INDEMNIFICATION AGREEMENT
Exhibit 10.4
THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is made as of May 6, 2011 by and between
Oceaneering International, Inc., a Delaware corporation (the “Company”), and _____________________
(“Indemnitee”).
PRELIMINARY STATEMENT
Highly competent persons have become more reluctant to serve corporations as directors or in
other capacities unless they are provided with adequate protection through insurance or adequate
indemnification against inordinate risks of claims and actions against them arising out of their
service to and activities on behalf of corporations and other enterprises.
The Board of Directors of the Company (the “Board”) has determined that, in order to attract
and retain qualified individuals, the Company will attempt to maintain on an ongoing basis, at its
sole expense, liability insurance to protect persons serving the Company and its subsidiaries from
certain liabilities. Although the furnishing of that insurance has been a customary and widespread
practice among United States-based corporations and other enterprises, the Board believes that,
given current market conditions and trends, that insurance may be available to it in the future
only at higher premiums and with more exclusions. At the same time, directors, officers and other
persons in service to corporations or other enterprises increasingly are being subjected to
expensive and time-consuming litigation relating to, among other matters, matters that
traditionally would have been brought only against the corporation or enterprise itself. The
uncertainties relating to liability insurance and to indemnification have increased the difficulty
of attracting and retaining those persons, and the Board has determined that (1) this increased
difficulty is detrimental to the best interests of the Company’s stockholders and that the Company
should act to assure those persons that increased certainty of that protection will exist in the
future and (2) it is reasonable, prudent and necessary for the Company contractually to obligate
itself to indemnify those persons to the fullest extent applicable law permits so that they will
serve or continue to serve the Company free from undue concern that they will not be so
indemnified.
NOW THEREFORE, in consideration of the premises and the covenants herein, the parties to this
Agreement agree as follows:
Section 1. Services by Indemnitee. Indemnitee will serve, or continue to serve, as a
Functionary of the Company and, as mutually agreed by Indemnitee and the Company, as a Functionary
of one or more Related Enterprises. Indemnitee may at any time and for any reason resign from any
such service, subject to any other contractual obligation or any obligation applicable law imposes.
This Agreement is not and is not to be construed as an employment contract by the Company or any
other Related Enterprise with Indemnitee or as otherwise affecting Indemnitee’s status, if any, as
an employee of the Company or any Related Enterprise.
Section 2. Indemnification. (a) If and whenever:
(1) Indemnitee was or is, or is threatened to be made, a party to any Proceeding by
reason of:
(A) the fact that Indemnitee serves or served as (1) a Functionary of the
Company or, at the request of the Company, (2) a Functionary of a Related
Enterprise; or
(B) the actual or alleged service or conduct of Indemnitee in Indemnitee’s
capacity as that Functionary, including any act actually or allegedly done or not
done by Indemnitee;
and
(2) Indemnitee (A) engaged in the service or conduct at issue in that Proceeding in
good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the
best interests of the Company and, in the event that Proceeding was or is a criminal action
or proceeding involving Indemnitee’s conduct, (B) had no reasonable cause to believe that
that conduct was unlawful,
the Company will, or will cause another Company Entity to, indemnify Indemnitee against, and hold
Indemnitee harmless from and in respect of:
(1) in the case of each Claim in that Proceeding, other than a Company Claim, all
liabilities and losses, including the amounts of all judgments, penalties and fines,
including excise taxes, and amounts paid in settlement, Indemnitee has suffered or will
suffer, and all Expenses Indemnitee reasonably has incurred or will incur, as a result of or
in connection with that Claim; and
(2) in the case of each Company Claim in that Proceeding, all Expenses Indemnitee
reasonably has incurred or will incur as a result of or in connection with that Company
Claim; provided, however, that the Company will not have any obligation under this clause
(2) to, or to cause another Company Entity to, indemnify Indemnitee against, or hold
Indemnitee harmless from or in respect of, any Company Claim as to which Indemnitee was or
is adjudged to be liable to the Company or any Related Enterprise unless, and only to the
extent that, the Court of Chancery or the court in which that Company Claim was or is
brought determines on application that, despite the adjudication of liability, but in view
of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to
indemnity for such of those Expenses as the Court of Chancery or that other court shall deem
proper.
(b) If and whenever Indemnitee was or is, or is threatened to be made, a party to any
Proceeding of any type of which Section 2(a) refers and has been successful, on the merits or
otherwise, in defense of that Proceeding, or in defense of any Claim therein, the Company will, or
will cause another Company Entity to, indemnify Indemnitee against, and hold Indemnitee harmless
from and in respect of, all Expenses Indemnitee reasonably has incurred in connection therewith.
For purposes of this Section 2(b), the termination of any Claim in any Proceeding by dismissal,
with or without prejudice, will be deemed a successful result as to that Claim.
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(c) If and whenever Indemnitee was, or reasonably could have been expected to have been, or
is, or reasonably could be expected to be, by reason of the knowledge of facts Indemnitee actually
or allegedly has obtained in the course of his service as (1) a Functionary of the Company or, at
the request of the Company, (2) a Functionary of a Related Enterprise, a witness in or a deponent
in connection with any Proceeding to which Indemnitee was or is not a party, the Company will, or
will cause another Company Entity to, indemnify Indemnitee against, and hold Indemnitee harmless
from and in respect of, all Expenses Indemnitee reasonably has incurred or will incur in connection
therewith.
