EXHIBIT 10.10
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement"), dated as of June 16, 2004,
is between Valley Bancorp, a Nevada corporation ("Bancorp"), and
____________________________ ("Indemnitee").
RECITALS
A. Indemnitee is a director of Bancorp and its wholly owned subsidiary,
Valley Bank, a Nevada state-chartered bank (the "Bank"), and performs
valuable services for Bancorp and the Bank.
B. Bancorp's Articles of Incorporation ("Articles") and Bylaws set forth
substantive provisions governing the indemnification of officers and
directors of Bancorp and its related corporations.
C. Bancorp has purchased and maintains a policy or policies of Directors and
Officers Liability Insurance ("D&O Insurance"), covering certain
liabilities that may be incurred by its directors and officers in the
performance of their duties.
D. In order to provide certainty regarding Indemnitee's indemnification
rights for all parties involved, and to induce Indemnitee to continue
serving as a director of Bancorp and the Bank, Bancorp desires to enter
this contract with Indemnitee.
Therefore, in consideration of Indemnitee's continued service as a
director, the parties agree as follows:
AGREEMENT
1. INDEMNITY. Bancorp agrees to hold harmless and indemnify Indemnitee:
(a) to the fullest extent not prohibited under the Articles and Bylaws,
as in effect as of the date of this Agreement, and federal and state
law applicable to Bancorp and the Bank (collectively, "Applicable
Law"), as may be amended from time to time; and
(b) against any and all expenses (including, without limitation,
attorneys' fees and expenses and any expenses of establishing a
right to indemnification), witness fees, judgments, fines, ERISA
excise taxes, and amounts paid in settlement actually and reasonably
incurred by Indemnitee in connection with any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (including an action by or in the
right of Bancorp or the Bank) to which Indemnitee is, was or at any
time becomes a party, or is threatened to be made a party, by reason
of the fact that Indemnitee is or was a director of Bancorp.
2. LIMITATIONS ON INDEMNITY. No indemnity under Section 1 will be paid by
Bancorp:
(a) for expenses or liabilities paid to the Indemnitee under any D&O
Insurance;
(b) on account of any action, suit or proceeding brought by or on behalf
of Bancorp or the Bank in which judgment is rendered holding the
Indemnitee liable to Bancorp or the Bank;
(c) on account of Indemnitee's conduct which is the subject of an
action, suit or proceeding described in Section 6.3(ii);
(d) on account of any action, claim or proceeding (other than a
proceeding referred to in Section 7.2) initiated by the Indemnitee
unless such action, claim or proceeding is specifically authorized
by Bancorp's board of directors;
(e) on account of any action, claim or proceeding referred to in Section
7.2 which action is finally adjudged to be frivolous or made not in
good faith;
(f) if a final decision by a court having jurisdiction in the matter
determines that such indemnification is not lawful; or
(g) if Bancorp's Articles and Bylaws, as in effect as of the date of
this Agreement, or Applicable Law, as may be amended from time to
time, prohibit or limit indemnification under the facts and
circumstances of the specific action, claim or proceeding.
3. MUTUAL ACKNOWLEDGMENT. Bancorp and Indemnitee acknowledge that, in certain
instances, federal law or public policy may override applicable state law
and prohibit Bancorp from indemnifying its directors and officers. For
example, Bancorp and Indemnitee acknowledge that the Securities and
Exchange Commission takes the position that indemnification is not
permitted for liabilities arising under certain federal securities laws,
and federal legislation prohibits indemnification for certain ERISA and
federal banking law violations.
4. CONTINUATION OF OBLIGATIONS. Under this Agreement, Bancorp is obligated to
Indemnitee for any period during which Indemnitee is or was a director of
Bancorp or the Bank. Furthermore, this obligation will continue after
Indemnitee's service as a director terminates and for so long as
Indemnitee may be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether civil, criminal or
investigative, by reason of the fact that Indemnitee was a director of
Bancorp or the Bank.
