INDEMNIFICATION AGREEMENT
Exhibit 10.44
THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is made and entered into this
18th day of November, 2010, by and between
Xxxxxxx X. Xxxxxx (the “Indemnified Party”)
and CHICO’S FAS, INC., a Florida corporation (the “Corporation”).
WITNESSETH
WHEREAS, it is essential to the Corporation to retain and attract as Directors and/or
Executive Officers the most capable persons available; and
WHEREAS, the substantial increase in corporate litigation subjects directors and officers to
expensive litigation risks at the same time that the availability of directors’ and officers’
liability insurance has been severely limited; and
WHEREAS, in addition, the statutory indemnification provisions of the Florida Business
Corporation Act and Article VII of the bylaws of the Corporation (the “Article”) expressly provide
that they are non-exclusive; and
WHEREAS, the Indemnified Party does not regard the protection available under the Article and
insurance, if any, as adequate in the present circumstances, and considers it necessary and
desirable to his service as a Director and/or Executive Officer to have adequate protection, and
the Corporation desires the Indemnified Party to serve in such capacity and have such protection;
and
WHEREAS, the Florida Business Corporation Act and the Article provide that indemnification of
Directors and Executive Officers of the Corporation may be authorized by agreement, and thereby
contemplates that contracts of this nature may be entered into between the Corporation and the
Indemnified Party with respect to indemnification of the Indemnified Party as a Director and/or
Executive Officer of the Corporation.
NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements
contained in this Agreement, it is hereby agreed as follows:
1. INDEMNIFICATION GENERALLY.
(a)
Grant of Indemnity. (i) Subject to and upon the terms and conditions of this
Agreement, the Corporation shall indemnify and hold harmless the Indemnified Party in respect of
any and all costs, claims, losses, damages and expenses which may be incurred or suffered by the
Indemnified Party as a result of or arising out of prosecuting, defending, settling or
investigating:
(1) any threatened, pending, or completed claim, demand, inquiry,
investigation, action, suit or proceeding, whether formal or informal or brought by
or in the right of the Corporation or otherwise and whether of a civil, criminal,
administrative or investigative nature, in which the Indemnified Party may be or may
have been involved as a party or otherwise, arising out of the fact that the
Indemnified Party is or was a director, officer, employee, independent contractor or
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stockholder of the Corporation or any of its “Affiliates” (as such term is defined
in the rules and regulations promulgated by the Securities and Exchange Commission
under the Securities Act of 1933), or served as a director, officer, employee,
independent contractor or stockholder in or for any person, firm, partnership,
corporation or other entity at the request of the Corporation (including without
limitation service in any capacity for or in connection with any employee benefit
plan maintained by the Corporation or on behalf of the Corporation’s employees);
(2) any attempt (regardless of its success) by any person to charge or cause the
Indemnified Party to be charged with wrongdoing or with financial responsibility for
damages arising out of or incurred in connection with the matters indemnified against
in this Agreement; or
(3) any expense, interest, assessment, fine, tax, judgment or settlement
payment arising out of or incident to any of the matters indemnified against in this
Agreement including reasonable fees and disbursements of legal counsel, experts,
accountants, consultants and investigators (before and at trial and in appellate
proceedings).
(ii) The obligation of the Corporation under this Agreement is not conditioned in any way on
any attempt by the Indemnified Party to collect from an insurer any amount under a liability
insurance policy.
(iii) In no case shall any indemnification be provided under this Agreement to the
Indemnified Party by the Corporation in:
(1) Any action or proceeding brought by or in the name or interest of the
Indemnified Party against the Corporation;
(2) Any action or proceeding brought by the Corporation against the Indemnified
Party, which action is initiated at the direction of the Board of Directors of the
Corporation; or
(3) Any threatened or filed action or proceeding of any nature brought by any
third party (including, without limitation, any governmental or administrative
agency) against the Indemnified Party resulting from, arising out of, or related to
the Indemnified Party’s use or operation of his personal aircraft.
