INDEMNIFICATION AGREEMENT
Exhibit 10.20
This Indemnification Agreement (this “Agreement”) is made and delivered this ___day of
___, 200___, by El Paso Pipeline GP Company, L.L.C. (the “Company”), to and for the benefit
of ___(“DIRECTOR”).
RECITALS
WHEREAS, in order to induce DIRECTOR to become a member of the Company’s Board of Directors
(“Board”), the Company is executing and delivering to DIRECTOR this Indemnification Agreement.
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company hereby agrees as follows:
SECTION 1. Right To Indemnification
If DIRECTOR is made a party or is threatened to be made a party to or is involved (including,
without limitation, as a witness) in any actual or threatened action, suit or proceeding, whether
civil, criminal, administrative or investigative (hereinafter a “proceeding”), by reason of the
fact that he is or was a Director of the Company (or of any subsidiary of the Company) or is or was
serving at the request of the Company or the Board of Directors, including service with respect to
any employee benefit plan or any subsidiary of the Company, whether the basis of such proceeding is
alleged action in an official capacity as a Director or in any other capacity while serving as a
Director, he shall be indemnified and held harmless by the Company to the fullest extent permitted
by Section 18-108 of the Delaware Limited Liability Company Act, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent that such
amendment permits the Company to provide broader indemnification rights than said law permitted the
Company to provide prior to such amendment), or by other applicable law as then in effect, against
all expense, liability and loss (including attorneys’ fees, judgments, fines, or penalties and
amounts to be paid in settlement) actually and reasonably incurred or suffered by him in connection
therewith and such indemnification shall continue after DIRECTOR has ceased to be a Director and
shall inure to the benefit of DIRECTOR’s heirs, executors and administrators; provided, however,
that except as provided in Section 2 of this Agreement with respect to proceedings seeking to
enforce rights to indemnification or to advancement of expenses, the Company shall be required to
indemnify DIRECTOR in connection with a proceeding (or part thereof) initiated by DIRECTOR only if
such proceeding (or part thereof) was authorized by the Board. The right to indemnification
conferred in this Agreement shall include the right to be paid by the Company the reasonable
expenses (including attorneys’ fees) incurred in defending any such proceeding in advance of its
final disposition (hereinafter an “advancement of expenses”); further provided, however, that, if
the Delaware Limited Liability Company Act requires, an advancement of expenses incurred by
DIRECTOR in his capacity as a Director (and not in any other capacity in which service was or is
rendered by DIRECTOR while a Director including, without limitation, service to an employee benefit
plan)
shall be made only upon delivery to the Company of a written request accompanied by such
documentation and information as is reasonably available to DIRECTOR and is reasonably necessary to
determine whether and to what extent DIRECTOR is entitled to indemnification and an undertaking, if
permitted by Federal law, by or on behalf of DIRECTOR, to repay all amounts so advanced if it shall
ultimately be determined that he is not entitled to be indemnified under this Agreement, or
otherwise, and provided further that except as provided in Section 2 of this Agreement with respect
to proceedings seeking to enforce rights to indemnification or an advancement of expenses, the
Company shall be required to advance expenses to DIRECTOR in connection with a proceeding initiated
by him only if such proceeding was authorized by the Board.
SECTION 2. Right To Bring Suit
If a claim under Section 1 of this Agreement is not paid in full by the Company within sixty
(60) days after a written claim has been received by the Company, except in the case of a claim for
an advancement of expenses, in which case the applicable period shall be twenty (20) days, DIRECTOR
may at any time thereafter bring suit against the Company to recover the unpaid amount of the claim
and, to the extent successful in whole or in material part, DIRECTOR shall be entitled to be paid
the expense of prosecuting such suit. DIRECTOR shall be presumed to be entitled to indemnification
under this Agreement upon submission of a written claim (and, in an action brought to enforce a
claim for an advancement of expenses, where the required undertaking, if any is required, has been
tendered to the Company), and thereafter the Company shall have the burden of proof to overcome the
presumption that DIRECTOR is not so entitled. Neither the failure of the Company (including its
Board, independent legal counsel, or its stockholders), to have made a determination prior to the
commencement of such suit that indemnification of DIRECTOR is proper in the circumstances, nor an
actual determination by the Company (including its Board, independent legal counsel or its security
holders) that DIRECTOR is not entitled to indemnification, shall be a defense to the suit or create
a presumption that DIRECTOR is not so entitled.
SECTION 3. Nonexclusivity of Rights
The rights to indemnification and to the advancement of expenses conferred in this Agreement
are in addition to and shall not be exclusive of any other right DIRECTOR may have or hereafter
acquire under any statute, provision of the Certificate of Formation of the Company or its Amended
and Restated Limited Liability Company Agreement, or under any other plan, program, arrangement,
agreement, vote of members or disinterested Directors or otherwise.
