INDEMNIFICATION AGREEMENT
Exhibit
10.16
This
INDEMNIFICATION AGREEMENT made and entered into this ___ day of _________,
20__
(the "Agreement"), by and between Triangle Petroleum Corporation, a Nevada
corporation (together with its affiliates, as defined in the federal securities
laws, the "Company"), and ___________ (the "Indemnitee"):
WHEREAS,
highly competent persons are becoming more reluctant to serve publicly-held
corporations as directors or in other capacities unless they are provided with
adequate protection through insurance and indemnification against inordinate
risks of claims and actions against them arising out of their service to and
activities on behalf of the corporation; and
WHEREAS,
the current difficulties or virtual impossibility of obtaining adequate
insurance and uncertainties relating to indemnification have increased the
difficulty of attracting and retaining such persons; and
WHEREAS,
the Board of Directors of the Company has determined that the inability to
attract and retain such persons is detrimental to the best interests of the
Company's stockholders and that the Company should act to assure such persons
that there will be increased certainty of such protection in the future;
and
WHEREAS,
it is reasonable, prudent and necessary for the Company contractually to
obligate itself to indemnify such persons to the fullest extent permitted by
applicable law so that they will serve or continue to serve the Company free
from undue concern that they will not be so indemnified; and
WHEREAS,
the Indemnitee is willing to serve, continue to serve and to take on additional
service for or on behalf of the Company on the condition that he be so
indemnified;
NOW,
THEREFORE, in consideration of the premises and the covenants contained herein,
the Company and the Indemnitee do hereby covenant and agree as
follows:
Section
1. Services by Indemnitee.
The
Indemnitee agrees to serve as a director of the Company. The Indemnitee may
at
any time and for any reason resign from such position (subject to any other
contractual obligation or other obligation imposed by operation of
law).
Section
2. Indemnification.
The
Company shall indemnify the Indemnitee to the fullest extent permitted by
applicable law in effect on the date hereof or as such laws may from time to
time be amended. Without diminishing the scope of the indemnification provided
by this Section 2, the rights of indemnification of the Indemnitee provided
hereunder shall include but shall not be limited to those rights set forth
hereinafter, except to the extent expressly prohibited by applicable
law.
Section
3. Action or Proceeding Other Than an Action by or in the Right of the
Company.
The
Indemnitee shall be entitled to the indemnification rights provided in this
Section 3 if he 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 in nature, other than an action by
or
in the right of the Company, by reason of the fact that he is or was a director,
director, employee, agent, partner or fiduciary of the Company or is or was
serving at the request of the Company as a director, director, employee, agent,
partner or fiduciary of any other entity or by reason of anything done or not
done by him in any such capacity. Pursuant to this Section 3, the Indemnitee
shall be indemnified against all expenses (including attorneys' fees), costs,
judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding
(including, but not limited to, the investigation, defense or appeal thereof),
if he acted in good faith and in a manner he reasonably believed to be in or
not
opposed to the best interests of the Company, and, with respect to any criminal
action or proceeding, he had no reasonable cause to believe his conduct was
unlawful.
Section
4. Actions by or in the Right of the Company.
The
Indemnitee shall be entitled to the indemnification rights provided in this
Section 4 if he is a person who was or is made a party or is threatened to
be
made a party to any threatened, pending or completed action or suit brought
by
or in the right of the Company to procure a judgment in its favor by reason
of
the fact that he is or was a director, director, employee, agent, partner or
fiduciary of the Company or is or was serving at the request of the Company
as a
director, director, employee, agent, partner or fiduciary of any other entity
by
reason of anything done or not done by him in any such capacity. Pursuant to
this Section 4, the Indemnitee shall be indemnified against all expenses
(including attorneys' fees) and costs actually and reasonably incurred by him
in
connection with such action or suit (including, but not limited to, the
investigation, defense, settlement or appeal thereof) if he acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best
interests of the Company; provided, however, that no such indemnification shall
be made in respect of any claim, issue or matter as to which applicable law
expressly prohibits such indemnification by reason of an adjudication of
liability of the Indemnitee to the Company, unless, and only to the extent
that,
the District Court of the State of Nevada or the court in which such action
or
suit was brought shall determine upon application that, despite such
adjudication of liability but in view of all the circumstances of the case,
the
Indemnitee is fairly and reasonably entitled to indemnification for such
expenses and costs as such court shall deem proper.
