Exhibit 10.46
INDEMNITY AGREEMENT
THIS INDEMNITY AGREEMENT (the "Agreement") is made and entered into as of
this 1st day of July 1998, by and between Aurora Foods Inc., a Delaware
corporation (the "Company"), and Xxx X. Xxxxxx, a director of the Company
(the "Director").
W I T N E S S E T H:
WHEREAS, the Company and the Director recognize that the legal risks and
potential liabilities associated with lawsuits filed against the directors of
the Company pose a significant deterrent to experienced and capable individuals
serving as directors of the Company;
WHEREAS, the Company recognizes that the result of the foregoing may be to
encourage those directors who nonetheless determine to serve the Company in such
capacity to act with undue conservatism in the performance of their duties to
the Company and, thus, may result in less effective direction, supervision and
management of the Company's business and operations;
WHEREAS, Section 145 of the Delaware General Corporation Law is not
exclusive of other rights to which those indemnified thereunder may be entitled
under any by-law, agreement, vote of stockholders or disinterested directors or
otherwise and, thus, does not by itself limit the extent to which the Company
may indemnify (and advance expenses to) persons serving as its directors;
WHEREAS, the Company desires to have the Director begin or continue to
serve as a director of the Company, free from undue concern for unpredictable,
inappropriate or unreasonable legal risks and personal liabilities by reason of
performing his duty to the Company or his status as a director, and the Director
desires to begin or continue to serve as a director of the Company.
NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements of the parties contained herein and the mutual benefits to be derived
from this Agreement, the parties hereto covenant and agree as follows:
1. Agreement to Serve. The Director agrees to begin or to continue to
serve the Company as a director, provided, however, that nothing contained in
this Agreement shall create or supersede or amend any existing contract of
employment between the Company and the Director, or the Securityholders
Agreement dated as of April 8, 1998 and the termination of the Director's
relationship with the Company by either party hereto shall not be restricted by
this Agreement. Should the Director and the Company agree and
subject to any written employment agreement between the Director and the
Company, the Director may also serve another corporation, limited liability
company, partnership, joint venture, employee benefit plan, trust including,
without limitation, any subsidiary or other enterprise affiliated with the
Company (any and all of which are collectively referred to herein as an
"Affiliate"), in which event the terms and provisions of this Agreement shall
automatically apply to any such other service to the full extent permitted by
applicable law without the need for any additional action on the part of the
Director or the Company.
2. Indemnity.
(A) Subject to the conditions and limitations of this Paragraph 2
(including without limitation Paragraph 2(B) below), the Company shall, to
the fullest extent permitted by the Delaware General Corporation Law as it
may then be in effect, indemnify and hold the Director and his estate,
heirs and legal representatives (each an "Indemnified Party") harmless if
any of them is, becomes or was a party to or witness or other participant
in, or is or was threatened to be made a party to or witness or other
participant in, any Claim (as defined below) by reason of (or arising in
part out of) an Indemnifiable Event (as defined below) against any and all
expenses (including attorneys', accountants' and other experts' fees,
disbursements and expenses), judgments, fines, penalties, excise taxes and
amounts paid or to be paid in settlement incurred by the Indemnified Party
in connection with preparation for or in defense of such Claim
(collectively, "Indemnified Amounts"). "Claim" means any threatened,
pending or completed action, cause of action, suit or proceeding, whether
civil, criminal, administrative or investigative or other, including,
without limitation, an action by or in the right of any corporation
(including without limitation, the Company) of any type or kind, domestic
or foreign, or any limited liability company, partnership, joint venture,
trust, employee benefit plan or other enterprise, whether predicated on
foreign, federal, state or local law and whether formal or informal.
"Indemnifiable Event" means any event or occurrence related to the fact
that the Director is or was or has agreed to become a director or other
representative of the Company, or is or was serving or has agreed to serve
in any capacity, at the request of the Company, in any other corporation,
limited liability company, partnership, joint venture, employee benefit
plan, trust or other enterprise, or by reason of anything done or not done
by the Director in any such capacity.
(B) Any indemnification under paragraph (A) of this Paragraph 2 shall
be made by the Company only as authorized in the specific case upon a
determination that the Director acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company and, with respect to any criminal action or proceeding, had no
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reasonable cause to believe his conduct was unlawful; provided, however,
that no indemnification shall be made in respect of any Claim as to which
the Director shall have been adjudged to be liable to the Company unless
and only to the extent that the Court of Chancery of the State of Delaware
or the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all
the circumstances of the case, the Indemnified Party is fairly and
reasonably entitled to indemnity for such Indemnified Amounts which the
Court of Chancery of the State of Delaware or such other court shall deem
proper. Such determination (each, a "Board Action") shall be made (1) by
the Board of Directors by a majority vote of the directors who are not a
party to such Claim with respect to an Indemnifiable Event, even if less
than a quorum, or (2) by a committee of such directors appointed by a
majority vote of such directors, even if less than a quorum, or (3) by the
Board of Directors acting upon an opinion in writing of independent legal
counsel, if there are no such directors or if a majority of such directors
so direct.
