INDEMNIFICATION AGREEMENT
Exhibit
10.36
INDEMNIFICATION
AGREEMENT (this “Agreement”), made and executed as of _________________, by and
between Rosetta Resources Inc., a Delaware corporation (the ”Company”), and
__________________________, an individual resident of the State of Texas
(the “Indemnitee”).
WHEREAS,
the Company is aware that, in order to induce highly competent persons to serve
the Company as directors or officers or in other capacities, the Company must
provide such persons with adequate protection through insurance and
indemnification against inordinate risks of claims and actions against them
arising out of their service to and activities on behalf of the
Company;
WHEREAS,
the Company recognizes that the increasing difficulty in obtaining directors'
and officers' liability insurance, the increasing cost of such insurance and the
general reductions in coverage of such insurance have made attracting and
retaining such persons more difficult;
WHEREAS,
the Company recognizes the substantial increase in corporate litigation in
general, subjecting directors and officers to expensive litigation risks at the
same time as the availability and coverage of liability insurance has been
severely limited;
WHEREAS,
the Board of Directors of the Company has determined that it is in the best
interests of the Company's stockholders that the Company act to assure such
persons that there will be increased certainty of such protection in the
future;
WHEREAS,
it is reasonable, prudent and necessary for the Company to contractually
obligate itself to indemnify such persons to the fullest extent permitted by
applicable law so that they will continue to serve the Company free from undue
concern that they will not be so indemnified; and
WHEREAS,
the Indemnitee is willing to serve, continue to serve and take on additional
service for or on behalf of the Company or any of its direct or indirect
wholly-owned subsidiaries on the condition that he/she be so
indemnified.
NOW,
THEREFORE, in consideration of the premises and the mutual promises and
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Indemnitee do hereby agree as follows:
1. DEFINITIONS. For
purposes of this Agreement:
(a) “Change
in Control” shall mean:
(i)
a “change in control” of the Company
of a nature that would be required to be reported in response to Item 6(e) of
Schedule 14A for a proxy statement filed under Section 14(a) of the Securities
Exchange Act of 1934, as amended (the “Act”), as in effect on the date of this
Agreement;
(ii) a
“person” (as that term is used in 14(d)(2) of the Act) becomes the beneficial
owner (as defined in Rule 13d-3 under the Act) directly or indirectly of
securities representing 30% or more of the combined voting power for election of
directors of the then outstanding securities of the Company;
(iii) the
individuals who at the beginning of any period of two consecutive years or less
(starting on or after the date of this Agreement) constitute the Company's Board
of Directors cease for any reason during such period to constitute at least a
majority of the Company's Board of Directors, unless the election or nomination
for election of each new member of the Board of Directors was approved in
advance by vote of a majority of the members of such Board of Directors then
still in office who were members of such Board of Directors at the beginning of
such period;
(iv) the
stockholders of the Company approve any reorganization, merger, consolidation or
share exchange as a result of which the common stock of the Company shall be
changed, converted or exchanged into or for securities of another organization
or any dissolution or liquidation of the Company or any sale or the disposition
of 50% or more of the assets or business of the Company; or
(v) the
stockholders of the Company approve any reorganization, merger, consolidation or
share exchange with another corporation unless (1) the persons who were the
beneficial owners of the outstanding shares of the common stock of the Company
immediately before the consummation of such transaction beneficially own more
than 60% of the outstanding shares of the common stock of the successor or
survivor corporation in such transaction immediately following the consummation
of such transaction and (2) the number of shares of the common stock of such
successor or survivor corporation beneficially owned by the persons described in
Section 1(a)(v)(1) immediately following the consummation of such transaction is
beneficially owned by each such person in substantially the same proportion that
each such person had beneficially owned shares of the Company common stock
immediately before the consummation of such transaction, provided (3) the
percentage described in Section 1(a)(v)(1) of the beneficially owned shares of
the successor or survivor corporation and the number described in Section
1(a)(v)(2) of the beneficially owned shares of the successor or survivor
corporation shall be determined exclusively by reference to the shares of the
successor or survivor corporation which result from the beneficial ownership of
shares of common stock of the Company by the persons described in Section
1(a)(v)(1) immediately before the consummation of such transaction.
(b) “Disinterested
Director” shall mean a director of the Company who is not or was not a party to
the action, suit, investigation or proceeding in respect of which
indemnification is being sought by the Indemnitee.
(c) “Expenses”
shall include all attorneys' fees, retainers, court costs, transcript costs,
fees of experts, witness fees, travel expenses, duplicating costs, printing and
binding costs, telephone charges, postage, delivery service fees, and all other
disbursements or expenses incurred in connection with prosecuting, defending,
preparing to prosecute or defend, investigating or being or preparing to be a
witness in any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative in nature.