SECTION 4. Insurance, Contracts and Funding
The Company may maintain insurance, at its expense, to protect itself and DIRECTOR against any
expense, liability or loss, whether or not the Company would have the power to indemnify DIRECTOR
against such expense, liability or loss under the Delaware Limited Liability Company Act. The
Company may enter into contracts with DIRECTOR in furtherance of the provisions of this Agreement
and may create a trust fund, grant a security interest or use other means (including, without
limitation, a letter of credit) to ensure the payment of such
- 2 -
amounts as may be necessary to effect indemnification as provided in this Agreement. To the
extent the Company maintains an insurance policy or policies providing directors’ and officers’
liability insurance, DIRECTOR 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 Company director or
officer.
SECTION 5. Change of Control
(a) A “Change in Control” shall mean the occurrence of any of the following:
With respect to the Company, any of the following events: (i) any sale, lease, exchange or
other transfer (in one transaction or a series of related transactions) of all or substantially all
of the Company’s assets to any other person, unless immediately following such sale, lease,
exchange or other transfer such assets are owned, directly or indirectly, by the Company; (ii) the
dissolution or liquidation of the Company; (iii) the consolidation or merger of the Company with or
into another person pursuant to a transaction in which the outstanding securities of any class of a
person entitling the holders thereof to vote in the election of, or to appoint, members of the
board of directors or other similar governing body of the Company (“Voting Securities”) are changed
into or exchanged for cash, securities or other property, other than any such transaction where (a)
the outstanding Voting Securities of the Company are changed into or exchanged for Voting
Securities of the surviving person or its parent and (b) the holders of the Voting Securities of
the Company immediately prior to such transaction own, directly or indirectly, not less than a
majority of the outstanding Voting Securities of the surviving person or its parent immediately
after such transaction; and (iv) a “person” or “group” (within the meaning of Sections 13(d) or
14(d)(2) of the Exchange Act) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5
under the Exchange Act) of more than 50% of all of the then outstanding Voting Securities of the
Company, except (a) El Paso and any affiliates of El Paso Corporation and (b) in a merger or
consolidation which would not constitute a Change in Control under clause (iii) above.
(b) Change in Control of the Company. The Company agrees that if there is a Change in
Control of the Company, then with respect to all matters thereafter arising concerning the rights
of DIRECTOR to indemnity payments and expense advances under this Agreement, any other agreements,
the Certificate of Formation or the Amended and Restated Limited Liability Company Agreement now or
hereafter in effect relating to a proceeding, the Company shall seek legal advice only from special
independent counsel selected by DIRECTOR and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services for the Company (other than in
connection with such matters) or DIRECTOR. In the event that DIRECTOR and the Company are unable
to agree on the selection of the special independent counsel, such special independent counsel
shall be selected by lot from among at least five law firms in New York City, New York or Houston,
Texas selected by DIRECTOR, each having no less than 50 partners. Such selection shall be made in
the presence of DIRECTOR (and his legal counsel or either of them, as DIRECTOR may elect). Such
special independent counsel, among other things, shall determine whether and to what extent
DIRECTOR would be permitted to be indemnified under applicable law and shall render its written
opinion to the Company and DIRECTOR to such effect.
- 3 -
The Company agrees to pay the reasonable fees of the special independent counsel referred to
above and to fully indemnify such counsel against any and all expenses (including attorneys’ fees),
claims, liabilities and damages arising out of or relating to this Agreement or its engagement
pursuant hereto.
SECTION 6. No Modification
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. Any waiver to this agreement shall be in
writing.
SECTION 7. 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 DIRECTOR, 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.
SECTION 8. No Duplication of Payments
The Company shall not be liable under this Agreement to make any payment in connection with
any proceeding against DIRECTOR to the extent DIRECTOR has otherwise actually received payment
(under any insurance policy or otherwise) of the amounts otherwise indemnifiable hereunder.
