EXHIBIT (e)(11)
INDEMNIFICATION AGREEMENT
This Agreement is made this 26th day of October, 2000, by and between
DevX Energy, Inc., a Delaware corporation (the "Company"), and Xxxxx X. Xxxxx
("Director").
WITNESSETH:
WHEREAS, Director is unwilling to serve, or continue to serve, the
Company as a director without assurances that adequate liability insurance,
indemnification or a combination thereof is, and will continue to be, provided;
and
WHEREAS, the Company, in order to induce Director to serve or continue
to serve the Company, has agreed to provide Director with the benefits
contemplated by this Agreement which benefits are intended to supplement or
replace, if necessary, the Company's existing directors' and officers' liability
insurance; and
WHEREAS, as a result of the provision of such benefits, Director has
agreed to serve or to continue to serve as a director of the Company;
NOW, THEREFORE, in consideration of the promises, conditions,
representations and warranties set forth herein, including the Director's
service or continued service to the Company, the Company and Director hereby
agree as follows:
Section 1. Definitions. The following terms, as used herein, shall have the
following respective meanings:
"Covered Act" means any breach of duty, neglect, error, misstatement,
misleading statement, omission or other act done or wrongfully attempted by
Director in connection with his services as an officer, director, employee,
trustee, agent or fiduciary of the Company, or any event or occurrence related
to the fact that Director is or was a director, officer, employee, agent or
fiduciary of the Company or is or was serving at the request of the Company as a
director, officer, employee, trustee, agent or fiduciary of another corporation,
partnership, joint venture, trust or other entity, or by reason of anything done
or not done by Director in such capacities or any of the foregoing alleged by
any claimant or any claim against Director solely by reason of him being a
director or officer of the company.
"Covered Amount" means Losses and Expenses which, in type or amount,
are not insured under the directors' and officers' liability insurance
maintained by the Company from time to time.
"D&O Insurance" means the directors' and officers' liability insurance
issued by the insurer(s), and having the policy number(s), amount(s) and
deductible(s) set forth on Exhibit A hereto and any replacement or substitute
policies issued by one or more reputable insurers providing in all respects
coverage at least comparable to and in the same amount as that provided under
the policy or policies identified on Exhibit A.
"Determination" means a determination, based on the facts known at the
time, made by:
(i) A majority vote of the directors who are not parties
to the action, suit or proceeding as to which
indemnification has been requested, even though less
than a quorum; or
(ii) Independent legal counsel in a written opinion
prepared at the request of a majority of a quorum of
disinterested directors; or
(iii) A majority of the disinterested stockholders of the
Company; or
(iv) A final adjudication by a court of competent
jurisdiction.
"Determined" shall have a correlative meaning.
"Excluded Claim" means any payment for Losses or Expenses in connection
with any claim:
(i) Based upon or attributable to Director gaining in
fact any personal profit or advantage to which
Director is not entitled; or
(ii) For the return by Director of any remuneration paid
to Director without the previous approval of the
stockholders of the Company which is illegal; or
(iii) For an accounting of profits in fact made from the
purchase or sale by Director of securities of the
Company within the meaning of Section 16 of the
Securities Exchange Act of 1934, as amended, or
similar provisions of any state law; or
(iv) Resulting from Director's fraudulent, dishonest or
willful misconduct; or
(v) The payment of which by the Company under this
Agreement is not permitted by applicable law; or
(vi) The payment of which would cause the total amount of
all Losses and Expenses paid by the Company to exceed
the Covered Amount; or
(vii) Any claim for which Director would not be permitted
to be indemnified under applicable law,
notwithstanding the obligations of the Company under
this Agreement.
"Expenses" means any reasonable expenses incurred by Director as a
result of a claim or claims made against him for Covered Acts including, without
limitation, counsel fees and costs of investigative, judicial or administrative
proceedings or appeals, but shall not include Fines.
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"Fines" means any fine, penalty or, with respect to an employee benefit
plan, any excise tax or penalty assessed with respect thereto.
"Loss" means any amount which Director is legally obligated to pay as a
result of a claim or claims made against him for Covered Acts including, without
limitation, damages and judgments and sums paid in settlement of a claim or
claims, but shall not include Fines.
"Subsidiary" means, with respect to any person, any corporation or
other entity of which a majority of the voting power of the voting equity
securities or equity interest is owned, directly or indirectly, by that person.