Section 3. Advancement of Expenses. (a) If and whenever Indemnitee is, or is threatened to
be made, a party to any proceeding that may give rise to a right of Indemnitee to indemnification
under Section 2(a), the Company will advance all Expenses reasonably incurred by or on behalf of
Indemnitee in connection with that Proceeding within 10 days after the Company receives a statement
or statements from Indemnitee requesting the advance or advances from time to time, whether prior
to or after final disposition of that Proceeding. Each such statement must reasonably evidence the
Expenses incurred by or on behalf of Indemnitee and include or be preceded or accompanied by an
undertaking by or on behalf of Indemnitee to repay any Expenses advanced if it ultimately is
determined that Indemnitee is not entitled to be indemnified by the Company under Section 2(a)
against those Expenses. The Company will accept any such undertaking without reference to the
financial ability of Indemnitee to make repayment. If the Company advances Expenses in connection
with any Claim as to which Indemnitee has requested or may request indemnification under Section
2(a) and a determination is made under Section 5(c) that Indemnitee is not entitled to that
indemnification, Indemnitee will not be required to reimburse the Company for those advances until
the 180th day following the date of that determination; provided, however, that if
Indemnitee timely commences and thereafter prosecutes in good faith a judicial proceeding or
arbitration under Section 7(a) or otherwise to obtain that indemnification, Indemnitee will not be
required to reimburse the Company for those Expenses until a determination in that proceeding or
arbitration that Indemnitee is not entitled to that indemnification has become final and
nonappealable.
(b) The Company may advance Expenses under Section 3(a) to Indemnitee or, at the Company’s
option, directly to the Person to which those Expenses are owed, and Indemnitee hereby consents to
any such direct payment, to Indemnitee’s legal counsel or any other Person.
Section 4. Notification and Defense of Claims. (a) If Indemnitee receives notice, otherwise
than from the Company, that Indemnitee is or will be made, or is threatened to be made, a party to
any Proceeding in respect of which Indemnitee intends to seek indemnification hereunder, Indemnitee
must promptly notify the Company in writing of the nature and, to Indemnitee’s knowledge, status of
that Proceeding. If this Section 4(a) requires Indemnitee to give such a notice, but Indemnitee
fails to do so, that failure will not relieve the Company from the obligations the Company may have
to indemnify Indemnitee under this Agreement, unless the Company can establish that the failure has
resulted in actual prejudice to the Company.
(b) Except as this Section 4(b) otherwise provides below, in the case of any Proceeding in
respect of which Indemnitee seeks indemnification hereunder:
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(1) the Company and any Related Enterprise that also may be obligated to indemnify
Indemnitee in respect of that Proceeding will be entitled to participate at its own expense
in that Proceeding;
(2) the Company or that Related Enterprise, or either of them, will be entitled to
assume the defense of all Claims, other than (A) Company Claims, if any, and (B) other
Claims, if any, as to which Indemnitee shall reasonably reach the conclusion clause (3) of
the next sentence describes, in that Proceeding against Indemnitee by prompt written notice
of that election to Indemnitee; and
(3) if clause (2) above entitles the Company or that Related Enterprise to assume the
defense of any of those Claims and it delivers to Indemnitee notice of that assumption under
clause (2), the Company will not be liable to Indemnitee hereunder for any fees or expenses
of legal counsel for Indemnitee which Indemnitee incurs after Indemnitee receives that
notice.
Indemnitee will have the right to employee Indemnitee’s own legal counsel in that Proceeding, but,
as clause (3) of the preceding sentence provides, will bear the fees and expenses of that counsel
unless:
(1) the Company has authorized Indemnitee in writing to retain that counsel;
(2) the Company shall not within a reasonable period of time actually have employed
counsel to assume the defense of those Claims; or
(3) Indemnitee shall have (A) reasonably concluded that a conflict of interest may
exist between Indemnitee and the Company as to the defense of one or more of those Claims
and (B) communicated that conclusion to the Company in writing.
(c) The Company will not be obligated hereunder to, or to cause another Company Entity to,
indemnify Indemnitee against or hold Indemnitee harmless from and in respect of any amounts paid,
or agreed to be paid, by Indemnitee in settlement of any Claim against Indemnitee which Indemnitee
effects without the Company’s prior written consent. The Company will not settle any Claim against
Indemnitee in any manner that would impose any penalty or limitation on Indemnitee without
Indemnitee’s prior written consent. Neither the Company nor Indemnitee will unreasonably delay or
withhold consent to any such settlement the other party proposes to effect.
Section 5. Procedure for Determination of Entitlement to Indemnification. (a) To obtain
indemnification under this Agreement, Indemnitee must submit to the Company a written request
therefor which specifies the Section or Sections under which Indemnitee is seeking indemnification
and which includes, or is accompanied by, such documentation and information as is reasonably
available to Indemnitee and is reasonably necessary to determine whether and to what extent
Indemnitee is entitled to that indemnification. Indemnitee may request indemnification hereunder
at any time and from time to time as Indemnitee deems appropriate in Indemnitee’s sole discretion.
In the case of any request for indemnification under Section 2(a) as to any Claim which is pending
or threatened at the time Indemnitee delivers that request to the Company and would not be resolved
with finality, whether by judgment, order, settlement or
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otherwise, on payment of the indemnification requested, the Company may defer the
determination under Section 5(c) of Indemnitee’s entitlement to that indemnification to a date that
is no later than 45 days after the effective date of that final resolution if the Board concludes
in good faith that an earlier determination would be materially prejudicial to the Company or a
Related Enterprise.
(b) On written request by Indemnitee under section 5(a) for indemnification under Section
2(a), the determination of Indemnitee’s entitlement to that indemnification will be made:
(1) if Indemnitee will be a director or officer of the Company at the time that
determination is made, under Section 5(c) in each case; or
(2) if Indemnitee will not be a director or officer of the Company at the time that
determination is made, under Section 5(c) in any case, if so requested in writing by
Indemnitee or so directed by the Board, or, in the absence of that request and direction, as
the Board shall duly authorize or direct.
