INDEMNIFICATION AGREEMENT
This AGREEMENT, effective as of October 5, 1995 is between Xxxxxxxxxxx
Enterra, Inc., a Delaware corporation (the "Company"), and Xxxx X. Xxxx (the
"Director"), a director of the Company;
WHEREAS, in recognition of Director's need for substantial protection
against personal liability in order to enhance Director's continued service
to the Company in an effective manner and of Director's reliance on the
provisions of the Company's By-Laws requiring indemnification of the
Director under certain circumstances, and in part to provide Director with
specific contractual assurance that the protection promised by such By-Laws
will be available to Director (regardless of, among other things, any
amendment to or revocation of such By-Laws, any change in the composition
of the Company's board of Directors or any acquisition transaction relating
to the Company), the Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to, Director 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 Director under the Company's directors' and
officers' liability insurance policies.
NOW THEREFORE, in consideration of the premises and of Director
agreeing to serve or continuing to serve the Company directly or, at its
request, with another enterprise, and intending to be legally bound hereby,
the parties hereto agree as follows:
1. BASIC INDEMNIFICATION ARRANGEMENT
(a) In the event Director 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 (as defined hereinafter) by
reason of (or arising in part out of) an Indemnifiable Event (as
defined hereinafter), the Company shall indemnify Director to the
fullest extent permitted by law as soon as practicable, but in any
event no later than 30 days after written demand is presented to the
Company, against any and all Expenses (as defined hereinafter),
judgments, fines, penalties and amounts paid in settlement of such
Claim. If so requested by Director, the Company shall advance (within
ten business days after such written request) any and all Expenses to
Director an "Expense Advance". Notwithstanding anything in this
Agreement to the contrary, and except as provided in Section 3 hereof,
prior to a Change in Control (as defined hereinafter), Director shall
not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Director against the Company or
any director or officer of the Company, unless the Company has joined
in or consented to the initiation of such Claim.
(b) Notwithstanding the foregoing, (i) the obligations of the Company
under Section 1(a)
shall be subject to the condition that the Reviewing Party (as defined
hereinafter) shall not have determined (in a written opinion, in any
case in which the special independent counsel referred to in Section 2
hereof is involved) that Director 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 1(a) shall be
subject to the condition that, if when and to the extent that the
Reviewing Party determines that Director would not be permitted to be
so indemnified under applicable law, the Company shall be entitled to
be reimbursed by Director (who hereby agrees to reimburse the Company)
for all such amounts theretofore paid; provided, however, that if
Director has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Director should be
indemnified under applicable law, any determination made by the
Reviewing Party that Director would not be permitted to be indemnified
under applicable law shall not be binding and Director 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 not been a Change in Control, the Reviewing Party shall be
selected by the Board of Directors, and if there has been such a
Change in Control, the Reviewing Party shall be the special
independent counsel referred to in Section 2 hereof. If there has been
no determination by the Reviewing Party or if the Reviewing Party
determines that Director substantively would not be permitted to be
indemnified in whole or in part under applicable law, Director shall
have the right to commence litigation in any court in the states of
Texas or Delaware having subject matter jurisdiction thereof and in
which venue is proper, seeking an initial determination by the court
or challenging any such determination by the Reviewing Party or any
aspect thereof, and the Company hereby consents to service of process
and to appear in any such proceeding. Any determination by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and Director.
2. CHANGE IN CONTROL. The Company agrees that if there is a Change
in Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control), then with
respect to all matters thereafter arising concerning the rights of
Director 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 special independent counsel selected by
Director and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services
for the Company or Director within the last five years (other than in
connection with such matters). Such counsel, among other things,
shall render its written opinion to the Company and Director as to
whether and to what extent Director would be permitted to be
indemnified under applicable law. The Company agrees to pay the
reasonable fees of the special, independent counsel referred to above
2
and to fully indemnify 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.
3. INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify Director against any and all expenses (including attorneys'
fees) and, if requested by Director, shall (within ten business days
after such written request) advance such expenses to Director, which
are incurred by Director in connection with any claim asserted against
or action brought by Director 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 Idemnifiable Events and/or (ii) recovery under any
directors' and officers' liability insurance policies maintained by
the Company, regardless of whether Director ultimately is determined
to be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
4. PARTIAL INDEMNITY, ETC. If Director is entitled under any
provision of this Agreement to indemnification by the Company of 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 Director for
the portion thereof to which Director is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Director 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, Director shall be indemnified
against all Expenses incurred in connection therewith. In connection
with any determination by the Reviewing Party or otherwise as to
whether Director is entitled to be indemnified hereunder, the burden
of proof shall be on the Company to establish that Director is not so
entitled.
