Exhibit 10(r)
Indemnification Agreement
THIS AGREEMENT is made and entered into this ___ day of __________, 199__
between Xxxxxx Corporation, a Delaware corporation ("Corporation"), and
______________("Director").
Witnesseth That:
WHEREAS, Director, a member of the Board of Directors of Corporation, performs a
valuable service in such capacity for Corporation; and
WHEREAS, the stockholders of Corporation have adopted Bylaws (the "Bylaws")
providing for the indemnification of the officers and directors of Corporation
to the maximum extent authorized by the Delaware General Corporation Law, as
amended ("Code"); and
WHEREAS, the Code by its non-exclusive nature and the Bylaws by express
provision, permit contracts between Corporation and the members of its Board of
Directors with respect to indemnification of such directors; and
WHEREAS, in accordance with the authorization as provided by the Code,
Corporation has purchased and presently maintains a policy or policies of
Directors and Officers Liability Insurance ("D & O Insurance"), covering certain
liabilities which may be incurred by its directors and officers in their
performance as directors or officers of Corporation; and
WHEREAS, as a result of recent developments affecting the terms, scope and
availability of D & O Insurance there exists general uncertainty as to the
extent of protection afforded members of the Board of Directors by such D & O
Insurance and by statutory and bylaw indemnification provisions; and
WHEREAS, in order to induce Director to continue to serve as a member of the
Board of Directors of Corporation, Corporation has determined and agreed to
enter into this contract with Director;
NOW, THEREFORE, in consideration of Director's continued service as a director
after the date hereof, the parties hereto agree as follows:
1. Indemnity of Director. Corporation hereby agrees to hold harmless and
indemnify Director to the fullest extent authorized or permitted by the
provisions of the Code, as may be amended from time to time.
2. Additional Indemnity. Pursuant to the Bylaws and subject only to the
exclusions set forth in Section 3 hereof, Corporation hereby further agrees
to hold harmless and indemnify Director:
(a) against any and all expenses and loss (including inter alia,
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and
amounts paid in settlement) actually and reasonably incurred by
Director in connection with the investigation, defense or appeal of
any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (including an
action by or in the right of Corporation) to which Director is, was or
at any time becomes a party, or is threatened to be made a party, by
reason of the fact that Director is, was or at any time becomes a
director, officer, employee or agent of Corporation, or is or was
serving or at any time serves at the request of Corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise; and
(b) otherwise to the fullest extent as may be provided to Director by
Corporation under the non-exclusivity provisions of Section 4 of
Article IX of the Bylaws of Corporation and the Code.
3. Limitations on Additional Indemnity. No indemnity pursuant
to Section 2 hereof shall be paid by Corporation:
(a) except to the extent the aggregate of losses to be indemnified
thereunder exceeds the amount of such losses for which the Director is
indemnified either pursuant to Section 1 hereof or pursuant to any D &
O Insurance purchased and maintained by Corporation;
(b) in respect to remuneration paid to Director if it shall be determined
by a final judgment or other final adjudication that such remuneration
was in violation of law;
(c) on account of any suit in which judgment is rendered against Director
for an accounting of profits made from the purchase or sale by
Director of securities of Corporation pursuant to the provisions of
Section 16(b) of the Securities Exchange Act of 1934 and amendments
thereto or similar provisions of any federal, state or local statutory
law;
(d) on account of Director's conduct which is finally adjudged to have
been knowingly fraudulent or deliberately dishonest, or to constitute
willful misconduct; or
(e) if a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful.
4. Contribution. If the indemnification provided in Sections 1 and 2 is
unavailable and may not be paid to Director for any reason other than those
set forth in paragraphs (b), (c) and (d) of Section 3, then in respect of
any threatened, pending or completed action, suit or proceeding in which
Corporation is jointly liable with Director (or would be if joined in such
action, suit or proceeding), Corporation shall contribute to the amount of
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred and paid or payable by Director
in such proportion as is appropriate to reflect (i) the relative benefits
received by Corporation on the one hand and Director on the other hand from
the transaction from which such action, suit or proceeding arose, and (ii)
the relative fault of Corporation on the one hand and of Director on the
other in connection with the events which resulted in such expenses,
judgments, fines or settlement amounts, as well as any other relevant
equitable considerations. The relative fault of Corporation on the one hand
and of Director on the other shall be determined by reference to, among
other things, the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent the circumstances
resulting in such expenses, judgments, fines or settlement amounts.
