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Exhibit 10
INDEMNIFICATION AGREEMENT
This Agreement is made as of the __________ day of
______________________ _______, 199 __, by and between United States
Exploration, Inc., a Colorado Corporation ("the Company"), and the undersigned
director and/or officer of the Company (the "Indemnitee") with reference to the
following facts:
The Indemnitee is currently serving as a director and/or officer of the
Company and the Company wishes the Indemnitee to continue in such capacity,
and, if requested in the future, to serve in such other positions with the
Company and its subsidiaries as the Company may determine. The Indemnitee is
willing, under certain circumstances, to continue serving as a director and/or
officer of the Company.
The Indemnitee does not regard the indemnities available under the
Company's Articles of Incorporation (the "Articles of Incorporation") and
Bylaws (the "Bylaws") as adequate to protect the Indemnitee against the risks
of personal liability associated with the Indemnitee's service to the Company.
In this connection the Company and the Indemnitee now agree they should enter
into this Indemnification Agreement in order to provide greater protection to
Indemnitee against such risks of service to the Company.
In order to induce the Indemnitee to continue to serve as a director
and/or officer of the Company and in consideration of the Indemnitee's
continued service, the Company hereby agrees to indemnify the Indemnitee as
follows:
1. INDEMNITY. The Company will indemnify the Indemnitee, his
executors, administrators or assigns, for any Expenses (as defined below) which
the Indemnitee is or becomes legally obligated to pay in connection with any
Proceeding. As used in this Agreement the term "Proceeding" includes any
threatened, pending or completed claim, action, suit or proceeding, whether
brought by or in the right of the Company or otherwise and whether of a civil,
criminal, administrative or investigative nature, in which the Indemnitee may
be or may have been involved as a party or otherwise, by reason of the fact
that Indemnitee is or was a director or officer of the Company, by reason of
any actual or alleged error or misstatement or misleading statement made or
suffered by the Indemnitee, by reason of any action taken by him or of any
inaction on his part while acting as such director or officer, or by reason of
the fact that he was serving at the request of the Company as a director,
trustee, officer, fiduciary, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise; provided, that in each
such case Indemnitee acted in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Company, and, in
the case of a criminal proceeding, had no reasonable cause to believe that his
conduct was unlawful. As used in this Agreement, the term "other enterprise"
includes (without limitation) employee benefit plans and administrative
committees thereof, and the term "fines" includes (without limitations) any
excise tax assessed with respect to any employee benefit plan.
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2. EXPENSES. As used in this Agreement, the term "Expenses"
includes, without limitation, damages, judgments, fines, penalties, settlements
and costs, reasonable attorneys' fees and disbursements and costs of attachment
or similar bonds, and investigations in connection with investigating,
defending, being a witness or participating in any Proceeding, and any expenses
of establishing a right to indemnification under this Agreement.
3. ENFORCEMENT. If a claim or request under this Agreement is not
paid by the Company, or on its behalf, within thirty days after a written claim
or request has been received by the Company, the Indemnitee may at any time
thereafter bring suit against the Company to recover the unpaid amount of the
claim or request and if successful in whole or in part, the Indemnitee shall be
entitled to be paid also the Expenses of prosecuting such suit.
4. SUBROGATION. 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; provided, however, that neither this right
of subrogation nor the exclusion set forth in Section 5(b) below shall apply to
any right of recovery of the Indemnitee or any payment received by the
Indemnitee from an entity that is the primary employer of the Indemnitee or on
whose behalf the Indemnitee serves as a director and/or officer of the Company
or an affiliate of any such entity.