5. NO PRESUMPTION. For purposes of this Agreement, the termination of
any action, suit or proceeding by judgment, order, settlement (whether
with or without court approval), conviction, or plea of nolo
contendere, or its equivalent, shall not create a presumption that
director 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.
6. NON-EXCLUSIVITY, ETC. The rights of Director hereunder shall be
in addition to any other rights Director may have under the Company's
By-Laws or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether
by statute or judicial decision) or the Company's By-Laws permits
greater indemnification by agreement than would be afforded currently
under the Company's By-Laws and this Agreement, it is the intent of
the
3
parties hereto that Director shall enjoy by this Agreement the greater
benefits so afforded by such change.
7. LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Director 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.
8. CERTAIN DEFINITIONS.
(a) CHANGE IN CONTROL: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
Voting Securities (as defined hereinafter), or (ii) during any period
of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two- thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the stockholders of
the Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding
or by being converted into Voting Securities of the surviving entity)
at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or the stockholders of
the Company approve a plan of complete liquidation of the Company or
an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.
(b) CLAIM: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation whether conducted by the
Company or any other party, whether civil, criminal, administrative or
investigative.
(c) 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
4
participate in any Claim relating to any Indemnifiable Event.
(d) INDEMNIFIABLE EVENT: any event or occurrence related to the fact
that Director 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, employee benefit
plan, trust or other enterprise, or by reason of anything done or not
done by Director in any such capacity.
(e) REVIEWING PARTY: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special
independent counsel referred to in Section 2) who is not a party to
the particular Claim for which Director is seeking indemnification.
(f) VOTING SECURITIES: any securities of the Company which vote
generally in the election of directors.
9. AMENDMENTS AND WAIVER. 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.
10. 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 Director, 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.
11. NO DUPLICATION OF PAYMENTS. The Company shall not be liable
under this Agreement to make any payment in connection with any claim
made against Director to the extent Director has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of
the amounts otherwise indemnifiable hereunder.
12. 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, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Director
continues to serve as a director (or in one of the capacities
enumerated in Section 8(d) hereof) of the Company or of any other
enterprise at the Company's request.
5
13. 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, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed as of October 5, 1995.
XXXXXXXXXXX ENTERRA, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
---------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: President
/s/ Xxxx X. Xxxx
----------------------------
Xxxx X. Xxxx
INDEMNIFICATION AGREEMENT
This AGREEMENT, effective as of October 5, 1995 is between Xxxxxxxxxxx
Enterra, Inc., a Delaware corporation (the "Company"), and Xxxxxxx X. Xxxxxxxx
(the "Director"), a director of the Company;
WHEREAS, in recognition of Director's need for substantial protection
against personal liability in order to enhance Director's continued service
to the Company in an effective manner and of Director's reliance on the
provisions of the Company's By-Laws requiring indemnification of the
Director under certain circumstances, and in part to provide Director with
specific contractual assurance that the protection promised by such By-Laws
will be available to Director (regardless of, among other things, any
amendment to or revocation of such By-Laws, any change in the composition
of the Company's board of Directors or any acquisition transaction relating
to the Company), the Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to, Director 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 Director under the Company's directors' and
officers' liability insurance policies.
NOW THEREFORE, in consideration of the premises and of Director agreeing to
serve or continuing to serve the Company directly or, at its request, with
another enterprise, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. BASIC INDEMNIFICATION ARRANGEMENT
(a) In the event Director 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 (as defined hereinafter) by
reason of (or arising in part out of) an Indemnifiable Event (as
defined hereinafter), the Company shall indemnify Director to the
fullest extent permitted by law as soon as practicable, but in any
event no later than 30 days after written demand is presented to the
Company, against any and all Expenses (as defined hereinafter),
judgments, fines, penalties and amounts paid in settlement of such
Claim. If so requested by Director, the Company shall advance (within
ten business days after such written request) any and all Expenses to
Director an "Expense Advance". Notwithstanding anything in this
Agreement to the contrary, and except as provided in Section 3 hereof,
prior to a Change in Control (as defined hereinafter), Director shall
not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Director against the Company or
any director or officer of the Company, unless the Company has joined
in or consented to the initiation of such Claim.
