INDEMNIFICATION AGREEMENT
This Indemnification Agreement, made and entered into as of this [ ] day of
[ ], 2004 ("Agreement"), by and between The Hain Celestial Group, Inc., a
Delaware corporation ("Company"), and [ ] ("Indemnitee"):
WHEREAS, highly competent persons continue to be reluctant to serve
corporations as directors, officers or in other capacities unless they are
provided with adequate protection through insurance and/or adequate
indemnification against inordinate risks of claims and actions against them
arising out of their service to and activities on behalf of the corporation;
WHEREAS, uncertainties relating to such insurance and to indemnification
have increased the difficulty of attracting and retaining such persons;
WHEREAS, the Board of Directors of the Company (the "Board") has determined
that the increased difficulty in attracting and retaining such persons is
detrimental to the best interest of the Company's stockholders and that the
Company should act to assure such persons that there will be increased certainty
of such protection in the future;
WHEREAS, the Delaware corporate indemnification statute (Section 145 of the
Delaware General Corporation Law) is nonexclusive and, therefore, contemplates
that contracts may be entered into with respect to indemnification of directors,
officers, employees and agents;
WHEREAS, it is reasonable, prudent and necessary for the Company
contractually to obligate itself to indemnify, and to advance expenses on behalf
of, such persons to the fullest extent permitted by applicable law so that they
will serve or continue to serve the Company free from undue concern that they
will not be so indemnified; and
WHEREAS, Indemnitee is willing to serve, continue to serve and to take on
additional service for or on behalf of the Company on the condition that
Indemnitee be so indemnified.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, the Company and Indemnitee do hereby agree as follows:
Section 1. Services by Indemnitee. Indemnitee agrees to serve as a
director, officer, employee and/or agent of the Company and/or any of its
subsidiaries, as the case may be, and may serve as a director, officer, employee
and/or agent of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise at the request of the Company (a "Relevant
Enterprise" and, together with the Company and the Company's subsidiaries, the
"Company Entities"). Indemnitee may at any time and for any reason resign from
such position (subject to any other contractual obligation or any obligation
imposed by operation of law), in which event the Company shall have no
obligation under this Agreement to continue Indemnitee in such position. This
Agreement shall not be deemed an employment contract between any of the Company
Entities and Indemnitee. Indemnitee specifically acknowledges that Indemnitee's
employment with any of the Company Entities, if any, is "at will", and the
Indemnitee may be discharged at any time for any reason, with or without cause,
except as may be otherwise provided in any written employment contract between
Indemnitee and any of the Company Entities or other applicable formal severance
policies duly adopted by the Board, and, with respect to service as a director
of any of the Company Entities, Indemnitee specifically acknowledges that this
Agreement does not impose any obligation of the Company to continue Indemnitee's
service to the Company except as may otherwise be provided by the Certificate of
Incorporation or By-laws of the
relevant Company Entity and the General Corporation Law of the State of
Delaware. The foregoing notwithstanding, subject to Section 13 hereof, this
Agreement shall continue in force after Indemnitee has ceased to serve as a
director, officer, employee and/or agent, as the case may be, of any of the
Company Entities.
Section 2. Notice by Indemnitee. Indemnitee agrees to notify the Company in
writing immediately upon being served with any summons, citation, subpoena,
complaint, indictment, information or other document relating to any Proceeding
or matter which may be subject to indemnification or advancement of Expenses (as
hereinafter defined) covered hereunder. The failure of Indemnitee to so notify
the Company shall not relieve the Company of any obligation which it may have to
the Indemnitee under this Agreement or otherwise.
Section 3. Indemnification -- General. The Company shall indemnify, and
advance Expenses to, Indemnitee (a) as provided in this Agreement and (b) to the
fullest extent permitted by applicable law in effect on the date hereof and as
amended from time to time. The rights of Indemnitee provided under clause (b) of
the preceding sentence shall include, but shall not be limited to, the rights
set forth in the other Sections of this Agreement.
