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EXHIBIT 10.5
INDEMNITY AGREEMENT
THIS INDEMNITY AGREEMENT is entered into as of ____________, 1997, by and
among Xxxxxx Capital Group, Inc. ("TCG") and those certain persons listed on
Schedule A hereof (the "Xxxxxx Family") for the purposes described below.
RECITALS
WHEREAS, the Xxxxxx Family and Xxxx Xxxxxx Financial Group, Inc. ("CTFG")
entered into an Amended and Restated Share Exchange Agreement dated as of June
12, 1996 (the "Share Exchange Agreement");
WHEREAS, pursuant to Section 7(c) of the Share Exchange Agreement, the
Xxxxxx Family has formed TCG; and
WHEREAS, TCG desires to indemnify the Xxxxxx Family for certain
liabilities under the Share Exchange Agreement;
NOW THEREFORE, the parties agree as follows:
1. DEFINITIONS. For purposes of this Agreement:
(a) "PROCEEDING" means any action, suit, arbitration, alternate
dispute resolution mechanism, investigation, administrative hearing, or any
other proceeding, pending, threatened or completed, whether civil,
criminal, administrative or investigative, in which a Xxxxxx Family member
is a party or threatened to be a party:
(i) arising, caused by, or as a result of, a breach by TCG of the
Section 7(c) Agreement dated _________, 1997 between TCG and CTFG;
and/or
(ii) arising from or relating to the following sections of the
Share Exchange Agreement:
Section 3
Section 5.2(a) (last two sentences only)
Section 5.2(b) (last two sentences only)
Section 10(g)(i) (first sentence only), (other than a breach of
10(g)(ii)(x), other than any breach by the Xxxxxx Family of
its covenant not to enter into any Transfer Arrangement
relating to control of TCG, and other than a breach of the
Share Exchange Agreement by CTFG),
10(g)(ii)(other than a breach of 10(g)(ii)(x) and other than
any breach by the Xxxxxx Family of its covenant not to enter
into any Transfer Arrangement relating to control of TCG),
Section 10(h)
Section 10(j) (second sentence only)
Section 10(n)
Section 15(a) (other than Section 15(a)(i))
Section 16
Section 17
(b) "CLOSING" means the closing of the transactions contemplated by
the Share Exchange Agreement.
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(c) "EXPENSES" means all reasonable attorneys' fees, retainers, court
costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing
to prosecute or defend, investigating, or being or preparing to be a
witness in a Proceeding.
(d) "LIABILITIES" means any judgments, fines, penalties, or similar
payments or amounts paid or incurred by a Xxxxxx Family member in
connection with any Proceeding, amounts paid or incurred by a Xxxxxx Family
member or on a Xxxxxx Family member's behalf in settlement of any
Proceeding, and all Expenses.
(e) Capitalized terms not otherwise defined herein shall have the
same meaning as ascribed to them in the Share Exchange Agreement.
2. INDEMNIFICATION BY TCG. TCG shall hold harmless and indemnify each
member of the Xxxxxx Family against all Liabilities and advance to each Xxxxxx
Family member all Expenses to the fullest extent permitted by law; provided,
however, that TCG shall have no obligation to indemnify or hold harmless any
member of the Xxxxxx Family from any Liability caused by such Xxxxxx Family
member's knowing or reckless breach of any representation, warranty or covenant
contained in the Share Exchange Agreement. The Xxxxxx Family has no actual
knowledge of any pending or threatened claim which may reasonably be expected
to result in a claim for indemnification by a Xxxxxx Family member hereunder,
except as described with reasonable specificity in the Registration Statement
relating to ______% Noncumulative Perpetual Preferred Stock, Series A.
3. INDEMNIFICATION BY XXXXXX FAMILY. The Xxxxxx Family shall hold
harmless and indemnify TCG against any judgments, fines, penalties, or similar
payments or amounts paid and reasonable expenses (including attorneys' fees and
costs) incurred by TCG which are caused by any knowing or reckless breach by
any member of the Xxxxxx Family of any representation, warranty or covenant in
the Share Exchange Agreement
4. INDEMNIFICATION PROCEDURES. Promptly after receipt by an indemnified
party under Section 2 or Section 3 above of notice of the commencement of any
Proceeding or other third party claim which may give rise to a claim for
indemnification hereunder (an "Indemnifiable Matter"), such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such section, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party
shall not relieve the indemnifying party from any liability that it may have to
any indemnified party. In case any such action shall be brought against any
indemnified party, and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
in, and, to the extent that it shall wish, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of the indemnifying
party's election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such section for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation;
provided, however, that such indemnified party shall have the right to employ
counsel in any such proceeding at his or its own expense; and provided further,
that if the indemnified party shall have reasonably concluded that there may be
a conflict of interest between the indemnified party and the indemnifying party
in the conduct of any such defense, or the indemnifying party shall not, in
fact, have employed counsel to assume the defense of such proceeding, then, in
any such case, the fees and expenses of the indemnified party's counsel shall
be borne by the indemnifying party and advanced in accordance with Section 5 of
this Agreement, if applicable. Each indemnified party shall give the
indemnifying party such reasonable information and reasonable cooperation as it
may reasonably require in the defense of an Indemnifiable Matter. In no event
shall the members of the Xxxxxx Family as a group be entitled to
indemnification under this Agreement for the reasonable fees and expenses of
more than one counsel unless such members reasonably believe that with respect
to a particular indemnification matter, a conflict of interest among such
Xxxxxx Family members so requires separate additional counsel for such Xxxxxx
Family member.