(b) Notwithstanding the foregoing, (i) the obligations of the Company
under Section 1(a) shall be subject to the condition that the
Reviewing Party (as defined hereinafter) shall not have determined (in
a written opinion, in any case in which the special independent
counsel referred to in Section 2 hereof is involved) that Director
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 1(a) shall be subject to the condition that, if when and to
the extent that the Reviewing Party determines that Director would not
be permitted to be so indemnified under applicable law, the Company
shall be entitled to be reimbursed by Director (who hereby agrees to
reimburse the Company) for all such amounts theretofore paid;
provided, however, that if Director has commenced legal proceedings in
a court of competent jurisdiction to secure a determination that
Director should be indemnified under applicable law, any determination
made by the Reviewing Party that Director would not be permitted to be
indemnified under applicable law shall not be binding and Director
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 not been a Change in Control, the Reviewing
Party shall be selected by the Board of Directors, and if there has
been such a Change in Control, the Reviewing Party shall be the
special independent counsel referred to in Section 2 hereof. If there
has been no determination by the Reviewing Party or if the Reviewing
Party determines that Director substantively would not be permitted to
be indemnified in whole or in part under applicable law, Director
shall have the right to commence litigation in any court in the states
of Texas or Delaware having subject matter jurisdiction thereof and in
which venue is proper, seeking an initial determination by the court
or challenging any such determination by the Reviewing Party or any
aspect thereof, and the Company hereby consents to service of process
and to appear in any such proceeding. Any determination by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and Director.
2. CHANGE IN CONTROL. The Company agrees that if there is a Change
in Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control), then with
respect to all matters thereafter arising concerning the rights of
Director 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 special independent counsel selected by
Director and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services
for the Company or Director within the last five years (other than in
connection with such matters). Such counsel, among other things,
shall render its written opinion to the Company and Director as to
whether and to what extent Director would be permitted to be
indemnified under applicable law. The Company
2
agrees to pay the reasonable fees of the special, independent counsel
referred to above and to fully indemnify 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.
3. INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify Director against any and all expenses (including attorneys'
fees) and, if requested by Director, shall (within ten business days
after such written request) advance such expenses to Director, which
are incurred by Director in connection with any claim asserted against
or action brought by Director 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 Idemnifiable Events and/or (ii) recovery under any
directors' and officers' liability insurance policies maintained by
the Company, regardless of whether Director ultimately is determined
to be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
4. PARTIAL INDEMNITY, ETC. If Director is entitled under any
provision of this Agreement to indemnification by the Company of 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 Director for
the portion thereof to which Director is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Director 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, Director shall be indemnified
against all Expenses incurred in connection therewith. In connection
with any determination by the Reviewing Party or otherwise as to
whether Director is entitled to be indemnified hereunder, the burden
of proof shall be on the Company to establish that Director is not so
entitled.
5. NO PRESUMPTION. For purposes of this Agreement, the termination of
any action, suit or proceeding by judgment, order, settlement (whether
with or without court approval), conviction, or plea of nolo
contendere, or its equivalent, shall not create a presumption that
director 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.
6. NON-EXCLUSIVITY, ETC. The rights of Director hereunder shall be
in addition to any other rights Director may have under the Company's
By-Laws or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether
by statute or judicial decision) or the Company's By-Laws permits
greater indemnification by agreement than would be afforded
3
currently under the Company's By-Laws and this Agreement, it is the
intent of the parties hereto that Director shall enjoy by this
Agreement the greater benefits so afforded by such change.
7. LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Director 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.
8. CERTAIN DEFINITIONS.
(a) CHANGE IN CONTROL: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
Voting Securities (as defined hereinafter), or (ii) during any period
of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two- thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the stockholders of
the Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding
or by being converted into Voting Securities of the surviving entity)
at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or the stockholders of
the Company approve a plan of complete liquidation of the Company or
an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.
(b) CLAIM: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation whether conducted by the
Company or any other party, whether civil, criminal, administrative or
investigative.
(c) EXPENSES: include attorneys' fees and all other costs, expenses
and obligations paid or incurred in connection with investigating,
defending, being a witness in or
4
participating in (including on appeal), or preparing to defend, be a
witness in or participate in any Claim relating to any Indemnifiable
Event.
(d) INDEMNIFIABLE EVENT: any event or occurrence related to the fact
that Director 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, employee benefit
plan, trust or other enterprise, or by reason of anything done or not
done by Director in any such capacity.
