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EXHIBIT 10d
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (this "Agreement") is made as of
the 29th day of June, 1998 by and between BRUSH XXXXXXX INC., an Ohio
corporation (the "Company"), and XXXXXXX X. XXXXXXXX (the "Indemnitee"), an
Officer of the Company.
RECITALS
A. The Indemnitee is presently serving as an Officer of the Company,
and the Company desires the Indemnitee to continue in that capacity. The
Indemnitee is willing, subject to certain conditions (including, without
limitation, the execution and performance of this Agreement by the Company), to
continue in that capacity.
B. In addition to the indemnification to which the Indemnitee is
entitled under the Code of Regulations of the Company (the "Regulations") or
otherwise, the Company has obtained, at its sole expense, insurance protecting
the Company and its Directors and officers including the Indemnitee against
certain losses arising out of actual or threatened actions, suits, or
proceedings to which such persons may be made or threatened to be made parties.
However, as a result of circumstances having no relation to, and beyond the
control of, the Company and the Indemnitee, there can be no assurance of the
continuation or renewal of that insurance.
Accordingly, and in order to induce the Indemnitee to continue to serve
in his present capacity, the Company and the Indemnitee agree as follows:
1. CONTINUED SERVICE. The Indemnitee shall continue to serve at the
will of the Company as an Officer of the Company so long as he is duly elected
and qualified in accordance with the Regulations or until he resigns in writing
in accordance with applicable law.
2. INITIAL INDEMNITY. (a) The Company shall indemnify the Indemnitee,
if or when he is a party or is threatened to be made a party to any threatened,
pending, or completed action, suit or proceeding, whether civil, criminal,
administrative, or investigative (other than an action by or in the right of the
Company), by reason of the fact that he is or was a Director or an officer of
the Company or is or was serving at the request of the Company as a director,
trustee, officer, employee, or agent of another corporation, domestic or
foreign, nonprofit or for profit, partnership, joint venture, trust, or other
enterprise, or by reason of any action alleged to have been taken or omitted in
any such capacity, against any and all costs, charges, expenses (including,
without limitation, fees and expenses of attorneys and/or others; all such
costs, charges and expenses being herein jointly referred to as "Expenses"),
judgments, fines and amounts paid in settlement, actually and reasonably
incurred by the Indemnitee in connection therewith including any appeal of or
from any judgment or decision, unless it is proved by clear and convincing
evidence in a court of competent jurisdiction that the Indemnitee's action or
failure to act involved an act or omission undertaken with deliberate intent to
cause injury to the Company or undertaken with reckless disregard for the best
interests of the Company. In addition, with respect to any criminal action or
proceeding,
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indemnification hereunder shall be made only if the Indemnitee had no reasonable
cause to believe his conduct was unlawful. The termination of any action, suit
or proceeding by judgment, order, settlement, or conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a presumption
that the Indemnitee did not satisfy the foregoing standard of conduct to the
extent applicable thereto.
(b) The Company shall indemnify the Indemnitee, if or when he is a
party or is threatened to be made a party to any threatened, pending, or
completed action, suit, or proceeding by or in the right of the Company to
procure a judgment in its favor, by reason of the fact that the Indemnitee is or
was a Director or an officer of the Company or is or was serving at the request
of the Company as a director, trustee, officer, employee, or agent of another
corporation, domestic or foreign, nonprofit or for profit, partnership, joint
venture, trust, or other enterprise, against any and all Expenses actually and
reasonably incurred by the Indemnitee in connection with the defense or
settlement thereof or any appeal of or from any judgment or decision, unless it
is proved by clear and convincing evidence in a court of competent jurisdiction
that the Indemnitee's action or failure to act involved an act or omission
undertaken with deliberate intent to cause injury to the Company or undertaken
with reckless disregard for the best interests of the Company, except that no
indemnification shall be made in respect of any action or suit in which the only
liability asserted against the Indemnitee is pursuant to Section 1701.95 of the
Ohio Revised Code (the "ORC").
(c) Any indemnification under Section 2(a) or 2(b) (unless ordered by
a court) shall be made by the Company only as authorized in the specific case
upon a determination that indemnification of the Indemnitee is proper in the
circumstances because he has met the applicable standard of conduct set forth in
Section 2(a) or 2(b). Such authorization shall be made (i) by the Directors of
the Company (the "Board") by a majority vote of a quorum consisting of Directors
who were not and are no parties to or threatened with such action, suit, or
proceeding, or (ii) if such a quorum of disinterested Directors is not
obtainable or if a majority of such quorum so directs, in a written opinion by
independent legal counsel (designated for such purpose by the Board) which shall
not be an attorney, or a firm having associated with it an attorney, who has
been retained by or who has performed services for the Company, or any person to
be indemnified, within the five years preceding such determination, or (iii) by
the shareholders of the Company (the "Shareholders"), or (iv) by the court in
which such action, suit, or proceeding was brought.
