INDEMNIFICATION AGREEMENT
Exhibit 10.7
AGREEMENT, effective as of June ___, 2010, between Fremont General Corporation, a Nevada
corporation to be renamed Signature Group Holdings, Inc. (the “Company”), and
(the “Indemnitee”).
WHEREAS, Indemnitee is a director and/or officer of the Company;
WHEREAS, the Bylaws of the Company require the Company to indemnify and advance expenses to
its directors and officers to the full extent permitted by law and the Indemnitee has agreed to
serve as a director and/or officer of the Company in part in reliance on such Bylaws;
WHEREAS, in recognition of Indemnitee’s reliance on the aforesaid Bylaws, and in part to
provide Indemnitee with specific contractual assurance that the protection promised by such Bylaws
will be available to Indemnitee (regardless of, among other things, any amendment to or revocation
of such Bylaws), the Company wishes to provide in this Agreement for the indemnification of and the
advancing of expenses to Indemnitee to the fullest extent (whether partial or complete) permitted
by law and as set forth in this Agreement, and, to the extent insurance is maintained, for the
continued coverage of Indemnitee under the Company’s directors’ and officers’ liability insurance
policies and fiduciary liability policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee’s service to the Company
directly or, at its request, another enterprise, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Certain Definitions.
(a) Claim: any threatened, pending or completed action, suit or proceeding, or any
inquiry or investigation, whether instituted by the Company or any other party, that Indemnitee in
good faith believes might lead to the institution of any such action, suit or proceeding, whether
civil, criminal, administrative, investigative or other.
(b) Expenses: include attorneys’ fees and all other costs, expenses and obligations
paid or incurred in connection with investigating, defending, being a witness in or participating
in (including on appeal), or preparing to defend, be a witness in or participate in, any Claim
relating to any Indemnifiable Event.
(c) Indemnifiable Event: any event or occurrence related to the fact that Indemnitee
is or was a director, officer, employee, agent or fiduciary of the Company, or any Subsidiary
thereof, or is or was serving at the request of the Company as a director, officer, employee,
trustee, agent or fiduciary of another corporation, partnership, joint venture, employee benefit
plan, trust or other enterprise, or by reason of anything done or not done by Indemnitee in any
such capacity.
(d) Independent Legal Counsel: an attorney or firm of attorneys, selected in
accordance with the provisions of Section 3, who shall not have otherwise performed services for
the Company or
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Indemnitee within the last five years (other than with respect to matters concerning the
rights of Indemnitee under this Agreement, or of other indemnitees under similar indemnity
agreements).
2. Basic Indemnification Arrangement.
(a) In the event Indemnitee was, is or becomes a party to or witness or other participant in,
or is threatened to be made a party to or witness or other participant in, a Claim by reason of (or
arising in part out of) an Indemnifiable Event, the Company shall indemnify Indemnitee to the
fullest extent permitted by law as soon as practicable but in any event no later than thirty days
after written demand is presented to the Company, against any and all Expenses, judgments, fines,
penalties and amounts paid in settlement (including all interest, assessments and other charges
paid or payable in connection with or in respect of such Expenses, judgments, fines, penalties or
amounts paid in settlement) of such Claim. If so requested by Indemnitee, the Company shall advance
(within two business days of such request) any and all Expenses to Indemnitee (an “Expense
Advance”).
(b) Notwithstanding the foregoing, (i) the obligations of the Company under Section 2(a) shall
be subject to the condition that Independent Legal Counsel shall not have determined, in a written
opinion, that Indemnitee would not be permitted to be indemnified under applicable law, and (ii)
the obligation of the Company to make an Expense Advance pursuant to Section 2(a) shall be subject
to the condition that, if, when and to the extent that Independent Legal Counsel determines that
Indemnitee would not be permitted to be so indemnified under applicable law, the Company shall be
entitled to be reimbursed by Indemnitee (who hereby agrees to reimburse the Company) for all such
amounts theretofore paid; provided, however, that if Indemnitee has commenced or thereafter
commences legal proceedings in a court of competent jurisdiction to secure a determination that
Indemnitee should be indemnified under applicable law, any determination made by Independent Legal
Counsel that Indemnitee would not be permitted to be indemnified under applicable law shall not be
binding and Indemnitee shall not be required to reimburse the Company for any Expense Advance until
a final judicial determination is made with respect thereto (as to which all rights of appeal
therefrom have been exhausted or lapsed). If there has been no determination by Independent Legal
Counsel or if Independent Legal Counsel determines that Indemnitee substantively would not be
permitted to be indemnified in whole or in part under applicable law, Indemnitee shall have the
right to commence litigation in any court in the States of California or Nevada having subject
matter jurisdiction thereof and in which venue is proper seeking an initial determination by the
court or challenging any such determination by Independent Legal Counsel or any aspect thereof,
including the legal or factual bases therefor, and the Company hereby consents to service of
process and to appear in any such proceeding. Any determination by Independent Legal Counsel
otherwise shall be conclusive and binding on the Company and Indemnitee.
