Exhibit 10.46
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is made as of February 11, 2004, by
and between Brightpoint, Inc., a Delaware corporation (the "Company"), and V.
Xxxxxxx Xxxx ("Indemnitee").
RECITALS
The Company and Indemnitee recognize the increasing difficulty in obtaining
directors' and officers' liability insurance, the increases in the cost of such
insurance and the general reductions in the coverage of such insurance.
The Company and Indemnitee further recognize the substantial increase in
corporate litigation in general, subjecting officers and directors to expensive
litigation risks at the same time as the availability and coverage of liability
insurance has been severely limited. Indemnitee does not regard the current
protection available as adequate under the present circumstances, and Indemnitee
and other officers and directors of the Company may not be willing to continue
to serve as officers and directors without additional protection.
The Company desires to attract and retain the services of highly qualified
individuals, such as Indemnitee, to serve as officers and directors of the
Company and to indemnify its officers and directors so as to provide them with
the maximum protection permitted by law.
AGREEMENT
In consideration of the mutual promises made in this Agreement, and for other
good and valuable consideration, receipt of which is hereby acknowledged, the
Company and Indemnitee hereby agree as follows:
1. INDEMNIFICATION.
(a) GENERAL AGREEMENT. The Company shall indemnify Indemnitee if Indemnitee
is or was a party to or witness or other participant in, or is
threatened to be made a party to or witness or other participant to any
threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (including an action
by or in the right of the Company) by reason of the fact that
Indemnitee is or was a director, officer, employee or agent of the
Company, or any subsidiary of the Company, by reason of any action or
inaction on the part of Indemnitee while an officer or director or by
reason of the fact that Indemnitee is or was serving at the request of
the Company as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees and costs), judgments,
fines, any interest, assessments, and other charges and amounts paid in
settlement (if such settlement is approved in advance by the Company,
which approval shall not be unreasonably withheld) actually and
reasonably incurred by Indemnitee in connection with such action, suit
or
proceeding if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of
the Company, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe Indemnitee's conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that Indemnitee
did not act in good faith and in a manner which Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company,
and, with respect to any criminal action or proceeding, had reasonable
cause to believe that Indemnitee's conduct was unlawful.
(b) MANDATORY PAYMENT OF EXPENSES. To the extent that Indemnitee has been
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Subsection (a) of this Section 1 or the
defense of any claim, issue or matter therein, Indemnitee shall be
indemnified against expenses (including reasonable attorneys' fees)
actually and reasonably incurred by Indemnitee in connection therewith.
2. NO EMPLOYMENT RIGHTS. Nothing contained in this Agreement is intended
to create in Indemnitee any right to continued employment.
3. EXPENSES; INDEMNIFICATION PROCEDURE.
(a) ADVANCEMENT OF EXPENSES. Subject to the terms and conditions of this
Agreement, the Company shall advance all expenses incurred by
Indemnitee in connection with the investigation, defense, settlement or
appeal of any civil or criminal action, suit or proceeding referenced
in Section 1(a) hereof (including amounts actually paid in settlement
of any such action, suit or proceeding). Indemnitee hereby undertakes
to repay such amounts advanced only if, and to the extent that, it
shall ultimately be determined that Indemnitee is not entitled to be
indemnified by the Company as authorized hereby. Any advances made
hereunder shall be paid by the Company to Indemnitee within twenty (20)
days following delivery of a written request therefor by Indemnitee to
the Company.
(b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a condition
precedent to his or her right to be indemnified under this Agreement,
give the Company notice in writing as soon as practicable of any claim
made against Indemnitee for which indemnification will or could be
sought under this Agreement. Notice to the Company shall be directed to
the Chief Executive Officer of the Company at the address shown on the
signature page of this Agreement (or such other address as the Company
shall designate in writing to Indemnitee). Notice shall be deemed
received three (3) business days after the date postmarked if sent by
domestic certified or registered mail, properly addressed, otherwise
notice shall be deemed received when such notice shall actually be
received by the Company. In addition, Indemnitee shall give the Company
such information and cooperation as it may reasonably require and as
shall be within Indemnitee's power.