Section 4. Proceedings Other Than Proceedings by or in the Right of any of
the Company Entities. Indemnitee shall be entitled to the rights of
indemnification provided in this Section 4 if, by reason of his Corporate Status
(as hereinafter defined), he is, or is threatened to be made, a party to or a
participant in any threatened, pending, or completed Proceeding (as hereinafter
defined), other than a Proceeding by or in the right of any of the Company
Entities. Pursuant to this Section 4, Indemnitee shall be indemnified against
all Expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him or on his behalf in connection with such Proceeding
or any claim, issue or matter therein, if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
relevant Company Entity, and, with respect to any criminal Proceeding, had no
reasonable cause to believe his conduct was unlawful.
Section 5. Proceedings by or in the Right of any of the Company Entities.
Indemnitee shall be entitled to the rights of indemnification provided in this
Section 5 if, by reason of his Corporate Status, he is, or is threatened to be
made, a party to or a participant in any threatened, pending or completed
Proceeding brought by or in the right of any of the Company Entities to procure
a judgment in its favor. Pursuant to this Section, Indemnitee shall be
indemnified against all Expenses (including all interest, assessments and other
charges paid or payable in connection with or in respect of such Expenses)
actually and reasonably incurred by him or on his behalf in connection with such
Proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the relevant Company Entity;
provided, however, that, if applicable law so provides, no indemnification
against such Expenses shall be made in respect of any claim, issue or matter in
such Proceeding as to which Indemnitee shall have been adjudged to be liable to
any of the Company Entities, unless and to the extent that the Court of Chancery
of the State of Delaware, or the court in which such Proceeding shall have been
brought or is pending, shall determine that such indemnification may be made.
Section 6. Partial Indemnification. Notwithstanding any other provision of
this Agreement, to the extent that Indemnitee is, by reason of his Corporate
Status, a party to (or a participant in) and is successful, on the merits or
otherwise, in defense of any Proceeding, he shall be indemnified against all
Expenses actually and reasonably incurred by him or on his behalf in connection
therewith. If Indemnitee is not wholly successful in defense of such Proceeding
but is successful, on the merits or otherwise, as to one or more but less than
all claims, issues or matters in such Proceeding, the Company shall indemnify
Indemnitee against all Expenses actually and reasonably incurred by him or on
his behalf in connection with each successfully resolved claim, issue or matter.
For purposes of this Section and
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without limitation, the termination of any claim, issue or matter in such a
Proceeding by dismissal, with or without prejudice, shall be deemed to be a
successful result as to such claim, issue or matter. If Indemnitee is entitled
under any provision of this Agreement to indemnification by the Company for some
or a portion of the Expenses, judgments, penalties, fines 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, penalties,
fines and amounts paid in settlement) actually and reasonably incurred by him or
on his behalf in connection with such Proceeding or any claim, issue or matter
therein, but not, however, for the total amount thereof, the Company shall
nevertheless indemnify Indemnitee for the portion to which Indemnitee is
entitled.
Section 7. Indemnification for Additional Expenses.
(a) The Company shall indemnify Indemnitee against any and all Expenses
which are reasonably incurred by Indemnitee in connection with any action
brought by Indemnitee for (i) indemnification or advance payment of Expenses by
the Company under this Agreement or any other agreement or By-Law of the Company
now or hereafter in effect, or (ii) recovery under any directors' and officers'
liability insurance policies maintained by the Company; but only to the extent
that Indemnitee prevails in such action and ultimately is determined to be
entitled to such indemnification, advance payment of Expenses or insurance
recovery, as the case may be. Indemnitee shall be entitled to advancement of
such Expenses pursuant to and in accordance with the provisions of Section 8
hereof.
(b) Notwithstanding any other provision of this Agreement, to the extent
that Indemnitee is, by reason of his Corporate Status, a witness in any
Proceeding to which Indemnitee is not a party, he shall be indemnified against
all Expenses actually and reasonably incurred by him or on his behalf in
connection therewith.
Section 8. Advancement of Expenses. The Company shall advance all
reasonable Expenses incurred by or on behalf of Indemnitee in connection with
any Proceeding within seven (7) days after the receipt by the Company of a
statement or statements from Indemnitee requesting such advance or advances from
time to time, whether prior to or after final disposition of such Proceeding.