Section 2. Maintenance of D&O Insurance.
a. The Company hereby represents and warrants that Exhibit A contains a
complete and accurate description of the policies of directors' and officers'
liability insurance purchased by the Company and that such policies are in full
force and effect.
b. The Company hereby covenants and agrees that, so long as Director
shall continue to serve as a director of the Company and thereafter so long as
Director shall be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether civil, criminal or investigative,
by reason of the fact that Director was a director of the Company, the Company,
subject to Section 2(d), shall maintain in full force and effect D&O Insurance.
c. In all policies of D&O Insurance, Director shall be named as an
insured in such a manner as to provide Director the same rights and benefits,
subject to the same limitations, as are accorded to the Company's directors or
officers most favorably insured by such policy.
d. The Company shall have no obligation to maintain D&O Insurance if
the Company determines in good faith that such insurance is not reasonably
available, the premium costs for such insurance is disproportionate to the
amount of coverage provided, or the coverage provided by such insurance is
limited by exclusions so as to provide an insufficient benefit.
Section 3. Indemnification. The Company shall indemnify Director and hold him
harmless from the Covered Amount of any and all Losses and Expenses subject, in
each case, to the further provisions of this Agreement.
Section 4. Excluded Coverage.
a. The Company shall have no obligation to indemnify Director for and
hold him harmless from any Loss or Expense which has been determined, by final
adjudication by a court of competent jurisdiction, to constitute an Excluded
Claim.
b. The Company shall have no obligation to indemnify Director and hold
him harmless for any Loss or Expense to the extent that Director is indemnified
by the Company pursuant to the Company's Bylaws or otherwise indemnified.
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Section 5. Indemnification Procedures.
a. Promptly after receipt by Director of notice of the commencement of
or the threat of commencement of any action, suit or proceeding, Director shall,
if indemnification with respect thereto may be sought from the Company under
this Agreement, notify the Company of the commencement thereof.
b. If, at the time of the receipt of such notice, the Company has D&O
Insurance in effect, the Company shall give prompt notice of the commencement of
such action, suit or proceeding to the insurers in accordance with the
procedures set forth in the respective policies in favor of Director. The
Company shall thereafter take all necessary or desirable action to cause such
insurers to pay, on behalf of Director, all Losses and Expenses payable as a
result of such action, suit or proceeding in accordance with the terms of such
policies.
c. To the extent the Company does not, at the time of the commencement
of or the threat of commencement of such action, suit or proceeding, have
applicable D&O Insurance, or if a Determination is made that any Expenses
arising out of such action, suit or proceeding will not be payable under the D&O
Insurance then in effect, the Company shall be obligated to pay the Expenses of
any such action, suit or proceeding in advance of the final disposition thereof
and the Company, if appropriate, shall be entitled to assume the defense of such
action, suit or proceeding, with counsel satisfactory to Director, upon the
delivery to Director of written notice of its election to do so. After delivery
of such notice, the Company will not be liable to Director under this Agreement
for any legal or other Expenses subsequently incurred by the Director in
connection with such defense other than reasonable Expenses of investigation;
provided that Director shall have the right to employ its counsel in any such
action, suit or proceeding but the fees and expenses of such counsel incurred
after delivery of notice from the Company of its assumption of such defense
shall be at the Director's expense; provided further that if (i) the employment
of counsel by Director has been previously authorized by the Company, (ii)
Director shall have reasonably concluded that there may be a conflict of
interest between the Company and Director in the conduct of any such defense, or
(iii) the Company shall not, in fact, have employed counsel to assume the
defense of such action, the fees and expenses of counsel shall be at the expense
of the Company.
d. All payments on account of the Company's indemnification obligations
under this Agreement shall be made within sixty (60) days of Director's written
request therefor unless a Determination is made that the claims giving rise to
Director's request are Excluded Claims or otherwise not payable under this
Agreement; provided that all payments on account of the Company's obligations
under Section 5(c) of this Agreement prior to the final disposition of any
action, suit or proceeding shall be made within 20 days of Director's written
request therefor and such obligation shall not be subject to any such
determination but shall be subject to Section 5(e) of this Agreement.
e. Director agrees that he will reimburse the Company for all Losses
and Expenses paid by the Company in connection with any action, suit or
proceeding against Director in the event and only to the extent that a
Determination shall have been made by a court in a final adjudication from which
there is no further right of appeal that the Director is not entitled to be
indemnified by the Company for such Expenses because the claim is an Excluded
Claim or because Director is otherwise not entitled to payment under this
Agreement.