(c) Each determination of Indemnitee’s entitlement to indemnification under Section 2(a) to
which this Section 5(c) applies will be made as follows:
(1) by a majority vote of the Disinterested Directors, even though less than a quorum;
or
(2) by a committee of Disinterested Directors a majority vote of the Disinterested
Directors may designate, even though less than a quorum; or
(3) if (A) there are no Disinterested Directors or (B) a majority vote of the
Disinterested Directors so directs, by an Independent Counsel in a written opinion to the
Board, a copy of which the Company will deliver to Indemnitee;
provided, however, that if Indemnitee has so requested in Indemnitee’s request for indemnification,
an Independent Counsel will make that determination in a written opinion to the Board, a copy of
which the Company will deliver to Indemnitee.
(d) If it is determined that Indemnitee is entitled to indemnification under Section 2(a), the
Company will, or will cause another Company Entity to, subject to the provisions of Section 5(f):
(1) within 10 days after that determination pay to Indemnitee all amounts (A)
theretofore incurred by or on behalf of Indemnitee in respect of which Indemnitee is
entitled to that indemnification by reason of that determination and (B) requested from the
Company in writing by Indemnitee; and
(2) thereafter on written request by Indemnitee, pay to Indemnitee within 10 days after
that request such additional amounts theretofore incurred by or on behalf of Indemnitee in
respect of which Indemnitee is entitled to that indemnification by reason of that
determination.
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Indemnitee will cooperate with the person, persons or entity making the determination under Section
5(c) with respect to Indemnitee’s entitlement to indemnification under Section 2(a), including
providing to such person, persons or entity, on reasonable advance request, any documentation or
information that is:
| (1) | not privileged or otherwise protected from disclosure; | ||
| (2) | reasonably available to Indemnitee; and | ||
| (3) | reasonably necessary to that determination. |
(e) If an independent Counsel is to make a determination under Section 5(c) of entitlement to
indemnification under Section 2(a), it will be selected as this Section 5(e) provides. If a Change
of Control has not occurred within the period of two years prior to the date of Indemnitee’s
written request for that indemnification, the Board will select the Independent Counsel. If a
Change of Control has occurred within that period, Indemnitee will select the Independent Counsel,
unless Indemnitee requests that the Board make the selection, in which event the Board will do so.
The party entitled initially to select the Independent Counsel must give written notice to the
other party which names the person or firm it has selected, whereupon the other party may, within
10 days after its receipt of that notice, deliver to the selecting party a written objection to the
selection; provided, however, that any such objection may be asserted only on the ground that the
person or firm selected is not an “Independent Counsel” as Section 14 defines that term, and the
objection must set forth with particularity the factual basis for that assertion. Absent a proper
and timely objection, the person or firm so selected will act as Independent Counsel under Section
5(c). If any such written objection is so made and substantiated, the person or firm so selected
may not serve as Independent Counsel unless and until the objection is withdrawn or a court of
competent jurisdiction has determined that the objection is without merit.
If the person or firm that will act as Independent Counsel has not been determined within 30
days after Indemnitee’s submission of the related request for indemnification, either the Company
or Indemnitee may petition the Court of Chancery for resolution of any objection that has been made
by the Company or Indemnitee to the other’s selection of Independent Counsel or for the appointment
as Independent Counsel of a person or firm selected by the Court of Chancery or by such other
person or firm as the Court of Chancery designates, and the person or firm with respect to whom all
objections are so resolved or the person or firm so appointed will act as Independent Counsel under
Section 5(c).
The Company will pay any and all reasonable fees and expenses the Independent Counsel incurs
in connection with acting under Section 5(c), and the Company will pay all reasonable fees and
expenses incident to the procedures this Section 5(e) sets forth, regardless of the manner in which
the Independent Counsel is selected or appointed.
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If Indemnitee becomes entitled to, and does, initiate any judicial proceeding or arbitration
under Section 7, the Company will terminate its engagement of the person or firm acting as
Independent Counsel, whereupon that person or firm will be, subject to the applicable standards of
professional conduct then prevailing, relieved of any further responsibility in the capacity of
Independent Counsel.
(f) The amount of any indemnification against Expenses to which Indemnitee becomes entitled
under any provision hereof, including Section 2(a), will be determined subject to the provisions of
this Section 5(f). Indemnitee will have the burden of showing that Indemnitee actually has
incurred the Expenses for which Indemnitee requests indemnification. If the Company or a Company
Entity has made any advance in respect of any Expense without objecting in writing to Indemnitee at
the time of the advance to the reasonableness thereof, the incurrence of that Expense by Indemnitee
will be deemed for all purposes hereof to have been reasonable. In the case of any Expense as to
which such an objection has been made, or any Expense for which no advance has been made, the
incurrence of that Expense will be presumed to have been reasonable, and the Company will have the
burden of proof to overcome that presumption.
Section 6. Presumptions and Effect of Certain Proceedings. (a) In making a determination
under Section 5(c) with respect to entitlement to indemnification under Section 2(a), the person,
persons or entity making that determination must presume that Indemnitee is entitled to that
indemnification if Indemnitee has submitted a request for indemnification in accordance with
Section 5(a), and the Company will have the burden of proof to overcome that presumption in
connection with the making by any person, persons or entity of any determination contrary to that
presumption.