(e) REVIEWING PARTY: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special
independent counsel referred to in Section 2) who is not a party to
the particular Claim for which Director is seeking indemnification.
(f) VOTING SECURITIES: any securities of the Company which vote
generally in the election of directors.
9. AMENDMENTS AND WAIVER. 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.
10. 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 Director, 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.
11. NO DUPLICATION OF PAYMENTS. The Company shall not be liable
under this Agreement to make any payment in connection with any claim
made against Director to the extent Director has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of
the amounts otherwise indemnifiable hereunder.
12. 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, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Director
continues to serve as a director (or in one of the capacities
enumerated in Section 8(d) hereof) of the Company or of any other
enterprise at the Company's request.
5
13. 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, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed as of October 5, 1995.
WEATHERFORD ENTERRA, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: President
/s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Xxxxxxx X. Xxxxxxxx
6
INDEMNIFICATION AGREEMENT
This AGREEMENT, effective as of October 5, 1995 is between Weatherford
Enterra, Inc., a Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxx, Xx.
(the "Director"), a director of the Company;
WHEREAS, in recognition of Director's need for substantial protection
against personal liability in order to enhance Director's continued service
to the Company in an effective manner and of Director's reliance on the
provisions of the Company's By-Laws requiring indemnification of the
Director under certain circumstances, and in part to provide Director with
specific contractual assurance that the protection promised by such By-Laws
will be available to Director (regardless of, among other things, any
amendment to or revocation of such By-Laws, any change in the composition
of the Company's board of Directors or any acquisition transaction relating
to the Company), the Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to, Director 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 Director under the Company's directors' and
officers' liability insurance policies.
NOW THEREFORE, in consideration of the premises and of Director
agreeing to serve or continuing to serve the Company directly or, at its
request, with another enterprise, and intending to be legally bound hereby,
the parties hereto agree as follows:
1. BASIC INDEMNIFICATION ARRANGEMENT
(a) In the event Director 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 (as defined hereinafter) by
reason of (or arising in part out of) an Indemnifiable Event (as
defined hereinafter), the Company shall indemnify Director to the
fullest extent permitted by law as soon as practicable, but in any
event no later than 30 days after written demand is presented to the
Company, against any and all Expenses (as defined hereinafter),
judgments, fines, penalties and amounts paid in settlement of such
Claim. If so requested by Director, the Company shall advance (within
ten business days after such written request) any and all Expenses to
Director an "Expense Advance". Notwithstanding anything in this
Agreement to the contrary, and except as provided in Section 3 hereof,
prior to a Change in Control (as defined hereinafter), Director shall
not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Director against the Company or
any director or officer of the Company, unless the Company has joined
in or consented to the initiation of such Claim.
(b) Notwithstanding the foregoing, (i) the obligations of the Company
under Section 1(a) shall be subject to the condition that the
Reviewing Party (as defined hereinafter) shall not have determined (in
a written opinion, in any case in which the special independent
counsel referred to in Section 2 hereof is involved) that Director
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 1(a) shall be subject to the condition that, if when and to
the extent that the Reviewing Party determines that Director would not
be permitted to be so indemnified under applicable law, the Company
shall be entitled to be reimbursed by Director (who hereby agrees to
reimburse the Company) for all such amounts theretofore paid;
provided, however, that if Director has commenced legal proceedings in
a court of competent jurisdiction to secure a determination that
Director should be indemnified under applicable law, any determination
made by the Reviewing Party that Director would not be permitted to be
indemnified under applicable law shall not be binding and Director
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 not been a Change in Control, the Reviewing
Party shall be selected by the Board of Directors, and if there has
been such a Change in Control, the Reviewing Party shall be the
special independent counsel referred to in Section 2 hereof. If there
has been no determination by the Reviewing Party or if the Reviewing
Party determines that Director substantively would not be permitted to
be indemnified in whole or in part under applicable law, Director
shall have the right to commence litigation in any court in the states
of Texas or Delaware having subject matter jurisdiction thereof and in
which venue is proper, seeking an initial determination by the court
or challenging any such determination by the Reviewing Party or any
aspect thereof, and the Company hereby consents to service of process
and to appear in any such proceeding. Any determination by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and Director.