Section
5. Indemnification for Costs, Charges and Expenses of Successful
Party.
Notwithstanding the other provisions of this Agreement and in addition to the
rights to indemnification set forth in Sections 3 and 4 hereof, to the extent
that the Indemnitee has served as a witness on behalf of the Company or has
been
successful on the merits or otherwise, including, without limitation, the
dismissal of an action without prejudice, in defense of any action, suit or
proceeding referred to in Sections 3 and 4 hereof, or in defense of any claim,
issue or matter therein, he shall be indemnified against all costs, charges
and
expenses (including attorneys' fees) actually and reasonably incurred by him
or
on his behalf in connection therewith.
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Section
6. Partial Indemnification.
In
addition to the rights to indemnification set forth in Sections 3 and 4 hereof,
if the Indemnitee is only partially successful in the defense, investigation,
settlement or appeal of any action, suit, investigation or proceeding described
in Section 3 or 4 hereof, and as a result is not entitled under Section 3,
4 or
5 hereof to indemnification by the Company for the total amount of the expenses
(including attorneys' fees), costs, judgments, penalties, fines, and amounts
paid in settlement actually and reasonably incurred by him, the Company shall
nevertheless indemnify the Indemnitee, as a matter of right pursuant to Section
5 hereof, to the extent that the Indemnitee has been partially
successful.
Section
7. Determination of Entitlement to Indemnification.
Upon
written request by the Indemnitee for indemnification pursuant to Section 3
or 4
hereof, the entitlement of the Indemnitee to indemnification pursuant to the
terms of this Agreement shall be determined by the following person or persons
who shall be empowered to make such determination: (a) the Board of Directors
of
the Company by a majority vote of a quorum consisting of Disinterested Directors
(as hereinafter defined); or (b) if such a quorum is not obtainable or, even
if
obtainable, if the Board of Directors by the majority vote of Disinterested
Directors so directs, by Independent Counsel (as hereinafter defined) in a
written opinion to the Board of Directors, a copy of which shall be delivered
to
the Indemnitee; or (c) by the stockholders of the Company. Independent Counsel
shall be selected by the Board of Directors and approved by the Indemnitee.
Upon
failure of the Board so to select Independent Counsel or upon failure of the
Indemnitee so to approve Independent Counsel, Independent Counsel shall be
selected by the Chief Justice of the State of Nevada or such other person as
the
Chief Justice shall designate to make such selection. Such determination of
entitlement to indemnification shall be made not later than 60 days after
receipt by the Company of a written request for indemnification. Such request
shall include documentation or information which is necessary for such
determination and which is reasonably available to the Indemnitee. Any costs
or
expenses (including attorneys' fees) incurred by the Indemnitee in connection
with his request for indemnification hereunder shall be borne by the Company.
The Company hereby indemnifies and agrees to hold the Indemnitee harmless
therefrom irrespective of the outcome of the determination of the Indemnitee's
entitlement to indemnification. If the person making such determination shall
determine that the Indemnitee is entitled to indemnification as to part (but
not
all) of the application for indemnification, such person shall reasonably
prorate such partial indemnification among such claims, issues or
matters.
