EXHIBIT (e)(14)
INDEMNIFICATION AGREEMENT
This Agreement is made this 10th day of November, 2000, by and between
DevX Energy, Inc., a Delaware corporation (the "Company"), and Xxxxxxx X.
Xxxxxxx ("Executive").
WITNESSETH:
WHEREAS, Executive is unwilling to serve, or continue to serve, the
Company as an officer without assurances that adequate liability insurance,
indemnification or a combination thereof is, and will continue to be, provided;
and
WHEREAS, the Company, in order to induce Executive to serve or continue
to serve the Company, has agreed to provide Executive with the benefits
contemplated by this Agreement which benefits are intended to supplement or
replace, if necessary, the Company's existing directors' and officers' liability
insurance; and
WHEREAS, as a result of the provision of such benefits, Executive has
agreed to serve or to continue to serve as an officer of the Company;
NOW, THEREFORE, in consideration of the promises, conditions,
representations and warranties set forth herein, including the Executive's
service or continued service to the Company, the Company and Executive hereby
agree as follows:
Section 1. Definitions. The following terms, as used herein, shall have the
following respective meanings:
"Covered Act" means any breach of duty, neglect, error, misstatement,
misleading statement, omission or other act done or wrongfully attempted by
Executive in connection with his services as an officer, director, employee,
trustee, agent or fiduciary of the Company, or any event or occurrence related
to the fact that Executive is or was a director, officer, employee, agent or
fiduciary of the Company 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, trust or other entity, or by reason of anything done
or not done by Executive in such capacities or any of the foregoing alleged by
any claimant or any claim against Executive solely by reason of him being a
director or officer of the company.
"Covered Amount" means Losses and Expenses which, in type or amount,
are not insured under the directors' and officers' liability insurance
maintained by the Company from time to time.
"D&O Insurance" means the directors' and officers' liability insurance
issued by the insurer(s), and having the policy number(s), amount(s) and
deductible(s) set forth on Exhibit A hereto and any replacement or substitute
policies issued by one or more reputable insurers providing in all respects
coverage at least comparable to and in the same amount as that provided under
the policy or policies identified on Exhibit A.
"Determination" means a determination, based on the facts known at the
time, made by:
(i) A majority vote of the directors who are not parties
to the action, suit or proceeding as to which
indemnification has been requested, even though less
than a quorum; or
(ii) Independent legal counsel in a written opinion
prepared at the request of a majority of a quorum of
disinterested directors; or
(iii) A majority of the disinterested stockholders of the
Company; or
(iv) A final adjudication by a court of competent
jurisdiction.
"Determined" shall have a correlative meaning.
"Excluded Claim" means any payment for Losses or Expenses in connection
with any claim:
(i) Based upon or attributable to Executive gaining in
fact any personal profit or advantage to which
Executive is not entitled; or
(ii) For the return by Executive of any remuneration paid
to Executive without the previous approval of the
stockholders of the Company which is illegal; or
(iii) For an accounting of profits in fact made from the
purchase or sale by Executive of securities of the
Company within the meaning of Section 16 of the
Securities Exchange Act of 1934, as amended, or
similar provisions of any state law; or
(iv) Resulting from Executive's fraudulent, dishonest or
willful misconduct; or
(v) The payment of which by the Company under this
Agreement is not permitted by applicable law; or
(vi) The payment of which would cause the total amount of
all Losses and Expenses paid by the Company to exceed
the Covered Amount; or
(vii) Any claim for which Executive would not be permitted
to be indemnified under applicable law,
notwithstanding the obligations of the Company under
this Agreement.
"Expenses" means any reasonable expenses incurred by Executive as a
result of a claim or claims made against him for Covered Acts including, without
limitation, counsel fees and costs of investigative, judicial or administrative
proceedings or appeals, but shall not include Fines.
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"Fines" means any fine, penalty or, with respect to an employee benefit
plan, any excise tax or penalty assessed with respect thereto.
"Loss" means any amount which Executive is legally obligated to pay as
a result of a claim or claims made against him for Covered Acts including,
without limitation, damages and judgments and sums paid in settlement of a claim
or claims, but shall not include Fines.
"Subsidiary" means, with respect to any person, any corporation or
other entity of which a majority of the voting power of the voting equity
securities or equity interest is owned, directly or indirectly, by that person.