5. ADVANCEMENT OF EXPENSES. Notwithstanding anything to the contrary in
this Agreement, TCG shall advance all Expenses incurred by or on behalf of a
Xxxxxx Family member in connection with any Proceeding within five (5) days
after the receipt by TCG of a statement from such Xxxxxx Family member
requesting the advance from time to time, whether prior to or after final
disposition of the Proceeding. Each statement shall reasonably evidence the
Expenses incurred by such Xxxxxx Family member. Each Xxxxxx Family member
hereby undertakes to repay promptly any Expenses advanced if it shall
ultimately be determined that such Xxxxxx Family member is not entitled to be
indemnified against such Expenses. Any advances and the undertaking to repay
pursuant to this Section 3 shall be unsecured and, until thirty (30) days after
the date on which it is determined that such Xxxxxx Family member is not
entitled to be so indemnified, interest free.
6. EXPENSES UNDER THIS AGREEMENT. Notwithstanding any other provision in
this Agreement to the contrary, TCG shall indemnify each Xxxxxx Family member
against all expenses (including reasonable attorneys' fees and costs) incurred
by such Xxxxxx Family member against all Expenses incurred by such Xxxxxx
Family member in connection with any action between the TCG and such Xxxxxx
Family member involving the interpretation or enforcement of the rights of
such Xxxxxx Family member under this Agreement, if such Xxxxxx Family member
should prevail in such action.
7. GENERAL PROVISIONS.
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7.1 EFFECTIVE DATE. This Agreement shall be effective upon the
Closing, and shall be of no force and effect until the Closing.
7.2 AMENDMENTS AND WAIVER. No amendment, waiver or consent with
respect to any provision of this Agreement shall in any event be effective,
unless the same shall be in writing and signed by the parties hereto, and then
such amendment, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
7.3 NON-EXCLUSIVITY. The rights of indemnification and to receive
advancement of Expenses as provided by this Agreement shall not be deemed
exclusive of any other rights to which a Xxxxxx Family member may at any time be
entitled under applicable law, the articles of incorporation or bylaws of any
corporation, any other agreement, a vote of shareholders, a resolution of
directors, or otherwise.
7.4 SUBROGATION. In the event of any payment under this Agreement,
TCG shall be subrogated to the extent of such payment to all of the rights of
recovery of each Xxxxxx Family member, who shall reasonably cooperate with TCG
and execute all papers required and take all reasonable action necessary to
secure such rights, including execution of such documents as are necessary to
enable TCG to bring suit to enforce such rights.
7.5 NO DUPLICATIVE PAYMENT. TCG shall not be liable under this
Agreement to make any payment of amounts otherwise indemnifiable hereunder if
and to the extent that a Xxxxxx Family member has otherwise actually received
such payment under any insurance policy, contract or agreement. The Xxxxxx
Family shall use its reasonable efforts to collect any payment under any such
insurance policy, contract or agreement. The Xxxxxx Family shall use its
reasonable efforts to collect any payment under any such insurance policy,
contact or agreement.
7.6 NOTICES. All notices, requests, consents, demands and other
communications hereunder must be in writing.
7.7 COUNTERPARTS. This Agreement may be executed simultaneously in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7.8 SUCCESSORS AND ASSIGNS. This Agreement, and the rights and
obligations of the parties hereunder, shall inure to and be binding on the
parties hereto and their respective successors and assigns. TCG may not assign
(by operation of law or otherwise) any rights, benefits, duties or obligations
under this Agreement, without the prior written consent of the Xxxxxx Family;
provided, however, that TCG may, without such consent, assign its rights under
this Agreement to any successor in the event of a merger, consolidation, sale
of all or substantially all its assets, liquidation or dissolution, if such
assignee executes and delivers to the other parties hereto an agreement
reasonably satisfactory in form and substance to such other parties under
which such assignee assumes and agrees to perform and discharge all the
obligations and liabilities of the assigning party. No permitted assignment by
any party under this Section 7.8 shall relieve the assigning party of its
obligations hereunder.