5. EXCLUSIONS. The Company shall not be liable under this Agreement
to make any payment in connection with any claim made against the Indemnitee:
(a) to the extent that payment is actually made to the
Indemnitee under a valid, enforceable and collectible insurance policy;
(b) to the extent that the Indemnitee is indemnified
and actually paid otherwise than pursuant to this Agreement, subject to Section
4;
(c) in connection with a judicial action by or in the
right of the Company, in respect of any claim, issue or matter as to which the
Indemnitee shall have been adjudged to be liable for negligence or misconduct
in the performance of his duty to the Company unless, and only to the extent
that, any court in which such action was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, the Indemnitee is fairly and reasonably entitled to
indemnity for such expenses as such court shall deem proper;
(d) if it is proved by final judgment in a court of law
or other final adjudication to have been based upon or attributable to the
Indemnitee's having gained any personal profit or advantage to which he was not
legally entitled;
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(e) for a disgorgement of profits made from the
purchase and sale by the Indemnitee of securities pursuant to Section 16(b) of
the Securities Exchange Act of 1934 and amendments thereto or similar
provisions of any state statutory law or common law;
(f) brought about or contributed to by the dishonesty
of the Indemnitee; provided, however, notwithstanding the foregoing, the
Indemnitee shall be protected under this Agreement as to any claims upon which
suit may be brought against him by reason of any alleged dishonesty on his
part, unless a judgment or other final adjudication thereof adverse to the
Indemnitee shall establish that he committed (i) acts of active and deliberate
dishonesty, (ii) with actual dishonest purpose and intent, (iii) which acts
were material to the cause of action so adjudicated; or
(g) for any judgment, fine or penalty which the Company
is prohibited by applicable law from paying as indemnity or for any other
reason.
6. INDEMNIFICATION OF EXPENSES OF SUCCESSFUL PARTY.
Notwithstanding any other provision of this Agreement, to the extent that the
Indemnitee has been successful on the merits or otherwise in defense of any
Proceeding or in defense of any claim, issue or matter therein, including
dismissal without prejudice, Indemnitee shall be indemnified against any and
all Expenses incurred in connection therewith.
7. PARTIAL INDEMNIFICATION. If the Indemnitee is entitled
under any provision of this Agreement to indemnification by the Company for a
portion of any Expenses, but not for the total amount thereof, the Company
shall indemnify the Indemnitee for the portion of such Expenses to which the
Indemnitee is entitled.
8. ADVANCE OF EXPENSES. Expenses reasonably and necessarily
incurred by the Indemnitee in connection with any Proceeding, except the amount
of any settlement, shall be paid by the Company in advance upon request of the
Indemnitee that the Company pay such Expenses. The Indemnitee hereby
undertakes to repay to the Company the amount of any Expenses theretofore paid
by the Company to the extent that it is ultimately determined that such
Expenses were not reasonable or that the Indemnitee is not entitled to
indemnification in respect thereof.
Such advances shall be made by the Company unless: (a) the Board
of Directors determines, by a majority vote of a quorum of disinterested
directors based on clear and convincing evidence known to the Board of
Directors at the time such determination is made, that the Indemnitee would not
be entitled to indemnification under applicable law, or (b) if such a quorum is
not obtainable or a quorum of disinterested directors so directs, independent
legal counsel determines, based on clear and convincing evidence known to the
counsel at the time such determination is made, that Indemnitee would not be
entitled to indemnification under applicable law.
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9. NOTICE AND DEFENSE OF CLAIM. The Indemnitee, as a
condition precedent to his right to be indemnified under this Agreement, shall
give to the Company notice in writing as soon as practicable of any claim made
against him for which indemnity will or could be sought under this Agreement.
Notice to the Company shall be given at its principal office, shall be directed
to the Corporate Secretary (or such other address as the Company shall
designate in writing to the Indemnitee) and shall be effective only upon actual
receipt. In addition, the Indemnitee shall give the Company such information
and cooperation as it may reasonably require and as shall be within the
Indemnitee's power.