Such statement or statements shall reasonably evidence the Expenses incurred by
Indemnitee and shall include or be preceded or accompanied by an undertaking by
or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately
be determined that Indemnitee is not entitled to be indemnified against such
Expenses. Notwithstanding the foregoing, the obligation of the Company to
advance Expenses pursuant to this Section 8 shall be subject to the condition
that, if, when and to the extent that the Company determines that Indemnitee
would not be permitted to be indemnified under applicable law, the Company shall
be entitled to be reimbursed, within thirty (30) days of such determination, by
Indemnitee (who hereby agrees to reimburse the Company) for all such amounts
theretofore paid; provided, however, that if Indemnitee has commenced or
thereafter commences 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 Company that Indemnitee would not be
permitted to be indemnified under applicable law shall not be binding and
Indemnitee shall not be required to reimburse the Company for any advance of
Expenses until a final judicial determination is made with respect thereto (as
to which all rights of appeal therefrom have been exhausted or lapsed).
Section 9. Procedure for Determination of Entitlement to Indemnification.
(a) To obtain indemnification under this Agreement, Indemnitee shall submit
to the Company a written request, including therein or therewith such
documentation and information as is reasonably available to Indemnitee and is
reasonably necessary to determine whether and to what extent Indemnitee is
entitled to indemnification. The Secretary or Assistant Secretary of the Company
shall,
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promptly upon receipt of such a request for indemnification, advise the Board in
writing that Indemnitee has requested indemnification.
(b) Upon written request by Indemnitee for indemnification pursuant to the
first sentence of Section 9(a) hereof, a determination, if required by
applicable law, with respect to Indemnitee's entitlement thereto shall be made
in the specific case:
(i) if a Change in Control (as hereinafter defined) shall have
occurred, by Independent Counsel (as hereinafter defined) in a written
opinion to the Board, a copy of which shall be delivered to Indemnitee; or
(ii) if a Change of Control shall not have occurred, (A) by a majority
vote of the Disinterested Directors (as hereinafter defined), even though
less than a quorum of the Board, or (B) if there are no such Disinterested
Directors or, if such Disinterested Directors so direct, by Independent
Counsel in a written opinion to the Board, a copy of which shall be
delivered to Indemnitee or (C) if so directed by the Board, by a majority
vote of a quorum of the outstanding shares of stock of all classes entitled
to vote for directors, voting as a single class, which quorum shall consist
of stockholders who are not at that time parties to the Proceeding in
question;
and, if it is so determined that Indemnitee is entitled to indemnification,
payment to Indemnitee shall be made within seven (7) days after such
determination. Indemnitee shall cooperate with the person, persons or entity
making such determination with respect to Indemnitee's entitlement to
indemnification, including providing to such person, persons or entity upon
reasonable advance request any documentation or information which is not
privileged or otherwise protected from disclosure and which is reasonably
available to Indemnitee and reasonably necessary to such determination. Any
costs or expenses (including reasonable attorneys' fees and disbursements)
incurred by Indemnitee in so cooperating with the person, persons or entity
making such determination shall be borne by the Company (irrespective of the
determination as to Indemnitee's entitlement to indemnification), and the
Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.