(b) The termination of any Proceeding or of any Claim therein, by judgment, order, settlement
or conviction, or on a plea of nolo contendere or its equivalent, will not, except as this
Agreement otherwise expressly provides, of itself adversely affect the right of Indemnitee to
indemnification hereunder or, in the case of any determination under Section 5(c) of Indemnitee’s
entitlement to indemnification under Section 2(a), create a presumption that Indemnitee did not act
in good faith and in a manner 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, that Indemnitee had
reasonable cause to believe that Indemnities’ conduct was unlawful.
(c) Any service of Indemnitee as a Functionary of the Company or any Related Enterprise which
imposes duties on, or involves services by, Indemnitee with respect to any Related Enterprise that
is an employee benefit or welfare plan or related trust, if any, or that plan’s participants or
that trust’s beneficiaries, will be deemed for all purposes hereof as service at the request of the
Company. Any action Indemnitee takes or omits to take in connection with any such plan or trust
will, if taken or omitted in good faith by Indemnitee and in a manner Indemnitee reasonably
believed to be in the interest of the participants in or beneficiaries of that plan or trust, be
deemed to have been taken or omitted in a manner “not opposed to the best interests of the Company”
for all purposes hereof.
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(d) For purposes of any determination hereunder as to whether Indemnitee has performed
services or engaged in conduct on behalf of any Enterprise in good faith, Indemnitee will be deemed
to have acted in good faith if Indemnitee acted in reliance on the records of the Enterprise or on
information, opinions, reports or statements, including financial statements and other financial
information, concerning the Enterprise or any other Person which were prepared or supplied to
Indemnitee by:
(1) one or more of the officers or employees of the Enterprise;
(2) appraisers, engineers, investment bankers, legal counsel or other Persons as to
matters Indemnitee reasonably believed were within the professional or expert competence of
those Persons; and
(3) any committee of the board of directors or equivalent managing body of the
Enterprise of which Indemnitee is or was, at the relevant time, not a member;
provided, however, that if Indemnitee has actual knowledge as to any matter that makes any such
reliance unwarranted as to that matter, this Section 6(d) will not entitle Indemnitee to any
presumption that Indemnitee acted in good faith respecting that matter.
(e) For purposes of any determination hereunder as to whether Indemnitee is entitled to
indemnification under Section 2(a), neither the knowledge nor the conduct of any Functionary of the
Company or any Related Enterprise, other than Indemnitee, shall be imputed to Indemnitee.
(f) Indemnitee will be deemed a party to a Proceeding for all purposes hereof if Indemnitee is
named as a defendant or respondent in a complaint or petition for relief in that Proceeding,
regardless of whether Indemnitee ever is served with process or makes an appearance in that
Proceeding.
(g) If Indemnitee serves or served as a Functionary of a Related Enterprise, that service will
be deemed to be “at the request of the Company” for all purposes hereof notwithstanding that the
request is not evidenced by a writing or shown to have been made orally. In the event the Company
were to extend the rights of indemnification and advancement of Expenses hereunder to Indemnitee’s
serving at the request of the Company as a Functionary of any Enterprise other than the Company or
a Related Enterprise, Indemnitee must show that the request was made by the Board or at its
authorization.
Section 7. Remedies of Indemnitee in Certain Cases. (a) If indemnitee makes a written
request in compliance with Section 5(a) for indemnification under Section 2(a) and either:
(1) no determination as to the entitlement of Indemnitee to that indemnification is
made before the last to occur of (A) the close of business on the date, if any, the Company
has specified under Section 5(a) as the outside date for that determination or (B) the
elapse of the 45-day period beginning the day after the date the Company receives that
request; or
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(2) a determination is made under Section 5(c) that Indemnitee is not entitled to that
indemnification in whole or in any part in respect of any Claim to which that request
related,
Indemnitee will be entitled to an adjudication from the Court of Chancery of Indemnitee’s
entitlement to that indemnification. Alternatively, Indemnitee, at Indemnitee’s option, may seek
an award in arbitration to be conducted by a single arbitrator in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. In the case of any determination under
Section 5(c) that is adverse to Indemnitee, Indemnitee must commence any such judicial proceeding
or arbitration with 180 days following the date on which Indemnitee first has the right to commence
that proceeding under this Section 7(a) or Indemnitee will be bound by that determination for all
purposes of this Agreement.
(b) If a determination has been made under Section 5 that Indemnitee is not entitled to
indemnification hereunder, any judicial proceeding or arbitration commenced under this Section 7
will be conducted in all respects as a de novo trial or arbitration on the merits, and Indemnitee
will not be prejudiced by reason of that adverse determination. In any judicial proceeding or
arbitration commenced under this Section 7, the Company will have the burden of proving that
Indemnitee is not entitled to indemnification hereunder, and the Company may not, for any purposes,
refer to or introduce into evidence any determination under Section 5(c) which is adverse to
Indemnitee.
(c) If a determination has been made under Section 5 that Indemnitee is entitled to
indemnification hereunder, the Company will be bound by that determination in any judicial
proceeding or arbitration Indemnitee thereafter commences under this Section 7 or otherwise,
absent:
(1) a misstatement by Indemnitee of a material fact, or an omission by Indemnitee of a
material fact necessary to make Indemnitee’s statements not materially misleading, in
connection with the request for indemnification; or
(2) a prohibition of that indemnification under applicable law.
