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INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this "Agreement") is made and entered
into to be effective as of the 20th day of July, 1998, by and between Xxxxxx
Production Services, Inc., a Texas corporation ("Xxxxxx"), and ________ a Texas
resident ("Indemnitee").
WHEREAS, competent and experienced persons are reluctant to serve or
to continue to serve corporations as directors or in other capacities unless
they are provided with adequate protection through insurance or indemnification
(or both) against claims and actions against them arising out of their service
to and activities on behalf of those corporations;
WHEREAS, the Board of Directors of Xxxxxx has determined that the
continuation of present trends in litigation will make it more difficult to
attract and retain competent and experienced persons, that this situation is
detrimental to the best interests of the shareholders of Xxxxxx and that such
corporation should act to assure its directors and officers that there will be
increased certainty of adequate protection in the future;
WHEREAS, the Articles of Incorporation of Xxxxxx require Xxxxxx to
indemnify its directors and officers to the fullest extent permitted by law;
WHEREAS, it is reasonable, prudent, and necessary for Xxxxxx to
obligate itself contractually to indemnify its directors and officers to the
fullest extent permitted by applicable law in order to induce them to serve or
continue to serve such corporation;
WHEREAS, Indemnitee is willing to serve, continue to serve, and to
take on additional service for or on behalf of Xxxxxx on the condition that he
be indemnified to the fullest extent permitted by law; and
WHEREAS, concurrently with the execution of this Agreement, Indemnitee
is agreeing to serve or to continue to serve as a director or officer of
Xxxxxx.
NOW, THEREFORE, in consideration of the foregoing premises,
Indemnitee's agreement to serve or continue to serve as a director or officer
of Xxxxxx, and the covenants contained in this Agreement, the parties hereto
hereby covenant and agree as follows:
1. Certain Definitions:
(a) Acquiring Person: any Person other than (i) the
Company, (ii) any of the Company's Subsidiaries, (iii) any employee benefit
plan of the Company or of a Subsidiary of the Company or of a corporation owned
directly or indirectly by the shareholders of the Company in substantially the
same proportions as their ownership of stock of the Company, or (iv) any
trustee or other fiduciary holding securities under an employee benefit plan of
the Company or of a Subsidiary of the Company or of a corporation owned
directly or indirectly by the shareholders of the Company in substantially the
same proportions as their ownership of stock of the Company.
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(b) Change in Control shall be deemed to have occurred
if:
(i) any Acquiring Person, is or becomes
the "beneficial owner" (as defined in Rule 13d-3 under the Securities Exchange
Act of 1934, as amended (the "Exchange Act")), directly or indirectly, of
securities of the Company representing 20% or more of the combined voting power
of the then outstanding Voting Securities of the Company; or
(ii) members of the Incumbent Board cease
for any reason to constitute at least a majority of the Board of Directors of
the Company; or
(iii) a public announcement is made of a
tender or exchange offer by any Acquiring Person for 50% or more of the
outstanding Voting Securities of the Company, and the Board of Directors of the
Company approves or fails to oppose that tender or exchange offer in its
statements in Schedule 14D-9 under the Exchange Act; or
(iv) the shareholders of the Company
approve a merger or consolidation of the Company with any other corporation,
partnership or other entity (or, if no such approval is required, the
consummation of such a merger or consolidation of the Company), other than a
merger or consolidation that would result in the Voting Securities of the
Company outstanding immediately prior to the consummation thereof continuing to
represent (either by remaining outstanding or by being converted into Voting
Securities of the surviving entity or of a parent of the surviving entity) a
majority of the combined voting power of the Voting Securities of the surviving
entity (or its parent) outstanding immediately after that merger or
consolidation; or
(v) the shareholders of the Company
approve a plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Company of all or substantially all the Company's
assets (or, if no such approval is required, the consummation of such a
liquidation, sale, or disposition in one transaction or series of related
transactions) other than a liquidation, sale, or disposition of all or
substantially all the Company's assets in one transaction or a series of
related transactions to a corporation owned directly or indirectly by the
shareholders of the Company in substantially the same proportions as their
ownership of stock of the Company.