2. CHANGE IN CONTROL. The Company agrees that if there is a Change
in Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control), then with
respect to all matters thereafter arising concerning the rights of
Director 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 special independent counsel selected by
Director and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services
for the Company or Director within the last five years (other than in
connection with such matters). Such counsel, among other things,
shall render its written opinion to the Company and Director as to
whether and to what extent Director would be permitted to be
indemnified under applicable law. The Company
2
agrees to pay the reasonable fees of the special, independent counsel
referred to above and to fully indemnify 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.
3. INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify Director against any and all expenses (including attorneys'
fees) and, if requested by Director, shall (within ten business days
after such written request) advance such expenses to Director, which
are incurred by Director in connection with any claim asserted against
or action brought by Director 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 Idemnifiable Events and/or (ii) recovery under any
directors' and officers' liability insurance policies maintained by
the Company, regardless of whether Director ultimately is determined
to be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
4. PARTIAL INDEMNITY, ETC. If Director is entitled under any
provision of this Agreement to indemnification by the Company of 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 Director for
the portion thereof to which Director is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Director 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, Director shall be indemnified
against all Expenses incurred in connection therewith. In connection
with any determination by the Reviewing Party or otherwise as to
whether Director is entitled to be indemnified hereunder, the burden
of proof shall be on the Company to establish that Director is not so
entitled.
5. NO PRESUMPTION. For purposes of this Agreement, the termination of
any action, suit or proceeding by judgment, order, settlement (whether
with or without court approval), conviction, or plea of nolo
contendere, or its equivalent, shall not create a presumption that
director 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.
6. NON-EXCLUSIVITY, ETC. The rights of Director hereunder shall be
in addition to any other rights Director may have under the Company's
By-Laws or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether
by statute or judicial decision) or the Company's By-Laws permits
greater indemnification by agreement than would be afforded
3
currently under the Company's By-Laws and this Agreement, it is the
intent of the parties hereto that Director shall enjoy by this
Agreement the greater benefits so afforded by such change.
7. LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Director 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.
8. CERTAIN DEFINITIONS.
(a) CHANGE IN CONTROL: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
Voting Securities (as defined hereinafter), or (ii) during any period
of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two- thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the stockholders of
the Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding
or by being converted into Voting Securities of the surviving entity)
at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or the stockholders of
the Company approve a plan of complete liquidation of the Company or
an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.
(b) CLAIM: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation whether conducted by the
Company or any other party, whether civil, criminal, administrative or
investigative.
(c) EXPENSES: include attorneys' fees and all other costs, expenses
and obligations paid or incurred in connection with investigating,
defending, being a witness in or
4
participating in (including on appeal), or preparing to defend, be a
witness in or participate in any Claim relating to any Indemnifiable
Event.
(d) INDEMNIFIABLE EVENT: any event or occurrence related to the fact
that Director 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, employee benefit
plan, trust or other enterprise, or by reason of anything done or not
done by Director in any such capacity.
(e) REVIEWING PARTY: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special
independent counsel referred to in Section 2) who is not a party to
the particular Claim for which Director is seeking indemnification.
(f) VOTING SECURITIES: any securities of the Company which vote
generally in the election of directors.
9. AMENDMENTS AND WAIVER. 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.
10. 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 Director, 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.
11. NO DUPLICATION OF PAYMENTS. The Company shall not be liable
under this Agreement to make any payment in connection with any claim
made against Director to the extent Director has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of
the amounts otherwise indemnifiable hereunder.
12. 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, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Director
continues to serve as a director (or in one of the capacities
enumerated in Section 8(d) hereof) of the Company or of any other
enterprise at the Company's request.
5
13. 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, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed as of October 5, 1995.
XXXXXXXXXXX ENTERRA, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: President
/s/ Xxxxxx X. Xxxxxx, Xx.
--------------------------------
Xxxxxx X. Xxxxxx, Xx.
6
INDEMNIFICATION AGREEMENT
This AGREEMENT, effective as of October 5, 1995 is between Xxxxxxxxxxx
Enterra, Inc., a Delaware corporation (the "Company"), and R. Xxxxxxx Xxxxxxxxx
(the "Director"), a director of the Company;
WHEREAS, in recognition of Director's need for substantial protection
against personal liability in order to enhance Director's continued service
to the Company in an effective manner and of Director's reliance on the
provisions of the Company's By-Laws requiring indemnification of the
Director under certain circumstances, and in part to provide Director with
specific contractual assurance that the protection promised by such By-Laws
will be available to Director (regardless of, among other things, any
amendment to or revocation of such By-Laws, any change in the composition
of the Company's board of Directors or any acquisition transaction relating
to the Company), the Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to, Director 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 Director under the Company's directors' and
officers' liability insurance policies.
