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EXHIBIT 10.31
INDEMNIFICATION AGREEMENT
This Agreement is made as of the ____ day of ___________, by and between
Financial Pacific Insurance Company, a California Corporation ("the Company"),
and the undersigned Director of the Company (the "Indemnitee"), with reference
to the following facts:
The Indemnitee is currently serving as a Director of the Company and the
Company wishes the Indemnitee to continue in such capacity. The Indemnitee is
willing, under certain circumstances, to continue serving as a Director of the
Company.
The Indemnitee has indicated that he does not regard the indemnities
available under the Company's By-Laws as adequate to protect him against the
risks associated with his service to the Company and has noted that the Company
does not provide directors' and officers' liability insurance for his benefit.
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.
Section 145 of the General Corporation Law of the State of Delaware, under
which Law the Company is organized, empowers corporations to indemnify a person
serving as a director, officer, employee or agent of the corporation and a
person who serves at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust, or
other enterprise, and said Section 145 and the By-Laws of the Company specify
that
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the indemnification set forth in said Section 145 and in the By-Laws,
respectively, shall not be deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any By-Law, agreement, vote of
stockholders or disinterested directors or otherwise.
In order to induce the Indemnitee to continue to serve as a Director of
the Company and in consideration of his 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" shall include 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, employee or agent of
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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, in addition had no
reasonable cause to believe that his conduct was unlawful. As used in this
Agreement, the term "other enterprise" shall include (without limitation)
employee benefit plans and administrative committees thereof, and the term
"fines" shall include (without limitations) any excise tax assessed with respect
to any employee benefit plan.
2. Expenses. As used in this Agreement, the term "Expenses" shall
include, without limitation, damages, judgments, fines, penalties, settlements
and costs, attorneys' fees and disbursements and costs of attachment or similar
bonds, investigations, 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. The Company
shall have the right to recoup
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from the Indemnitee the amount of any item or items of Expenses theretofore paid
by the Company pursuant to this Agreement, to the extent such Expenses are not
reasonable in nature or amounts; provided, however, that the Company shall have
the burden of proving such Expenses to be unreasonable. The burden of proving
that the Indemnitee is not entitled to indemnification for any other reason
shall be upon the Company.
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.
5. Exclusions. The Company shall not be liable under this Agreement to pay
any Expenses 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;
(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
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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 in fact having gained any personal profit or advantage to
which he was not legally entitled;
(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 seeking payment hereunder; 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
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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 some or a
portion of Expenses, but not, however, for the total amount thereof, the Company
shall nevertheless indemnify the Indemnitee for the portion of such Expenses to
which the Indemnitee is entitled.
8. Advance of Expenses. Expenses 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
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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.
9. Approval of Expenses. No Expenses for which indemnity shall be sought
under this Agreement, other than those in respect of judgments and verdicts
actually rendered, shall be incurred without the prior consent of the Company,
which consent shall not be unreasonably withheld.
10. Notice 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; provided, however, that any
failure to give prompt notice shall not affect or limit the Company's
obligations hereunder unless the Company has actually been prejudiced by such
failure, in which event the Company shall be relieved of its obligations
hereunder solely to the extent of such prejudice. Notice to the Company shall be
given at its principal office and shall be directed to the Corporate Secretary
(or such other address as the Company shall designate in writing to the
Indemnitee); notice shall be deemed received if sent by prepaid mail properly
addressed, the date of such notice being the date postmarked. In
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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.
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 Certificate of Incorporation or
By-Laws of the Company and amendments thereto or under law.
13. Governing Law. This Agreement shall be governed by and construed in
accordance with Delaware law.
14. Saving Clause. Wherever there is conflict between any provision of
this Agreement and any applicable present or future statute, law or regulation
contrary to which the Company and the Indemnitee have no legal right to
contract, the latter shall prevail, but in such event the affected provisions of
this Agreement shall be curtailed and restricted only to the extent necessary to
bring them within applicable legal requirements.
15. Coverage. The provisions of this Agreement shall apply with respect to
the Indemnitee's service as a Director of the Company prior to the date of this
Agreement and with respect to all periods of such service after the date of this
Agreement, even though
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the Indemnitee may have ceased to be a Director of the Company.
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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.
Financial Pacific Insurance
Company
By [SIG]
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/s/
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[Director]
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