7.9 ENTIRE AGREEMENT. This Agreement and the documents referred to
herein contain the entire agreement and understanding among the parties with
respect to the transactions contemplated hereby and supersede all other
agreements, understandings and undertakings among the parties on the subject
matter hereof.
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7.10 SEVERABILITY. If any provision or provisions of this Agreement
shall be held to be invalid or unenforceable for any reason whatsoever: (a) the
validity, legality, and enforceability of the remaining provisions of this
Agreement (including, without limitation, each portion of any Section of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that is not itself invalid or unenforceable) shall not in any way
be affected or impaired thereby; and (b) to the fullest extent possible, the
remaining provisions of this Agreement (including, without limitation, each
portion of any Section of this Agreement containing any such provision held to
be invalid or unenforceable, that is not itself invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent manifested
by the provision or provisions held invalid or unenforceable.
7.11 GOVERNING LAW. This Agreement shall be construed, enforced and
interpreted in accordance with the substantive laws of the State of Delaware
applicable to contracts made and to be performed wholly within said State.
7.12 NO THIRD PARTY RIGHTS. This Agreement does not create any
rights, claims or benefits inuring to any person that is not a party hereto nor
create or establish any third-party beneficiary hereto.
7.13 XXXXXX FAMILY DESIGNEES. The Xxxxxx Family members hereby
appoint Xxxxxxx X. Xxxxxx and Xxxxx X. Xxxxxx, or either of them, to act as
their designated representatives (the "Xxxxxx Family Designees") for the
purpose of exercising all power of the Xxxxxx Family necessary to administer
this Agreement, including, without limitation, the power to modify, amend or
waive provisions under this Agreement, give consents or instructions, or give
or receive notices and incur all out-of-pocket expenses including the
reasonable fees and costs of attorneys or agents, which the Xxxxxx Family
Designees may find it necessary to engage in the performance of such Xxxxxx
Family Designees duties. Any notice, direction, consent or other act to be
received or given by a Xxxxxx Family member shall be deemed properly received
or given if received or given by the Xxxxxx Family Designees. The Xxxxxx
Family members, by unanimous written consent thereof delivered to TCG, may
change at any time the Xxxxxx Family Designees.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
XXXXXX CAPITAL GROUP, INC.
By:
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Name:
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Title:
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Xxxxxx X Xxxxxx 1/
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Xxxxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
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Xxxx Xxxxxx 2/
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Xxxxx Xxxxxx Xxxxx
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Xxxxxx X. Xxxxx, as Trustee 3/
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Xxxxx Xxxxxx, as Trustee of the
Xxxxx Xxxxxx Trust
Xxxx Xxxxxx Bank, as Trustee 4/
By:
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1/ Individually and a trustee under self declaration of trust dated 9/17/96.
2/ Individually and as trustee of the Xxxxxx Annual Gift Trust FBO
Xxxxxxxxx Xxxx Xxxxxx, the Xxxxxx Annual Gift Trust FBO Xxxx Xxxxxx, the
Xxxxxx Annual Gift Trust FBO Xxxxxxx Xxxx Xxxxx, the Xxxxxx Annual Gift
Trust FBO Xxxxxxx Xxxxxx, the Xxxxxx Annual Gift Trust FBO Xxxx Xxxxxxx
Xxxxxx, the Xxxxxx Annual Gift Trust FBO Xxxxx Xxxxxx Xxxxx, the Xxxxxx
Annual Gift Trust FBO Xxxxxxx X. Xxxxxx, the Xxxxxx Annual Gift Trust
FBO Xxxxxxxxx Xxx Xxxxx, the Xxxxxx Annual Gift Trust FBO Xxxxx Xxxxxx,
the Xxxxxx Annual Gift Trust FBO Xxxx Xxxxxx, the Xxxxxx Annual Gift
Trust FBO Xxxxx Xxxxxx Xxxxxx, the Xxxxxx Annual Gift Trust FBO Xxxxx
Xxxxxx, the Xxxxxx Annual Gift Trust FBO Xxxxx X. Xxxxxx.