(d) “Independent
Counsel” shall mean a law firm or a member of a law firm that neither is
presently nor in the past five years has been retained to represent (i) the
Company or the Indemnitee in any matter material to either such party or (ii)
any other party to the action, suit, investigation or proceeding giving rise to
a claim for indemnification hereunder. Notwithstanding the foregoing, the term
“Independent Counsel” shall not include any person who, under the applicable
standards of professional conduct then prevailing, would have a conflict of
interest in representing either the Company or the Indemnitee in an action to
determine the Indemnitee's right to indemnification under this
Agreement.
2. SERVICE
BY THE INDEMNITEE. The Indemnitee agrees to serve as a director or
officer of the Company and will discharge his/her duties and responsibilities to
the best of his/her ability so long as the Indemnitee is duly elected or
qualified in accordance with the provisions of the Certificate of Incorporation,
as amended (the “Certificate”), and the Bylaws, as amended (the “Bylaws”), of
the Company and the General Corporation Law of the State of Delaware, as amended
(the “DGCL”), or until his/her earlier death, retirement, resignation or
removal. The Indemnitee may at any time and for any reason resign from such
position (subject to any other obligation, whether contractual or imposed by
operation of law), in which event this Agreement shall continue in full force
and effect after such resignation. Nothing in this Agreement shall confer upon
the Indemnitee the right to continue in the employ of the Company or as a
director of the Company, or affect the right of the Company to terminate, in the
Company's sole discretion (with or without cause) and at any time, the
Indemnitee's employment or position as a director, in each case, subject to any
contractual rights of the Indemnitee created or existing otherwise than under
this Agreement.
3. INDEMNIFICATION. The
Company shall indemnify the Indemnitee and advance Expenses to the Indemnitee as
provided in this Agreement to the fullest extent permitted by the Certificate,
the Bylaws in effect as of the date hereof and the DGCL or other applicable law
in effect on the date hereof and to any greater extent that the DGCL or
applicable law may in the future from time to time permit. Without diminishing
the scope of the indemnification provided by this Section 3, the rights of
indemnification of the Indemnitee provided hereunder shall include, but shall
not be limited to, those rights hereinafter set forth, except that no
indemnification shall be paid to the Indemnitee:
(a) on
account of any action, suit or proceeding in which judgment is rendered against
the Indemnitee for disgorgement of profits made from the purchase or sale by the
Indemnitee of securities of the Company pursuant to the provisions of Section
16(b) of the Act or similar provisions of any federal, state or local statutory
law;
(b) on
account of conduct of the Indemnitee which is finally adjudged by a court of
competent jurisdiction to have been knowingly fraudulent or to constitute
willful misconduct;
(c) in
any circumstance where such indemnification is expressly prohibited by
applicable law;
(d) with
respect to liability for which payment is actually made to the Indemnitee under
a valid and collectible insurance policy or under a valid and enforceable
indemnity clause, Bylaw or agreement (other than this Agreement), except in
respect of any liability in excess of payment under such insurance, clause,
Bylaw or agreement;
(e) if
a final decision by a court having jurisdiction in the matter shall determine
that such indemnification is not lawful (and, in this respect, both the Company
and the Indemnitee have been advised that it is the position of the Securities
and Exchange Commission that indemnification for liabilities arising under the
federal securities laws is against public policy and is, therefore,
unenforceable, and that claims for indemnification should be submitted to the
appropriate court for adjudication); or
(f) in
connection with any action, suit or proceeding by the Indemnitee against the
Company or any of its direct or indirect wholly-owned subsidiaries or the
directors, officers, employees or other Indemnitees of the Company or any of its
direct or indirect wholly-owned subsidiaries, (i) unless such indemnification is
expressly required to be made by law, (ii) unless the action, suit or proceeding
was previously authorized by a majority of the Board of Directors of the
Company, (iii) unless such indemnification is provided by the Company, in its
sole discretion, pursuant to the powers vested in the Company under applicable
law or (iv) except as provided in Sections 12, 14 and 18 hereof.