(c) Notwithstanding anything in this Agreement to the contrary, Indemnitee shall not be
entitled to indemnification pursuant to this Agreement in connection with any Claim initiated by
Indemnitee unless the Board of Directors has authorized or consented to the initiation of such
Claim.
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3. Independent Legal Counsel. With respect to all matters hereafter arising concerning
the rights of Indemnitee to indemnity payments and Expense Advances under this Agreement or any
other agreement or Company By-law now or hereafter in effect relating to Claims for Indemnifiable
Events, the Company shall seek legal advice only from Independent Legal Counsel selected by
Indemnitee and approved by the Company. Such counsel, among other things, shall render its written
opinion to the Company and Indemnitee as to whether and to what extent Indemnitee would be
permitted to be indemnified under applicable law. The Company agrees to pay the reasonable fees of
the Independent Legal Counsel referred to above and to indemnify fully 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.
4. Indemnification for Additional Expenses. The Company shall indemnify Indemnitee
against any and all expenses (including attorneys’ fees) and, if requested by Indemnitee, shall
(within two business days of such request) advance such expenses to Indemnitee, which are incurred
by Indemnitee in connection with any action brought by Indemnitee for (i) indemnification or
advance payment of Expenses by the Company under this Agreement or any other agreement or Company
By-law now or hereafter in effect relating to Claims for Indemnifiable Events and/or (ii) recovery
under any directors’ and officers’ liability insurance policies maintained by the Company,
regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification,
advance expense payment or insurance recovery, as the case may be.
5. Partial Indemnity, Etc. If Indemnitee is entitled under any provision of this
Agreement to indemnification by the Company for some or a portion of the Expenses, judgments,
fines, penalties and amounts paid in settlement of a Claim but not, however, for all of the total
amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to
which Indemnitee is entitled. Moreover, notwithstanding any other provision of this Agreement, to
the extent that Indemnitee 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 dismissal without prejudice, Indemnitee shall be indemnified against all
Expenses incurred in connection therewith.
6. Burden of Proof. In connection with any determination by Independent Legal Counsel
or otherwise as to whether Indemnitee is entitled to be indemnified hereunder the burden of proof
shall be on the Company to establish that Indemnitee is not so entitled.
7. No Presumptions. For purposes of this Agreement, the termination of any action,
suit or proceeding, 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 Indemnitee 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 Independent Legal Counsel to have made a determination as to whether
Indemnitee has met any particular standard of conduct or had any particular belief, nor an actual
determination by Independent Legal Counsel that Indemnitee has not met such standard of conduct or
did not have such belief, prior to the commencement of legal proceedings by
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Indemnitee to secure a judicial determination that Indemnitee should be indemnified under
applicable law shall be a defense to Indemnitee’s claim or create a presumption that Indemnitee has
not met any particular standard of conduct or did not have any particular belief.
8. Nonexclusivity, Etc. The rights of the Indemnitee hereunder shall be in addition to
any other rights Indemnitee may have under the Company’s Bylaws or the Nevada General Corporation
Law or otherwise. To the extent that a change in the Nevada General Corporation Law (whether by
statute or judicial decision) permits greater indemnification by agreement than would be afforded
currently under the Company’s Bylaws and this Agreement, it is the intent of the parties hereto
that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change.
9. Liability Insurance. To the extent the Company maintains an insurance policy or
policies providing directors’ and officers’ liability insurance and fiduciary 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 Company director or officer.
10. Period of Limitations. No legal action shall be brought and no cause of action
shall be asserted by or in the right of the Company against Indemnitee, Indemnitee’s spouse, heirs,
executors or personal or legal representatives after the expiration of two years from the date of
accrual of such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal action within such
two-year period; provided, however, that if any shorter period of limitations is otherwise
applicable to any such cause of action such shorter period shall govern.
11. Supplements, Modifications or Amendments. 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.
12. 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 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.
13. No Duplication of Payments. The Company shall not be liable under this Agreement
to make any payment in connection with any Claim made against Indemnitee to the extent Indemnitee
has otherwise actually received payment (under any insurance policy, By-law or otherwise) of the
amounts otherwise indemnifiable hereunder.
14. Binding Effect, Etc. This Agreement shall be binding upon and inure to the benefit
of and be enforceable by the parties hereto and their respective successors, assigns, including any
direct or indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company, spouses, heirs, executors and
personal and legal
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representatives. This Agreement shall continue in effect regardless of whether Indemnitee
continues to serve as an officer or director of the Company or of any other enterprise at the
Company’s request.
15. Severability. The provisions of this Agreement shall be severable in the event
that any of the provisions hereof (including any provision within a single section, paragraph or
sentence) are held by a court of competent jurisdiction to be invalid, void or otherwise
unenforceable in any respect, and the validity and enforceability of any such provision in every
other respect and of the remaining provisions hereof shall not be in any way impaired and shall
remain enforceable to the fullest extent permitted by law.
16. Governing Law. This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Nevada applicable to contracts made and to be performed in
such state without giving effect to the principles of conflicts of laws.
[Signature Page Follows]
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IN
WITNESS WHEREOF, the parties hereto have executed this
Indemnification Agreement this
day of June 2010.
| COMPANY: | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| INDEMNITEE: | ||||
| Name: | ||||
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