(c) PROCEDURE. Any indemnification and advances provided for in Section 1
shall be made no later than forty-five (45) days after receipt of the
written request of Indemnitee. If a claim under this Agreement, under
any statute, or under any provision of the Company's Certificate
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of Incorporation or Bylaws providing for indemnification, is not paid
in full by the Company within forty-five (45) days after a written
request for payment thereof has first been received by the Company,
Indemnitee may, but need not, at any time thereafter bring an action
against the Company to recover the unpaid amount of the claim and,
subject to Section 13 of this Agreement, Indemnitee shall also be
entitled to be paid for the expenses (including attorneys' fees and
interest, at the Bank One, Indiana, National Association, prime rate in
effect on the date of Indemnitee's written request, on the unpaid
amount of the claim) of bringing such action. It shall be a defense to
any such action (other than an action brought to enforce a claim for
expenses incurred in connection with any action, suit or proceeding in
advance of its final disposition) that Indemnitee has not met the
standards of conduct which make it permissible under applicable law for
the Company to indemnify Indemnitee for the amount claimed. Indemnitee
shall be entitled to receive interim payments of expenses pursuant to
Subsection 3(a) unless and until such defense may be finally
adjudicated by court order or judgment from which no further right of
appeal exists. It is the parties' intention that if the Company
contests Indemnitee's right to indemnification, the question of
Indemnitee's right to indemnification shall be for the court to decide,
and neither the failure of the Company (including its Board of
Directors, any committee or subgroup of the Board of Directors,
independent legal counsel, or its stockholders) to have made a
determination that indemnification of Indemnitee is proper in the
circumstances because Indemnitee has met the applicable standard of
conduct required by applicable law, nor an actual determination by the
Company (including its Board of Directors, any committee or subgroup of
the Board of Directors, independent legal counsel, or its stockholders)
that Indemnitee has not met such applicable standard of conduct, shall
create a presumption that Indemnitee has or has not met the applicable
standard of conduct.
(d) NOTICE TO INSURERS. If, at the time of the receipt of a notice of a
claim pursuant to Section 3(b) hereof, the Company has director and
officer liability insurance in effect, the Company shall give prompt
notice of the commencement of such proceeding to the insurers in
accordance with the procedures set forth in the respective policies.
The Company shall thereafter take all necessary or desirable action to
cause such insurers to pay, on behalf of the Indemnitee, all amounts
payable as a result of such proceeding in accordance with the terms of
such policies.
(e) SELECTION OF COUNSEL. In the event the Company shall be obligated under
Section 3(a) hereof to pay the expenses of any proceeding against
Indemnitee, the Company, if appropriate, shall be entitled to assume
the defense of such proceeding, with counsel approved by Indemnitee,
upon the delivery to Indemnitee of written notice of its election so to
do. After delivery of such notice, approval of such counsel by
Indemnitee and the retention of such counsel by the Company, the
Company will not be liable to Indemnitee under this Agreement for any
fees of counsel subsequently incurred by Indemnitee with respect to the
same proceeding, provided that (i) Indemnitee shall have the right to
employ his or her counsel in any such proceeding at Indemnitee's
expense; and (ii) if (A) the employment of counsel by Indemnitee has
been previously authorized by the Company, (B) Indemnitee shall have
reasonably concluded that there may be a conflict of interest between
the Company and Indemnitee in the conduct of any such defense, or (C)
the Company shall
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not, in fact, have employed counsel to assume the defense of such
proceeding, then the fees and expenses of Indemnitee's counsel shall be
at the expense of the Company.