(C) Notwithstanding anything in the Company's Certificate of
Incorporation, By-Laws, or this Agreement to the contrary, if so requested
by an Indemnified Party the Company shall advance (an "Expense Advance")
(within 30 days of such request) any and all Indemnified Amounts relating
to a Claim to such Indemnified Party, upon the receipt of a written
undertaking by or on behalf of such Indemnified Party to repay such Expense
Advance if a judgment or other final adjudication adverse to such
Indemnified Party (as to which all rights or appeal therefrom have been
exhausted or lapsed) establishes that such Indemnified Party, with respect
to such Claim, is not eligible for indemnification.
(D) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Paragraph 2 shall not be deemed exclusive of any
other rights to which an Indemnified Party seeking indemnification or
advancement of expenses may be entitled under any by-law, other agreement,
vote of stockholders or disinterested directors, policy of insurance or
otherwise, both as to action of the Director in his official capacity and
as to action in another capacity while holding such office.
(E) For the purposes of this Paragraph 2, references to "the Company"
shall include, in addition to the resulting corporation or limited
liability company, any constituent corporation or limited liability company
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power
and authority to indemnify its directors, officers, employees or agents, so
that
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the Director if he is or was a director, officer, employee or agent of such
constituent entity, or is or was serving at the request of such constituent
entity as a director, officer, employee, agent, trustee, fiduciary or other
representative of another corporation, limited liability company,
partnership, joint venture, trust or other enterprise, shall stand in the
same position under the provisions of this Paragraph 2 with respect to the
resulting or surviving entity as he would have with respect to such
constituent entity if its separate existence had continued.
(F) Any repeal or modification of relevant provisions of the Delaware
General Corporation Law or any other applicable laws shall not in any way
diminish any rights to indemnification of an Indemnified Party or the
obligations of the Company arising hereunder except to the extent required
by law. All rights and obligations of the Company and the Director and the
other Indemnified Parties under this Agreement shall continue in full force
and effect despite the subsequent amendment or modification of the
Company's Certificate of Incorporation or Bylaws, as such are in effect on
the date hereof, and such rights and obligations shall not be affected by
any such amendment or modification, any resolution of the Board of
Directors or the stockholders of the Company, or any other corporate action
which in any way seeks to diminish any of the rights of the Director and
the other Indemnified Parties or the obligations of the Company under this
Agreement. If this Paragraph 2 or any portion hereof shall be invalidated
on any ground by any court of competent jurisdiction, then the Company
shall nevertheless indemnify each Indemnified Party as to Indemnified
Amounts with respect to any Claim, no matter by whom brought, and advance
expenses (including attorneys', accountants' and other experts' fees,
disbursements and expenses), in each such Claim to the full extent
permitted by any applicable portion of this Paragraph 2 that shall not have
been invalidated and to the full extent permitted by applicable law.
(G) Anything herein to the contrary notwithstanding, the settlement
of any Claim that is entered into without the prior written consent of the
Company shall be covered by the terms hereof as determined by the Company
in its sole discretion pursuant to Paragraph 2B.
(H) Notwithstanding any other provision of this Agreement, to the
extent that the Indemnified Party has been successful on the merits or
otherwise in defense of any or all Claims relating in whole or in part to
an Indemnifiable Event or in defense of any issue or matter therein,
including, without limitation, dismissal without prejudice, the Indemnified
Party shall be indemnified against any and all Indemnified Amounts paid or
to be paid in
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settlement of such Claim. In connection with any determination by Board
Action or by a court of competent jurisdiction that the Indemnified Party
is not entitled to be indemnified hereunder, the burden of proof shall be
on the Company to establish that the Indemnified Party is not so entitled.
3. Payment of Indemnity. Indemnified Amounts and Expense Advances, if
any, provided to any Indemnified Party by the Company under this Agreement upon
the final disposition or conclusion of a Claim unless otherwise ordered by the
court before which such Claim was brought, shall be paid by the Company (net of
all amounts, if any, previously advanced to the Indemnified Party or Parties
pursuant to Paragraph 2C) to the Indemnified Party (or to such other person as
the Indemnified Party may designate in writing to the Company) within 30 days
after the receipt of the Indemnified Party's written request therefor, which
request shall include a reasonably comprehensive accounting of amounts for which
indemnification is being sought and shall refer to one or more of the
provision(s) of this Agreement pursuant to which such claim is being made. All
expenses associated with the indemnification process set forth in this Agreement
or enforcements of rights hereunder shall be paid by the Company.
4. Termination of an Action is Nonconclusive. The termination of any
Action, no matter by whom brought, by judgment, order, settlement, conviction,
or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the Director has not met the applicable standard(s) of
conduct set forth in Paragraph 2 of this Agreement.
5. Partial Indemnification; Interest.
(A) If it is determined by the court before which a Claim is brought
or a court having competent jurisdiction that the Indemnified Party is
entitled to indemnification as to some claims, issues or matters, but not
as to other claims, issues or matters involved in such Claim, no matter by
whom brought, the court shall authorize the reasonable proration of the
Indemnified Amounts with respect to which indemnification is sought by the
Indemnified Party, among such claims, issues or matters as the court shall
deem appropriate in light of all of the circumstances of such Claim.