(c) In the event the determination of entitlement to indemnification is to
be made by Independent Counsel pursuant to Section 9(b) hereof, the Independent
Counsel shall be selected as provided in this Section 9(c). If a Change of
Control shall not have occurred, the Independent Counsel shall be selected by
the Board, and the Company shall give written notice to Indemnitee advising him
of the identity of the Independent Counsel so selected. If a Change of Control
shall have occurred, the Independent Counsel shall be selected by Indemnitee
(unless Indemnitee shall request that such selection be made by the Board, in
which event the preceding sentence shall apply), and Indemnitee shall give
prompt written notice to the Company advising it of the identity of the
Independent Counsel so selected. In either event, Indemnitee or the Company, as
the case may be, may, within 10 days after such written notice of selection
shall have been given, deliver to the Company or to Indemnitee, as the case may
be, a written objection to such selection; provided, however, that such
objection may be asserted only on the ground that the Independent Counsel so
selected does not meet the requirements of "Independent Counsel" as defined in
Section 18 of this Agreement, and the objection shall set forth with
particularity the factual basis of such assertion. If such written objection is
so made and substantiated, the Independent Counsel so selected may not serve as
Independent Counsel unless and until such objection is withdrawn or a court has
determined that such objection is without merit. If, within 20 days after
submission by Indemnitee of a written request for indemnification pursuant to
Section 9(a) hereof, no Independent Counsel shall have been selected and not
objected to, either the Company or Indemnitee, as the case may be, may petition
the Court of Chancery of the State of Delaware for resolution of any objection
which shall have been made by the Company or Indemnitee to the other's selection
of Independent Counsel and/or for the appointment as Independent Counsel of a
person selected by the Court or by such other
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person as the Court shall designate, and the person with respect to whom all
objections are so resolved or the person so appointed shall act as Independent
Counsel under Section 9(b) hereof. The Company shall pay any and all reasonable
fees and expenses of Independent Counsel incurred by such Independent Counsel in
connection with acting pursuant to Section 9(b) hereof, and the Company shall
pay all reasonable fees and expenses incident to the procedures of this Section
9(c), regardless of the manner in which such Independent Counsel was selected or
appointed. Upon the due commencement of any judicial proceeding or arbitration
pursuant to Section 11(a) of this Agreement, Independent Counsel shall be
discharged and relieved of any further responsibility in such capacity (subject
to the applicable standards of professional conduct then prevailing).
(d) The Company shall not be required to obtain the consent of the
Indemnitee to the settlement of any Proceeding which the Company has undertaken
to defend if the Company assumes full and sole responsibility for such
settlement and the settlement grants the Indemnitee a complete and unqualified
release in respect of the potential liability. The Company shall not be liable
for any amount paid by the Indemnitee in settlement of any Proceeding that is
not defended by the Company, unless the Company has consented to such
settlement, which consent shall not be unreasonably withheld.
Section 10. Presumptions and Effect of Certain Proceedings.
(a) In making a determination with respect to entitlement to
indemnification or the advancement of expenses hereunder, the person or persons
or entity making such determination shall presume that Indemnitee is entitled to
indemnification or advancement of expenses under this Agreement if Indemnitee
has submitted a request for indemnification or the advancement of expenses in
accordance with Section 9(a) of this Agreement, and the Company shall have the
burden of proof to overcome that presumption in connection with the making by
any person, persons or entity of any determination contrary to that presumption.
Neither the failure of the Company (including the Board or independent legal
counsel) to have made a determination prior to the commencement of any action
pursuant to this Agreement that indemnification is proper in the circumstances
because Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Company (including the Board or independent legal counsel)
that Indemnitee has not met such applicable standard of conduct, shall be a
defense to the action or create a presumption that Indemnitee has not met the
applicable standard of conduct.
(b) If the person, persons or entity empowered or selected under Section 9
of this Agreement to determine whether Indemnitee is entitled to indemnification
shall not have made a determination within sixty (60) days after receipt by the
Company of the request therefor, the requisite determination of entitlement to
indemnification shall be deemed to have been made and Indemnitee shall be
entitled to such indemnification, absent (i) a misstatement by Indemnitee of a
material fact, or an omission of a material fact necessary to make Indemnitee's
statement not materially misleading, in connection with the request for
indemnification, or (ii) a prohibition of such indemnification under applicable
law; provided, however, that such 60-day period may be extended for a reasonable
time, not to exceed an additional thirty (30) days, if the person, persons or
entity making the determination with respect to entitlement to indemnification
in good faith requires such additional time for the obtaining or evaluating of
documentation and/or information relating thereto; provided, further, that the
foregoing provisions of this Section 10(b) shall not apply (i) if the
determination of entitlement to indemnification is to be made by the
stockholders pursuant to Section 9(b) of this Agreement and if (A) within
fifteen (15) days after receipt by the Company of the request for such
determination, the Board has resolved to submit such determination to the
stockholders for their consideration at an annual meeting thereof to be held
within seventy-five (75) days after such receipt and such determination is made
thereat, or (B) a special meeting of stockholders is called within fifteen (15)
days after such receipt for the purpose of making such determination, such
meeting is held for such purpose within sixty (60) days after having been so
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called and such determination is made thereat, or (ii) if the determination of
entitlement to indemnification is to be made by Independent Counsel pursuant to
Section 9(b) of this Agreement.