(b) Claims for Indemnification. (i) Whenever any claims shall arise for
indemnification under this Agreement, the Indemnified Party shall notify the Corporation promptly
and in any event within 30 days after the Indemnified Party has actual knowledge of the facts
constituting the basis for such claim. The notice shall specify all facts known to the Indemnified
Party giving rise to such indemnification right and the amount or an estimate of the amount of
liability (including estimated expenses) arising therefrom.
(ii) Any indemnification under this Agreement shall be made no later than 30 days after
receipt by the Corporation of the written notification specified in Section 1(b)(i), unless a
determination is made within such 30 day period by (X) the Board of Directors by a majority vote
of a quorum consisting of directors who were not parties to the matter described in the
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notice of (Y) independent legal counsel, agreed to by the Corporation, in a written opinion (which
counsel shall be appointed if such a quorum is not obtainable), that the Indemnified Party has not
met the relevant standards for indemnification under this Agreement.
(c) Rights to Defend or Settle; Third Party Claims (i) If the facts giving rise to
any indemnification right under this Agreement shall involve any actual or threatened claim or
demand against the Indemnified Party, or any possible claim by the Indemnified Party against any
third party, such claim shall be referred to as a “Third Party Claim.” If the Corporation provides
the Indemnified Party with an agreement in writing in form and substance satisfactory to the
Indemnified Party and his counsel, agreeing to indemnify, defend or prosecute and hold the
Indemnified Party harmless from all costs and liability arising from any Third Party Claim (an
“Agreement of Indemnity”), and demonstrating to the satisfaction of the Indemnified Party the
financial wherewithal to accomplish such indemnification, the Corporation may at its own expense
undertake full responsibility for the defense or prosecution of such Third Party Claim. The
Corporation may contest or settle any such Third Party Claim for money damages on such terms and
conditions as it deems appropriate but shall be obligated to consult in good faith with the
Indemnified Party and not to contest or settle any Third Party Claim involving injunctive or
equitable relief against or affecting the Indemnified Party or his properties or assets without
the prior written consent of the Indemnified Party, such consent not to be withheld unreasonably.
The Indemnified Party may participate at his own expense and with his own counsel in defense or
prosecution of a Third Party Claim pursuant to this Section 1(c)(i), and such participation shall
not relieve the Corporation of its obligation to indemnify the Indemnified Party under this
Agreement.
(ii) If the Corporation fails to deliver a satisfactory Agreement of Indemnity and evidence of
financial wherewithal within 10 days after receipt of notice pursuant to Section 1(b)(i), the
Indemnified Party may contest or settle the Third Party Claim on such terms as it sees fit but
shall not reach a settlement with respect to the payment of money damages without consulting in
good faith with the Corporation. The Corporation may participate at its own expense and with its
own counsel in defense or prosecution of a Third Party Claim pursuant to this Section 1(c)(ii), but
any such participation shall not relieve the Corporation of its obligations to indemnify the
Indemnified Party under this Agreement. All expenses (including attorneys’ fees) incurred in
defending or prosecuting any Third Party Claim shall be paid promptly by the Corporation as the
suit or other matter is proceeding, upon the submission of bills therefore or other satisfactory
evidence of such expenditures during the pendency of any matter as to which indemnification is
available under this Agreement. The failure to make such payments within 10 days after submission
of evidence of those expenses shall constitute a breach of a material obligation of the Corporation
under this Agreement.
(iii) If by reason of any Third Party Claim a lien, attachment, garnishment or execution is
placed upon any of the property or assets of the Indemnified Party, the Corporation shall promptly
furnish a satisfactory indemnity bond to obtain the prompt release of such lien, attachment,
garnishment or execution.
(iv) The Indemnified Party shall cooperate in the defense of any Third Party Claim which is
controlled by the Corporation, but the Indemnified Party shall continue to be entitled to
indemnification and reimbursement for all costs and expenses incurred by him in connection
therewith as provided in this Agreement.