Corporation agrees that it would not be just and equitable if contribution
pursuant to this Section 4 were determined by pro rata allocation or any
other method of allocation which does not take account of the foregoing
equitable considerations.
5. Continuation of Obligations. All agreements and obligations of Corporation
contained herein shall continue during the period Director is a director,
officer, employee or agent of Corporation (or is or was serving at the
request of Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise) and
shall continue thereafter so long as Director shall be subject to any
possible claim or threatened, pending or completed action, suit or
proceeding whether civil, criminal, administrative or investigative, by
reason of the fact that Director was a director of Corporation or serving
in any other capacity referred to herein.
6. Notification and Defense of Claim. Promptly after receipt by Director of
notice of the commencement of any action, suit or proceeding, Director
will, if a claim in respect thereof is to be made against Corporation under
this Agreement, notify Corporation of the commencement thereof; but the
omission so to notify Corporation will not relieve it from any liability
which it may have to Director otherwise than under this Agreement. With
respect to any such action, suit or proceeding as to which Director
notifies Corporation of the commencement thereof:
(a) Corporation will be entitled to participate therein at its own
expense;
(b) except as otherwise provided below, to the extent that it may wish,
Corporation jointly with any other indemnifying party similarly
notified will be entitled to assume the defense thereof, with counsel
satisfactory to Director. After notice from Corporation to Director of
its election so as to assume the defense thereof, Corporation will not
be liable to Director under this Agreement for any legal or other
expenses subsequently incurred by Director in connection with the
defense thereof other than reasonable costs of investigation or as
otherwise provided below. Director shall have the right to employ its
counsel in such action, suit or proceeding but the fees and expenses
of such counsel incurred after notice from Corporation of its
assumption of the defense thereof shall be at the expense of Director
unless (i) the employment of counsel by Director has been authorized
by Corporation, (ii) Director shall have reasonably concluded that
there may be a conflict of interest between Corporation and Director
in the conduct of the defense of such action or (iii) Corporation
shall not in fact have employed counsel to assume the defense of such
action, in each of which cases the fees and expenses of counsel shall
be at the expense of Corporation. Corporation shall not be entitled to
assume the defense of any action, suit or proceeding brought by or on
behalf of Corporation or as to which Director shall have made the
conclusion provided for in (ii) above; and
(c) Corporation shall not be liable to indemnify Director under this
Agreement for any amounts paid in settlement of any action or claim
effected without its written consent. Corporation shall not settle any
action or claim in any manner which would impose any penalty or
limitation on Director without Director's written consent. Neither
Corporation nor Director will unreasonably withhold its consent to any
proposed settlement.
7. Advancement and Repayment of Expenses.
(a) In the event that Director employs his own counsel pursuant to Section
6(b) (i) through (iii) above, Corporation shall advance to Director,
prior to any final disposition of any threatened or pending action,
suit or proceeding, whether civil, criminal, administrative or
investigative, any and all reasonable expenses (including legal fees
and expenses) incurred in investigating or defending any such action,
suit or proceeding within ten (10) days after receiving copies of
invoices presented to Director for such expenses.
(b) Director agrees that Director will reimburse Corporation for all
reasonable expenses paid by Corporation in defending any civil or
criminal action, suit or proceeding against Director in the event and
only to the extent it shall be ultimately determined that Director is
not entitled, under the provisions of the Code, the Bylaws, this
Agreement or otherwise, to be indemnified by Corporation for such
expenses.
8. Enforcement
(a) Corporation expressly confirms and agrees that it has entered into
this Agreement and assumed the obligations imposed on Corporation
hereby in order to induce Director to continue as a director of
Corporation, and acknowledges that Director is relying upon this
Agreement in continuing in such capacity.
(b) In the event Director is required to bring any action to enforce
rights or to collect monies due under this Agreement and is successful
in such action, Corporation shall reimburse Director for all of
Director's reasonable fees and expenses in bringing and pursuing such
action.
9. Separability. Each of the provisions of this Agreement is a separate and
distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or
enforceability of the other provisions hereof.
10. Governing Law. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Delaware.
11. Binding Effect. This Agreement shall be binding upon Director and upon
Corporation, its successors and assigns, and shall inure to the benefit of
Director, his heirs, personal representatives and assigns and to the
benefit of Corporation, its successors and assigns.
12. Amendment and Termination. No amendment, modification, termination or
cancellation of this Agreement shall be effective unless in writing signed
by both parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of
the day and year first above written.
Xxxxxx Corporation
By:
Xxxx X. Xxxxx
Chairman of the Board
and
[ ]
Director