(f) (i) For purposes of this Agreement, a "Change of Control" shall be
deemed to occur, unless previously consented to in writing by the
Employee, upon (a) individuals who, as of the date hereof, constitute
the Board of Directors of the Employer (the "Incumbent Board") ceasing
for any reason to constitute at least a majority of the Board of
Directors of the Employer (the "Board"); provided, however, that any
individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Employer's shareholders,
was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for
this purpose, any such individual whose initial assumption of office
occurs in connection with a Combination, as defined below, or as a
result of either an actual or threatened election contest (as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) or
other actual or threatened solicitation of proxies or consents by or on
behalf of a person other than the Board; (b) the acquisition of
beneficial ownership (as determined pursuant to Rule 13d-3 promulgated
under the Exchange Act) of 15% or more of the voting securities of the
Employer by any person, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act) not affiliated with the
Employee or the Employer; provided, however, that no Change of Control
shall be deemed to have occurred for purposes of this Agreement if such
person, entity or group acquires beneficial ownership of 15% or more of
the voting securities of the Employer (i) as a result of a combination
of the Employer or a wholly-owned subsidiary of the Employer with such
person, entity or group or another entity owned or controlled by such
person, entity or group (whether effected by a merger, consolidation,
sale of assets or exchange of stock or otherwise) (a "Combination") and
(ii) (x) executive officers of the Employer (as designated by the Board
for purposes of Section 16 of the Exchange Act) immediately prior to
the Combination constitute not less than 50% of the executive officers
of the Employer for a period of not less than six (6) months after the
Combination (for purposes of calculating the executive officers of the
Employer after the Combination, those executive officers who are
terminated by the Employer for Cause or who terminate their employment
without Good Reason shall be excluded from the calculation entirely),
and (y) the members of the Incumbent Board immediately prior to the
Combination constitute not less than 50% of the membership of the Board
after the Combination and (z) after the Combination, more than 35% of
the voting securities of the Employer is then beneficially owned,
directly or indirectly, by all or substantially all of the individuals
and entities who were the beneficial owners of the outstanding voting
securities of the Employer immediately prior to the Combination, it
being understood that while the existence of a Change in Control
pursuant to this Section 6.4.2(b) may not be ascertainable for six (6)
months after the Combination, if it is ultimately determined that such
Combination constituted a Change in Control, the date of the Change of
Control shall be the effective date of the Combination; (c) the
commencement of a proxy contest against the management for the election
of a majority of the Board of the Employer if the group conducting the
proxy contest owns, has or gains the power to vote at least 15% of the
voting securities of the Employer; (d) the consummation of a
reorganization, merger or consolidation, or the sale, transfer or
conveyance of all or substantially all of the assets of the Employer to
any person or entity not affiliated with the Employee or the Employer
unless, following such reorganization, merger, consolidation, sale,
transfer or conveyance, the conditions set forth in clause (b)(ii)
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above are present; or (e) the complete liquidation or dissolution of
the Employer. (ii) With respect to all matters arising after a Change
in Control (other than a Change in Control approved by a majority of
the directors on the Board who were directors immediately prior to such
Change in Control) concerning the rights of Indemnitee to indemnity
payments and advancement of expenses under this Agreement, the Company
shall seek legal advice only from independent counsel selected by
Indemnitee and approved by the Company (which approval shall not be
unreasonably withheld) (the "Independent Counsel"), and who has not
otherwise performed services for the Company or the Indemnitee (other
than in connection with indemnification matters) within the last five
years. The 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
Indemnitee in an action to determine Indemnitee's rights under this
Agreement. Such counsel, among other things, shall render its written
opinion to the Company and Indemnitee as to whether and to what extent
the Indemnitee should be permitted to be indemnified under applicable
law. The Company agrees to pay the reasonable fees of the Independent
Counsel and to indemnify fully such counsel against any and all
expenses (including attorneys' fees), claims, liabilities, loss, and
damages arising out of or relating to this Agreement or the engagement
of Independent Counsel pursuant hereto.