Section 2. Maintenance of D&O Insurance.
a. The Company hereby represents and warrants that Exhibit A contains a
complete and accurate description of the policies of directors' and officers'
liability insurance purchased by the Company and that such policies are in full
force and effect.
b. The Company hereby covenants and agrees that, so long as Executive
shall continue to serve as an officer of the Company and thereafter so long as
Executive shall be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether civil, criminal or investigative,
by reason of the fact that Executive was an officer of the Company, the Company,
subject to Section 2(d), shall maintain in full force and effect D&O Insurance.
c. In all policies of D&O Insurance, Executive shall be named as an
insured in such a manner as to provide Executive the same rights and benefits,
subject to the same limitations, as are accorded to the Company's directors or
officers most favorably insured by such policy.
d. The Company shall have no obligation to maintain D&O Insurance if
the Company determines in good faith that such insurance is not reasonably
available, the premium costs for such insurance is disproportionate to the
amount of coverage provided, or the coverage provided by such insurance is
limited by exclusions so as to provide an insufficient benefit.
Section 3. Indemnification. The Company shall indemnify Executive and hold him
harmless from the Covered Amount of any and all Losses and Expenses subject, in
each case, to the further provisions of this Agreement.
Section 4. Excluded Coverage.
a. The Company shall have no obligation to indemnify Executive for and
hold him harmless from any Loss or Expense which has been determined, by final
adjudication by a court of competent jurisdiction, to constitute an Excluded
Claim.
b. The Company shall have no obligation to indemnify Executive and hold
him harmless for any Loss or Expense under this agreement to the extent that
Executive is indemnified by the Company pursuant to the Company's Bylaws or is
otherwise indemnified.
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Section 5. Indemnification Procedures.
a. Promptly after receipt by Executive of notice of the commencement of
or the threat of commencement of any action, suit or proceeding, Executive
shall, if indemnification with respect thereto may be sought from the Company
under this Agreement, notify the Company of the commencement thereof.
b. If, at the time of the receipt of such notice, the Company has D&O
Insurance in effect, the Company shall give prompt notice of the commencement of
such action, suit or proceeding to the insurers in accordance with the
procedures set forth in the respective policies in favor of Executive. The
Company shall thereafter take all necessary or desirable action to cause such
insurers to pay, on behalf of Executive, all Losses and Expenses payable as a
result of such action, suit or proceeding in accordance with the terms of such
policies.
c. To the extent the Company does not, at the time of the commencement
of or the threat of commencement of such action, suit or proceeding, have
applicable D&O Insurance, or if a Determination is made that any Expenses
arising out of such action, suit or proceeding will not be payable under the D&O
Insurance then in effect, the Company shall be obligated to pay the Expenses of
any such action, suit or proceeding in advance of the final disposition thereof
and the Company, if appropriate, shall be entitled to assume the defense of such
action, suit or proceeding, with counsel satisfactory to Executive, upon the
delivery to Executive of written notice of its election to do so. After delivery
of such notice, the Company will not be liable to Executive under this Agreement
for any legal or other Expenses subsequently incurred by the Executive in
connection with such defense other than reasonable Expenses of investigation;
provided that Executive shall have the right to employ its counsel in any such
action, suit or proceeding but the fees and expenses of such counsel incurred
after delivery of notice from the Company of its assumption of such defense
shall be at the Executive's expense; provided further that if (i) the employment
of counsel by Executive has been previously authorized by the Company, (ii)
Executive shall have reasonably concluded that there may be a conflict of
interest between the Company and Executive in the conduct of any such defense,
or (iii) the Company shall not, in fact, have employed counsel to assume the
defense of such action, the fees and expenses of counsel shall be at the expense
of the Company.
d. All payments on account of the Company's indemnification obligations
under this Agreement shall be made within sixty (60) days of Executive's written
request therefor unless a Determination is made that the claims giving rise to
Executive's request are Excluded Claims or otherwise not payable under this
Agreement; provided that all payments on account of the Company's obligations
under Section 5(c) of this Agreement prior to the final disposition of any
action, suit or proceeding shall be made within 20 days of Executive's written
request therefor and such obligation shall not be subject to any such
determination but shall be subject to Section 5(e) of this Agreement.
e. Executive agrees that he will reimburse the Company for all Losses
and Expenses paid by the Company in connection with any action, suit or
proceeding against Executive in the event and only to the extent that a
Determination shall have been made by a court in a final adjudication from which
there is no further right of appeal that the Executive is not entitled to be
indemnified by the Company for such Expenses because the claim is an Excluded
Claim or because Executive is otherwise not entitled to payment under this
Agreement.