SECTION 9. Notification and Defense of Proceedings
DIRECTOR agrees that he will use all reasonable efforts to notify the Company promptly after
receipt by DIRECTOR of notice of the commencement of any proceeding if he anticipates that a
request for indemnification in respect thereof is to be made against the Company under this
Agreement; but failure to so notify the Company will not relieve the Company from any
indemnification or other obligation or liability which it may have to DIRECTOR. With respect to
any such proceeding as to which DIRECTOR notifies the Company of the commencement thereof:
(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 satisfactory to DIRECTOR. After notice from the Company to DIRECTOR of its
election to assume the defense thereof, the Company will not be liable to DIRECTOR under this
Agreement for any legal or other expenses subsequently incurred by DIRECTOR in connection with the
defense thereof other than reasonable costs of investigation
- 4 -
or as otherwise provided below. DIRECTOR shall have the right to employ its 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 DIRECTOR unless (i) the employment of
counsel by DIRECTOR has been authorized by the Company, (ii) DIRECTOR shall have reasonably
concluded that there may be a conflict of interest between the Company and DIRECTOR in the conduct
of the defense of such proceeding or (iii) the Company shall not in fact have employed counsel to
assume the defense of such proceeding, in each of which cases the fees and expenses of 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 as to which DIRECTOR shall have made the
conclusion provided for in clause (ii) of this subsection 9(b).
(c) The Company shall not be liable to indemnify DIRECTOR under this Agreement for any amounts
paid in settlement of any proceeding effected by DIRECTOR without the Company’s prior written
consent. The Company shall not settle any proceeding in any manner which would impose any penalty
or limitation on DIRECTOR without DIRECTOR’s prior written consent. Neither the Company nor
DIRECTOR will unreasonably withhold their consent to any proposed settlement.
SECTION 10. Notices
(a) All notices, requests, demands and other communications sent pursuant to this Agreement
must be in writing or by electronic transmission and will be deemed delivered and received: (i) if
personally delivered by telex, telegram, facsimile, electronic transmission or courier service,
when actually received by the party to whom the notice or communication is sent; or (ii) if
delivered by mail, whether actually received or not, at the close of business on the third business
day in the city in which the Company’s principal executive office is located next following the day
when placed in the U.S. mail, postage prepaid, certified or registered, addressed to the
appropriate party at the address of that party set forth below, or at such other address as that
party may designate by notice in writing or by electronic transmission to the other party in
accordance herewith.
(b) If to DIRECTOR, to:
__________________________________
__________________________________
__________________________________
Fax No.:___________________________
E-mail: ____________________________
__________________________________
__________________________________
Fax No.:___________________________
E-mail: ____________________________
with a copy, which will not constitute notice for purposes of this Agreement, to such legal
counsel, if any, as DIRECTOR may designate in writing or by electronic transmission.
(c) If to the Company, to:
El Paso Pipeline GP Company, L.L.C.
El Paso Building, 0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention: _________________________
Fax No.: (713) 420-__________________
E-mail: _____________@xxxxxx.xxx
El Paso Building, 0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention: _________________________
Fax No.: (713) 420-__________________
E-mail: _____________@xxxxxx.xxx
- 5 -
SECTION 11. No Presumptions
For purposes of this Agreement, the termination of any proceeding against DIRECTOR by
judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea
of nolo contendere, or its equivalent, shall not create a presumption that DIRECTOR did not meet
any particular standard of conduct or have any particular belief or that a court has determined
that indemnification is not permitted by applicable law. In addition, neither the failure of the
Company to have made a determination as to whether DIRECTOR has met any particular standard of
conduct or had any particular belief, nor an actual determination by the Company that DIRECTOR has
not met such standard of conduct or did not have such belief, prior to the commencement of legal
proceedings by DIRECTOR to secure a judicial determination that DIRECTOR should be indemnified
under applicable law shall be a defense to DIRECTOR’s claim for indemnification or create a
presumption that DIRECTOR has not met any particular standard of conduct or did not have any
particular belief.
SECTION 12. Acknowledgment of Reliance
The Company acknowledges that DIRECTOR is relying on this Agreement and the promises
and agreements of the Company herein in continuing his service as a Director and in agreeing to
undertake and in undertaking his responsibilities, duties and services to and for the Company in
connection therewith.
SECTION 13. Counterparts
This Agreement may be executed in one or more counterparts, each of which will for
all purposes be deemed to be original but all of which together will constitute one and the same
agreement.
SECTION 14. Headings
The headings of the Sections hereof are inserted for convenience only and do not and will not
be deemed to constitute part of this Agreement or to affect the construction thereof.
SECTION 15. Miscellaneous
This Agreement shall be governed by and construed in accordance with the laws of the State of
Delaware. Each provision hereof is intended to be severable and the invalidity or illegality of
any portion of this Agreement shall not affect the validity or legality of the remainder.
- 6 -
Executed as an instrument under seal as of the day and year first above written.
| EL PASO PIPELINE GP COMPANY, L.L.C. |
||||
| By: | ||||
| Name: | ||||
| Title: Hereunto duly authorized |
||||
| By: | ||||
| Name: | ||||
| Title: Hereunto duly authorized |
||||
- 7 -