(d) If Indemnitee, under this Section 7 or otherwise, seeks a judicial adjudication of or an
award in arbitration to enforce his rights under, or to recover damages for breach of, this
Agreement, Indemnitee will be entitled to recover from the Company, and will be indemnified by the
Company against, any and all expenses, of the types the definition of Expenses in Section 14
describes, reasonably incurred by or on behalf of Indemnitee in that judicial adjudication or
arbitration, but only if Indemnitee prevails therein. If it is determined in that judicial
adjudication or arbitration that Indemnitee is entitled to receive part of, but not all, the
indemnification or advancement of expenses sought, the expenses incurred by Indemnitee in
connection with that Judicial adjudication or arbitration will be appropriately prorated between
those in respect of which this Agreement entitles Indemnitee to indemnification and those
Indemnitee must bear.
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(e) In any judicial proceeding or arbitration under this Section 7, the Company:
(1) will not, and will not permit any other Person acting on its behalf to, assert that
the procedures or presumptions this Agreement establishes are not valid, binding and
enforceable; and
(2) will stipulate that it is bound by all the provisions hereof.
Section 8. Non-exclusivity; Survival of Rights; Insurance; Subrogation. (a) The rights of
indemnification and advancement of Expenses and the remedies this Agreement provides are not and
will not be deemed exclusive of any other rights or remedies to which Indemnitee may at any time be
entitled under applicable law, the Company’s Charter Documents, any agreement, a vote of
stockholders or Disinterested Directors, or otherwise, but each such right or remedy hereunder will
be cumulative with all such other rights and remedies. No amendment, alteration or termination of
this Agreement or any provision hereof will limit or restrict any right of Indemnitee hereunder in
respect of any action Indemnitee has taken or omitted in Indemnitee’s capacity as a Functionary of
the Company or any Related Enterprise prior to that amendment, alteration or termination. To the
extent that a change in Delaware law, whether by statute or judicial decision, permits greater
indemnification by agreement than would be afforded currently under this Agreement, it is the
intent and agreement of the parties hereto that Indemnitee will enjoy by this Agreement the greater
benefits that change affords.
(b) If the Company maintains an insurance policy or policies providing liability insurance for
Functionaries of the Company or of any Related Enterprise who serve or served in the same
capacities as Indemnitee, Indemnitee will be covered by the policy or policies in accordance with
its or their terms to the maximum extent of the coverage available for any such Functionary under
the policy or policies. If the Company receives written notice from any source of a pending
Proceeding to which Indemnitee is a party and in respect of which Indemnitee might be entitled to
indemnification under Section 2(a) and the Company then maintains any such policy of which
Indemnitee is a beneficiary, the Company will:
(1) promptly give notice of that Proceeding to the relevant insurers in accordance with
the applicable policy procedures; and
(2) thereafter take all action necessary to cause those insurers to pay, on behalf of
Indemnitee, all amounts payable in accordance with the applicable policy terms as a result
of that Proceeding;
provided, however that the Company need not comply with the provisions of this sentence if its
failure to do so would not actually be prejudicial to Indemnitee in any material respect.
(c) The Company will not be liable under this Agreement to make or cause to be made any
payment of amounts otherwise indemnifiable hereunder, or to make or cause to be made any advance
this Agreement otherwise requires it to make or cause to be made, if and to the extent that
Indemnitee has otherwise actually received or had applied for Indemnitee’s benefit that payment or
advance or obtained the entire benefit therefrom under any insurance policy, any other contract or
agreement or otherwise.
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(d) If the Company makes or causes to be made any payment hereunder, it will be subrogated to
the extent of that payment to all the rights of recovery of Indemnitee, who will execute all papers
required and take all action necessary to secure those rights, including execution of such
documents as are necessary to enable the Company to bring suit to enforce those rights.
(e) The Company’s obligation to make or cause to be made any payment or advance hereunder to
or for the account of Indemnitee with respect to Indemnitee’s service at the request of the Company
as a Functionary of any Related Enterprise will be reduced by any amount Indemnitee has actually
received as indemnification or advancement of expenses from that Related Enterprise.
Section 9. Duration of Agreement; Binding Effect. This Agreement will continue until and
terminate on the later of:
(1) 10 years after the date that Indemnitee has ceased to serve as a Functionary of the
Company and each Related Enterprise that Indemnitee served at the request of the Company; or
(2) one year after the final, nonappealable termination of any Proceeding then pending
in respect of which Indemnitee is granted rights of indemnification or advancement or
Expenses hereunder and of any proceeding commenced by Indemnitee under Section 7 or
otherwise.
This Agreement will be binding on the Company and its successors and assigns and will inure to the
benefit of Indemnitee and his spouse, if Indemnitee resides in Texas or another community property
state, heirs, executors and administrators.
Section 10. Severability. If any provision or provisions hereof is or are invalid, illegal
or unenforceable for any reason whatsoever:
(1) the validity, legality and enforceability of the remaining provisions hereof,
including each portion of any Section containing any such invalid, illegal or unenforceable
provision which is not itself invalid, illegal or unenforceable, will not in any way be
affected or impaired thereby;
(2) such provision or provisions will be deemed reformed to the extent necessary to
conform to applicable law and to give the maximum effect to the intent of the parties
hereto; and
(3) to the fullest extent possible, the provisions hereof, including each portion of
any Section containing any such invalid, illegal or unenforceable provision which is not
itself invalid, illegal or unenforceable, will be construed so as to give effect to the
intent manifested thereby.
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Section 11. Exceptions to Right of Indemnification or Advancement of Expenses.
No provision in this Agreement will obligate the Company to pay or cause to be paid any indemnity
to or for the account of Indemnitee, or to advance Expenses under Section 3, in connection with or
as a result of:
(1) any Claim made against Indemnitee for an accounting of profits, under Section 16(b)
of the Exchange Act or similar provision of state statutory or common law, from the purchase
and sale, or sale and purchase, by Indemnitee of securities of the Company or any Related
Enterprise; or
(2) except for any Claim initiated by Indemnitee, whether as a cause of action or as a
defense to a cause of action under Section 7 or otherwise, to enforce or establish, by
declaratory judgment or otherwise, Indemnitee’s rights or remedies hereunder, any Claim
initiated by Indemnitee without the prior authorization of the Board against the Company or
any Related Enterprise or any of their respective present or former Functionaries.