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(d) Cooperation. The parties to this Agreement shall execute such powers of attorney
as may be necessary or appropriate to permit participation of counsel selected by any party hereto
and, as may be reasonably related to any such claim or action, shall provide to the counsel,
accountants and other representatives of each party access during normal business hours to all
properties, personnel, books, records, contracts, commitments and all other business records of
such other party and will furnish to such other party copies of all such documents as may be
reasonably requested (certified, if requested).
(e) Choice of Counsel. In all matters as to which indemnification is available to
the Indemnified Party under this Agreement, the Indemnified Party shall be free to choose and
retain counsel, provided the Indemnified Party shall secure the prior written consent of the
Corporation as to such selection, which consent shall not be unreasonably withheld.
(f) Consultation. If the Indemnified Party desires to retain the services of an
attorney prior to the determination by the Corporation as to whether it will undertake the defense
or prosecution of the Third Party Claim as provided in Section 1(c), the Indemnified Party shall
notify the Corporation of such desire in the notice delivered pursuant to Section 1(b)(i), and such
notice shall identify the counsel to be retained. The Corporation shall then have 10 days within
which to advise the Indemnified Party whether it will assume the defense or prosecution of the
Third Party Claim in accordance with Section 1(c)(i). If the Indemnified Party does not receive an
affirmative response within such 10-day period, he shall be free to retain counsel of his choice,
and the indemnity provided in Section 1(a) shall apply to the reasonable fees and disbursements of
such counsel incurred after the expiration of such 10-day period. Any fees or disbursements
incurred prior to the expiration of such 10-day period shall not be covered by the indemnity of
Section 1(a).
(g)
Repayment. (i) Notwithstanding the other provisions of this Agreement to the
contrary, if the Corporation has incurred any cost, damage or expense under this Agreement paid to
or for the benefit of the Indemnified Party and it is determined by a court of competent
jurisdiction from which no appeal may be taken that the Indemnified Party’s actions or omissions
constitute “Nonindemnifiable Conduct” as that term is defined in Section 1(g)(ii), the Indemnified
Party shall and does hereby undertake in such circumstances to reimburse the Corporation for any
and all such amounts previously paid to or for the benefit of the Indemnified Party.
(ii) For these purposes, “Nonindemnifiable Conduct” shall mean actions or omissions
of the
Indemnified Party material to the cause of action to which the indemnification under this
Agreement related is determined to involve:
(1) a violation of the criminal law, unless the Indemnified Party had reasonable
cause to believe his conduct was lawful and had no reasonable cause to believe his
conduct was unlawful;
(2) a transaction in which the Indemnified Party derived an improper
personal benefit;
(3) if the Indemnified Party is a director of the Corporation, a circumstance
under which the liability provisions of Section 607.0834 (or any successor or similar
statute) are applicable;
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(4) willful misconduct or a conscious disregard for the best interests of the
Corporation (when indemnification is sought in a proceeding by or in the right of the
Corporation to procure a judgment in favor of the Corporation or when indemnification
is sought in a proceeding by or in the right of a stockholder); or
(5) conduct pursuant to then applicable law that prohibits such indemnification.
2. TERM.
This Agreement shall be effective upon its execution by all parties and shall continue in
full force and effect until the date seven years after the date of this Agreement, or seven years
after the termination of the Indemnified Party’s employment or term of office, whichever is later,
provided that such term shall be extended by any period of time during which the Corporation is in
breach of a material obligation to the Indemnified Party, plus ninety days. Such term shall also
be extended with respect to each Third Party Claim then pending and as to which notice under
Section 1(b) has theretofore been given by the Indemnified Party to the Corporation, and this
Agreement shall continue to be applicable to each such Third Party Claim.