4. ACTIONS
OR PROCEEDINGS OTHER THAN AN ACTION BY OR IN THE RIGHT OF THE
COMPANY. The Indemnitee shall be entitled to the indemnification
rights provided in this Section 4 if the Indemnitee was or is a party or is
threatened to be a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative in nature,
other than an action by or in the right of the Company, by reason of the fact
that the Indemnitee is or was a director, officer, employee, agent or fiduciary
of the Company, or any of its direct or indirect wholly-owned subsidiaries, or
is or was serving at the request of the Company, or any of its direct or
indirect wholly-owned subsidiaries, as a director, officer, employee, agent or
fiduciary of any other entity, including, but not limited to, another
corporation, partnership, limited liability company, employee benefit plan,
joint venture, trust or other enterprise, or by reason of any act or omission by
him/her in such capacity. Pursuant to this Section 4, the Indemnitee shall be
indemnified against all Expenses, judgments, penalties (including excise and
similar taxes), fines, liabilities and amounts paid in settlement which were
actually and reasonably incurred by the Indemnitee or on Indemnitee's behalf in
connection with such action, suit or proceeding (including, but not limited to,
the investigation, defense or appeal thereof), if the Indemnitee acted in good
faith and in a manner the Indemnitee 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 reasonable cause to believe his/her conduct was
unlawful.
5. ACTIONS
BY OR IN THE RIGHT OF THE COMPANY. The Indemnitee shall be entitled
to the indemnification rights provided in this Section 5 if the Indemnitee was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding brought 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, officer, employee, agent or fiduciary of the Company, or any
of its direct or indirect wholly-owned subsidiaries, or is or was serving at the
request of the Company, or any of its direct or indirect wholly-owned
subsidiaries, as a director, officer, employee, agent or fiduciary of another
entity, including, but not limited to, another corporation, partnership, limited
liability company, employee benefit plan, joint venture, trust or other
enterprise, or by reason of any act or omission by him/her in any such capacity.
Pursuant to this Section 5, the Indemnitee shall be indemnified against all
Expenses actually and reasonably incurred by him/her in connection with the
defense or settlement of such action, suit or proceeding (including, but not
limited to the investigation, defense or appeal thereof), if the Indemnitee
acted in good faith and in a manner the Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company; provided, however, that no
such indemnification shall be made in respect of any claim, issue or matter as
to which the Indemnitee 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, suit or proceeding 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 which such court shall deem
proper.
6. GOOD
FAITH DEFINITION. For purposes of this Agreement, the Indemnitee
shall be deemed to have acted in good faith and in a manner the Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any criminal action or proceeding, to have had no
reasonable cause to believe the Indemnitee's conduct was unlawful, if such
action was based on any of the following: (a) the records or books of the
account of the Company or other enterprise, including financial statements; (b)
information supplied to the Indemnitee by the officers of the Company or other
enterprise in the course of his/her duties; (c) the advice of legal counsel for
the Company or other enterprise; or (d) information or records given in reports
made to the Company or other enterprise by an independent certified public
accountant or by an appraiser or other expert selected with reasonable care by
the Company or other enterprise. The provisions of this Section 6
shall not be deemed to be exclusive or to limit in any way the other
circumstances in which Indemnitee may be deemed to have met the applicable
standard of conduct set forth in this Agreement.
7. INDEMNIFICATION
FOR EXPENSES OF SUCCESSFUL PARTY. Notwithstanding the other provisions of this
Agreement, to the extent that the Indemnitee has served on behalf of the
Company, or any of its direct or indirect wholly-owned subsidiaries, as a
witness or other participant in any class action or proceeding, or has been
successful, on the merits or otherwise, in defense of any action, suit or
proceeding referred to in Sections 4 and 5 hereof, or in defense of any claim,
issue or matter therein, including, but not limited to, the dismissal of any
action without prejudice, the Indemnitee shall be indemnified against all
Expenses actually and reasonably incurred by the Indemnitee in connection
therewith.
8. PARTIAL
INDEMNIFICATION. If the Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of the
Expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by the Indemnitee in connection with the investigation,
defense, appeal or settlement of such suit, action, investigation or proceeding
described in Sections 4 and 5 hereof, but is not entitled to indemnification for
the total amount thereof, the Company shall nevertheless indemnify the
Indemnitee for the portion of such Expenses, judgments, penalties, fines and
amounts paid in settlement actually and reasonably incurred by the Indemnitee to
which the Indemnitee is entitled. For purposes of this Section 8 and
without limitation, the termination of any claim, issue, or matter in such a
proceeding described herein (a) by dismissal, summary judgment, judgment on the
pleading, or final judgment, with or without prejudice, or (b) by agreement
without payment or assumption or admission of liability by Indemnitee, shall be
deemed to be a successful determination or result as to such claim, issue or
matter.
9. PROCEDURE
FOR DETERMINATION OF ENTITLEMENT TO INDEMNIFICATION.