(c) Claim: any threatened, pending, or completed action,
suit, or proceeding (including, without limitation, securities laws actions,
suits, and proceedings), or any inquiry or investigation (including discovery),
whether asserted, instituted or conducted, directly or indirectly (including,
without limitation, shareholder derivative suits) by the Company or any other
party, that Indemnitee in good faith believes might lead to the institution of
any action, suit, or proceeding, whether civil, criminal, administrative,
investigative, or other.
(d) Company: Xxxxxx Production Services, Inc.
(e) Expenses: all costs, expenses (including attorneys'
and expert witnesses' fees), and obligations paid or incurred in connection
with investigating, defending (including
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affirmative defenses and counterclaims), being a witness in, or participating
in (including on appeal), or preparing to defend, be a witness in, or
participate in, any Claim relating to any Indemnifiable Event.
(f) Incumbent Board: individuals who, as of July 20,
1998, constitute the Board of Directors of the Company and any other individual
who becomes a director of the Company after that date and whose election or
appointment by the Board of Directors or nomination for election by the
Company's shareholders was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board.
(g) Indemnifiable Event: any event or occurrence related
to the fact that Indemnitee 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, employee benefit plan, trust, or other
enterprise, or by reason of anything done or not done by Indemnitee in any such
capacity. For purposes of this Agreement, the Company agrees that Indemnitee's
service on behalf of or with respect to any Subsidiary of the Company shall be
deemed to be at the request of the Company.
(h) Person: any person or entity of any nature
whatsoever, specifically including an individual, a firm, a company, a
corporation, a partnership, a limited liability company, a trust, or other
entity. A Person, together with that Person's Affiliates and Associates (as
those terms are defined in Rule 12b-2 under the Exchange Act), and any Persons
acting as a partnership, limited partnership, joint venture, association,
syndicate, or other group (whether or not formally organized), or otherwise
acting jointly or in concert or in a coordinated or consciously parallel manner
(whether or not pursuant to any express agreement), for the purpose of
acquiring, holding, voting, or disposing of securities of the Company with such
Person, shall be deemed a single "Person."
(i) Potential Change in Control: shall be deemed to have
occurred if (i) the Company enters into an agreement, the consummation of which
would result in the occurrence of a Change in Control; (ii) any Acquiring
Person becomes the beneficial owner, directly or indirectly, of securities of
the Company representing 15% or more of the combined voting power of the
outstanding Voting Securities of the Company; or (iii) the Board of Directors
of the Company adopts a resolution to the effect that, for purposes of this
Agreement, a Potential Change in Control has occurred.
(j) Reviewing Party: any appropriate person or body
consisting of a member or members of the Company's Board of Directors or any
other person or body appointed by the Board (including Special Counsel referred
to in Section 3) who is not a party to the particular Claim for which
Indemnitee is seeking indemnification.
(k) Special Counsel: special, independent counsel
selected by Indemnitee and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services for the
Company or for Indemnitee within the last three years (other than as Special
Counsel under this Agreement or similar agreements).
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(l) Subsidiary: 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.
(m) Voting Securities: any securities that vote
generally in the election of directors, in the admission of general partners,
or in the selection of any other similar governing body.
2. Basic Indemnification and Expense Reimbursement Arrangement.
(a) If Indemnitee was, is, or becomes a party to or
witness or other participant in, or is threatened to be made a party to or
witness or other participant in, a Claim by reason of (or arising in part out
of) an Indemnifiable Event, the Company shall indemnify Indemnitee to the
fullest extent permitted by law as soon as practicable but in any event no
later than 30 days after written demand is presented to the Company, against
any and all Expenses, judgments, fines, penalties, and amounts paid in
settlement (including all interest, assessments, and other charges paid or
payable in connection with or in respect of such Expenses, judgments, fines,
penalties, or amounts paid in settlement) of or with respect to that Claim.
Notwithstanding the foregoing, the obligations of the Company under Section
2(a) shall be subject to the condition that the Reviewing Party shall not have
determined (in a written opinion, in any case in which Special Counsel referred
to in Section 3 hereof is involved) that Indemnitee would not be permitted to
be indemnified under applicable law. Nothing contained in this Agreement shall
require any determination under this Section 2(a) to be made by the Reviewing
Party prior to the disposition or conclusion of the Claim against the
Indemnitee; provided, however, that Expense Advances (defined below) shall
continue to be made by the Company pursuant to and to the extent required by
the provisions of Section 2(b).
