INDEMNIFICATION AND HOLD HARMLESS AGREEMENT
Exhibit 10.1
INDEMNIFICATION
AND HOLD HARMLESS AGREEMENT
THIS INDEMNIFICATION AND HOLD
HARMLESS AGREEMENT (this “Agreement”) is made as
of November ____, 2008, by and between Energy XXI (Bermuda) Limited, a company
formed under the laws of Bermuda (the “Company”), and ______________
(“Indemnitee”).
WHEREAS, in order to incentivize
Indemnitee to serve, or to continue to serve, as a director and/or officer of
the Company (in any such case, the “Service”), the Company has agreed to
indemnify Indemnitee as set forth below; and
WHEREAS, the Company recognizes that
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 have increased the difficulty of
attracting and retaining such persons; and
WHEREAS, the Board of Directors of
the Company has determined that it is in the best interests of the Company and
its shareholders that the Company act to assure such persons that there will be
increased certainty of such protection in the future; and
WHEREAS, it is reasonable, prudent
and necessary for the Company to contractually obligate itself to indemnify such
persons to the fullest extent permitted by applicable law so that they will
continue to serve the Company free from undue concern that they will not be so
indemnified;
NOW, THEREFORE, in consideration of
the foregoing and certain other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties, intending to be legally bound, hereby
agree as follows:
1. Indemnification.
Effective as of the original date of Indemnitee’s beginning Service, the Company
shall indemnify Indemnitee and hold Indemnitee harmless if the Indemnitee is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative,
arbitrative or investigative, and in any appeal in such action, suit or
proceeding, and in any inquiry or investigation that could lead to such an
action, suit or proceeding, against any and all liabilities, obligations
(whether known or unknown, or due or to become due or otherwise), judgments,
fines, fees, penalties, interest obligations, deficiencies, other actual losses
(for example, verifiable lost income related to time spent defending such claim
or action) and reasonable expenses (including, without limitation amounts paid
in settlement, interest, court costs, costs of investigators, reasonable fees
and expenses of attorneys, accountants, financial advisors and other experts)
incurred or suffered by Indemnitee or on Indemnitee’s behalf in connection with
such action, suit or proceeding arising out of or pertaining to any actual or
alleged action or omission which arises out of or relates to the fact that
Indemnitee is, was or has agreed to serving as a director or officer of the
Company or at the request of the Company as a director, officer, trustee,
employee, or agent of or in any other capacity for another corporation,
partnership, joint venture, trust or other enterprise, to the fullest extent
permitted by then applicable law, including the Companies Xxx 0000 of Bermuda
(“Companies Act”), the Company’s Memorandum of Association
(“Memorandum”) and the Company’s Bye-laws, each as may be amended from time to
time (but in the case of any such amendment, only to the extent that such
amendment permits the Company to provide the same or broader indemnification
rights than permitted prior thereto) (each such liability, obligation, judgment,
fine, fee, penalty, interest obligation, deficiency, other actual losses, and
reasonable expenses being referred to herein as a “Loss,” and collectively, as
“Losses”).
2. Payment.
Any Loss incurred by Indemnitee shall be paid in full by the Company on a
regular monthly basis. This indemnity applies even if the Indemnitee caused the
Loss through his or her negligence, strict liability or other fault; however, if
any Losses for which Indemnitee received payment from the Company
under
this Agreement are determined by final judicial decision from which there is no
further right to appeal, to have been caused by Indemnitee under circumstances
with respect to which indemnification is not permitted by applicable law or this
Agreement (any such Loss, a “Non-Indemnification Loss”), Indemnitee shall repay
to the Company such Losses paid on behalf of Indemnitee hereunder.
3. Term.
The indemnification rights provided hereby to Indemnitee shall continue even
though he or she may have ceased to be a director, officer, trustee, employee,
or agent of or in any other capacity for the applicable entity.
4. Notice
and Coverage Prior to Notice. Indemnitee shall give notice (the “Notice”)
to the Company within five days after actual receipt of service or summons
related to any action begun in respect of which indemnity may be sought
hereunder or actual notice of assertion of a claim with respect to which
he
seeks
indemnification; provided, however, that the Indemnitee’s failure to give such
notice to the Company within such time shall not relieve the Company from any of
its obligations under Section 1 of this Agreement except to the extent the
Company has been materially prejudiced by Indemnitee’s failure to give such
notice within such time period. Upon receipt of the Notice, the Company shall
assume the defense of such action, whereupon the Indemnitee shall not be liable
for any reasonable fees or expenses of counsel for Indemnitee or any other
Losses incurred thereafter with respect to the matters set forth in the Notice
and the Company shall reimburse the Indemnitee for all reasonable expenses
related to the action or claim incurred by the Indemnitee prior to the
Indemnitee’s giving of the Notice.