(a) To
obtain indemnification under this Agreement, the Indemnitee shall submit to the
Company a written request, including documentation and information which is
reasonably available to the Indemnitee and is reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to
indemnification. The Secretary of the Company shall, promptly upon
receipt of a request for indemnification, advise the Board of Directors in
writing that the Indemnitee has requested indemnification. Any Expenses incurred
by the Indemnitee in connection with the Indemnitee's request for
indemnification hereunder shall be borne by the Company. The Company hereby
indemnifies and agrees to hold the Indemnitee harmless for any Expenses incurred
by the Indemnitee under the immediately preceding sentence irrespective of the
outcome of the determination of the Indemnitee's entitlement to
indemnification.
(b) Upon
written request by the Indemnitee for indemnification pursuant to Sections 4 and
5 hereof, the entitlement of the Indemnitee to indemnification pursuant to the
terms of this Agreement shall be determined by the following person or persons,
who shall be empowered to make such determination: (i) if a Change in Control
shall have occurred, by Independent Counsel (unless the Indemnitee shall request
in writing that such determination be made by the Board of Directors (or a
committee thereof) in the manner provided for in clause (b)(ii) of this Section
9) in a written opinion to the Board of Directors, a copy of which shall be
delivered to the Indemnitee; (ii) if a Change in Control shall not have
occurred, (A) by the Board of Directors of the Company, by a majority vote of a
quorum consisting of Disinterested Directors, or (B) if a quorum consisting of
Disinterested Directors is not obtainable, or if a majority vote of a quorum
consisting of Disinterested Directors so directs, by Independent Counsel in a
written opinion to the Board of Directors, a copy of which shall be delivered to
the Indemnitee. The Independent Counsel shall be selected by the Board of
Directors and approved by the Indemnitee. Upon failure of the Board of Directors
to so select, or upon failure of the Indemnitee to so approve, the Independent
Counsel shall be selected by the Chancellor of the State of Delaware or such
other person as the Chancellor shall designate to make such selection. Such
determination of entitlement to indemnification shall be made not later than 45
days after receipt by the Company of a written request for
indemnification. If the person making such determination shall
determine that the Indemnitee is entitled to indemnification as to part (but not
all) of the application for indemnification, such person shall reasonably
prorate such part of indemnification among such claims, issues or matters. If it
is so determined that Indemnitee is entitled to indemnification, payment to
Indemnitee shall be made within 10 days after such determination.
(c) Indemnitee
shall be entitled to indemnification hereunder without a separate determination
by or on behalf of the Company, with respect to any proceeding and/or any claim,
issue, or matter with respect thereto: (i) which is resolved by agreement
without any payment or assumption or admission of liability by Indemnitee; or
(ii) as to which a final decision on the merits has been made by the court or
other body with jurisdiction over that proceeding, in which Indemnitee was not
determined to be liable with respect to such claim, issue, or matter asserted
against Indemnitee in the proceeding, or (iii) as to which a court or arbitrator
determines upon application that, despite such a determination of liability on
the part of Indemnitee, but in view of all the circumstances of the proceeding
and of Indemnitee’s conduct with respect thereto, Indemnitee is fairly and
reasonably entitled to indemnification for such judgments, penalties, fines,
amounts paid in settlement, and Expenses as such court or arbitrator shall deem
proper; provided, however, such decision shall have been rendered in or with
respect to the proceeding for which Indemnitee seeks indemnification under this
Agreement.
10. PRESUMPTIONS
AND EFFECT OF CERTAIN PROCEEDINGS.
(a) In
making a determination with respect to entitlement to indemnification, the
Indemnitee shall be presumed to be entitled to indemnification hereunder and the
Company shall have the burden of proof in the making of any determination
contrary to such presumption. Neither the failure of the Board of
Directors (or such other person or persons empowered to make the determination
of whether the Indemnitee is entitled to indemnification) to have made a
determination prior to the commencement of any action pursuant to this Agreement
that indemnification is proper in the circumstances because Indemnitee has met
the applicable standard of conduct, nor any determination thereby that
Indemnitee has not met such applicable standard of conduct, shall be a defense
or admissible as evidence in any action for any purpose or create a presumption
that Indemnitee has not acted in good faith or met any other applicable standard
of conduct.
(b) If
the Board of Directors, or such other person or persons empowered pursuant to
Section 9 to make the determination of whether the Indemnitee is entitled to
indemnification, shall have failed to make a determination as to entitlement to
indemnification within 45 days after receipt by the Company of such request, the
requisite determination of entitlement to indemnification shall be deemed to
have been made and the Indemnitee shall be absolutely entitled to such
indemnification, absent actual and material fraud in the request for
indemnification or a prohibition of indemnification under applicable
law. The termination of any action, suit, investigation or proceeding
described in Sections 4 or 5 hereof by judgment, order, settlement or
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself: (i) create a presumption that the Indemnitee did not act in good faith
and in a manner which he/she reasonably believed to be in or not opposed to the
best interests of the Company, or, with respect to any criminal action or
proceeding, that the Indemnitee has reasonable cause to believe that the
Indemnitee's conduct was unlawful; or (ii) otherwise adversely affect the rights
of the Indemnitee to indemnification, except as may be provided
herein.