3/ As trustee of the Xxxxxxx Xxxx Great Grandchildrens Trust FBO Family of
Xxxxxxx Xxxxxx (a general partner of Xxxxxx Family Partnership),
the Xxxxxxx Xxxx Grandchildrens Trust FBO Xxxxx Xxxxxx (a general partner
of Xxxxxx Family Partnership), the Xxxxxxx Xxxx Grandchildrens FBO Xxxxx
Xxxxx (a general partner of Xxxxxx Family Partnership), the Xxxxxx 1992
Trust FBO Xxxx Xxxxxx, the Xxxxxxx Xxxx Great Grandchildrens Trust FBO
Family of Xxxxx Xxxxxx Xxxxx, the Xxxxxxx Xxxx Great Grandchildrens Trust
FBO Family of Xxxxx Xxxxxx, the Xxxxxx 1992 Trust FBO Xxxxxxx Xxxxxxxx
Xxxxxx, the Xxxxxx 1992 Trust FBO Xxxxxxxxx Xxx Xxxxx, the Xxxxx X.
Xxxxxx Gift Trust, the Xxxxxx 1992 Trust FBO Xxxx Xxxxxxx Xxxxxx, the
Xxxxxx 1992 Trust FBO Xxxxxxx Xxxx Xxxxx, the Xxxxxxx X. Xxxxxx Gift
Trust, the Xxxxxx 1992 Trust FBO Xxxxxxxxx Xxxx Xxxxxx, the Xxxxx Xxxxxx
Gift Trust, and the Xxxxxx 1992 Trust FBO Xxxxx Xxxxxx Xxxxxx.
4/ As Trustee of the Trust FBO Xxxxxx X. Xxxxxx and the Iris Fund Tark.
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EXHIBIT A
XXXXXX FAMILY
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Directly Owned Shares
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Xxxxxx Xxxxxx 53,900
Xxxxxxx Xxxxxx 86,880
Xxxxx Xxxxxx 126,880
Xxxxx Xxxxx 126,880
Indirectly Owned Shares
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Xxxx Xxxxxx TR FBO Xxxx Xxxxxx 21,720
Xxxxxx Xxxxx TR/BT Gift Trust 26,480
Xxxxxx Xxxxx TR/Xxxxx Xxxxxx Xxxxxx 8,800
Xxxx Xxxxxx TR/Xxxxx Xxxxxx Xxxxxx 11,320
Xxxx Xxxxxx TR/Xxxxx Xxxxxx 21,720
Xxxx Xxxxxx TR/Xxxxx Xxxxxx 21,720
Xxxxxx Xxxxx TR/Tark/Xxxxx Xxxxxx 211,320
Xxxx Xxxxxx TR/Xxxxx Xxxxxx Xxxxx 21,720
Xxxxxx Xxxxx TR/Tark/Xxxxx Xxxxxx Xxxxx 211,320
Xxxxxx Xxxxx TR/Xxxxx Xxxxxx 26,520
Xxxx Xxxxxx Bank/FBO SJT 38,040
Xxxx Xxxxxx Bank/Xxxx Xxxx Fund 152,200
Xxxxxx Xxxxx TR/FBO X. Xxxxx 8,800
Xxxx Xxxxxx TR/FBO X. Xxxxx 4,640
Xxxxxx Xxxxx TR/FBO X. X. Xxxxxx 8,800
Xxxx Xxxxxx TR/FBO Xxxxx Xxxxxx 21,760
Xxxxxx Xxxxx TR/Tark/Xxxxx Xxxxxx 261,320
Xxxxxx Xxxxx TR/Tark/X. Xxxxx 261,320
Xxxxxx Xxxxx TR/Tark/X. Xxxxxx 261,320
Xxxxxx Xxxxx TR/JWT Gift Trust 26,520
Xxxx Xxxxxx TR/FBO JWT 17,800
Xxxxxx Xxxxx TR/Tark/X. Xxxxxx 211,320
Xxxxxx Xxxxx TR/FBO Xxxx Xxxxxx 4,800
Xxxx Xxxxxx TR/FBO Xxxx Xxxxxx 16,960
Xxxx Xxxxxx TR/FBO Xxxxxxx Xxxxxx 21,760
Xxxxxx Xxxxx TR/FBO X. Xxxxx 8,800
Xxxx Xxxxxx TR/FBO X. Xxxxx 11,320
Xxxxxx Xxxxx TR/FBO Xxxx Xxxxxx 8,800
Xxxx Xxxxxx TR/FBO Xxxx Xxxxxx 1,480
Xxxx Xxxxxx TR/FBO Xxxxxxxxx Xxxxxx 16,960
Xxxxxx Xxxxx TR/FBO Xxxxxxxxx Xxxxxx 4,800
Xxxxxx Family Partnership 750,000
Xxxxxx X Xxxxxx Trust under self 509,280
Xxxxx Xxxxxx Trust 40,000
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