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Section 6. Settlement. The Company shall have no obligation to indemnify
Director under this Agreement for any amounts paid in settlement of any action,
suit or proceeding effected without the Company's prior written consent. The
Company shall not settle any claim in any manner which would impose any Fine or
any obligation on Director without Director's written consent. Neither the
Company nor Director shall unreasonably withhold their consent to any proposed
settlement.
Section 7. Rights Not Exclusive. The rights provided hereunder shall not be
deemed exclusive of any other rights to which the Director may be entitled under
any bylaw, agreement, vote of stockholders or of disinterested directors or
otherwise, both as to action in his official capacity and as to action in any
other capacity by holding such office, and shall continue after the Director
ceases to serve the Corporation as a Director.
Section 8. Enforcement.
a. Director's right to indemnification shall be enforceable by Director
only in the Chancery Court of the State of Delaware and shall be enforceable
notwithstanding any adverse Determination, other than a Determination which has
been made by a final adjudication of a court of competent jurisdiction. In any
such action, if a prior adverse Determination has been made, the burden of
proving that indemnification is required under this Agreement shall be on
Director. The Company shall have the burden of proving that indemnification is
not required under this Agreement if no prior adverse Determination shall have
been made.
b. In the event that any action is instituted by Director under this
Agreement or to enforce or interpret any of the terms of this Agreement,
Director shall be entitled to be paid all court costs and expenses, including
reasonable counsel fees, incurred by Director with respect to such action,
unless the court determines that each of the material assertions made by
Director as a basis for such action were not made in good faith or were
frivolous.
Section 9. Severability. In the event that any provision of this Agreement is
determined by a court to require the Company to do or to fail to do an act which
is in violation of applicable law, such provision shall be limited or modified
in its application to the minimum extent necessary to avoid a violation of law,
and, as so limited or modified, such provision and the balance of this Agreement
shall be enforceable in accordance with their terms.
Section 10. Choice of Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware.
Section 11. Consent to Jurisdiction. The Company and the Director each hereby
irrevocably consent to the jurisdiction of the courts of the State of Delaware
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 Chancery Court of the State of Delaware.
Section 12. Successor and Assigns. This Agreement shall be (i) binding upon all
successors and assigns of the Corporation (including any transferee of all or
substantially all of its assets and any successor by merger or otherwise by
operation of law) and (ii) shall be binding on and inure to the benefit of the
heirs, personal representatives and estate of Director.
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Section 13. Amendment. No amendment, modification, termination or cancellation
of this Agreement shall be effective unless made in a writing signed by each of
the parties hereto.
Section 14. Notice. For purposes of this Agreement, all notices and other
communications provided for in this Agreement shall be addressed as follows,
shall be in writing and shall be deemed to have been duly given upon actual
receipt:
If to the Director: If to the Company:
DevX Energy, Inc. DevX Energy, Inc.
00000 Xxxx Xxxx 00000 Xxxx Xxxx
Xxxxx 0000 Xxxxx 0000
Xxxxxx, XX 00000-0000 Xxxxxx, XX 00000-0000
Attn: Xxxxx X. Xxxxx Attn: President & Chief Executive Officer
Section 15. No Duplication of Payments. The Company shall have no obligation to
indemnify Director and hold him harmless for any Loss, Expense or Fine to the
extent that Director has otherwise actually received payment for such Loss,
Expense or Fine (whether pursuant to any insurance policy, provision of the
Company's Certificate of Incorporation or bylaws or otherwise).
Section 16. Entire Agreement. This Agreement sets forth the entire
understandings of the parties hereto with respect to the subject matter hereof.
It incorporates and merges with any and all previous communications and
understandings, oral or written, with respect to the subject matter hereof.
* * * * *
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IN WITNESS WHEREOF, the Company and Director have executed this
Agreement as of the day and year first above written.
COMPANY:
DEVX ENERGY, INC.
By: /s/ XXXXXX X. XXXXXXXX
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Name: Xxxxxx X. Xxxxxxxx
Title: Chairman of the Board,
Chief Executive Officer, President
and Director
DIRECTOR:
/s/ XXXXX X. XXXXX
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Xxxxx X. Xxxxx
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