5. NOTIFICATION AND DEFENSE OF CLAIM.
5.1 Assumption of Defense by Bancorp. Within 30 days after Indemnitee
receives any notice of the commencement of any action, suit, or
proceeding with respect to which action may be made against Bancorp
under this Agreement, Indemnitee
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will notify Bancorp of the same. With respect to any action, suit or
proceeding of which Indemnitee timely notifies Bancorp:
(a) Bancorp is entitled to participate at its own expense;
(b) Bancorp shall retain counsel of its choice for Indemnitee reasonably
satisfactory to Indemnitee, subject to the requirements of Bancorp's
D&O Insurance;
(c) except as otherwise provided below, Bancorp (jointly with any other
indemnifying party similarly notified) is entitled to assume the
defense of the action with counsel reasonably satisfactory to
Indemnitee; and
(d) Bancorp is not liable to indemnify Indemnitee under this Agreement
for any amounts paid in settlement of any action or claim that is
effected without its written consent.
5.2 Expenses of Counsel. After notice from Bancorp to Indemnitee of its
election to assume the defense of the action, Bancorp will not be
liable to Indemnitee under this Agreement for any legal or other
expenses subsequently incurred by Indemnitee in connection with the
defense of such action, other than reasonable costs of investigation
or as otherwise provided below. Notwithstanding the above,
Indemnitee may employ his or her own counsel in such action, but the
fees and expenses of such counsel incurred after notice from Bancorp
of its assumption of the defense will be at the expense of
Indemnitee unless: (i) Indemnitee's employment of counsel is
authorized by Bancorp; (ii) Indemnitee reasonably concludes that
there may be a conflict of interest between Bancorp and Indemnitee
in the conduct of the defense of such action; or (iii) Bancorp has
not employed counsel to assume the defense of such action, in each
of which cases the fees and expenses of Indemnitee's separate
counsel will be at the expense of Bancorp so long as such counsel is
reasonably satisfactory to Bancorp and meets the requirements of
Bancorp's D&O Insurance. Bancorp is not entitled to assume the
defense of any action, suit, or proceeding brought by or on behalf
of Bancorp or as to which Indemnitee has made the conclusion
provided for in (ii) above, but Indemnitee's selection of counsel
for such defense must be reasonably satisfactory to Bancorp and meet
the requirements of Bancorp's D&O Insurance.
5.3 Settlement. Bancorp may settle any action, but it may not settle any
action or claim in any manner that would impose any penalty or
limitation on Indemnitee without Indemnitee's written consent.
Neither Bancorp nor Indemnitee will unreasonably withhold its
consent to any proposed settlement.
6. ADVANCEMENT AND REPAYMENT OF EXPENSES.
6.1 Advances by Bancorp. If Indemnitee employs his or her own counsel,
the cost of which is to be indemnified by Bancorp under Section 5,
then, in accordance with Applicable Law and its Articles and Bylaws,
Bancorp will advance to Indemnitee any and all reasonable expenses
(including, without limitation, legal fees and expenses) incurred in
investigating or defending any such action, suit or
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proceeding. Provided that the requirements of Applicable Law and the
Articles and Bylaws with respect to advancing expenses are met,
Bancorp shall advance such expenses before any final disposition of
any threatened or pending action, suit or proceeding, whether civil,
criminal, administrative or investigative and within ten days after
receiving copies of invoices presented to Indemnitee for such
expenses.
6.2 Reimbursement by Indemnitee. Indemnitee will reimburse Bancorp for
all reasonable expenses paid by Bancorp under Section 6.1 if, and
only to the extent that, it is ultimately determined by a final
judicial decision (from which there is no right of appeal) that
Indemnitee is not entitled to be indemnified by Bancorp for such
expenses.
6.3 Exclusions. Bancorp is not required to advance expenses to
Indemnitee if Indemnitee (i) commences any action, suit or
proceeding as a plaintiff, unless such advance is specifically
approved by a majority of Bancorp's board of directors (which
approval shall not be unreasonably withheld), or (ii) is a party to
an action, suit or proceeding brought by Bancorp and approved by a
majority of Bancorp's board, which action alleges in good faith
willful misappropriation of corporate assets by Indemnitee,
disclosure of confidential information in violation of Indemnitee's
fiduciary or contractual obligations to Bancorp, or any other
willful and deliberate breach in faith of Indemnitee's duty to
Bancorp, its affiliates, or its shareholders.