5. Non-Exclusivity.
The rights of Indemnitee hereunder shall be in addition to any rights that
Indemnitee may have under the Company’s governance documents (e.g. Memorandum,
Bye-laws, etc.) (the “Governance Documents”), applicable law or otherwise and
shall survive any termination, resignation, death or other dismissal of
Indemnitee. No amendment or alteration of the Company’s Governance Documents
shall adversely affect Indemnitee’s rights under the Governance Documents or
this Agreement.
6. Insurance.
To the extent the Company maintains, at its expense, an insurance policy or
policies providing liability insurance with respect to the acts or omissions
covered by this Agreement, Indemnitee shall be covered by such policy or
policies, in accordance with its or their terms, to the maximum extent of the
coverage available there under.
7. Payment.
The Company shall not be liable to Indemnitee under this Agreement to make any
payment in connection with any claim against Indemnitee to the extent the
Indemnitee has otherwise actually received, and is entitled to retain, payment
(under any insurance policy or otherwise) of the amounts
otherwise
indemnifiable hereunder.
8. Enforceability.
The indemnification contained in this Agreement shall be binding upon and inure
to the benefit of and be enforceable by the parties hereto and their respective
successors, assigns (including any direct or indirect successor by purchase,
merger, consolidation, liquidation or otherwise to all or substantially all of
the business and/or assets of the Company), spouses, heirs and personal and
legal representatives.
9. Binding
Obligation. If this Agreement or any portion hereof shall be found to be
invalid on any ground by any court of competent jurisdiction, then the Company
shall nevertheless indemnify and hold harmless Indemnitee, as to costs, charges
and expenses (including court costs and attorneys’ fees), judgments, fines,
penalties and amounts paid in settlement with respect to any action, suit or
proceeding, whether civil, criminal, administrative, arbitrative or
investigative, and in any appeal in such action, suit or proceeding, and in any
inquiry or investigation that could lead to such an action, suit or
proceeding,
to the
full extent permitted by any applicable portion of this Agreement that shall not
have been invalidated and to the fullest extent permitted by applicable
law.
10. Governing
Law; Venue; Interpretation. This Agreement shall be construed in
accordance with and governed by the laws of Bermuda, without regard to the
principles of conflicts of laws. The parties agree that any litigation directly
or indirectly relating to this Agreement must be brought before and determined
by a court of competent jurisdiction within Xxxxxx County, Texas, and the
parties hereby agree to waive any rights to object to, and hereby agree to
submit to, the jurisdiction of such courts. It is understood that the
parties hereto intend this Agreement to be interpreted and enforced so as to
provide indemnification to Indemnitee to the fullest extent now or hereafter
permitted by law.
11. Right to
Xxx; Attorneys’ Fees and Costs. If a claim by Indemnitee for payment of
Losses hereunder is not paid in full by the Company within forty-five (45) days
after a written claim has been delivered to the Company, Indemnitee may at any
time thereafter bring suit against the Company to recover the unpaid amount of
the claim. If successful in whole or in part in any such suit, Indemnitee shall
be entitled to be paid also the reasonable costs and expenses of prosecuting
such suit. In any suit brought by Indemnitee to enforce any right hereunder
(including, without limitation, the right to indemnification), the
burden of
proving that Indemnitee is not entitled to such right shall be borne by the
Company. If a claim by the Company for repayment of any Non-Indemnification
Losses previously paid on behalf of Indemnitee hereunder is not repaid in full
to the Company within forty-five (45) days after such ruling has been delivered
to Indemnitee, the Company may at any time thereafter bring suit against the
Indemnitee to recover the unpaid amount.
12. Successors
and Assigns. This Agreement shall be binding upon and shall inure to the
benefit of the heirs, successors and assigns of each party to this
Agreement.
13. Amendment.
This Agreement may be amended, modified or supplemented only by a written
instrument executed by each of the parties hereto.
14. Facsimile
and Counterpart Signature. This Agreement may be executed by facsimile
signature and in one or more counterparts, each of which shall for all purposes
be deemed an original and all of which shall constitute the same instrument, but
only one of which need be produced.
IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.
ENERGY XXI (BERMUDA)
LIMITED
By:
Name:
Title:
INDEMNITEE
By:
Name