(c) The termination of any Proceeding or of any claim, issue or matter
therein, by judgment, order, settlement or conviction, or upon a plea of nolo
contendere or its equivalent, shall not (except as otherwise expressly provided
in this Agreement) of itself adversely affect the right of Indemnitee to
indemnification or create a presumption that Indemnitee did not act in good
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Company or, with respect to any criminal Proceeding,
that Indemnitee had reasonable cause to believe that his conduct was unlawful.
(d) For purposes of any determination of good faith, Indemnitee shall be deemed
to have acted in good faith if Indemnitee's action is based on the records or
books of account of the relevant Company Entity, including financial statements,
or on information supplied to Indemnitee by the officers of the relevant Company
Entity in the course of their duties, or on the advice of legal counsel for the
relevant Company Entity, by an independent certified public accountant or by an
appraiser or other expert selected with reasonable care by such Company Entity.
The provisions of this Section 10(d) shall not be deemed to be exclusive or to
limit in any way the other circumstances in which the Indemnitee may be deemed
to have met the applicable standard of conduct set forth in this Agreement.
(e) The knowledge and/or actions, or failure to act, of any other director,
officer, agent or employee of any of the Company Entities shall not be imputed
to Indemnitee for purposes of determining the right to indemnification under
this Agreement.
Section 11. Remedies of Indemnitee.
(a) In the event that (i) a determination is made pursuant to Section 9 of
this Agreement that Indemnitee is not entitled to indemnification under this
Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 8
of this Agreement, (iii) no determination of entitlement to indemnification
shall have been made pursuant to Section 9(b) of this Agreement within the time
periods specified therein, (iv) payment of indemnification is not made pursuant
to Section 6 or 7 of this Agreement within seven (7) days after receipt by the
Company of a written request therefor or (v) payment of indemnification is not
made within seven (7) days after a determination has been made that Indemnitee
is entitled to indemnification, Indemnitee shall be entitled to an adjudication
by the Court of Chancery of the State of Delaware of his entitlement to such
indemnification or advancement of Expenses. Alternatively, Indemnitee, at his
option, may seek an award in arbitration to be conducted by a single arbitrator
pursuant to the Commercial Arbitration Rules of the American Arbitration
Association. Indemnitee shall commence such proceeding seeking an adjudication
or an award in arbitration within 180 days following the date on which
Indemnitee first has the right to commence such proceeding pursuant to this
Section 11(a); provided, however, that the foregoing clause shall not apply in
respect of a proceeding brought by Indemnitee to enforce his rights under
Section 6 of this Agreement.
(b) In the event that a determination shall have been made pursuant to
Section 9(b) of this Agreement that Indemnitee is not entitled to
indemnification, any judicial proceeding or arbitration commenced pursuant to
this Section 11 shall be conducted in all respects as a de novo trial, or
arbitration, on the merits, and Indemnitee shall not be prejudiced by reason of
that adverse determination. If a Change of Control shall have occurred, in any
judicial proceeding or arbitration commenced pursuant to this Section 11, the
Company shall have the burden of proving that Indemnitee is not entitled to
indemnification or advancement of Expenses, as the case may be.
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(c) If a determination shall have been made pursuant to Section 9(b) of
this Agreement that Indemnitee is entitled to indemnification, the Company shall
be bound by such determination in any judicial proceeding or arbitration
commenced pursuant to this Section 11, absent (i) a misstatement by Indemnitee
of a material fact, or an omission of a material fact necessary to make
Indemnitee's statement not materially misleading, in connection with the request
for indemnification, or (ii) a prohibition of such indemnification under
applicable law.
(d) In the event that Indemnitee, pursuant to this Section 11, seeks a
judicial adjudication of or an award in arbitration to enforce his rights under,
or to record damages for breach of, this Agreement, Indemnitee shall be entitled
to recover from the Company, and shall be indemnified by the Company against,
any and all expenses (of the types described in the definition of Expenses in
Section 18 of this Agreement) actually and reasonably incurred by him in such
judicial adjudication or arbitration, but only if he prevails therein. If it
shall be determined in said judicial adjudication or arbitration that Indemnitee
is entitled to receive part but not all of the indemnification or advancement of
expenses sought, the expenses incurred by Indemnitee in connection with such
judicial adjudication or arbitration shall be appropriately prorated.