(g) ESTABLISHMENT OF TRUST. In the event of a Change in Control (other than
a Change in Control approved by a majority of the directors on the
Board who were directors immediately prior to such Change in Control)
the Company shall, upon written request by Indemnitee, create a trust
for the benefit of the Indemnitee and from time to time upon written
request of Indemnitee shall fund the trust in an amount sufficient to
satisfy any and all expenses reasonably anticipated at the time of each
such request to be incurred in connection with investigating, preparing
for, participating in, and/or defending any proceeding relating to any
indemnifiable event covered herein. The amount or amounts to be
deposited in the trust pursuant to the foregoing funding obligation
shall be determined by the Independent Counsel. The terms of the trust
shall provide that (i) the trust shall not be revoked or the principal
thereof invaded without the written consent of the Indemnitee, (ii) the
trustee shall advance, within ten business days of a request by the
Indemnitee, any and all expenses to the Indemnitee (and the Indemnitee
hereby agrees to reimburse the trust under the same circumstances for
which the Indemnitee would be required to reimburse the Company under
Section 3(a) of this Agreement), (iii) the trust shall continue to be
funded by the Company in accordance with the funding obligation set
forth above, (iv) the trustee shall promptly pay to the Indemnitee all
amounts for which the Indemnitee shall be entitled to indemnification
pursuant to this Agreement or otherwise, and (v) all unexpended funds
in the trust shall revert to the Company upon a final determination by
the Independent Counsel or a court of competent jurisdiction, as the
case may be, that the Indemnitee has been fully indemnified under the
terms of this Agreement. The trustee shall be chosen by the Indemnitee.
Nothing in this Section 3(g) shall relieve the Company of any of its
obligations under this Agreement. All income earned on the assets held
in the trust shall be reported as income by the Company for federal,
state, local, and foreign tax purposes. The Company shall pay all costs
of establishing and maintaining the trust and shall indemnify the
trustee against any and all expenses (including attorneys' fees),
claims, liabilities, loss, and damages arising out of or relating to
this Agreement or the establishment and maintenance of the trust.
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4 ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.
(a) SCOPE. Notwithstanding any other provision of this Agreement, the
Company hereby agrees to indemnify the Indemnitee to the fullest extent
permitted by law, notwithstanding that such indemnification is not
specifically authorized by the other provisions of this Agreement, the
Company's Certificate of Incorporation, the Company's Bylaws or by
statute. In the event of any change in any applicable law, statute or
rule which narrows the right of a Delaware corporation to indemnify a
member of its board of directors or an officer, such changes, to the
extent not otherwise required by such law, statute or rule to be
applied to this Agreement shall have no effect on this Agreement or the
parties' rights and obligations hereunder.
(b) NONEXCLUSIVITY. The indemnification provided by this Agreement shall
not be deemed exclusive of any rights to which Indemnitee may be
entitled under the Company's Certificate of Incorporation, its Bylaws,
any agreement, any vote of stockholders or disinterested members of the
Company's Board of Directors, the General Corporation Law of the State
of Delaware, or otherwise, both as to action in Indemnitee's official
capacity and as to action in another capacity while holding such
office. The indemnification provided under this Agreement shall
continue as to Indemnitee for any action taken or not taken while
serving in an indemnified capacity even though he or she may have
ceased to serve in such capacity at the time of any action, suit or
other covered proceeding.
5. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a
portion of the expenses, judgments, fines or penalties actually or
reasonably incurred by him or her in the investigation, defense, appeal
or settlement of any civil or criminal action, suit or proceeding, but
not, however, for the total amount thereof, the Company shall
nevertheless indemnify Indemnitee for the portion of such expenses,
judgments, fines or penalties to which Indemnitee is entitled.
6. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that
in certain instances, Federal law or applicable public policy may
prohibit the Company from indemnifying its directors and officers under
this Agreement or otherwise. Indemnitee understands and acknowledges
that the Company has undertaken or may be required in the future to
undertake with the Securities and Exchange Commission to submit the
question of indemnification to a court in certain circumstances for a
determination of the Company's right under public policy to indemnify
Indemnitee.
7. OFFICER AND DIRECTOR LIABILITY INSURANCE. The Company shall, from time
to time, make the good faith determination whether or not it is
practicable for the Company to obtain and maintain a policy or policies
of insurance with reputable insurance companies providing the officers
and directors of the Company with coverage for losses from wrongful
acts, or to ensure the Company's performance of its indemnification
obligations under this Agreement. Among other considerations, the
Company will weigh the costs of obtaining such insurance coverage
against the protection afforded by such coverage. Notwithstanding the
foregoing, the Company shall have no obligation to obtain or maintain
such insurance if
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the Company determines in good faith that such insurance is not
necessary or is not reasonably available, if the premium costs for such
insurance are disproportionate to the amount of coverage provided, if
the coverage provided by such insurance is limited by exclusions so as
to provide an insufficient benefit, or if Indemnitee is covered by
similar insurance maintained by a subsidiary or parent of the Company.
However, the Company's decision whether or not to adopt and maintain
such insurance shall not affect in any way its obligations to indemnify
its officers and directors under this Agreement or otherwise. In all
policies of director and officer liability insurance, Indemnitee shall
be named as an insured in such a manner as to provide Indemnitee the
same rights and benefits as are accorded to the most favorably insured
of the Company's directors, if Indemnitee is a director; or of the
Company's officers, if Indemnitee is not a director of the Company, but
is an officer; or of the Company's key employees, if Indemnitee is not
an officer or director, but is a key employee.
8. SEVERABILITY. Nothing in this Agreement is intended to require or shall
be construed as requiring the Company to do or fail to do any act in
violation of applicable law. The Company's inability, pursuant to court
order, to perform its obligations under this Agreement shall not
constitute a breach of this Agreement. The provisions of this Agreement
shall be severable as provided in this Section 8. If this Agreement or
any portion hereof shall be invalidated on any ground by any court of
competent jurisdiction, then the Company shall nevertheless indemnify
Indemnitee to the full extent permitted by any applicable portion of
this Agreement that shall not have been invalidated, and the balance of
this Agreement not so invalidated shall be enforceable in accordance
with its terms.
9. EXCEPTIONS. Any other provision herein to the contrary notwithstanding,
the Company shall not be obligated pursuant to the terms of this
Agreement:
(a) CLAIMS INITIATED BY INDEMNITEE. To indemnify or advance expenses to
Indemnitee with respect to proceedings or claims initiated or brought
voluntarily by Indemnitee and not by way of defense, except with
respect to proceedings brought to establish or enforce a right to
indemnification under this Agreement or any other statute or law or
otherwise as required under Section 145 of the Delaware General
Corporation Law, but such indemnification or advancement of expenses
may be provided by the Company in specific cases if the Board of
Directors has approved the initiation or bringing of such suit.
(b) LACK OF GOOD FAITH. To indemnify Indemnitee for any expenses incurred
by the Indemnitee with respect to any proceeding instituted by
Indemnitee to enforce or interpret this Agreement, if a court of
competent jurisdiction determines that each of the material assertions
made by the Indemnitee in such proceeding was not made in good faith or
was frivolous.
(c) INSURED CLAIMS. To indemnify Indemnitee for expenses or liabilities of
any type whatsoever (including, but not limited to, judgments, fines,
ERISA excise taxes or penalties, and amounts paid in settlement) to the
extent such expenses or liabilities have been paid directly to
Indemnitee by an insurance carrier under a policy of officers' and
directors' liability insurance maintained by the Company.
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(d) CLAIMS UNDER SECTION 16(b). To indemnify Indemnitee for expenses and
the payment of profits arising from the purchase and sale by Indemnitee
of securities in violation of Section 16(b) of the Securities Exchange
Act of 1934, as amended, or any similar successor statute.