3. REPRESENTATIONS AND AGREEMENTS OF THE CORPORATION.
(a) Authority. The Corporation represents, covenants and agrees that it has the
corporate power and authority to enter into this Agreement and to carry out its obligations under
this Agreement. The execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated by this Agreement have been duly authorized by the Board of Directors
of the Corporation. This Agreement is a valid and binding obligation of the Corporation and is
enforceable against the Corporation in accordance with its terms.
(b) Noncontestability. The Corporation represents, covenants and agrees that it will
not initiate, and that it will use its best efforts to cause any of its Affiliates not to initiate,
any action, suit or proceeding challenging the validity or enforceability of this Agreement.
(c) Good Faith Judgment. The Corporation represents, covenants and agrees that it
will exercise good faith judgment in determining the entitlement of the Indemnified Party to
indemnification under this Agreement.
4. RELATIONSHIP OF THIS AGREEMENT TO OTHER INDEMNITIES.
(a)
Nonexclusivity. (i) This Agreement and all rights granted to the Indemnified
Party under this Agreement are in addition to and are not deemed to be exclusive with or of any
other rights that may be available to the Indemnified Party under any Articles of Incorporation,
bylaw, statute, agreement, or otherwise.
(ii) The rights, duties and obligations of the Corporation and the Indemnified Party under
this Agreement do no limit, diminish or supersede the rights, duties and obligations of the
Corporation and the Indemnified Party with respect to the indemnification afforded to the
Indemnified Party under any liability insurance, the Florida Business Corporation Act, or under
the bylaws or the Articles of Incorporation of the Corporation. In addition, the
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Indemnified Party’s rights under this Agreement will not be limited or diminished in any respect
by any amendment to the bylaws or the Articles of Incorporation of the Corporation.
(b)
Availability, Contribution. (i) The availability or nonavailability of
indemnification by way of insurance policy, Articles of Incorporation, bylaw, vote of stockholders,
or otherwise from the Corporation to the Indemnified Party shall not affect the right of the
Indemnified Party to indemnification under this Agreement, provided that all rights under this
Agreement shall be subject to applicable statutory provisions in effect from time to time.
(ii) Any funds received by the Indemnified Party by way of indemnification or payment from any
source other than from the Corporation under this Agreement shall reduce any amount otherwise
payable to the Indemnified Party under this Agreement.
(iii) If the Indemnified Party is entitled under any provision of this Agreement to
indemnification by the Corporation for some claims, issues or matters, but not as to other claims,
issues or matters, or for some or a portion of the expenses, judgments, fines or penalties
actually and reasonably incurred by him or amounts actually and reasonably paid in settlement by
him in the investigation, defense, appeal or settlement of any matter for which indemnification is
sought under this Agreement, but not for the total amount thereof, the Corporation shall
nevertheless indemnify the Indemnified Party for the portion of such claims, issues or matters or
expenses, judgments, fines, penalties or amounts paid in settlement to which the Indemnified Party
is entitled.
(iv) If for any reason a court of competent jurisdiction from which no appeal can be taken
rules that the indemnity provided under this Agreement is unavailable, or if for any reason the
indemnity under this Agreement is insufficient to hold the Indemnified Party harmless as provided
in this Agreement, then in either event, the Corporation shall contribute to the amounts paid or
payable by the Indemnified Party in such proportion as equitably reflects the relative benefits
received by, and fault of the Indemnified Party and the Corporation and its Affiliates.
(c) Allowance for Compliance with SEC Requirements. The Indemnified Party
acknowledges that the Securities and Exchange Commission (“SEC”) has expressed the
opinion that indemnification of directors and officers from liabilities under the Securities Act of
1933 (the “1933 Act”) is against public policy as expressed in the 1933 Act and, is therefore,
unenforceable. The Indemnified Party hereby agrees that it will not be a breach of this Agreement
for the Corporation to undertake with the SEC in connection with the registration for sale of any
stock or other securities of the Corporation from time to time that, in the event a claim for
indemnification against such liabilities (other than the payment by the Corporation of expenses
incurred or paid by a director of officer of the Corporation in the successful defense of any
action, suit or proceeding) is asserted in connection with such stock or other securities being
registered, the Corporation will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of competent jurisdiction on the question of whether or
not such indemnification by it is against public policy as expressed in the 1933 Act and will be
governed by the final adjudication of such issue. The Indemnified Party further agrees that such
submission to a court of competent jurisdiction shall not be a breach of this Agreement.