(e) The Company shall be precluded from asserting in any judicial
proceeding or arbitration commenced pursuant to this Section 11 that the
procedures and presumptions of this Agreement are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator
that the Company is bound by all the provisions of this Agreement.
Section 12. Non-Exclusivity; Survival of Rights; Insurance; Subrogation.
(a) 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 Indemnitee may at any time be entitled under applicable law, the relevant
company's Certificate of Incorporation or By-Laws, any other agreement, a vote
of stockholders or a resolution of directors, or otherwise. No amendment,
alteration or repeal of this Agreement or of any provision hereof shall limit or
restrict any right of Indemnitee under this Agreement in respect of any action
taken or omitted by such Indemnitee in his Corporate Status prior to such
amendment, alteration or repeal. To the extent that a change in the General
Corporation Law of the State of Delaware, whether by statute or judicial
decision, permits greater indemnification or advancement of Expenses than would
be afforded under the relevant company's Certificate of Incorporation or By-Laws
and/or this Agreement, it is the intent of the parties hereto that Indemnitee
shall enjoy by this Agreement the greater benefits so afforded by such change.
No right or remedy herein conferred is intended to be exclusive of any other
right or remedy, and every other right and remedy shall be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other right or remedy.
(b) To the extent that the Company maintains an insurance policy or
policies providing liability insurance for directors, officers, employees, or
agents of any of the Company Entities, Indemnitee shall be covered by such
policy or policies in accordance with its or their terms to the maximum extent
of the coverage available for any such director, officer, employee or agent
under such policy or policies.
(c) In the event of any payment under this Agreement, the Company shall be
subrogated to the extent of such payment to all of the rights of recovery of
Indemnitee, who shall execute all papers required and take all action necessary
to secure such rights, including execution of such documents as are necessary to
enable the Company to bring suit to enforce such rights.
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(d) The Company shall not be liable under this Agreement to make any
payment of amounts otherwise indemnifiable hereunder if and to the extent that
Indemnitee has otherwise actually received such payment under any insurance
policy, contract, agreement or otherwise.
(e) The Company's obligations to indemnify or advance expenses hereunder to
Indemnitee who is or was serving a Relevant Enterprise shall be reduced by any
amount Indemnitee has actually received as indemnification or advancement of
expenses from such Relevant Enterprise.
Section 13. Duration of Agreement. This Agreement shall continue until and
terminate upon the later of: (a) 10 years after the date that Indemnitee shall
have ceased to serve as a director, officer, employee and/or agent of any of the
Company Entities; or (b) the final termination of any Proceeding then pending in
respect of which Indemnitee is granted rights of indemnification or advancement
of expenses hereunder and of any proceeding commenced by Indemnitee pursuant to
Section 11 of this Agreement relating thereto. This Agreement shall be binding
upon the Company and its successors and assigns and shall inure to the benefit
of Indemnitee and his heirs, executors and administrators.
Section 14. Severability. If any provision or provisions of this Agreement
shall be held to be invalid, illegal 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, illegal or unenforceable) shall not
in any way be affected or impaired thereby; (b) such provision or provisions
shall be deemed reformed to the extent necessary to conform to applicable law
and to give the maximum effect to the intent of the parties hereto; and (c) to
the fullest extent possible, the 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, illegal or unenforceable) shall be construed so as to give effect to
the intent manifested thereby.
Section 15. Exception to Right of Indemnification or Advancement of
Expenses. Except as provided in Section 7(a) of this Agreement, Indemnitee shall
not be entitled to indemnification or advancement of Expenses under this
Agreement (including, with respect to subsection (c) of this Section 15, payment
of profits) with respect to any Proceeding:
(a) brought by Indemnitee (other than a Proceeding by Indemnitee to enforce
his rights under this Agreement),
(b) brought by any of the Company Entities against the Indemnitee alleging
(x) a willful violation by the Indemnitee of the terms and conditions of any
employment contract, (y) a willful misappropriation of corporate assets by the
Indemnitee or (z) any other willful and deliberate breach in bad faith of any of
the Indemnitee's duties to any of the Company Entities or its stockholders, if
the bringing of such Proceeding against Indemnitee shall have been approved or
subsequently ratified by the Board,
(c) arising out of the purchase and sale by Indemnitee of securities in
violation of Section 16(b) of the Securities Act of 1934, as amended, or any
similar successor statute, or
(d) arising out of acts or omissions, or transactions, from which
Indemnitee may not be relieved of liability under applicable law.