(d) To the extent that the Indemnitee has been successful on the
merits or otherwise, including, without limitation, the dismissal of an action
without prejudice, in defense of any action, suit, or proceeding referred to in
Section 2(a) or 2(b), or in defense of any claim, issue, or matter therein, he
shall be indemnified against Expenses actually and reasonably incurred by him in
connection therewith. Expenses actually and reasonably incurred by the
Indemnitee in defending any such action, suit, or proceeding shall be paid by
the Company as they are incurred in advance of the final disposition of such
action, suit, or proceeding under the procedure set forth in Section 4(b).
(e) For purposes of this Agreement, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on the Indemnitee with respect to any employee benefit
plan; references to "serving at the request of the Company" shall include any
service which imposes duties on, or involves services by, the Indemnitee with
respect to an employee benefit plan, its participants or
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beneficiaries; references to the masculine shall include the feminine; and
references to the singular shall include the plural and vice versa.
3. ADDITIONAL INDEMNIFICATION. Pursuant to ORC Section 1701.13(E)(6),
without limiting any right which the Indemnitee may have pursuant to Section 2
hereof or any other provision of this Agreement or the Amended Articles of
Incorporation of the Company (the "Articles"), the Regulations, the ORC, any
policy of insurance, or otherwise, but subject to any limitation on the maximum
permissible indemnity which may exist under applicable law at the time of any
request for indemnity hereunder and subject to the following provisions of this
Section 3, the Company shall indemnify the Indemnitee against any amount which
he is or becomes obligated to pay relating to or arising out of any claim
(including any pending, threatened or completed action, suit or proceeding to
which he is or is threatened to be made a party) made against him because of any
action alleged to have been taken or omitted to be taken, including any actual
or alleged error, misstatement, or misleading statement, which he commits,
suffers, permits, or acquiesces in while acting in his capacity as a Director or
an officer of the Company. The payments which the Company is obligated to make
pursuant to this Section 3 shall include, without limitation, judgments, fines,
and amounts paid in settlement and any and all Expenses actually and reasonably
incurred by the Indemnitee in connection therewith including any appeal of or
from any judgment or decision; provided, however, that the Company shall not be
obligated under this Section 3 to make any payment in connection with any claim
against the Indemnitee:
(a) to the extent of any fine or similar governmental imposition which
the Company is prohibited by applicable law from paying which results
from a final, nonappealable order; or
(b) to the extent based upon or attributable to the Indemnitee having
actually realized a personal gain or profit to which he was not legally
entitled, including, without limitation, profit from the purchase and
sale by the Indemnitee of equity securities of the Company which is
recoverable by the Company pursuant to Section 16(b) of the Securities
Exchange Act of 1934, or profit arising from transactions in publicly
traded securities of the Company which were effected by the Indemnitee
in violation of Section 10(b) of the Securities Exchange Act of 1934, or
Rule 10b-5 promulgated thereunder.
A determination as to whether the Indemnitee shall be entitled to
indemnification under this Section 3 shall be made in accordance with Section
4(a). Expenses incurred by the Indemnitee in defending any claim to which this
Section 3 applies shall be paid by the Company as they are actually and
reasonably incurred in advance of the final disposition of such claim under the
procedure set forth in Section 4(b).
4. CERTAIN PROCEDURES RELATING TO INDEMNIFICATION. (a) For purposes of
pursuing his rights to indemnification under Section 3, the Indemnitee shall (i)
submit to the Board a sworn statement of request for indemnification
substantially in the form of Exhibit 1 attached hereto and made a part hereof
(the "Indemnification Statement") stating that he is entitled to indemnification
hereunder; and (ii) present to the Board reasonable evidence of all amounts for
which indemnification is requested. Submission of an Indemnification Statement
to the Board shall create a presumption that the Indemnitee is entitled to
indemnification hereunder, and the Company shall, within 60 calendar days after
submission of the
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Indemnification Statement, make the payments requested in the Indemnification
Statement to or for the benefit of the Indemnitee, unless (i) within such
60-calendar-day period the Board shall resolve by vote of a majority of the
Directors at a meeting at which a quorum is present that the Indemnitee is not
entitled to indemnification under Section 3, (ii) such vote shall be based upon
clear and convincing evidence (sufficient to rebut the foregoing presumption),
and (iii) the Indemnitee shall have received within such period notice in
writing of such vote, which notice shall disclose with particularity the
evidence upon which the vote is based. The foregoing notice shall be sworn to by
all persons who participated in the vote and voted to deny indemnification. The
provisions of this Section 4(a) are intended to be procedural only and shall not
affect the right of any Indemnitee to indemnification under Section 3 so long as
the Indemnitee follows the prescribed procedure and any determination by the
Board that an Indemnitee is not entitled to indemnification and any failure to
make the payments requested in the Indemnification Statement shall be subject to
judicial review by any court of competent jurisdiction.