Section 12. Identical Counterparts. This Agreement may be executed in one or more
counterparts, each of which will for all purposes be deemed to be an original but all of which
together will constitute one and the same agreement. Only one such counterpart signed by the party
against whom enforceability is sought needs to be produced to evidence the existence of this
Agreement.
Section 13. Headings. The headings of the Sections hereof are inserted for convenience only
and do not and will not be deemed to constitute part of this Agreement or to affect the
construction thereof.
Section 14. Definitions and Definitional Provisions. (a) For purposes of this Agreement:
“Acquiring Person” means any Person who or which, together with all its Affiliates and
Associates, is or are the Beneficial Owner of 15% or more of the shares of Common Stock then
outstanding, but does not include any Exempt Person provided, however, that a Person will
not be or become an Acquiring Person if that Person, together with its Affiliates and
Associates, becomes the Beneficial Owner of 15% or more of the shares of Common Stock then
outstanding solely as a result of a reduction in the number of shares of Common Stock
outstanding which results from the Company’s direct or indirect repurchase of Common Stock,
unless and until such time as that Person or any Affiliate or Associate of that Person
purchases or otherwise becomes the Beneficial Owner of additional shares of Common Stock
constituting 1% or more of the then outstanding shares of Common Stock or any other Person
or Persons who is or collectively are the Beneficial Owner of shares of Common Stock
constituting 1% or more of the then outstanding shares of Common Stock becomes an Affiliate
or Associate of that Person, unless, in either such case, that Person, together with all its
Affiliates and Associates, is not then the Beneficial Owner of 15% or more of the shares of
Common Stock then outstanding.
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“Affiliate” has the meaning Exchange Act Rule 12b-2 specifies.
“Associate” means, with reference to any Person:
(1) any corporation, firm, partnership, limited liability company,
association, unincorporated organization or other entity, other than the Company or
a Related Enterprise, of which that Person is an officer or general partner, or
officer or general partner of a general partner, or is, directly or indirectly, the
Beneficial Owner of 10% or more of any class of its equity securities or interests;
(2) any trust or other estate in which that Person has a substantial beneficial
interest or for or of which that Person serves as trustee or in a similar fiduciary
capacity; and
(3) any relative or spouse of that Person, or any relative of that spouse, who
has the same home as that Person.
A specified Person is deemed the “Beneficial Owner” of, and is deemed to “beneficially
own,” any securities:
(1) of which that Person or any of that Person’s Affiliates or Associates,
directly or indirectly, is the “beneficial owner,” as determined under Exchange Act
rule 13d-3, or otherwise has the right to vote or dispose of, including under any
agreement, arrangement or understanding, whether or not in writing; provided,
however, that a Person will not be deemed the “Beneficial Owner” of, or to
“beneficially own,” any security under this subparagraph (1) as a result of an
agreement, arrangement or understanding to vote that security if that agreement,
arrangement or understanding: (A) arises solely from a revocable proxy or consent
given in response to a public, that is, not including a solicitation exempted by
Exchange Act Rule 14a-2(b)(2), proxy or consent solicitation made under, and in
accordance with, the applicable provisions of the Exchange Act; and (B) is not then
reportable by that Person on Exchange Act Schedule 13D or any comparable or
successor report;
(2) which that Person or any of that Person’s Affiliates or Associates,
directly or indirectly, has the right or obligation to acquire, whether that right
or obligation is exercisable or effective immediately or only after the passage of
time or the occurrence of an event, under any agreement, arrangement or
understanding, whether or not in writing, or on the exercise of conversion rights,
exchange rights, other rights, warrants or options, or otherwise; provided, however,
that a Person will not be deemed the “Beneficial Owner” of, or to “beneficially
own,” securities tendered in response to a tender or exchange offer made by that
Person or any of that Person’s Affiliates or Associates until those tendered
securities are accepted for purchase or exchange; or
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(3) which are beneficially owned, directly or indirectly, by (A) any other
Person, or any Affiliate or Associate thereof, with which the specified Person or
any of the specified Person’s Affiliates or Associates has any agreement,
arrangement or understanding, whether or not in writing, for the purpose of
acquiring, holding, voting, except by a revocable proxy or consent as described in
the proviso to subparagraph (1) of this definition, or disposing of any voting
securities of the Company or (B) any group, as Exchange Act Rule 13d-5(b) uses that
term, of which that specified Person is a member;
provided, however, that nothing in this definition will cause a Person engaged in business
as an underwriter of securities to be the “Beneficial Owner” of, or to “beneficially own,”
any securities that Person acquires through its participation in good faith in a firm
commitment underwriting, including securities acquired in stabilizing transactions to
facilitate a public offering in accordance with Exchange Act Regulation M or to cover
overallotments created in connection with a public offering, until the expiration of 40 days
after the date of that acquisition. For purposes of this definition, “voting” a security
includes voting, granting a proxy, acting by consent, making a request or demand relating to
corporate action, including calling a stockholder meeting, or otherwise giving an
authorization, within the meaning of Section 14(a) of the Exchange Act, in respect of that
security.
“Board” has the meaning the Preliminary Statement specifies.