(b) If so requested by Indemnitee, the Company shall pay
any and all Expenses incurred by Indemnitee (or, if applicable, reimburse
Indemnitee for any and all Expenses incurred by Indemnitee and previously paid
by Indemnitee) within two business days after such request (an "Expense
Advance"). The Company shall be obligated to make or pay an Expense Advance in
advance of the final disposition or conclusion of any Claim. In connection
with any request for an Expense Advance, if requested by the Company,
Indemnitee or Indemnitee's counsel shall submit an affidavit stating that the
Expenses incurred were reasonable. Any dispute as to the reasonableness of any
Expense shall not delay an Expense Advance by the Company, and the Company
agrees that any such dispute shall be resolved only upon the disposition or
conclusion of the underlying Claim against the Indemnitee. If, when, and to
the extent that the Reviewing Party determines that Indemnitee would not be
permitted to be indemnified with respect to a Claim under applicable law, the
Company shall be entitled to be reimbursed by Indemnitee and Indemnitee hereby
agrees to reimburse the Company without interest (which agreement shall be an
unsecured obligation of Indemnitee) for all related Expense Advances
theretofore made or paid by the Company; provided, however, that if Indemnitee
has commenced legal proceedings in a court of competent jurisdiction to secure
a determination that Indemnitee should be indemnified under applicable law, any
determination made by the Reviewing Party that Indemnitee would not be
permitted to be indemnified under applicable law shall not be binding and
Indemnitee shall not
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be required to reimburse the Company for any Expense Advance, and the Company
shall be obligated to continue to make Expense Advances, until a final judicial
determination is made with respect thereto (as to which all rights of appeal
therefrom have been exhausted or lapsed). If there has not been a Change in
Control, the Reviewing Party shall be selected by the Board of Directors of the
Company. If there has been a Change in Control, the Reviewing Party shall be
advised by or shall be Special Counsel referred to in Section 3 hereof, if and
as Indemnitee so requests. If there has been no determination by the Reviewing
Party or if the Reviewing Party determines that Indemnitee substantively would
not be permitted to be indemnified in whole or in part under applicable law,
Indemnitee shall have the right to commence litigation in any court in the
State of Texas having subject matter jurisdiction thereof and in which venue is
proper seeking an initial determination by the court or challenging any such
determination by the Reviewing Party or any aspect thereof, and the Company
hereby consents to service of process and to appear in any such proceeding.
Any determination by the Reviewing Party otherwise shall be conclusive and
binding on the Company and Indemnitee.
3. Change in Control. The Company agrees that, if there is a
Change in Control and if Indemnitee requests in writing that Special Counsel
advise the Reviewing Party or be the Reviewing Party, then the Company shall
not deny any indemnification payments (and Expense Advances shall continue to
be paid by the Company pursuant to Section 2(b)) that Indemnitee requests or
demands under this Agreement or any other agreement or law now or hereafter in
effect relating to Claims for Indemnifiable Events. The Company further agrees
not to request or seek reimbursement from Indemnitee of any related Expense
Advances unless, with respect to a denied indemnification payment, Special
Counsel has rendered its written opinion to the Company and Indemnitee that the
Company would not be permitted under applicable law to pay Indemnitee such
indemnification payment. The Company agrees to pay the reasonable fees of
Special Counsel referred to in this Section 3 and to indemnify fully Special
Counsel against any and all expenses (including attorneys' fees), claims,
liabilities, and damages arising out of or relating to this Agreement or
Special Counsel's engagement pursuant hereto.
4. Establishment of Trust. In the event of a Potential Change in
Control, and in the event the Company has not maintained an insurance policy or
policies providing for directors' and officers' liability insurance for the
benefit of Indemnitee with an aggregate policy limit (for all beneficiaries of
such policy or policies) of $5,000,000 or more, the Company shall, upon written
request by Indemnitee, create a trust for the benefit of Indemnitee (the
"Trust") and from time to time upon written request of Indemnitee the Company
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, and defending any Claim relating
to an Indemnifiable Event, and any and all judgments, fines, penalties, and
settlement amounts of any and all Claims relating to an Indemnifiable Event
from time to time actually paid or claimed, reasonably anticipated, or proposed
to be paid; provided, however, that Indemnitee may not request funding so that
the amount in the Trust exceeds $250,000 without an actual Change in Control.