11. ADVANCEMENT
OF EXPENSES. Subject to applicable law, all reasonable Expenses
actually incurred by the Indemnitee in connection with any threatened or pending
action, suit or proceeding shall be paid by the Company in advance of the final
disposition of such action, suit or proceeding, if so requested by the
Indemnitee, within 20 days after the receipt by the Company of a statement or
statements from the Indemnitee requesting such advance or advances. The
Indemnitee may submit such statements from time to time. The Indemnitee's
entitlement to such Expenses shall include those incurred in connection with any
proceeding by the Indemnitee seeking an adjudication or award in arbitration
pursuant to this Agreement. Such statement or statements shall reasonably
evidence the Expenses incurred by the Indemnitee in connection therewith and
shall include or be accompanied by a written affirmation by the Indemnitee of
the Indemnitee's good faith belief that the Indemnitee has met the standard of
conduct necessary for indemnification under this Agreement and an undertaking by
or on behalf of the Indemnitee to repay such amount if it is ultimately
determined that the Indemnitee is not entitled to be indemnified against such
Expenses by the Company pursuant to this Agreement or otherwise. Each written
undertaking to pay amounts advanced must be an unlimited general obligation but
need not be secured, and shall be accepted without reference to financial
ability to make repayment.
12. REMEDIES
OF THE INDEMNITEE IN CASES OF DETERMINATION NOT TO INDEMNIFY OR TO ADVANCE
EXPENSES. In the event that a determination is made that the
Indemnitee is not entitled to indemnification hereunder or if the payment has
not been timely made following a determination of entitlement to indemnification
pursuant to Sections 9 and 10, or if Expenses are not advanced pursuant to
Section 11, the Indemnitee shall be entitled to a final adjudication in an
appropriate court of the State of Delaware or any other court of competent
jurisdiction of the Indemnitee's entitlement to such indemnification or
advance. Alternatively, the Indemnitee may, at the Indemnitee's
option, seek an award in arbitration to be conducted by a single arbitrator
chosen by the Indemnitee and approved by the Company, which approval shall not
be unreasonably withheld or delayed. If the Indemnitee and the Company do not
agree upon an arbitrator within 30 days following notice to the Company by the
Indemnitee that it seeks an award in arbitration, the arbitrator will be chosen
pursuant to the rules of the American Arbitration Association (the “AAA”). The
arbitration will be conducted pursuant to the rules of the AAA and an award
shall be made within 60 days following the filing of the demand for arbitration.
The arbitration shall be held in Houston, Texas. The Company shall
not oppose the Indemnitee's right to seek any such adjudication or award in
arbitration or any other claim. Such judicial proceeding or arbitration shall be
made de novo, and the Indemnitee shall not be prejudiced by reason of a
determination (if so made) that the Indemnitee is not entitled to
indemnification. If a determination is made or deemed to have been made pursuant
to the terms of Section 9 or Section 10 hereof that the Indemnitee is entitled
to indemnification, the Company shall be bound by such determination and shall
be precluded from asserting that such determination has not been made or that
the procedure by which such determination was made is not valid, binding and
enforceable. The Company further agrees to stipulate in any such court or before
any such arbitrator that the Company is bound by all the provisions of this
Agreement and is precluded from making any assertions to the contrary. If the
court or arbitrator shall determine that the Indemnitee is entitled to any
indemnification hereunder, the Company shall pay all reasonable Expenses
actually incurred by the Indemnitee in connection with such adjudication or
award in arbitration (including, but not limited to, any appellate
proceedings).
13. NOTIFICATION
AND DEFENSE OF CLAIM. Promptly after receipt by the Indemnitee of
notice of the commencement of any action, suit or proceeding, the Indemnitee
will, if a claim in respect thereof is to be made against the Company under this
Agreement, notify the Company in writing of the commencement thereof. The
omission by the Indemnitee to so notify the Company will not relieve the Company
from any liability that it may have to the Indemnitee under this Agreement or
otherwise, except to the extent that the Company may suffer material prejudice
by reason of such failure. Notwithstanding any other provision of this
Agreement, with respect to any such action, suit or proceeding as to which the
Indemnitee gives notice to the Company of the commencement thereof:
(a) The
Company will be entitled to participate therein at its own expense.