10. CONSTRUCTION OF CERTAIN PHRASES.
(a) For purposes of this Agreement, references to the "COMPANY" shall
include any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its
separate existence had continued, would have had power and authority to
indemnify its directors, officers, and employees or agents, so that if
Indemnitee is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, Indemnitee shall stand in the same position under the
provisions of this Agreement with respect to the resulting or surviving
corporation as Indemnitee would have with respect to such constituent
corporation if its separate existence had continued.
(b) For purposes of this Agreement, references to "OTHER ENTERPRISES",
shall include employee benefit plans; references to "FINES" shall
include any excise taxes assessed on Indemnitee with respect to an
employee benefit plan; and references to "SERVING AT THE REQUEST OF THE
COMPANY" shall include any service as a director, officer, employee or
agent of the Company which imposes duties on, or involves services by,
such director, officer, employee or agent with respect to an employee
benefit plan, its participants, or beneficiaries; and if Indemnitee
acted in good faith and in a manner Indemnitee reasonably believed to
be in the interest of the participants and beneficiaries of an employee
benefit plan, Indemnitee shall be deemed to have acted in a manner "NOT
OPPOSED TO THE BEST INTERESTS OF THE COMPANY" as referred to in this
Agreement.
11. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Company and its successors and assigns, and shall inure to the benefit
of Indemnitee and Indemnitee's estate, heirs, legal representatives and
assigns.
12. ATTORNEYS' FEES. In the event that any action is instituted by
Indemnitee under this Agreement to enforce or interpret any of the
terms hereof, Indemnitee shall be entitled to be paid all court costs
and expense, including reasonable attorneys' fees, incurred by
Indemnitee with respect to such action. The Company hereby consents to
service of process and to appear in any such action. In the event of an
action instituted by or in the name of the Company under this Agreement
or to enforce or interpret any of the terms of this Agreement,
Indemnitee shall be entitled to be paid all court costs and expenses,
including attorneys' fees and costs, incurred by Indemnitee in defense
of such action (including with respect to Indemnitee's counterclaims
and cross-claims made in such action).
13. NOTICE. All notices, requests, demands and other communications under
this Agreement shall be in writing and shall be deemed duly given (i)
if delivered by hand and receipted for by the party addressee, on the
date of such receipt, or (ii) if mailed by domestic certified or
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registered mail with postage prepaid, on the third business day after
the date postmarked. Addresses for notice to either party are as shown
on the signature page of this Agreement, or as subsequently modified by
written notice.
14. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby
irrevocably consent to the jurisdiction of the courts of the State of
Indiana for all purposes in connection with any action or proceeding
which arises out of or relates to this Agreement and agree that any
action instituted under this Agreement shall be brought only in the
state courts of the State of Indiana.
15. CHOICE OF LAW. This Agreement shall be governed by and its provisions
construed in accordance with the laws of the State of Delaware, as
applied to contracts between Delaware residents entered into and to be
performed entirely within Delaware.
16. MODIFICATION. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof. All prior
negotiations, agreements and understandings between parties with
respect thereto are superseded hereby. This Agreement may not be
modified or amended except by an instrument in writing signed by or on
behalf of the parties hereto.
The parties hereto have executed this Agreement as of the day and year set forth
on the first page of this Agreement.
BRIGHTPOINT, INC.
By:/s/ Xxxxxx X. Xxxxx
----------------------
Name: Xxxxxx X. Xxxxx
Title: EVP, General Counsel & Secretary
AGREED TO AND ACCEPTED:
INDEMNITEE
/s/ V. Xxxxxxx Xxxx
--------------------
Printed Name: V. Xxxxxxx Xxxx
Address: 0000 Xxxxxx Xxxx, Xxxxxxxxxxxx, XX 00000
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