7. ENFORCEMENT.
7.1 Reliance. Bancorp confirms that it has entered into this Agreement
to induce Indemnitee to remain as a director of Bancorp and the
Bank, and acknowledges that Indemnitee is relying upon this
Agreement in serving in such capacity.
7.2 Expenses of Enforcement. If Indemnitee successfully brings any
action to enforce rights or to collect moneys due under this
Agreement, Bancorp will reimburse Indemnitee for all Indemnitee's
reasonable fees and expenses in bringing and pursuing such action.
8. D & O INSURANCE. Bancorp will at all times use its best efforts to
maintain appropriate D&O Insurance for the benefit of Indemnitee.
9. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provisions of
this Agreement to indemnification by Bancorp for a portion, but not all,
of the expenses, witness fees, judgments, fines, ERISA excise taxes, and
amounts paid in settlement actually incurred by Indemnitee in the
investigation, defense, appeal or settlement of any proceeding, Bancorp
shall indemnify Indemnitee only for the portion of such amounts to which
Indemnitee is entitled.
10. SUBROGATION. If Bancorp pays Indemnitee under this Agreement, Bancorp will
be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee, who agrees, at Bancorp's expense, to execute such
documents and take such actions as
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Bancorp may reasonably request in order to secure such rights and to
enable Bancorp effectively to bring suit to enforce such rights.
11. ARBITRATION. Any dispute between Bancorp and Indemnitee, arising out of
this Agreement, that would not be resolved by the court or agency having
jurisdiction over the action, suit or proceeding for which Indemnitee has
given notice to Bancorp under this Agreement, shall be submitted to final
and binding arbitration in Xxxxx County, Nevada, administered by an
arbitrator or arbitrators as may be acceptable to both Bancorp and
Indemnitee. The prevailing party in any such arbitration shall be entitled
to recover its reasonable attorneys fees, costs and expenses.
12. MISCELLANEOUS.
12.1 Non-Exclusivity of Rights. The rights conferred on Indemnitee by
this Agreement are not exclusive of any other rights which
Indemnitee may have or hereafter acquire under any statute,
provision of the Articles or Bylaws, agreement, vote of shareholders
or directors, or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding office.
12.2 Survival of Rights. The rights conferred on Indemnitee by this
Agreement continue after Indemnitee ceases to be a director of
Bancorp or the Bank and will inure to the benefit of Indemnitee's
heirs, executors, and administrators.
12.3 Separability. Each provision of this Agreement is a separate and
distinct agreement independent of others. If any provision is held
to be invalid or unenforceable for any reason, such invalidity or
unenforceability will not affect the validity or enforceability of
the other provisions or the obligation of Bancorp to indemnify the
Indemnitee to the full extent provided by the Articles, Bylaws or
Applicable Law.
12.4 Governing Law and Venue. This Agreement will be governed by and
construed in accordance with Nevada law, except to the extent that
federal law may govern certain matters. The parties must bring any
legal proceeding arising out of this Agreement in Xxxxx County,
Nevada.
12.5 Binding Effect. This Agreement is binding upon Indemnitee and upon
Bancorp and its successors and assigns, and inures to the benefit of
Indemnitee, his or her heirs, personal representatives, and assigns
and to the benefit of Bancorp and its successors and assigns.
12.6 Amendment and Termination. No amendment, modification, termination,
or cancellation of this Agreement is effective unless in writing
signed by all parties. No amendment, modification, termination or
cancellation of the Articles or Bylaws shall prejudice or limit the
rights of Indemnitee arising under this Agreement for any actions,
suits or proceedings arising prior to the time of such amendment,
modification, termination or cancellation.
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12.7 Counterparts; Facsimile. This Agreement may be executed in one or
more counterparts, each of which will be deemed an original, but all
of which taken together will constitute one and the same document.
Delivery of an executed signature page to this Agreement shall be as
effective as delivery of a manually signed counterpart.
Signatures on Next Page
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Signed as of June 16, 2004:
VALLEY BANCORP
__________________________
By:
Its:
INDEMNITEE
__________________________
Signature
__________________________
Print Name
Accepted and approved this 16th day of June, 2004:
VALLEY BANK
__________________________
By:
Its:
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