Upon a Change in Control, the amount or amounts to be deposited in the Trust
pursuant to the foregoing funding obligation shall be determined by the
Reviewing Party. The terms of the Trust shall provide that, upon a Change in
Control, (i) the Trust shall not be revoked or the principal thereof invaded,
without the written consent of Indemnitee; (ii) the trustee of the Trust
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shall advance, within two business days of a request by Indemnitee, any and all
Expenses to Indemnitee (and Indemnitee hereby agrees to reimburse the Trust
under the circumstances in which Indemnitee would be required to reimburse the
Company for Expense Advances under Section 2(b) 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 of the Trust shall promptly pay to
Indemnitee all amounts for which Indemnitee shall be entitled to
indemnification pursuant to this Agreement or otherwise; and (v) all unexpended
funds in that Trust shall revert to the Company upon a final determination by
the Reviewing Party or a court of competent jurisdiction, as the case may be,
that Indemnitee has been fully indemnified under the terms of this Agreement.
The trustee of the Trust shall be chosen by Indemnitee. Nothing in this
Section 4 shall relieve the Company of any of its obligations under this
Agreement.
5. Indemnification for Additional Expenses. The Company shall
indemnify Indemnitee against any and all costs and expenses (including
attorneys' and expert witnesses' fees) and, if requested by Indemnitee, shall
(within two business days of that request) advance those costs and expenses to
Indemnitee, that are incurred by Indemnitee in connection with any claim
asserted against or action brought by Indemnitee for (i) indemnification or
advance payment of Expenses by the Company under this Agreement or any other
agreement or provision of the Company's Articles of Incorporation or Bylaws now
or hereafter in effect relating to Claims for Indemnifiable Events or (ii)
recovery under any directors' and officers' liability insurance policies
maintained by the Company, regardless of whether Indemnitee ultimately is
determined to be entitled to that indemnification, advance expense payment, or
insurance recovery, as the case may be.
6. Partial Indemnity. 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, penalties, and amounts paid in
settlement of a Claim but not, however, for all of the total amount thereof,
the Company shall nevertheless indemnify Indemnitee for the portion thereof to
which Indemnitee is entitled. Moreover, notwithstanding any other provision of
this Agreement, to the extent that Indemnitee has been successful on the merits
or otherwise in defense of any or all Claims relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein, including
dismissal without prejudice, Indemnitee shall be indemnified against all
Expenses incurred in connection therewith.
7. Contribution.
(a) Contribution Payment. To the extent the
indemnification provided for under any provision of this Agreement is
determined (in the manner hereinabove provided) not to be permitted under
applicable law, then if Indemnitee was, is, or becomes a party to or witness or
other participant in, or is threatened to be made a party to or witness or
other participant in, a Claim by reason of (or arising in part out of) an
Indemnifiable Event, the Company, in lieu of indemnifying Indemnitee, shall
contribute to the amount of any and all Expenses, judgments, fines, or
penalties assessed against or incurred or paid by Indemnitee on account of that
Claim and any and all amounts paid in settlement of that Claim (including all
interest, assessments, and other charges paid or payable in connection with or
in respect of such Expenses, judgments, fines,
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penalties, or amounts paid in settlement) for which such indemnification is not
permitted ("Contribution Amounts"), in such proportion as is appropriate to
reflect the relative fault with respect to the Indemnifiable Event giving rise
to the Contribution Amounts of Indemnitee, on the one hand, and of the Company
and any and all other parties (including officers and directors of the Company
other than Indemnitee) who may be at fault with respect to such Indemnifiable
Event (collectively, including the Company, the "Third Parties") on the other
hand.
(b) Relative Fault. The relative fault of the Third
Parties and the Indemnitee shall be determined (i) by reference to the relative
fault of Indemnitee as determined by the court or other governmental agency
assessing the Contribution Amount, or (ii) to the extent such court or other
governmental agency does not apportion relative fault, by the Reviewing Party
(which shall include Special Counsel) after giving effect to, among other
things, the relative intent, knowledge, access to information, and opportunity
to prevent or correct the applicable Indemnifiable Event and other relevant
equitable considerations of each party. The Company and Indemnitee agree that
it would not be just and equitable if contribution pursuant to this Section 7
were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to in this
Section 7(b).