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Section 6. Settlement. The Company shall have no obligation to indemnify
Executive under this Agreement for any amounts paid in settlement of any action,
suit or proceeding effected without the Company's prior written consent. The
Company shall not settle any claim in any manner which would impose any
obligation, including any Fine, on Executive without Executive's written
consent. Neither the Company nor Executive shall unreasonably withhold their
consent to any proposed settlement.
Section 7. Rights Not Exclusive. The rights provided hereunder shall not be
deemed exclusive of any other rights to which the Executive may be entitled
under any bylaw, agreement, vote of stockholders or of disinterested directors
or otherwise, both as to action in his official capacity and as to action in any
other capacity by holding such office, and shall continue after the Executive
ceases to serve the Corporation as an Executive.
Section 8. Enforcement.
a. Executive's right to indemnification shall be enforceable by
Executive only in the Chancery Court of the State of Delaware and shall be
enforceable notwithstanding any adverse Determination, other than a
Determination which has been made by a final adjudication of a court of
competent jurisdiction. In any such action, if a prior adverse Determination has
been made, the burden of proving that indemnification is required under this
Agreement shall be on Executive. The Company shall have the burden of proving
that indemnification is not required under this Agreement if no prior adverse
Determination shall have been made.
b. In the event that any action is instituted by Executive under this
Agreement or to enforce or interpret any of the terms of this Agreement,
Executive shall be entitled to be paid all court costs and expenses, including
reasonable counsel fees, incurred by Executive with respect to such action,
unless the court determines that each of the material assertions made by
Executive as a basis for such action were not made in good faith or were
frivolous.
Section 9. Severability. In the event that any provision of this Agreement is
determined by a court to require the Company to do or to fail to do an act which
is in violation of applicable law, such provision shall be limited or modified
in its application to the minimum extent necessary to avoid a violation of law,
and, as so limited or modified, such provision and the balance of this Agreement
shall be enforceable in accordance with their terms.
Section 10. Choice of Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware.
Section 11. Consent to Jurisdiction. The Company and the Executive each hereby
irrevocably consent to the jurisdiction of the courts of the State of Delaware
for all purposes in connection with any action or proceeding which arises out of
or relates to this Agreement and agree that any action instituted under this
Agreement shall be brought only in the Chancery Court of the State of Delaware.
Section 12. Successor and Assigns. This Agreement shall be (i) binding upon all
successors and assigns of the Corporation (including any transferee of all or
substantially all of its assets and any
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successor by merger or otherwise by operation of law) and (ii) shall be binding
on and inure to the benefit of the heirs, personal representatives and estate of
Executive.
Section 13. Amendment. No amendment, modification, termination or cancellation
of this Agreement shall be effective unless made in a writing signed by each of
the parties hereto.
Section 14. Notice. For purposes of this Agreement, all notices and other
communications provided for in this Agreement shall be addressed as follows,
shall be in writing and shall be deemed to have been duly given upon actual
receipt:
If to the Executive: If to the Company:
Xxxxxxx X. Xxxxxxx DevX Energy, Inc.
6730 Blue Valley 00000 Xxxx Xxxx
Xxxxxx, XX 00000 Xxxxx 0000
Xxxxxx, XX 00000-0000
Attn: President & Chief Executive Officer
Section 15. No Duplication of Payments. The Company shall have no obligation to
indemnify Executive and hold him harmless for any Loss, Expense or Fine to the
extent that Executive has otherwise actually received payment for such Loss,
Expense or Fine (whether pursuant to any insurance policy, provision of the
Company's Certificate of Incorporation or bylaws or otherwise).
Section 16. Entire Agreement. This Agreement sets forth the entire
understandings of the parties hereto with respect to the subject matter hereof.
It incorporates and merges with any and all previous communications and
understandings, oral or written, with respect to the subject matter hereof.
* * * * *
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IN WITNESS WHEREOF, the Company and Executive have executed this
Agreement as of the day and year first above written.
COMPANY:
DEVX ENERGY, INC.
By: /s/ XXXXXX X. XXXXXXXX
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Name: Xxxxxx X. Xxxxxxxx
Title: Chairman of the Board,
Chief Executive Officer, President
and Director
EXECUTIVE:
/s/ XXXXXXX X. XXXXXXX
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Xxxxxxx X. Xxxxxxx
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