“Change of Control” means the occurrence of any of the following events that occurs
after the date of this Agreement:
(1) any Person becomes an Acquiring Person;
(2) at any time the then Continuing Directors cease to constitute a majority of
the members of the Board; or
(3) a merger of the Company with or into, or a sale by the Company of its
properties and assets substantially as an entirety to, another Person occurs and,
immediately after that occurrence, any Person, other than an Exempt Person, together
with all Affiliates and Associates of that Person, other than Exempt Persons, will
be the Beneficial Owner of 15% or more of the total voting power of the then
outstanding Voting Shares of the Person surviving that transaction, in the case of a
merger or consolidation, or the Person acquiring those properties and assets
substantially as an entirety unless that Person, together with all its Affiliates
and Associates, other than Exempt Persons, was the Beneficial Owner of 15% or more
of the shares of Common Stock outstanding prior to that transaction.
“Charter Documents” means, with respect to any corporation or other entity at any time,
in each case as amended, modified and supplemented at that time:
(1) the articles or certificate of formation, incorporation or organization, or
the equivalent organizational documents, of that entity;
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(2) the bylaws or limited liability company agreement or regulations, or the
equivalent governing documents, of that entity; and
(3) each document setting forth the designation, amount and relative rights,
limitations and preferences of any class or series of that entity’s capital stock or
other equity interests.
“Claim” means any claim for damages or a declaratory, equitable or other substantive
remedy, or any other issue or matter, in any Proceeding.
“Common Stock” means:
(1) the common stock, par value $0.25 per share, of the Company; and
(2) any other class of capital stock of the Company which is (A) except for
different voting rights or par value, identical to the common stock clause (1) of
this definition describes and (B) convertible into that common stock on a share for
share basis on the occurrence of a Change of Control.
“Company Entity” means any Related Enterprise, other than an employee benefit or
welfare plan or its related trust, if any.
“Company Claim” means any Claim brought by or in the right of the Company or a Related
Enterprise against Indemnitee.
“Continuing Director” means at any time any individual who then:
(1) is a member of the Board on the date hereof or whose nomination for his
first election, or that first election, to the Board following that date was
recommended or approved by a majority of the then Continuing Directors, acting
separately or as a part of any action taken by the Board or any committee thereof;
and
(2) is not an Acquiring Person, an Affiliate or Associate of an Acquiring
Person or a nominee or representative of an Acquiring Person or of any such
Affiliate or Associate.
“Court of Chancery” means the Court of Chancery of the State of Delaware.
“DGCL” means the General Corporation Law of the State of Delaware, as amended.
“Disinterested Director” means a director of the Company who is not and was not a party
to the Proceeding, or any Claim therein, in respect of which indemnification is sought by
Indemnitee hereunder.
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“Enterprise” means any business trust, corporation, joint venture, limited liability
company, partnership or other entity or enterprise, including any operational division of
any entity, or any employee benefit or welfare plan or related trust.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Exempt Person” means:
(1) (A) the Company, any subsidiary of the Company, any employee benefit plan
of the Company or of any subsidiary of the Company and (B) any Person organized,
appointed or established by the Company for or pursuant to the terms of any such
plan or for the purpose of funding any such plan or funding other employee benefits
for employees of the Company or any subsidiary of the Company; and
(2) Indemnitee, any Affiliate or Associate of Indemnitee or any group, as
Exchange Act Rule 13d-5(b) uses that term, of which Indemnitee or any Affiliate or
Associate of Indemnitee is a member.
“Expenses” 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, all other disbursements or expenses of
the types customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, being or preparing to be a witness in, or otherwise
participating in, a Proceeding. Should any payments by the Company under this Agreement be
determined to be subject to any federal, state or local income or excise tax, “Expenses”
also will include such amounts as are necessary to place Indemnitee in the same after-tax
position, after giving effect to all applicable taxes, Indemnitee would have been in had no
such tax been determined to apply to those payments.
“Functionary” of any Enterprise means any director, officer, manager, administrator,
employee, agent, representative or other functionary of that Enterprise, including, in the
case of any employee benefit or welfare plan, any member of any committee administering that
plan or any individual to whom the duties of that committee are delegated.
“Independent Counsel” means a law firm, or a member of a law firm, that or who is
experienced in matters of corporation law and neither presently is, nor in the past five
years has been, retained to represent:
(1) the Company or any of its Affiliates or Indemnitee in any matter material
to any such party; or
(2) any other party to the Proceeding giving rise to a claim for
indemnification hereunder.
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Notwithstanding the foregoing, the term “Independent Counsel” does not include at any time
any Person who, under the applicable standards of professional conduct then prevailing,
would have a conflict of interest in representing either the Company or a Related Enterprise
or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.
“Person” means any natural person, sole proprietorship, corporation, partnership,
limited liability company, business trust, unincorporated organization or association,
mutual company, joint stock company, joint venture or any other entity of any kind having a
separate legal status or any estate, trust, union or employee organization or governmental
authority.
“Proceeding” includes:
(1) any threatened, pending or completed action, suit, arbitration, alternate
dispute resolution procedure, investigation, inquiry or other threatened, actual or
completed proceeding, whether of a civil, criminal, administrative, investigative or
private nature and irrespective of the initiator thereof; and
(2) any appeal in any such proceeding.
“Related Enterprise” means at any time any Enterprise:
(1) 50% or more of the outstanding capital stock or other ownership interests
of which, or the assets of which, the Company owns or controls, or previously owned
or controlled, directly or indirectly, at that time;
(2) 50% or more of the outstanding voting power of the outstanding capital
stock or other ownership interests of which the Company owns or controls, or
previously owned or controlled, directly or indirectly, at that time;
(3) that is, or previously was, an Affiliate of the Company which the Company
controls, or previously controlled, by ownership, contract or otherwise and whether
alone or together with another Person, directly or indirectly, at that time; or
(4) if that Enterprise is an employee benefit or welfare plan or related trust,
whose participants or beneficiaries are present or former employees of the Company
or any other Related Enterprise.