8. Burden of Proof. In connection with any determination by the
Reviewing Party or otherwise as to whether Indemnitee is entitled to be
indemnified under any provision of this Agreement or to receive contribution
pursuant to Section 7 of this Agreement, the burden of proof shall be on the
Company to establish that Indemnitee is not so entitled.
9. No Presumption. For purposes of this Agreement, the
termination of any claim, action, suit, or proceeding, by judgment, order,
settlement (whether with or without court approval), or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not create a presumption that
Indemnitee did not meet any particular standard of conduct or have any
particular belief or that a court has determined that indemnification is not
permitted by applicable law.
10. Non-exclusivity. The rights of Indemnitee hereunder shall be
in addition to any other rights Indemnitee may have under the Company's
Articles of Incorporation or Bylaws, the Texas Business Corporation Act or
otherwise. To the extent that a change in the Texas Business Corporation Act
(whether by statute or judicial decision) permits greater indemnification by
agreement than would be afforded currently under the Company's Articles of
Incorporation or Bylaws and this Agreement, it is the intent of the parties
hereto that Indemnitee shall enjoy by this Agreement the greater benefits so
afforded by that change.
11. Liability Insurance. Except as otherwise agreed to by the
Company and Indemnitee in a written agreement, to the extent the Company
maintains an insurance policy or policies providing directors' and officers'
liability insurance, Indemnitee shall be covered by that policy or those
policies, in accordance with its or their terms, to the maximum extent of the
coverage available for any Company director or officer.
12. Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted, instituted or conducted, directly or
indirectly (including, without limitation,
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shareholder derivative suits), by or on behalf of the Company or any affiliate
of the Company against Indemnitee or Indemnitee's spouse, heirs, executors, or
personal or legal representatives after the expiration of three years from the
date of accrual of that cause of action, and any claim or cause of action of
the Company or its affiliate shall be extinguished and deemed released unless
asserted by the timely filing of a legal action within that three-year period;
provided, however, that, if any shorter period of limitations is otherwise
applicable to any such cause of action, the shorter period shall govern.
13. Termination. This Agreement, and the obligations of the
Company to indemnify Indemnitee set forth herein, shall terminate automatically
six years after the termination of Indemnitee's status as a director, officer,
employee, trustee, agent or fiduciary of the Company, a Subsidiary of the
Company, or any corporation, partnership, joint venture, employee benefit plan,
trust or other enterprise for which Indemnitee was serving at the request of
the Company. Notwithstanding the above, if there is a Claim relating to an
Indemnifiable Event pending against Indemnitee which arose prior to the end of
the six-year period stated above, the Company's obligation to indemnify
Indemnitee shall continue with respect to such Claim until the final resolution
of such Claim, even if such resolution does not occur until after the end of
such six-year period.
14. Amendments. No supplement, modification, or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed
or shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall that waiver constitute a continuing waiver.
15. Subrogation. In the event of payment under this Agreement,
the Company shall be subrogated to the extent of that payment to all of the
rights of recovery of Indemnitee, who shall execute all papers required and
shall do everything that may be necessary to secure those rights, including the
execution of the documents necessary to enable the Company effectively to bring
suit to enforce those rights.
16. No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any claim made
against Indemnitee to the extent Indemnitee has otherwise actually received
payment (under any insurance policy, provision of the Company's Articles of
Incorporation or Bylaws or otherwise) of the amounts otherwise indemnifiable
hereunder.
17. Binding Effect; Merger. 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, or otherwise to all or substantially all of
the business or assets of the Company), spouses, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the Company or
another enterprise at the Company's request.
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18. Severability. If any provision of this Agreement is held by
final judgment of a court of competent jurisdiction to be invalid, illegal or
unenforceable, such invalid, illegal or unenforceable provision shall be
severed from the remainder of this Agreement, and the remainder of this
Agreement shall be enforced. In addition, the invalid, illegal or
unenforceable provision shall be deemed to be automatically modified, and, as
so modified, to be included in this Agreement, such modification being made to
the minimum extent necessary to render the provision valid, legal and
enforceable. Notwithstanding the foregoing, however, if the severed or
modified provision concerns all or a portion of the essential consideration to
be delivered under this Agreement by one party to the other, the remaining
provisions of this Agreement shall also be modified to the extent necessary to
equitably adjust the parties' respective rights and obligations hereunder.
19. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Texas
applicable to contracts made and to be performed in that state without giving
effect to the principles of conflicts of laws or choice of laws.
20. Construction. The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Pronouns shall be construed to include the
masculine, feminine, neuter, singular and plural as the contest requires.
21. Superseding Prior Agreements. This Agreement replaces and
supersedes any prior indemnification agreement or other arrangement, written or
oral, between Xxxxxx and Indemnitee, expressly excluding, however, Indemnitee's
rights to indemnification under the Articles of Incorporation of the Company,
the Bylaws of the Company, and the Texas Business Corporation Act.
22. Notices. Whenever this Agreement requires or permits notice
to be given by one party to the other, such notice must be in writing to be
effective and shall be deemed delivered and received by the party to whom it is
sent upon actual receipt (by any means) of such notice. Receipt of a notice by
any officer of the Company shall be deemed receipt of such notice by the
Company.
23. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but in making proof
hereof it shall not be necessary to produce or account for more than one such
counterpart.
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EXECUTED as of the date first written above.
XXXXXX PRODUCTION SERVICES, INC.,
a Texas corporation
By:
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P. Xxxx Xxxxx, Chief Financial Officer
INDEMNITEE:
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CERTIFICATE OF INCORPORATION OF
XXXXXX PRODUCTION SERVICES, INC.
ARTICLE IX: INDEMNIFICATION
The Corporation shall indemnify any person who was, is, or is
threatened to be made a named defendant or respondent in a proceeding (as
hereinafter defined) because the person (i) is or was a director or officer of
the Corporation or (ii) while a director or officer of the Corporation, is or
was serving at a request of the Corporation as a director, officer, partner,
venturer, proprietor, trustee, employee, agent, or similar functionary of
another foreign or domestic corporation, partnership, joint venture, sole
proprietorship, trust, employee benefit plan, or other enterprise, to the
fullest extent that a corporation may grant indemnification to a director under
the Texas Business Corporation Act, as the same exists or may hereafter be
amended. Such right shall be a contract right and as such shall run to the
benefit of any director or officer who is elected and accepts the position of
director or officer of the Corporation or elects to continue to serve as a
director or officer of the Corporation while this Article Nine in effect. Any
repeal or amendment of this Article Nine shall be prospective only and shall not
limit the rights of any such director or officer or the obligations of the
Corporation with respect to any claim arising from or related to the services of
such director or officer in any of the foregoing capacities prior to any such
repeal or amendment of this Article Nine. Such right shall include the right to
be paid or reimbursed by the Corporation for expenses incurred in defending any
such proceeding in advance of its final disposition to the maximum extent
permitted under the Texas Business Corporation Act, as the same exists or may
hereafter be amended. If a claim for indemnification or advancement of expenses
hereunder is not paid in full by the Corporation within 90 days after a written
claim has been received by the Corporation, the claimant may at any time
thereafter bring suit against the Corporation to recover the unpaid amount of
the claim, and if successful in whole or in part, the claimant shall be entitled
to be paid also the expenses of prosecuting such claim. It shall be a defense to
any such action that such indemnification or advancement of costs of defense are
not permitted under the Texas Business Corporation act, but the burden of
proving such defense shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors or any committee thereof, special
legal counsel, or shareholders) to have made its determination prior to the
commencement of such action that indemnification of, or advancement of costs of
defense to, the claimant is permissible in the circumstances nor an actual
determination by the Corporation (including its Board of Directors or any
committee thereof, special legal counsel, or shareholders) that such
indemnification or advancement is not permissible, shall be a defense to the
action or create a presumption that such indemnification or advancement is not
permissible. In the event of the death of any person having a right of
indemnification under the foregoing provisions, such right shall inure to the
benefit of his heirs, executors, administrators, and personal representatives.
The rights conferred above shall not be exclusive of any other right which any
person may have or hereafter acquire under any statute, bylaw, resolution of
shareholders or directors, agreement, or otherwise.