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Section 16. Identical Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall for all purposes be deemed to be an
original but all of which together shall constitute one and the same Agreement.
Only one such counterpart signed by the party against whom enforceability is
sought needs to be produced to evidence the existence of this Agreement.
Section 17. Headings. The headings of the paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.
Section 18. Definitions. For purposes of this Agreement:
(a) "Change in Control" shall mean the occurrence of any of the following
events:
(i) the acquisition by any Person (as defined below) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) of 50% or
more of the combined voting power of the then outstanding Voting Stock of
the Company; provided, however, that for purposes of this clause (i), the
following acquisitions shall not constitute a Change of Control: (A) any
issuance of Voting Stock of the Company directly from the Company that is
approved by the Incumbent Board (as defined in clause (ii) of this
definition), (B) any acquisition by the Company of Voting Stock of the
Company or (C) any acquisition of Voting Stock of the Company by any Person
pursuant to a Business Combination (as defined in clause (iii) of this
definition) that complies with clauses (A), (B) and (C) of clause (iii) of
this definition; or
(ii) individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a member of
the Board (a "Director") subsequent to the date hereof whose election, or
nomination for election by the Company's stockholders, was approved by a
vote of at least two-thirds of the Directors then comprising the Incumbent
Board (either by a specific vote or by approval of the proxy statement of
the Company in which such person is named as a nominee for director,
without objection to such nomination) shall be deemed to have been a member
of the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result of an
actual or threatened election contest (within the meaning of Rule 14a-11 of
the Exchange Act) with respect to the election or removal of Directors or
other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board; or
(iii) consummation of a reorganization, merger or consolidation, a
sale or other disposition of all or substantially all of the assets of the
Company, or other transaction (each, a "Business Combination"), unless, in
each case, immediately following such Business Combination, (A) all or
substantially all of the individuals and entities who were the beneficial
owners of Voting Stock of the Company immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of the
combined voting power of the then outstanding shares of Voting Stock of the
entity resulting from such Business Combination (including, without
limitation, an entity which as a result of such transaction owns the
Company or all or substantially all of the Company's assets either directly
or through one or more subsidiaries) in substantially the same proportions
relative to each other as their ownership, immediately prior to such
Business Combination, (B) no Person (other than the Company or such entity
resulting from such Business Combination) beneficially owns, directly or
indirectly, 50% or more of the combined voting power of the then
outstanding shares of Voting Stock of the entity resulting from such
Business Combination and (C) at least a majority of the members of the
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board of directors of the entity resulting from such Business Combination
were members of the Incumbent Board at the time of the execution of the
initial agreement or of the action of the Board providing for such Business
Combination; or
(iv) the stockholders of the Company approve (a) the sale or
disposition by the Company (other than to a subsidiary of the Company) of
all or substantially all of the assets of the Company, or (b) a complete
liquidation or dissolution of the Company.
(b) "Corporate Status" describes the status of a person who is or was a
director, officer, employee or agent of a Company Entity.
(c) "Disinterested Director" means a director of the Company who is not and
was not a party to the Proceeding in respect of which indemnification is sought
by Indemnitee.
(d) "Expenses" shall include 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, being or preparing to be a witness in, or
otherwise participating in, a Proceeding.
(e) "Independent Counsel" means a law firm, or a member of a law firm, that
is experienced in matters of corporation law and neither presently is, nor in
the past five years has been, retained to represent: (i) the Company or
Indemnitee in any matter material to either such party, or (ii) any other party
to the Proceeding giving rise to a claim for indemnification hereunder.
Notwithstanding the foregoing, the term "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. The Company agrees to pay the reasonable fees of the Independent
Counsel referred to above and to fully indemnify such counsel against any and
all Expenses, claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto.