(b) For purposes of obtaining payments of Expenses in advance of final
disposition pursuant to the second sentence of Section 2(d) or the last sentence
of Section 3, the Indemnitee shall submit to the Company a sworn request for
advancement of Expenses substantially in the form of Exhibit 2 attached hereto
and made a part hereof (the "Undertaking"), stating that he has reasonably
incurred actual Expenses in defending an action, suit or proceeding referred to
in Section 2(a) or 2(b) or a claim referred to in Section 3. Unless at the time
of the Indemnitee's act or omission at issue, the Articles or Regulations
prohibit such advances by specific reference to ORC Section 1701.13(E)(5)(a) and
unless the only liability asserted against the Indemnitee in the subject action,
suit, or proceeding is pursuant to ORC Section 1701.95, the Indemnitee shall be
eligible to execute Part A of the Undertaking by which he undertakes to (a)
repay such amount if it is proved by clear and convincing evidence in a court of
competent jurisdiction that the Indemnitee's action or failure to act involved
an act or omission undertaken with deliberate intent to cause injury to the
Company or undertaken with reckless disregard for the best interests of the
Company and (b) reasonably cooperate with the Company concerning the action,
suit, proceeding or claim. In all cases, the Indemnitee shall be eligible to
execute Part B of the Undertaking by which he undertakes to repay such amount if
it ultimately is determined that he is not entitled to be indemnified by the
Company under this Agreement or otherwise. If the Indemnitee is eligible to and
does execute both Part A and Part B of the Undertaking, the Expenses which are
paid by the Company pursuant thereto shall be required to be repaid by the
Indemnitee only if he is required to do so under the terms of both Part A and
Part B of the Undertaking. Upon receipt of the Undertaking, the Company shall
thereafter promptly pay such Expenses of the Indemnitee as are noticed to the
Company in writing and in reasonable detail arising out of the matter described
in the Undertaking. No security shall be required in connection with any
Undertaking.
5. LIMITATION ON INDEMNITY. Notwithstanding anything contained herein
to the contrary, the Company shall not be required hereby to indemnify the
Indemnitee with respect to any action, suit, or proceeding that was initiated by
the Indemnitee unless (i) such action, suit or proceeding was initiated by the
Indemnitee to enforce any rights to indemnification arising hereunder and such
person shall have been formally adjudged to be entitled to indemnity by reason
hereof, (ii) authorized by another agreement to which the Company is a party
whether heretofore or hereafter entered, or (iii) otherwise ordered by the court
in which the suit was brought.
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6. SUBROGATION: DUPLICATION OF PAYMENTS. (a) In the event of payment
under this Agreement, the Company shall be subrogated to the extent of such
payment to all of the rights of recovery of the Indemnitee, who shall execute
all papers required and shall do everything that may be necessary to secure such
rights, including the execution of such documents necessary to enable the
Company effectively to bring suit to enforce such rights.
(b) The Company shall not be liable under this Agreement to make any
payment in connection with any claim made against an Indemnitee to the extent
that the Indemnitee has actually received payment (under any insurance policy,
the Regulations or otherwise) of amounts otherwise payable hereunder.
7. FEES AND EXPENSES OF ENFORCEMENT. It is the intent of the Company
that the Indemnitee not be required to incur expenses associated with the
enforcement of his rights under this Agreement by litigation or other legal
action because such expenses would substantially detract from the benefits
intended to be extended to the Indemnitee hereunder. Accordingly, if it should
appear to the Indemnitee that the Company has failed to comply with any of its
obligations under this Agreement or if the Company or any other person takes
any action to declare this Agreement void or unenforceable, or institutes any
action, suit, or proceeding to deny, or to recover from, the Indemnitee the
benefits intended to be provided to the Indemnitee hereunder, the Company
irrevocably authorizes the Indemnitee from time to time to retain counsel of
his choice, at the expense of the Company as hereafter provided, to represent
the Indemnitee in connection with the initiation or defense of any litigation
or other legal action, whether by or against the Company or any director,
officer, shareholder, or other person affiliated with the Company, in any
jurisdiction. Regardless of the outcome thereof, the Company shall pay and be
solely responsible for any and all expenses, including, without limitation,
fees and expenses of attorneys and others, reasonably incurred by the
Indemnitee pursuant to this Section 7.
8. MERGER OR CONSOLIDATION. If the Company shall be a constituent
corporation in a consolidation, merger, or other reorganization, the Company, if
it shall not be the surviving, resulting, or acquiring corporation therein,
shall require as a condition thereto that the surviving, resulting, or acquiring
corporation agree to assume all of the obligations of the Company hereunder and
to indemnify the Indemnitee to the full extent provided herein. Whether or not
the Company is the resulting surviving, or acquiring corporation in any such
transaction, the Indemnitee shall also stand in the same position under this
Agreement with respect to the resulting, surviving, or acquiring corporation in
which he would have stood with respect to the Company if its separate existence
had continued.