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The Corporation may additionally indemnify any person covered by the
grant of mandatory indemnification contained above to such further extent as is
permitted by law and may indemnify any other person to the fullest extent
permitted by law.
To the extent permitted by the applicable law, the grant of
mandatory indemnification to any person pursuant to this Article Nine shall
extend to proceedings involving the negligence of such person.
As used herein, the term "proceeding" means any threatened, pending,
or completed action, suit, or proceeding, whether civil, criminal,
administrative, arbitrative, or investigative, any appeal in such an action,
suit, or proceeding, and any inquiry or investigation that could lead to such an
action, suit, or proceeding.
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BYLAWS OF XXXXXX PRODUCTION SERVICES, INC.
ARTICLE EIGHT: INDEMNIFICATION
8.01 Indemnification. The Corporation shall indemnify any person
who was, is, or is threatened to be made a named defendant or respondent in a
proceeding (as hereinafter defined) because the person (a) is or was a director
or officer of the Corporation or (b) while a director or officer of the
Corporation, is or was serving at the request of the Corporation as a director,
officer, partner, venturer, proprietor, trustee, employee, agent, or similar
functionary of another foreign or domestic corporation, partnership, joint
venture, sole proprietorship, trust, employee benefit plan, or other enterprise,
the fullest extent that a corporation may grant indemnification to a director
under the Texas Business Corporation Act, as the same exists or may hereafter be
amended. Such right shall be a contract right and as such shall run to the
benefit of any director or officer who is elected and accepts the position of
director or officer of the Corporation or elects to continue to serve as a
director or officer of the Corporation while this Article Eight is in effect.
Any repeal or amendment of this Article Eight shall be prospective only and
shall not limit the rights of any such director or officer or the obligations of
the Corporation with respect to any claim arising from or related to the
services of such director or officer in any of the foregoing capacities prior to
any such repeal or amendment of this Article Eight. Such right shall include the
right to be paid or reimbursed by the Corporation for expenses incurred in
defending any such proceeding in advance of its final disposition to the maximum
extent permitted under the Texas Business Corporation Act, as the same exists or
may hereafter be amended. If a claim for indemnification or advancement of
expenses hereunder is not paid in full by the Corporation within ninety days
after a written claim has been received by the Corporation, the claimant may at
any time thereafter bring suit against the Corporation to recover the unpaid
amount of the claim, and if successful in whole or in part, the claimant shall
be entitled to be paid also the expenses of prosecuting such claims. It shall be
a defense to any such action that such indemnification or advancement of costs
of defense are not permitted under the Texas Business Corporation Act, but the
burden of proving such defense shall be on the Corporation. Neither the failure
of the Corporation (including its Board of Directors or any committee thereof,
special legal counsel, or shareholders) to have made its determination prior to
the commencement of such action that indemnification of, or advancement of costs
of defense to, the claimant is permissible in the circumstances nor an actual
determination by the Corporation (including its Board of Directors or any
committee thereof, special legal counsel, or shareholders) that such
indemnification or advancement is not permissible, shall be a defense to the
action or create a presumption that such indemnification or advancement is not
permissible. In the event of the death of any person having a right of
indemnification under the foregoing provisions, such right shall inure to the
benefit of his heirs, executors, administrators, and personal representatives.
The rights conferred above shall not be exclusive of any other right which any
person may have or hereafter acquire under any statute, bylaw, resolution of
shareholders or directors, agreement, or otherwise. As used herein, The term
"proceeding" means any threatened, pending, or completed action, suit, or
proceeding, whether civil, criminal, administrative, arbitrative, or
investigative, any appeal in such an action suit, or proceeding, and any inquiry
or investigation that could lead to such an
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action, suit, or proceeding, and any inquiry or investigation that could lead to
such an action, suit, or proceeding.
8.02 Additional Indemnification. The Corporation may additionally
indemnify any person covered by the grant of mandatory indemnification contained
above to such further extent as is permitted by law and may indemnify any other
person to the fullest extent permitted by law.
8.03 Negligence. To the extent permitted by then applicable law, the
grant of mandatory indemnification to any person pursuant to this Article Eight
shall extend to proceedings involving the negligence of such person.
