly
by a Parent Corporation, or (y) if there is one or more than
one Parent Corporation, the ultimate Parent Corporation;
(ii) A complete liquidation or dissolution of the
Company; or
(iii) The sale or other disposition of all or
substantially all of the assets of the Company and its subsidiaries
taken as a whole to any Person (other than (x) a transfer to a Related
Entity, (y) a transfer under conditions that would constitute a
Non-Control Transaction, with the disposition of assets being regarded
as a Merger for this
-4-
purpose or (z) the distribution to the Company's stockholders of the
stock of a Related Entity or any other assets).
Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the then
outstanding Shares or Voting Securities as a result of the acquisition
of Shares or Voting Securities by the Company which, by reducing the
number of Shares or Voting Securities then outstanding, increases the
proportional number of shares Beneficially Owned by the Subject
Persons; provided, that if a Change in Control would occur (but for the
operation of this sentence) as a result of the acquisition of Shares or
Voting Securities by the Company and, after such share acquisition by
the Company, the Subject Person becomes the Beneficial Owner of any
additional Shares or Voting Securities and such Beneficial Ownership
increases the percentage of the then outstanding Shares or Voting
Securities Beneficially Owned by the Subject Person, then a Change in
Control shall occur.
(b) Change in Control of the Company. 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 Participant to indemnity payments
and expense advances under this Agreement, any other agreements, the Restated
Certificate of Incorporation or the By-laws now or hereafter in effect relating
to a proceeding, the Company shall seek legal advice only from special
independent counsel selected by Participant and approved by the Company (which
approval shall not be unreasonably withheld), and who has not otherwise
performed services for the Company (other than in connection with such matters)
or Participant. In the event that Participant and the Company are unable to
agree on the selection of the special independent counsel, such special
independent counsel shall be selected by lot from among at least five law firms
in New York City, New York or Houston, Texas selected by Participant, each
having no less than 50 partners. Such selection shall be made in the presence of
Participant (and his legal counsel or either of them, as Participant may elect).
Such special independent counsel, among other things, shall determine whether
and to what extent the Participant would be permitted to be indemnified under
applicable law and shall render its written opinion to the Company and
Participant to such effect.
The Company agrees to pay the reasonable fees of the special
independent 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.
SECTION 6. NO MODIFICATION
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. Any waiver to this agreement shall be in
writing.
-5-
SECTION 7. 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
Participant, 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.
SECTION 8. NO DUPLICATION OF PAYMENTS
The Company shall not be liable under this Agreement to make any
payment in connection with any proceeding against Participant to the extent
Participant has otherwise actually received payment (under any insurance policy
or otherwise) of the amounts otherwise indemnifiable hereunder.
SECTION 9. NOTIFICATION AND DEFENSE OF PROCEEDINGS
Participant agrees that he will use all reasonable efforts to notify
the Company promptly after receipt by Participant of notice of the commencement
of any proceeding if he anticipates that a request for indemnification in
respect thereof is to be made against the Company under this Agreement; but
failure to so notify the Company will not relieve the Company from any
indemnification or other obligation or liability which it may have to
Participant. With respect to any such proceeding as to which Participant
notifies the Company of the commencement thereof:
(a) the Company will be entitled to participate therein at its own
expense; and
(b) except as otherwise provided below, to the extent that it may wish,
the Company jointly with any other indemnifying party similarly notified will be
entitled to assume the defense thereof, with counsel satisfactory to
Participant. After notice from the Company to Participant of its election to
assume the defense thereof, the Company will not be liable to Participant under
this Agreement for any legal or other expenses subsequently incurred by
Participant in connection with the defense thereof other than reasonable costs
of investigation or as otherwise provided below. Participant shall have the
right to employ its counsel in such proceeding, but the fees and expenses of
such counsel incurred after notice from the Company of its assumption of the
defense thereof shall be at the expense of Participant unless (i) the employment
of counsel by Participant has been authorized by the Company, (ii) Participant
shall have reasonably concluded that there may be a conflict of interest between
the Company and Participant in the conduct of the defense of such proceeding or
(iii) the Company shall not in fact have employed counsel to assume the defense
of such proceeding, in each of which cases the fees and expenses of counsel
shall be at the expense of the Company. The Company shall not be entitled to
assume the defense of any proceeding brought by or on behalf of the Company or
as to which Participant shall have made the conclusion provided for in clause
(ii) of this subsection 9(b).
(c) The Company shall not be liable to indemnify Participant under this
Agreement for any amounts paid in settlement of any proceeding effected by
Participant without the Company's prior written consent. The Company shall not
settle any proceeding in any manner which would impose any penalty or limitation
on Participant without Participant's prior written
-6-
consent. Neither the Company nor Participant will unreasonably withhold their
consent to any proposed settlement.
SECTION 10. NO PRESUMPTIONS
For purposes of this Agreement, the termination of any proceeding
against Participant 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 Participant 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 Company to have made a determination as to whether
Participant has met any particular standard of conduct or had any particular
belief, nor an actual determination by the Company that Participant has not met
such standard of conduct or did not have such belief, prior to the commencement
of legal proceedings by Participant to secure a judicial determination that
Participant should be indemnified under applicable law shall be a defense to
Participant's claim for indemnification or create a presumption that Participant
has not met any particular standard of conduct or did not have any particular
belief.
SECTION 11. ACKNOWLEDGMENT OF RELIANCE
The Company acknowledges that Participant is relying on this Agreement
and the promises and agreements of the Company herein in continuing his service
as an Officer and/or a Fiduciary and in agreeing to undertake and in undertaking
his responsibilities, duties and services to and for the Company in connection
therewith.
SECTION 12. MISCELLANEOUS
This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware. Each provision hereof is intended to be
severable and the invalidity or illegality of any portion of this Agreement
shall not affect the validity or legality of the remainder.
Executed as an instrument under seal as of the day and year first above
written.
EL PASO CORPORATION
By:
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President & Chief Executive Officer
Hereunto duly authorized
-7-
SCHEDULE A
OFFICER AND PLAN FIDUCIARY INDEMNIFICATION AGREEMENTS
1. Officers
a. Xxxxxxx X. Xxxxxx
b. Xxxxxx X. Xxxxx
c. Xxxxxxx X. Xxxxxx
d. Xxxxx X. Xxxxxxxxxx
e. D. Xxxxxx Xxxxx
f. Xxxx X. Xxxxxxxxxxx XX
g. Xxxx X. Xxxxxxx
2. Plan Fiduciaries - Plan fiduciaries who are not officers listed above.