9. NONEXCLUSIVELY AND SEVERABILITY. (a) The rights to indemnification
provided by this Agreement shall not be exclusive of any other rights of
indemnification to which the Indemnitee may be entitled under the Articles, the
Regulations, the ORC or any other statute, any insurance policy, agreement, or
vote of shareholders or directors or otherwise, as to any actions or failures to
act by the Indemnitee, and shall continue after he has ceased to be a Director,
officer, employee, or agent of the Company or other entity for which his service
gives rise to a right hereunder, and shall inure to the benefit of his heirs,
executors, and administrators. In the event of any payment under this Agreement,
the Company shall be subrogated to the extent thereof to all rights of recovery
previously vested in
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the Indemnitee, who shall execute all instruments and take all other actions
as shall be reasonably necessary for the Company to enforce such right.
(b) If any provision of this Agreement or the application of any
provision hereof to any person or circumstances is held invalid, unenforceable,
or otherwise illegal, the remainder of this Agreement and the application of
such provision to other persons or circumstances shall not be affected, and the
provision so held to be invalid, unenforceable, or otherwise illegal shall be
reformed to the extent (and only to the extent) necessary to make it
enforceable, valid, and legal.
10. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio, without giving effect to
principles of conflicts of law and the like.
11. MODIFICATION. This Agreement and the rights and duties of the
Indemnitee and the Company hereunder may be modified only by an instrument in
writing signed by both parties hereto.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first above written.
BRUSH XXXXXXX INC.
By: /s/ Xxxx Xxxxxx
-------------------
Xxxx Xxxxxx
Title: Vice President and
Chief Financial Officer
/s/ Xxxxxxx X. Xxxxxxxx
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Xxxxxxx X. Xxxxxxxx
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Exhibit 1
INDEMNIFICATION STATEMENT
State of )
) ss:
County of )
I,___________________, being first duly sworn, do depose and say as follows:
1. This Indemnification Statement is submitted pursuant to the
Indemnification Agreement made as of ______, 19__ between BRUSH XXXXXXX INC.
(the "Company"), an Ohio corporation, and the undersigned.
2. I am requesting indemnification against costs, charges, expenses
(which may include fees and expenses of attorneys and/or others), judgments,
fines, and amounts paid in settlement (collectively, "Liabilities"), which have
been actually and reasonably incurred by me in connection with a claim referred
to in Section 3 of the aforesaid Indemnification Agreement.
3. With respect to all matters related to any such claim, I am entitled
to be indemnified as herein contemplated pursuant to the aforesaid
Indemnification Agreement.
4. Without limiting any other rights which I have or may have, I am
requesting indemnification against Liabilities which have or may arise out of
______________.
-------------------------
[Signature of Indemnitee]
Subscribed and sworn to before me, a Notary Public in and for said
County and State, this ___ day of _____________ 19___.
[Seal]
My commission expires the________ day of_________________, 19___.
Ex. 1 - 1
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Exhibit 2
UNDERTAKING
State of )
) ss:
County of )
I,____________, being first duly sworn do depose and say as follows:
1. This Undertaking is submitted pursuant to the Indemnification
Agreement made as of _________, 19___ between BRUSH XXXXXXX INC. (the
"Company"), an Ohio corporation, and the undersigned.
2. I am requesting payment of costs, charges, and expenses which I have
reasonably incurred or will reasonably incur in defending an action, suit or
proceeding referred to in Section 2(a) or 2(b) or any claim referred to in
Section 3 of the aforesaid Indemnification Agreement.
3. The costs, charges, and expenses for which payment is requested are,
in general, all expenses related to _________.
4. Part A
I hereby undertake to (a) repay all amounts paid pursuant hereto if it
is proved by clear and convincing evidence in a court of competent jurisdiction
that my action or failure to act which is the subject of the matter described
herein involved an act or omission undertaken with deliberate intent to cause
injury to the Company or undertaken with reckless disregard for the best
interests of the Company and (b) reasonably cooperate with the Company
concerning the action, suit, proceeding or claim.
-------------------------
[Signature of Indemnitee]
4. Part B
I hereby undertake to repay all amounts paid pursuant hereto if it
ultimately is determined that I am not entitled to be indemnified by the Company
under the aforesaid Indemnification Agreement or otherwise.
-------------------------
[Signature of Indemnitee]
Subscribed and sworn to before me, a Notary Public in and for said
County and State, this ____ day of _____________, 19__.
[Seal] My commission expires the_________ day of_____________, 19__.
Ex. 2 - 1