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5. MISCELLANEOUS.
(a) Notices. All notices, requests, demands and other communications which are
required or may be given under this Agreement shall be in writing and shall be deemed to have been
duly given when received if personally delivered; when transmitted if transmitted by telecopy,
electronic telephone line facsimile transmission or other similar electronic or digital
transmission method; the day after it is sent, if sent by recognized expedited delivery service;
and five days after it is sent, if mailed, first class mail, postage prepaid. In each case notice
shall be sent to:
If to the Indemnified Party:
Xxxxxxx X. Xxxxxx
000 Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
000 Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
If to the Corporation: |
A. Xxxxxxxxx Xxxxxx EVP-General Counsel & Corporate Secretary Chico’s FAS, Inc. 00000 Xxxxx Xxxxxxx Xxxx Xxxxx, XX 00000 |
or to such other address as either party may have specified in writing to the other using the
procedures specified above in this Section 5(a).
(b)
Construction and Interpretation. (i) This Agreement shall be construed
pursuant to and governed by the substantive laws of the State of Florida (and any provision of
Florida law shall not apply if the law of a state or jurisdiction other than Florida would
otherwise apply).
(ii) The headings of the various sections in this Agreement are inserted for the convenience
of the parties and shall not affect the meaning, construction or interpretation of this Agreement.
(iii) Any provision of this Agreement which is determined by a court of competent jurisdiction
to be prohibited, unenforceable or not authorized in any jurisdiction
shall, as to such
jurisdiction, be ineffective to the extent of such prohibition, unenforceability or
non-authorization without invalidating the remaining provisions hereof or affecting the validity,
enforceability or legality of such provision in any other jurisdiction. In any such case, such
determination shall not affect any other provision of this Agreement, and the remaining provisions
of this Agreement shall remain in full force and effect. If any provision or term of this Agreement
is susceptible to two or more constructions or interpretations, one or more of which would render
the provision or term void or unenforceable, the parties agree that a construction or
interpretation which renders the term or provision valid shall be favorable.
(iv) As
used in this Agreement, (1) the word “including” is always without
limitation; (2)
the words in the singular number include words of the plural number and vice versa; and (3) the
word “person” includes a trust, corporation, association, partnership, joint venture, business
trust, unincorporated organization, limited liability company, government, public body or
authority and any governmental agency or department as well as a natural person.
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(c) Entire Agreement. This Agreement constitutes the entire Agreement, and
supersedes all prior agreements and understandings, oral and written, among the parties to this
Agreement with respect to the subject matter hereof.
(d)
Specific Enforcement. (i) The parties agree and acknowledge that in the
event of a breach by the Corporation of its obligation promptly to indemnify the Indemnified Party
as provided in this Agreement, or breach of any other material provision of this Agreement, damages
at law will be an insufficient remedy to the Indemnified Party. Accordingly, the parties agree
that, in addition to any other remedies or rights that may be available to the Indemnified Party,
the Indemnified Party shall also be entitled, upon application to a court of competent
jurisdiction, to obtain temporary or permanent injunctions to compel specific performance of the
obligations of the Corporation under this Agreement.