NOW THEREFORE, in consideration of the premises and of Director
agreeing to serve or continuing to serve the Company directly or, at its
request, with another enterprise, and intending to be legally bound hereby,
the parties hereto agree as follows:
1. BASIC INDEMNIFICATION ARRANGEMENT
(a) In the event Director 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 (as defined hereinafter) by
reason of (or arising in part out of) an Indemnifiable Event (as
defined hereinafter), the Company shall indemnify Director to the
fullest extent permitted by law as soon as practicable, but in any
event no later than 30 days after written demand is presented to the
Company, against any and all Expenses (as defined hereinafter),
judgments, fines, penalties and amounts paid in settlement of such
Claim. If so requested by Director, the Company shall advance (within
ten business days after such written request) any and all Expenses to
Director an "Expense Advance". Notwithstanding anything in this
Agreement to the contrary, and except as provided in Section 3 hereof,
prior to a Change in Control (as defined hereinafter), Director shall
not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Director against the Company or
any director or officer of the Company, unless the Company has joined
in or consented to the initiation of such Claim.
(b) Notwithstanding the foregoing, (i) the obligations of the Company
under Section 1(a) shall be subject to the condition that the
Reviewing Party (as defined hereinafter) shall not have determined (in
a written opinion, in any case in which the special independent
counsel referred to in Section 2 hereof is involved) that Director
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 1(a) shall be subject to the condition that, if when and to
the extent that the Reviewing Party determines that Director would not
be permitted to be so indemnified under applicable law, the Company
shall be entitled to be reimbursed by Director (who hereby agrees to
reimburse the Company) for all such amounts theretofore paid;
provided, however, that if Director has commenced legal proceedings in
a court of competent jurisdiction to secure a determination that
Director should be indemnified under applicable law, any determination
made by the Reviewing Party that Director would not be permitted to be
indemnified under applicable law shall not be binding and Director
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 not been a Change in Control, the Reviewing
Party shall be selected by the Board of Directors, and if there has
been such a Change in Control, the Reviewing Party shall be the
special independent counsel referred to in Section 2 hereof. If there
has been no determination by the Reviewing Party or if the Reviewing
Party determines that Director substantively would not be permitted to
be indemnified in whole or in part under applicable law, Director
shall have the right to commence litigation in any court in the states
of Texas or Delaware having subject matter jurisdiction thereof and in
which venue is proper, seeking an initial determination by the court
or challenging any such determination by the Reviewing Party or any
aspect thereof, and the Company hereby consents to service of process
and to appear in any such proceeding. Any determination by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and Director.
2. CHANGE IN CONTROL. The Company agrees that if there is a Change
in Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control), then with
respect to all matters thereafter arising concerning the rights of
Director 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 special independent counsel selected by
Director and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services
for the Company or Director within the last five years (other than in
connection with such matters). Such counsel, among other things,
shall render its written opinion to the Company and Director as to
whether and to what extent Director would be permitted to be
indemnified under applicable law. The Company
2
agrees to pay the reasonable fees of the special, independent counsel
referred to above and to fully indemnify 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.
3. INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify Director against any and all expenses (including attorneys'
fees) and, if requested by Director, shall (within ten business days
after such written request) advance such expenses to Director, which
are incurred by Director in connection with any claim asserted against
or action brought by Director 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 Idemnifiable Events and/or (ii) recovery under any
directors' and officers' liability insurance policies maintained by
the Company, regardless of whether Director ultimately is determined
to be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
4. PARTIAL INDEMNITY, ETC. If Director is entitled under any
provision of this Agreement to indemnification by the Company of 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 Director for
the portion thereof to which Director is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Director 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, Director shall be indemnified
against all Expenses incurred in connection therewith. In connection
with any determination by the Reviewing Party or otherwise as to
whether Director is entitled to be indemnified hereunder, the burden
of proof shall be on the Company to establish that Director is not so
entitled.
5. NO PRESUMPTION. For purposes of this Agreement, the termination of
any action, suit or proceeding by judgment, order, settlement (whether
with or without court approval), conviction, or plea of nolo
contendere, or its equivalent, shall not create a presumption that
director 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.