(B) If it is determined by the court before which such Claim was
brought or a court having competent jurisdiction that certain Indemnified
Amounts incurred by the Indemnified Party are, for whatever reason,
unreasonable in amount, the court shall authorize indemnification to be
paid by the Company to the Indemnified Party for only such amounts as the
court shall deem reasonable in light of all of the circumstances of such
Claim.
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6. Representation of Company. The Company represents and warrants to the
Director that neither the execution and delivery of this Agreement by the
Company nor the consummation of the transactions set forth herein or
contemplated hereby will conflict with or result in any violation of, or
constitute a breach of, or a default under, the Certificate of Incorporation or
Bylaws of the Company, or under any contract, instrument, agreement,
understanding, mortgage, indenture, lease, insurance policy, permit, concession,
grant, franchise, license, judgment, order, decree, statute, law, ordinance,
rule or regulation applicable to the Company.
7. Insurance.
(A) To the extent the Company maintains at any time an insurance
policy or policies providing directors' and officers' liability insurance,
Indemnitee 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
other Company director or officer under such insurance policy. The
purchase and maintenance of such insurance shall not in any way limit or
affect the rights and obligations of the parties hereto, and the execution
and delivery of this Agreement shall not in any way be construed to limit
or affect the rights and obligations of the Company or of the other parties
under any such insurance policy.
(B) In the event of payment to an Indemnified Party under this
Agreement, the Company shall be subrogated to the extent of such payment to
all of the rights of recovery with respect to such payment of the
Indemnified Party, who shall execute and deliver all instruments,
documents, and other papers and shall perform any and all acts or deeds
reasonably necessary or advisable to secure such rights.
8. Notice to the Company by Director. The Director agrees to, and each
other Indemnified Party shall, notify the Company promptly upon being served
with or having knowledge of any citation, summons, complaint, indictment or any
other similar document relating to any Action which is reasonably likely to
result in a claim of indemnification under this Agreement.
9. Continuation of Rights and Obligations. The terms and provisions of
this Agreement shall survive and continue as to the Director and the other
Indemnified Parties notwithstanding whether the Director ceases to be a director
of the Company or of an Affiliate.
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10. Amendment and Modification. This Agreement may be amended, modified
or supplemented only by the written agreement of the Director and the Company
(subject to approval by the Board of Directors).
11. Assignment. This Agreement shall not be assigned (including without
limitation by operation of law or merger) by the Company or the Director without
the prior written consent of the other party hereto, except that the Company may
assign its rights and obligations under this Agreement to any Affiliate for whom
the Director is serving as an executive thereof, provided, however, that no
permitted assignment shall release the assignor from its obligations hereunder.
Subject to the foregoing, this Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, including, without limitation, any successor
to the Company by way of merger, consolidation and/or disposition of all or
substantially all of the capital stock or assets of the Company.
12. Governing Law. All matters with respect to this Agreement, including,
without limitation, matters of validity, construction, effect and performance,
shall be governed by the internal laws of the State of Delaware applicable to
contracts made and to be performed therein between the residents thereof
(regardless of the laws that might otherwise be applicable under principles of
conflicts of law).
13. Headings. The headings used in this Agreement are for convenience and
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
14. Severability. Without limiting the provisions of Paragraph 2F hereof,
if any provision of this Agreement shall be deemed invalid, unenforceable or
inoperative, or if a court of competent jurisdiction determines that any of the
provisions of this Agreement contravene public policy, this Agreement shall be
construed so that the remaining provisions shall not be affected, but shall
remain in full force and effect, and any such provisions which are held to be
invalid, unenforceable or inoperative or which contravene public policy by such
court shall be deemed, without further action, to be modified, amended and/or
limited, but only to the extent necessary to render the same valid and
enforceable, and the Company shall thereafter indemnify the Indemnified Party
against reasonable expenses (including attorneys', accountants' and other
experts' fees, disbursements and expenses), judgments, fines and amounts
incurred in settlement with respect to any Action, no matter by whom brought, to
the full extent permitted by any applicable provisions of this Agreement that
shall not have been invalidated and to the full extent otherwise permitted by
the Delaware General Corporation Law as it may then be in effect.
15. Notices. All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been given
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when delivered by hand or two (2) business days after being mailed by a
recognized international private courier (by way of example, FedEx and UPS) or
by certified or registered mail, return receipt requested, with postage prepaid:
15.1. If to the Director, to:
Xxx X. Xxxxxx
Fenway Partners, Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
or to such other person or address as the Director shall furnish to the Company
in writing.
15.2. If to the Company, to:
Aurora Foods Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Chief Executive Officer
or to such other person or address as the Company shall furnish to the Director
in writing.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
DIRECTOR AURORA FOODS INC.
/s/ Xxx X. Xxxxxx /s/ Xxx Xxxxx
--------------------------- -----------------------------
XXX X. XXXXXX Name: Xxx Xxxxx
Title: Executive Vice President
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