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Section
8. Presumptions and Effect of Certain Proceedings.
The
Secretary of the Company shall, promptly upon receipt of the Indemnitee's
request for indemnification, advise in writing the Board of Directors or such
other person or persons empowered to make the determination as provided in
Section 7 that the Indemnitee has made such request for indemnification. Upon
making such request for indemnification, the Indemnitee shall be presumed to
be
entitled to indemnification hereunder and the Company shall have the burden
of
proof in the making of any determination contrary to such presumption. If the
person or persons so empowered to make such determination shall have failed
to
make the requested indemnification within 60 days after receipt by the Company
of such request, the requisite determination of entitlement to indemnification
shall be deemed to have been made and the Indemnitee shall be absolutely
entitled to such indemnification, absent actual and material fraud in the
request for indemnification. The termination of any action, suit, investigation
or proceeding described in Section 3 or 4 hereof by judgment, order, settlement
or conviction, or upon a plea of nolo contendere or its equivalent, shall not,
of itself: (a) create a presumption that the Indemnitee did not act in good
faith and in a manner which he reasonably believed to be in or not opposed
to
the best interests of the Company, and, with respect to any criminal action
or
proceeding, that the Indemnitee had reasonable cause to believe that his conduct
was unlawful; or (b) otherwise adversely affect the rights of the Indemnitee
to
indemnification except as may be provided herein.
Section
9. Advancement of Expenses and Costs.
All
reasonable expenses and costs incurred by the Indemnitee (including attorneys'
fees, retainers and advances of disbursements required of the Indemnitee) shall
be paid by the Company in advance of the final disposition of such action,
suit
or proceeding at the request of the Indemnitee within 20 days after the receipt
by the Company of a statement or statements from the Indemnitee requesting
such
advance or advances from time to time. The Indemnitee's entitlement to such
expenses shall include those incurred in connection with any proceeding by
the
Indemnitee seeking an adjudication or award in arbitration pursuant to this
Agreement. Such statement or statements shall reasonably evidence the expenses
and costs incurred by him in connection therewith and shall include or be
accompanied by an undertaking by or on behalf of the Indemnitee to repay such
amount if it is ultimately determined that the Indemnitee is not entitled to
be
indemnified against such expenses and costs by the Company as provided by this
Agreement or otherwise.
Section
10. Remedies of Indemnitee in Cases of Determination not to Indemnify or to
Advance Expenses.
In the
event that a determination is made that the Indemnitee is not entitled to
indemnification hereunder or if payment has not been timely made following
a
determination of entitlement to indemnification pursuant to Sections 7 and
8, or
if expenses are not advanced pursuant to Section 9, the Indemnitee shall be
entitled to a final adjudication in an appropriate court of the State of Nevada
or any other court of competent jurisdiction of his entitlement to such
indemnification or advance. Alternatively, the Indemnitee at his option may
seek
an award in arbitration to be conducted by a single arbitrator pursuant to
the
rules of the American Arbitration Association, such award to be made within
60
days following the filing of the demand for arbitration. The Company shall
not
oppose the Indemnitee's right to seek any such adjudication or award in
arbitration or any other claim, but may oppose the Indemnitee's right to
indemnification. Such judicial proceeding or arbitration shall be made de novo
and the Indemnitee shall not be prejudiced by reason of a determination (if
so
made) pursuant to Sections 7 and 8 that he is not entitled to indemnification.
If a determination is made or deemed to have been made pursuant to the terms
of
Section 7 or Section 8 hereof that the Indemnitee is entitled to
indemnification, the Company shall be bound by such determination and is
precluded from asserting that such determination has not been made or that
the
procedure by which such determination was made is not valid, binding and
enforceable. The Company further agrees to stipulate in any such court or before
any such arbitrator that the Company is bound by all the provisions of this
Agreement and is precluded from making any assertion to the contrary. If the
court or arbitrator shall determine that the Indemnitee is entitled to any
indemnification hereunder, the Company shall pay all reasonable expenses
(including attorneys' fees) and costs actually incurred by the Indemnitee in
connection with such adjudication or award in arbitration (including, but not
limited to, any appellate proceedings).
4
Section
11. Other Rights to Indemnification.
The
indemnification and advancement of expenses (including attorneys' fees) and
costs provided by this Agreement shall not be deemed exclusive of any other
rights to which the Indemnitee may now or in the future be entitled under any
provision of the by-laws, agreement, provision of the Articles of Incorporation,
vote of stockholders or disinterested directors, provision of law or
otherwise.