(f) "Person" shall have the meaning ascribed thereto in Section 3(a)(9) of
the Exchange Act, as modified, applied and used in Sections 13(d) and 14(d)
thereof; provided, however, a Person shall not include (i) the Company or any of
its subsidiaries, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its subsidiaries (in its capacity
as such), (iii) an underwriter temporarily holding securities pursuant to an
offering of such securities, or (iv) a corporation or other entity owned,
directly or indirectly, by the stockholders of the Company in substantially the
same character and proportions as their ownership of stock of the Company.
(g) "Proceeding" includes any threatened, pending or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation,
inquiry, administrative hearing or any other actual, threatened or completed
proceeding, whether brought by or in the right of the Company or otherwise and
whether civil, criminal, administrative or investigative, in which Indemnitee
was, is, may be or will be involved as a party or otherwise, by reason of the
fact that Indemnitee is or was a director, officer, employee and/or agent of any
of the Company Entities or by reason of any action taken by him or of any
inaction on his part while acting in such capacity, in each case whether or not
he is acting or serving in any such capacity at the time any liability or
expense is incurred for which indemnification or advancement of expenses can be
provided under this Agreement, except for (i) one initiated by an Indemnitee
pursuant to Section 11 of this Agreement to enforce his rights under this
Agreement or (ii) one pending on or before the date of this agreement.
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Section 19. Enforcement.
(a) The Company expressly confirms and agrees that it has entered into this
Agreement and assumed the obligations imposed on it hereby in order to induce
Indemnitee to serve as a director, officer, employee and/or agent one or more of
the Company Entities, and the Company acknowledges that Indemnitee is relying
upon this Agreement in serving in such capacity.
(b) This Agreement constitutes the entire agreement between the parties
hereto with respect to the subject matter hereof and supersedes all prior
agreements and understandings, oral, written and implied, between the parties
hereto with respect to the subject matter hereof.
Section 20. Modification and Waiver. 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 such waiver constitute a continuing waiver.
Section 21. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given (i) upon delivery, if delivered by hand and receipted for by the
party to whom said notice or other communication shall have been directed, (ii)
on the first business day after the date on which it is mailed by overnight
courier service or transmitted via facsimile or (iii) on the third business day
after the date on which it is mailed by certified or registered mail with
postage prepaid:
(a) If to Indemnitee, at the address specified on the signature page of
this Agreement; and
(b) If to the Company to:
The Hain Celestial Group, Inc.
00 Xxxxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Executive Officer
with a copy (which shall not constitute notice) to:
Xxxxxx Xxxxxx & Xxxxxxx LLP
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxxxxx, Esq.
or to such other address as may have been furnished to Indemnitee by the Company
or to the Company by Indemnitee, as the case may be.
Section 22. Governing Law; Submission to Jurisdiction; Appointment of Agent
for Service of Process. This Agreement and the legal relations among the parties
shall be governed by, and construed and enforced in accordance with, the laws of
the State of Delaware, without regard to its conflict of laws rules. Except with
respect to any arbitration commenced by Indemnitee pursuant to Section 11(a) of
this Agreement, the Company and Indemnitee hereby irrevocably and
unconditionally:
(a) agree that any action or proceeding arising out of or in connection
with this Agreement shall be brought only in the Chancery Court of the State of
Delaware (the "Delaware Court"),
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and not in any other state or federal court in the United States of America or
any court in any other country,
(b) consent to submit to the exclusive jurisdiction of the Delaware Court
for purposes of any action or proceeding arising out of or in connection with
this Agreement,
(c) waive any objection to the laying of venue of any such action or
proceeding in the Delaware Court and
(d) waive, and agree not to plead or to make, any claim that any such action or
proceeding brought in the Delaware Court has been brought in an improper or
otherwise inconvenient forum.
Section 23. Miscellaneous. Use of the masculine pronoun shall be deemed to
include usage of the feminine pronoun where appropriate, and vice versa.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
THE HAIN CELESITAL GROUP, INC.
By:
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Name: [ ]
Title: [ ]
INDEMNITEE:
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Name: [ ]
Address:
[ ]
------------------------------------------
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