With respect to any such Proceeding: (a) the Company will be
entitled to participate therein at its own expense; and (b) except as otherwise
provided below, to the extent that it may wish, the Company jointly with any
other indemnifying party similarly notified will be entitled to assume the
defense thereof, with counsel reasonably satisfactory to Indemnitee. After
notice from the Company to Indemnitee, given within a reasonable time, of its
election so to assume the defense thereof, the Company will not be liable to
Indemnitee under this Agreement for any legal or other expenses subsequently
incurred by Indemnitee in connection with the defense of such Proceeding except
as otherwise provided below. Indemnitee shall have the right to employ his own
counsel in such Proceeding but the fees and expenses of such counsel incurred
after notice from the Company of its assumption of the defense thereof shall be
at the expense of Indemnitee unless (i) the employment of counsel by Indemnitee
has been authorized by the Company, or (ii) Indemnitee shall have obtained the
written opinion of reputable counsel with expertise in such matters (such
counsel to be reasonably satisfactory to a majority of disinterested directors)
that there may be one or more defenses available to Indemnitee that could
reasonably be expected to result in a conflict of interest between the Company
and Indemnitee in the conduct of the defense of such action, in each of which
cases the reasonable fees and expenses of Indemnitee's counsel shall be at the
expense of the Company. The Company shall not be entitled to assume the
defense of any Proceeding brought by or on behalf of the Company or that is the
subject of the opinion provided by Indemnitee under clause (ii) above.
The Company shall not be liable to indemnify Indemnitee under
this Agreement for any amounts paid in settlement of any Proceeding effected
without its prior written consent. Indemnitee shall execute and deliver such
agreements, releases and other documents as the Company may reasonably request
to effect a settlement of any Proceeding. Without Indemnitee's consent, the
Company shall not enter into any settlement that provides for any action by
Indemnitee other than the payment of amounts against which Indemnitee is
entitled to indemnification hereunder. In the event that the Company proposes
to settle any Proceeding by the payment of damages against which Indemnitee is
entitled to indemnification hereunder and in an amount that the plaintiff has
indicated would be acceptable, and the Indemnitee refuses to enter into a
reasonable settlement agreement, the Company shall not thereafter be
responsible for any costs of defense or the amount by which any judgement or
settlement thereafter paid exceeds the damages that the Company proposed to pay
in settlement. Neither the Company nor Indemnitee will unreasonably withhold
their consent to any proposed settlement.
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10. NO EMPLOYMENT AGREEMENT. Nothing contained herein shall
be deemed to create a contract of employment between the Company and
Indemnitee.
11. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one
instrument.
12. INDEMNIFICATION HEREUNDER NOT EXCLUSIVE. Nothing herein
shall be deemed to diminish or otherwise restrict the Indemnitee's right to
indemnification under any provision of the Articles of Incorporation or Bylaws
of the Company and amendments thereto or under law.
13. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with Colorado law without giving effect to the
principles of conflicts of laws.
14. COVERAGE. The provisions of this Agreement shall apply
with respect to the Indemnitee's service in any of the capacities described in
Section 1 above prior to as well as after the date of this Agreement. The
right of Indemnitee to be indemnified hereunder shall continue after the
termination of Indemnitee's service as an officer and/or director of the
Company with respect to all periods prior to such termination.
15. AMENDMENTS; WAIVERS. 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 provision hereof
(whether or not similar) nor shall such waiver constitute a continuing waiver.
16. BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by both of the parties hereto and
their respective successors, assignees (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company), heirs,
executors and personal and legal representatives.
17. SEVERABILITY. If any provision of this Agreement
(including any provision within a single section, paragraph or sentence) is
held by a court of competent jurisdiction to be invalid, void or otherwise
unenforceable in any respect, the validity and enforceability of any such
provision in every other respect and of the remaining provisions of this
Agreement shall not be in any way impaired and shall remain enforceable to the
full extent permitted by law.
18. 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 delivered in person
(by express courier or otherwise), by telecopier or three days after being
deposited in the United States mail, certified mail, return receipt requested,
first class postage prepaid, as follows:
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If to the Company: United States Exploration, Inc.
0000 X. 000xx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention:
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Telecopier:
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If to Indemnitee:
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and signed as of the day and year first above written.
UNITED STATES EXPLORATION, INC.
By
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(Signature of Director/Officer)
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(Name of Director/Officer)
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