(b) Except
as otherwise provided in this Section 13(b), to the extent that it may wish, the
Company, jointly with any other indemnifying party similarly notified, shall be
entitled to assume the defense thereof with counsel reasonably satisfactory to
the Indemnitee. After notice from the Company to the Indemnitee of its election
to so assume the defense thereof, Company shall not be liable to the Indemnitee
under this Agreement for any legal or other Expenses subsequently incurred by
the Indemnitee in connection with the defense thereof other than reasonable
costs of investigation or as otherwise provided below. The Indemnitee shall have
the right to employ the Indemnitee's own counsel in such action, suit or
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
the Indemnitee unless (i) the employment of counsel by the Indemnitee has been
authorized by the Company, (ii) the Indemnitee shall have reasonably concluded
that there may be a conflict of interest between the Company and the Indemnitee
in the conduct of the defense of such action and such determination by the
Indemnitee shall be supported by an opinion of counsel, which opinion shall be
reasonably acceptable to the Company, or (iii) the Company shall not in fact
have employed counsel to assume the defense of the action, 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 action, suit or
proceeding brought by or on behalf of the Company or as to which the Indemnitee
shall have reached the conclusion provided for in clause (ii)
above.
(c) The
Company shall not be liable to indemnify the Indemnitee under this Agreement for
any amounts paid in settlement of any action, suit or proceeding affected
without its written consent, which consent shall not be unreasonably withheld.
The Company shall not be required to obtain the consent of the Indemnitee to
settle any action, suit or proceeding which the Company has undertaken to defend
if the Company assumes full and sole responsibility for such settlement and such
settlement grants the Indemnitee a complete and unqualified release in respect
of any potential liability. The Company shall have no obligation to
indemnify Indemnitee under this Agreement with regard to any judicial award
issued in a proceeding, or any related Expenses of Indemnitee, if the Company
was not given a reasonable and timely opportunity, at its expense, to
participate in the defense of such proceeding, except to the extent the Company
was not materially prejudiced thereby.
(d) If,
at the time of the receipt of a notice of a claim pursuant to this Section 13,
the Company has director and officer liability insurance in effect, the Company
shall give prompt notice of the commencement of such proceeding to the insurers
in accordance with the procedures set forth in the respective
policies.
The
Company shall thereafter take all necessary or desirable action to cause such
insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of
such proceeding in accordance with the terms of the policies.
14. OTHER
RIGHT TO INDEMNIFICATION. The indemnification and advancement of
Expenses provided by this Agreement are cumulative, and not exclusive, and are
in addition to any other rights to which the Indemnitee may now or in the future
be entitled under any provision of the Bylaws or Certificate of the Company, the
Certificate or Bylaws or other governing documents of any direct or indirect
wholly-owned subsidiary of the Company, any vote of the stockholders or
Disinterested Directors, any provision of law or otherwise. Except as required
by applicable law, the Company shall not adopt any amendment to its Bylaws or
Certificate the effect of which would be to deny, diminish or encumber the
Indemnitee's right to indemnification under this Agreement.
15. DIRECTOR
AND OFFICER LIABILITY INSURANCE. The Company shall, from time to
time, make the good faith determination whether or not it is practicable for the
Company to obtain and maintain a policy or policies of insurance with reputable
insurance companies providing the officers and directors of the Company, and any
direct or indirect wholly-owned subsidiary of the Company, with coverage for
losses from wrongful acts, or to ensure the Company's performance of its
indemnification obligations under this Agreement. Among other considerations,
the Company will weigh the costs of obtaining such insurance coverage against
the protection afforded by such coverage. Notwithstanding the foregoing, the
Company shall have no obligation to obtain or maintain such insurance if the
Company determines in good faith that such insurance is not necessary or is not
reasonably available, if the premium costs for such insurance are
disproportionate to the amount of coverage provided, if the coverage provided by
such insurance is limited by exclusions so as to provide an insufficient benefit
or if the Indemnitee is covered by similar insurance maintained by a direct or
indirect wholly-owned subsidiary of the Company. However, the
Company's decision whether or not to adopt and maintain such insurance shall not
affect in any way its obligations to indemnify its officers and directors under
this Agreement or otherwise. In all policies of director and officer liability
insurance, the Indemnitee shall be named as an insured in such a manner as to
provide the Indemnitee the same rights and benefits as are accorded to the most
favorably insured of the Company's directors, if the Indemnitee is a director;
or of the Company's officers, if the Indemnitee is not a director of the
Company, but is an officer. The Company agrees that the provisions of this
Agreement shall remain in effect regardless of whether liability or other
insurance coverage is at any time obtained or retained by the Company; except
that any payments made to, or on behalf of, the Indemnitee under an insurance
policy shall reduce the obligations of the Company hereunder.