(ii) There shall exist in such action a rebuttable presumption that the Indemnified Party has
met the applicable standard(s) of conduct and is therefore entitled to indemnification pursuant to
this Agreement, and the burden of proving that the relevant standards have not been met by the
Indemnified Party shall be on the Corporation. Neither the failure of the corporation (including
its Board of Directors or independent legal counsel) prior to the commencement of such action to
have made a determination that indemnification is proper in the circumstances because the
Indemnified Party has met the applicable standard of conduct, nor an actual determination by the
Corporation (including its Board of Directors or independent legal counsel) that the Indemnified
Party has not met such applicable standard of conduct, shall
(X) constitute a defense to the
action, (Y) create a presumption that the Indemnified Party has not met the applicable standard of
conduct, or (Z) otherwise alter the presumption in favor of the Indemnified Party referred to in
the preceding sentence.
(e)
Cost of Enforcement; Interest. (i) If the Indemnified Party engages the
services of an attorney or any other third party or in any way initiates legal action to enforce
his rights under this Agreement, including but not limited to the collection of monies due from the
Corporation to the Indemnified Party, the prevailing party shall be entitled to recover all
reasonable costs and expenses (including reasonable attorneys’ fees before and at trial and in
appellate proceedings). Should the Indemnified Party prevail, such costs and expenses shall be in
addition to monies otherwise due him under this Agreement.
(ii) If any monies shall be due the Indemnified Party from the Corporation under this
Agreement and shall not be paid within 30 days from the date of
written request for payment,
interest shall accrue on such unpaid amount at the rate of 2% per annum in excess of the prime
rate announced from time to time by Bank of America, or such lower rate as may be required to
comply with applicable law from the date when due until it is paid in full.
(f) Application to Third Parties. Nothing in this Agreement, whether express or
implied, is intended or should be construed to confer upon, or to grant to, any person, except the
Corporation, the Indemnified Party and their respective heirs, assignees and successors, any claim,
right or remedy under or because of this Agreement or in any provision of it. This Agreement shall
be binding upon and inure to the benefit of the successors in interest and assigns, heirs and
personal representatives, as the case may be, of the parties, including any successor corporation
resulting from a merger, consolidation, recapitalization, reorganization, sale of all or
substantially all of the assets of the Corporation, or any other transaction resulting in the
successor corporation assuming the liabilities of the Corporation under this Agreement (by
operation of law, or otherwise).
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(g) Further Assurances. The parties to this Agreement will execute and deliver, or
cause to be executed and delivered, such additional or further documents, agreements or
instruments and shall cooperate with one another in all respects for the purpose of carrying out
the transactions contemplated by this Agreement.
(h)
Venue; Process. The parties to this Agreement agree that jurisdiction and venue
in any action brought pursuant to this Agreement to enforce its terms or otherwise with respect to
the relationships between the parties shall properly lie in the Circuit Court of the Twentieth
Judicial Circuit of the State of Florida in and for Xxx County or in the United States District
Court for the Middle District of Florida, Tampa Division. Such jurisdiction and venue are merely
permissive; jurisdiction and venue shall also continue to lie in any court where jurisdiction and
venue would otherwise be proper. The parties agree that they will not object that any action
commenced in the foregoing jurisdictions is commenced in a forum non conveniens. The parties
further agree that the mailing by certified or registered mail, return receipt requested, of any
process required by any such court shall constitute valid and lawful service of process against
them, without the necessity for service by any other means provided by statute or rule of court.
(i) Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be considered an original, but all of which together shall constitute one and the
same instrument.
(j) Waiver and Delay. No waiver or delay in enforcing the terms of this Agreement
shall be construed as a waiver of any subsequent breach. No action taken by the Indemnified Party
shall constitute a waiver of his rights under this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.
CHICO’S FAS, INC.
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XXXXXXX X. XXXXXX | |
By: /s/ Xxxxx X. Xxxx
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/s/ Xxxxxxx X. Xxxxxx | |
| |
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Xxxxx X. Xxxx |
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Chief Executive Officer and President |
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WITNESSES:
|
WITNESSES: | |
/s/ Xxxxx Xxxxxx
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/s/ Xxx Xxxxxx | |
/s/ Xxxxx Xxxxxx |
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