“Voting Shares” means:
(1) in the case of any corporation, stock of that corporation of the class or
classes having general voting power under ordinary circumstances to elect a majority
of that corporation’s board of directors; and
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(2) in the case of any other entity, equity interests of the class or classes
having general voting power under ordinary circumstances equivalent to the Voting
Shares of a corporation.
(b) This Agreement uses the words “herein,” “hereof” and “hereunder” and words of similar
import to refer to this Agreement as a whole and not to any provision of this Agreement, and the
words “Section” and “Preliminary Statement” refer to Sections of and the Preliminary Statement in
this Agreement, unless it otherwise specifies.
(c) Whenever the context so requires, the singular number includes the plural and vice versa,
and a reference to one gender includes the other gender and the neuter.
(d) The word “including,” and, with correlative meaning, the word “include,” means including,
without limiting the generality of any description preceding that word, and the words “shall” and
“will” are used interchangeably and have the same meaning.
(e) The language this Agreement uses will be deemed to be the language the parties hereto have
chosen to express their mutual intent, and no rule of strict construction will be applied against
either party hereto.
Section 15. Modification and Waiver. No supplement to or modification or amendment of this
Agreement will be binding unless executed in writing by both parties hereto. No waiver of any
provision hereof will be deemed or will constitute a waiver of any other provision hereof, whether
or not similar, nor will any such waiver constitute a continuing waiver.
Section 16. Reliance. The Company confirms and agrees with Indemnitee that it has entered
into this Agreement and assumed the obligations this Agreement imposes on it in order to induce
Indemnitee to serve, or continue to serve, as a Functionary of the Company or a Related Enterprise.
The Company acknowledges that Indemnitee is relying on this Agreement in so serving.
Section 17. Notices. All notices, requests, demands and other communications hereunder must
be in writing or by electronic transmission and will be deemed delivered and received:
(1) if personally delivered or if delivered by telex, telegram, facsimile,
electronic transmission or courier service, when actually received by the party to
whom the notice or communication is sent; or
(2) if delivered by mail, whether actually received or not, at the close of
business on the third business day in the city in which the Company’s principal
executive office is located next following the day when placed in the U.S. mail,
postage prepaid, certified or registered, addressed to the appropriate party at the
address of that party set forth below, or at such other address as that party may
designate by notice in writing or by electronic transmission to the other party in
accordance herewith:
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(3) If to Indemnitee, to:
____________________________
____________________________
____________________________
with a copy, which will not constitute notice for purposes of this
Agreement, to such legal counsel, if any, as Indemnitee may designate in
writing or by electronic transmission; and
(4) If to the Company, to:
Oceaneering International, Inc.
00000 XX 000
Xxxxxxx, Xxxxx 00000
Attention: Corporate Secretary
Fax No.: (000) 000-0000
00000 XX 000
Xxxxxxx, Xxxxx 00000
Attention: Corporate Secretary
Fax No.: (000) 000-0000
Section 18. Contribution. If it is established, under Section 5(c) or otherwise,
that Indemnitee has the right to be indemnified under Section 2(a) in respect of any claim, but
that right is unenforceable by reason of any applicable law or public policy, then, to the fullest
extent applicable law permits, the Company, in lieu of indemnifying or causing the indemnification
of Indemnitee under Section 2(a), will, or will cause a Company Entity to, contribute to the amount
Indemnitee has incurred, whether for judgments, fines, penalties, excise taxes, amounts paid or to
be paid in settlement or for Expenses reasonably incurred, in connection with that Claim, in such
proportion as is deemed fair and reasonable in light of all the circumstances of that Claim in
order to reflect:
(1) the relative benefits Indemnitee and the Company have received as a result of the
event(s) or transaction(s) giving rise to that Proceeding; or
(2) the relative fault of Indemnitee and of the Company and its other Functionaries in
connection with those event(s) or transaction(s).
Section 19. Governing Law; Submission to Jurisdiction. This Agreement and the legal
relations among the parties will be governed by, and construed and enforced in accordance with, the
laws of the State of Delaware, without regard to its conflict of laws rules. Except with respect
to any arbitration Indemnitee commences under Section 7 or as Section 2(a) expressly contemplates
otherwise, the Company and Indemnitee hereby irrevocably and unconditionally:
(1) agree that any action or proceeding arising out of or in connection with this
Agreement will be brought only in the Court of Chancery and not in any other state or
federal court in the United States of America or any court in any other country;
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(2) consent to submit to the exclusive jurisdiction of the Court of Chancery for
purposes of any action or proceeding arising out of or in connection with this Agreement;
(3) waive any objection to the laying of venue of any such action or proceeding in the
Court of Chancery; and
(4) waive, and agree not to plead or to make, any claim that any such action or
proceeding brought in the Court of Chancery has been brought in an improper or otherwise
inconvenient forum.
Section 20. Entire Agreement. Except as Section 8(a) otherwise provides, this Agreement
constitutes the entire agreement and understanding between the Company and Indemnitee, and
supersedes all prior oral, written or implied agreements and understandings of the Company and
Indemnitee with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the day
and year first above written.
| OCEANEERING INTERNATIONAL, INC. |
||||
| By: | ||||
| M. Xxxxx XxXxxx | ||||
| President and Chief Executive Officer | ||||
| INDEMNITEE: |
||||
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