Exhibit 10(xii)
FORM OF
INDEMNIFICATION AGREEMENT
THIS AGREEMENT is made by and between BRASS EAGLE INC. (the "Company")
and Xxxxxx X. Xxxxxxx ("Xxxxxxx") as of ____________, 1997.
WHEREAS, Xxxxxxx is currently a Director of the Company and the holder
of shares of the Company's Preferred Stock (the "Preferred Stock"); and
WHEREAS, as the result of the Company's recent recapitalization the
Company is no longer authorized to issue Preferred Stock and Xxxxxxx'x shares of
Preferred Stock have been canceled (the "Recapitalization"); and
WHEREAS, the Company desires to indemnify Xxxxxxx and hold him harmless
from any adverse income tax consequences arising from or attributable to the
cancellation of the Preferred Stock.
NOW THEREFORE, in consideration of the services rendered, and to be
rendered, by Xxxxxxx to and on behalf of the Company, the Company agrees as
follows:
1. The Company shall indemnify and hold Xxxxxxx harmless from any
adverse income tax consequences arising from or attributable to the cancellation
of the shares of Preferred Stock in connection with the Recapitalization
including any attorney's fees associated with any protest or other challenge
contemplated by paragraph 3 hereof (the "Indemnification").
2. The Indemnification shall be accomplished on an after-tax basis as to
Xxxxxxx.
3. Xxxxxxx and the Company agree to cooperate in protesting or
challenging any assessment or other proposal by any taxing authority to impose
any tax liability arising from or attributable to the cancellation of the
Preferred Stock in connection with the Recapitalization; provided, however, that
the Company reserves the right to require Xxxxxxx to abandon any such protest or
other challenge, subject to the Company's Indemnification obligation.
4. Xxxxxxx shall promptly notify the Company of any proposed assessment
or other attempt by any taxing authority to impose any tax liability on Xxxxxxx
which is subject to the Company's Indemnification obligation.
5. This Agreement shall be binding on the Company's successors and
assigns and shall inure to the benefit of Xxxxxxx'x heirs and assigns.
IN WITNESS WHEREOF, the Company, by its duly authorized officer, and
Xxxxxxx have entered into this Agreement as of the day first above written.
BRASS EAGLE INC.
By:
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Title:
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Xxxxxx X. Xxxxxxx