16. SPOUSAL
INDEMNIFICATION. The Company will indemnify the Indemnitee's spouse
to whom the Indemnitee is legally married at any time the Indemnitee is covered
under the indemnification provided in this Agreement (even if the Indemnitee did
not remain married to him or her during the entire period of coverage) against
any pending or threatened action, suit, proceeding or investigation for the same
period, to the same extent and subject to the same standards, limitations,
obligations and conditions under which the Indemnitee is provided
indemnification herein, if the Indemnitee's spouse (or former spouse) becomes
involved in a pending or threatened action, suit, proceeding or investigation
solely by reason of his or her status as the Indemnitee's spouse, including,
without limitation, any pending or threatened action, suit, proceeding or
investigation that seeks damages recoverable from marital community property,
jointly-owned property or property purported to have been transferred from the
Indemnitee to his/her spouse (or former spouse). The Indemnitee's spouse or
former spouse also may be entitled to advancement of Expenses to the same extent
that the Indemnitee is entitled to advancement of Expenses herein. The Company
may maintain insurance to cover its obligation hereunder with respect to the
Indemnitee's spouse (or former spouse) or set aside assets in a trust or escrow
funds for that purpose.
17. INTENT. This
Agreement is intended to be broader than any statutory indemnification rights
applicable in the State of Delaware and shall be in addition to any other rights
the Indemnitee may have under the Company's Certificate, Bylaws, applicable law
or otherwise. To the extent that a change in applicable law (whether by statute
or judicial decision) permits greater indemnification by agreement than would be
afforded currently under the Company's Certificate, Bylaws, applicable law or
this Agreement, it is the intent of the parties that the Indemnitee enjoy by
this Agreement the greater benefits so afforded by such change.
18. ATTORNEY'S
FEES AND OTHER EXPENSES TO ENFORCE AGREEMENT. In the event that the
Indemnitee is subject to or intervenes in any proceeding in which the validity
or enforceability of this Agreement is at issue or seeks an adjudication or
award in arbitration to enforce the Indemnitee's rights under, or to recover
damages for breach of, this Agreement the Indemnitee, if he/she prevails in
whole or in part in such action, shall be entitled to recover from the Company
and shall be indemnified by the Company against any actual expenses for
attorneys' fees and disbursements reasonably incurred by the
Indemnitee.
19. 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 documents required and shall do all acts that may be
necessary to secure such rights and to enable the Company effectively to bring
suit to enforce such rights.
20.
EFFECTIVE DATE. The provisions of this
Agreement shall cover claims, actions, suits or proceedings whether now pending
or hereafter commenced and shall be retroactive to cover acts or omissions or
alleged acts or omissions which heretofore have taken place. The Company shall
be liable under this Agreement, pursuant to Sections 4 and 5 hereof, for all
acts of the Indemnitee while serving as a director and/or officer,
notwithstanding the termination of the Indemnitee's service, if such act was
performed or omitted to be performed during the term of the Indemnitee's service
to the Company.
21. GROSS
UP FOR TAXES. In the event any payment of indemnity to an Indemnitee
under this Agreement shall be deemed to be income for federal, state or local
income tax purposes, then the Company shall pay to the Indemnitee, in addition
to any amount for indemnification provided for herein, an amount equal to the
amount of taxes for which such Indemnitee shall become liable (without offset
for any deductions which such Indemnitee may have not related to the
indemnification amount), promptly upon receipt from such Indemnitee of a copy of
such Indemnitee’s tax return, which shall be maintained in strictest confidence
by the Company.