6. NON-EXCLUSIVITY, ETC. The rights of Director hereunder shall be
in addition to any other rights Director may have under the Company's
By-Laws or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether
by statute or judicial decision) or the Company's By-Laws permits
greater indemnification by agreement than would be afforded
3
currently under the Company's By-Laws and this Agreement, it is the
intent of the parties hereto that Director shall enjoy by this
Agreement the greater benefits so afforded by such change.
7. LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Director 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.
8. CERTAIN DEFINITIONS.
(a) CHANGE IN CONTROL: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
Voting Securities (as defined hereinafter), or (ii) during any period
of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two- thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the stockholders of
the Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding
or by being converted into Voting Securities of the surviving entity)
at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or the stockholders of
the Company approve a plan of complete liquidation of the Company or
an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.
(b) CLAIM: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation whether conducted by the
Company or any other party, whether civil, criminal, administrative or
investigative.
(c) EXPENSES: include attorneys' fees and all other costs, expenses
and obligations paid or incurred in connection with investigating,
defending, being a witness in or
4
participating in (including on appeal), or preparing to defend, be a
witness in or participate in any Claim relating to any Indemnifiable
Event.
(d) INDEMNIFIABLE EVENT: any event or occurrence related to the fact
that Director 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, employee benefit
plan, trust or other enterprise, or by reason of anything done or not
done by Director in any such capacity.
(e) REVIEWING PARTY: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special
independent counsel referred to in Section 2) who is not a party to
the particular Claim for which Director is seeking indemnification.
(f) VOTING SECURITIES: any securities of the Company which vote
generally in the election of directors.
9. AMENDMENTS AND WAIVER. 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.
10. 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 Director, 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.
11. NO DUPLICATION OF PAYMENTS. The Company shall not be liable
under this Agreement to make any payment in connection with any claim
made against Director to the extent Director has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of
the amounts otherwise indemnifiable hereunder.
12. 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, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Director
continues to serve as a director (or in one of the capacities
enumerated in Section 8(d) hereof) of the Company or of any other
enterprise at the Company's request.
5
13. 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, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed as of October 5, 1995.
XXXXXXXXXXX ENTERRA, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: President
/s/ R. Xxxxxxx Xxxxxxxxx
--------------------------------
R. Xxxxxxx Xxxxxxxxx
6
INDEMNIFICATION AGREEMENT
This AGREEMENT, effective as of October 5, 1995 is between Xxxxxxxxxxx
Enterra, Inc., a Delaware corporation (the "Company"), and Xxxxx X. Xxxxxxx (the
"Director"), a director of the Company;
WHEREAS, in recognition of Director's need for substantial protection
against personal liability in order to enhance Director's continued service
to the Company in an effective manner and of Director's reliance on the
provisions of the Company's By-Laws requiring indemnification of the
Director under certain circumstances, and in part to provide Director with
specific contractual assurance that the protection promised by such By-Laws
will be available to Director (regardless of, among other things, any
amendment to or revocation of such By-Laws, any change in the composition
of the Company's board of Directors or any acquisition transaction relating
to the Company), the Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to, Director 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 Director under the Company's directors' and
officers' liability insurance policies.
NOW THEREFORE, in consideration of the premises and of Director
agreeing to serve or continuing to serve the Company directly or, at its
request, with another enterprise, and intending to be legally bound hereby,
the parties hereto agree as follows:
1. BASIC INDEMNIFICATION ARRANGEMENT
(a) In the event Director 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 (as defined hereinafter) by
reason of (or arising in part out of) an Indemnifiable Event (as
defined hereinafter), the Company shall indemnify Director to the
fullest extent permitted by law as soon as practicable, but in any
event no later than 30 days after written demand is presented to the
Company, against any and all Expenses (as defined hereinafter),
judgments, fines, penalties and amounts paid in settlement of such
Claim. If so requested by Director, the Company shall advance (within
ten business days after such written request) any and all Expenses to
Director an "Expense Advance". Notwithstanding anything in this
Agreement to the contrary, and except as provided in Section 3 hereof,
prior to a Change in Control (as defined hereinafter), Director shall
not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Director against the Company or
any director or officer of the Company, unless the Company has joined
in or consented to the initiation of such Claim.