Section
12. Attorneys' Fees and Other Expenses To Enforce
Agreement.
In the
event that the Indemnitee is subject to or intervenes in any proceeding in
which
the validity or enforceability of this Agreement is at issue or seeks an
adjudication or award in arbitration to enforce his rights under, or to recover
damages for breach of, this Agreement, the Indemnitee, if he prevails in whole
or in part in such action, shall be entitled to recover from the Company and
shall be indemnified by the Company against, any actual expenses for attorneys'
fees and disbursements reasonably incurred by him.
Section
13. Duration of Agreement.
This
Agreement shall continue until and terminate upon the later of: (a) 10 years
after the Indemnitee has ceased to occupy any of the positions or have any
of
the relationships described in Sections 3 and 4 of this Agreement; and (b)
the
final termination of all pending or threatened actions, suits, proceedings
or
investigations with respect to the Indemnitee. This Agreement shall be binding
upon the Company and its successors and assigns and shall inure to the benefit
the Indemnitee and his spouse, assigns, heirs, devises, executors,
administrators or other legal representatives.
Section
14. Severability.
If any
provision or provisions of this Agreement shall be held to be invalid, illegal
or unenforceable for any reason whatsoever: (a) the validity, legality and
enforceability of the remaining provisions of this Agreement (including, without
limitation, all portions of any paragraphs of this Agreement containing any
such
provision held to be invalid, illegal or unenforceable, that are not themselves
invalid, illegal or unenforceable) shall not in any way be affected or impaired
thereby; and (b) to the fullest extent possible, the provisions of this
Agreement (including, without limitation, all portions of any paragraph of
this
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable) shall
be construed so as to give effect to the intent manifested by the provision
held
invalid, illegal or unenforceable.
5
Section
15. Identical Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
for
all purposes be deemed to be an original but all of which together shall
constitute one and the same Agreement. Only one such counterpart signed by
the
party against whom enforceability is sought needs to be produced to evidence
the
existence of this Agreement.
Section
16. Headings.
The
headings of the Sections of this Agreement are inserted for convenience only
and
shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.
Section 17. Definitions.
For
purposes of this Agreement:
(a)
"Disinterested Director" shall mean a director of the Company who is not or
was
not a party to the action, suit, investigation or proceeding in respect of
which
indemnification is being sought by the Indemnitee.
(b)
"Independent Counsel" shall mean a law firm or a member of a law firm that
neither is presently nor in the past five years has been retained to represent:
(i) the Company or the Indemnitee in any matter material to either such party,
or (ii) any other party to the action, suit, investigation or proceeding giving
rise to a claim for indemnification hereunder. Notwithstanding the foregoing,
the term "Independent Counsel" shall not include any person who, under the
applicable standards of professional conduct then prevailing, would have a
conflict of interest in representing either the Company or the Indemnitee in
an
action to determine the Indemnitee's right to indemnification under this
Agreement.
Section
18. Modification and 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.
Section
19. Notice by the Indemnitee.
The
Indemnitee agrees promptly to notify the Company in writing upon being served
with any summons, citation, subpoena, complaint, indictment, information or
other document relating to any matter which may be subject to indemnification
covered hereunder, either civil, criminal or investigative.
Section
20. Notices.
All
notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given if (i) delivered by hand
and
receipted for by the party to whom said notice or other communication shall
have
been directed or if (ii) mailed by certified or registered mail with postage
prepaid, on the third business day after the date on which it is so mailed:
6
(a)
If to
the Indemnitee, to the address written on the signature page hereto or such
other address as the Indemnitee may furnish in writing.
(b)
If to
the Company, to the Company’s then current principal executive offices, Attn:
Chief Executive.
Section
21. Governing Law.
The
parties agree that this Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Nevada, without giving
effect to the conflict of laws.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and
year first above written.
TRIANGLE
PETROLEUM CORPORATION
By:
_____________________________________
INDEMNITEE
________________________________________
Name:
7