22. DURATION
OF AGREEMENT. This Agreement shall continue until and terminate upon
the later of: (a) ten years after the Indemnitee has ceased to occupy any of the
positions or have any relationships described in Sections 4 and 5 of this
Agreement and (b) the final termination of all pending or threatened actions,
suits, proceedings or investigations to which the Indemnitee may be subject by
reason of the fact that he/she is or was a director, officer, employee, agent or
fiduciary of the Company, or any direct or indirect wholly-owned subsidiary of
the Company, or is or was serving at the request of the Company as a director,
officer, employee, agent or fiduciary of any other entity, including, but not
limited to, another corporation, partnership, limited liability company,
employee benefit plan, joint venture, trust or other enterprise, or by reason of
any act or omission by the Indemnitee in any such capacity. The indemnification
provided under this Agreement shall continue as to the Indemnitee even though
he/she may have ceased to be a director or officer of the Company, or any direct
or indirect wholly-owned subsidiary of the Company. This Agreement shall be
binding upon the Company and its successors and assigns, including, without
limitation, any corporation or other entity which may have acquired all or
substantially all of the Company's assets or business or into which the Company
may be consolidated or merged, and shall inure to the benefit of the Indemnitee
and his/her spouse, successors, assigns, heirs, devisees, executors,
administrators or other legal representations. The Company shall require any
successor or assignee (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company, by written agreement in form and substance reasonably
satisfactory to the Company and the Indemnitee, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform if no such succession or assignment had
taken place. No legal action shall be brought and no claim or cause
of action shall be asserted by or on behalf of the Company against Indemnitee or
any Indemnified Party based upon or arising out of a right of the Company or any
obligation of Indemnitee under this Agreement, after the later of one (1) year
following (i) the date of termination of Indemnitee’s service to the Company as
a director or officer, or (ii) with respect to a particular proceeding in
connection with which Indemnitee requests indemnification or advancement of
Expenses hereunder, the final termination of such proceeding, and any such claim
or cause of action of the Company shall be extinguished and deemed released
unless asserted by filing a legal action within such time.
23. DISCLOSURE
OF PAYMENTS. Except as expressly required by any federal securities
laws or other federal or state law, neither party hereto shall disclose any
payments under this Agreement unless prior approval of the other party is
obtained.
24. CONTRIBUTION. To
the fullest extent permissible under applicable law, if the indemnification
provided for in this Agreement is unavailable to Indemnitee for any reason
whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to
the amount incurred by Indemnitee, whether for judgments, fines, penalties,
excise taxes, amounts paid or to be paid in settlement, and/or for Expenses, in
connection with any claim relating to an indemnifiable event under this
Agreement, in such proportion as is deemed fair and reasonable in light of all
of the circumstances of such proceeding in order to reflect (i) the relative
benefits received by the Company and Indemnitee as a result of the event(s)
and/or transaction(s) giving rise to such proceeding, and/or (ii) the relative
fault of the Company (and its directors, officers, employees, and agents) and
Indemnitee in connection with such event(s) and/or transaction(s).
25. SEVERABILITY. If
any provision or provisions of this Agreement shall be held invalid, illegal or
unenforceable for any reason whatsoever, (a) the validity, legality and
enforceability of the remaining provisions of this Agreement (including, but not
limited to, all portions of any sections of this Agreement containing any such
provision held to be invalid, illegal or unenforceable) shall not in any way be
affected or impaired thereby and (b) to the fullest extent possible, the
provisions of this Agreement (including, but not limited to, all portions of any
paragraph of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that are not themselves invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent manifest by
the provision held invalid, illegal or unenforceable.
26. COUNTERPARTS. This
Agreement may be executed by one or more counterparts, each of which shall for
all purposes be deemed to be an original but all of which together shall
constitute one and the same agreement. Only one such counterpart signed by the
party against whom enforceability is sought shall be required to be produced to
evidence the existence of this Agreement.
27. CAPTIONS. The
captions and headings used in this Agreement are inserted for convenience only
and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.
28. ENTIRE
AGREEMENT, MODIFICATION AND WAIVER. This Agreement constitutes the
entire agreement and understanding of the parties hereto regarding the subject
matter hereof, and no supplement, modification or amendment of this Agreement
shall be binding unless executed in writing by both 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. No supplement, modification or amendment
to this Agreement shall limit or restrict any right of the Indemnitee under this
Agreement in respect of any act or omission of the Indemnitee prior to the
effective date of such supplement, modification or amendment unless expressly
provided therein.
29. NOTICES. All
notices, requests, demands or other communications hereunder shall be in writing
and shall be deemed to have been duly given if (a) delivered by hand with
receipt acknowledged by the party to whom said notice or other communication
shall have been directed, (b) mailed by certified or registered mail, return
receipt requested with postage prepaid, on the date shown on the return receipt
or (c) delivered by facsimile transmission on the date shown on the facsimile
machine report:
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(i)
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If
to the Indemnitee to:
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(ii)
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If
to the Company to:
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000
Xxxxx, Xxxxx 0000
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Xxxxxxx,
Xxxxx 00000
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Attention: Vice
President and General Counsel
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Facsimile:
(000)
000-0000
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or to
such other address as may be furnished to the Indemnitee by the Company or to
the Company by the Indemnitee, as the case may be.
30. GOVERNING
LAW. The parties hereto agree that this Agreement shall be governed
by, and construed and enforced in accordance with, the laws of the State of
Delaware, applied without giving effect to any conflicts of law
principles.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and
year first above written.
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THE
COMPANY
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By:
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Name:
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Title:
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INDEMNITEE
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By:
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