(b) Notwithstanding the foregoing, (i) the obligations of the Company
under Section 1(a) shall be subject to the condition that the
Reviewing Party (as defined hereinafter) shall not have determined (in
a written opinion, in any case in which the special independent
counsel referred to in Section 2 hereof is involved) that Director
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 1(a) shall be subject to the condition that, if when and to
the extent that the Reviewing Party determines that Director would not
be permitted to be so indemnified under applicable law, the Company
shall be entitled to be reimbursed by Director (who hereby agrees to
reimburse the Company) for all such amounts theretofore paid;
provided, however, that if Director has commenced legal proceedings in
a court of competent jurisdiction to secure a determination that
Director should be indemnified under applicable law, any determination
made by the Reviewing Party that Director would not be permitted to be
indemnified under applicable law shall not be binding and Director
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 not been a Change in Control, the Reviewing
Party shall be selected by the Board of Directors, and if there has
been such a Change in Control, the Reviewing Party shall be the
special independent counsel referred to in Section 2 hereof. If there
has been no determination by the Reviewing Party or if the Reviewing
Party determines that Director substantively would not be permitted to
be indemnified in whole or in part under applicable law, Director
shall have the right to commence litigation in any court in the states
of Texas or Delaware having subject matter jurisdiction thereof and in
which venue is proper, seeking an initial determination by the court
or challenging any such determination by the Reviewing Party or any
aspect thereof, and the Company hereby consents to service of process
and to appear in any such proceeding. Any determination by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and Director.
2. CHANGE IN CONTROL. The Company agrees that if there is a Change
in Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control), then with
respect to all matters thereafter arising concerning the rights of
Director 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 special independent counsel selected by
Director and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services
for the Company or Director within the last five years (other than in
connection with such matters). Such counsel, among other things,
shall render its written opinion to the Company and Director as to
whether and to what extent Director would be permitted to be
indemnified under applicable law. The Company
2
agrees to pay the reasonable fees of the special, independent counsel
referred to above and to fully indemnify 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.
3. INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify Director against any and all expenses (including attorneys'
fees) and, if requested by Director, shall (within ten business days
after such written request) advance such expenses to Director, which
are incurred by Director in connection with any claim asserted against
or action brought by Director 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 Idemnifiable Events and/or (ii) recovery under any
directors' and officers' liability insurance policies maintained by
the Company, regardless of whether Director ultimately is determined
to be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
4. PARTIAL INDEMNITY, ETC. If Director is entitled under any
provision of this Agreement to indemnification by the Company of 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 Director for
the portion thereof to which Director is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Director 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, Director shall be indemnified
against all Expenses incurred in connection therewith. In connection
with any determination by the Reviewing Party or otherwise as to
whether Director is entitled to be indemnified hereunder, the burden
of proof shall be on the Company to establish that Director is not so
entitled.
5. NO PRESUMPTION. For purposes of this Agreement, the termination of
any action, suit or proceeding by judgment, order, settlement (whether
with or without court approval), conviction, or plea of nolo
contendere, or its equivalent, shall not create a presumption that
director 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.
6. NON-EXCLUSIVITY, ETC. The rights of Director hereunder shall be
in addition to any other rights Director may have under the Company's
By-Laws or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether
by statute or judicial decision) or the Company's By-Laws permits
greater indemnification by agreement than would be afforded
3
currently under the Company's By-Laws and this Agreement, it is the
intent of the parties hereto that Director shall enjoy by this
Agreement the greater benefits so afforded by such change.
7. LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Director 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.
8. CERTAIN DEFINITIONS.
(a) CHANGE IN CONTROL: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
Voting Securities (as defined hereinafter), or (ii) during any period
of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two- thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the stockholders of
the Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding
or by being converted into Voting Securities of the surviving entity)
at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or the stockholders of
the Company approve a plan of complete liquidation of the Company or
an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.
(b) CLAIM: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation whether conducted by the
Company or any other party, whether civil, criminal, administrative or
investigative.
(c) EXPENSES: include attorneys' fees and all other costs, expenses
and obligations paid or incurred in connection with investigating,
defending, being a witness in or
4
participating in (including on appeal), or preparing to defend, be a
witness in or participate in any Claim relating to any Indemnifiable
Event.
(d) INDEMNIFIABLE EVENT: any event or occurrence related to the fact
that Director 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, employee benefit
plan, trust or other enterprise, or by reason of anything done or not
done by Director in any such capacity.
(e) REVIEWING PARTY: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special
independent counsel referred to in Section 2) who is not a party to
the particular Claim for which Director is seeking indemnification.
(f) VOTING SECURITIES: any securities of the Company which vote
generally in the election of directors.
9. AMENDMENTS AND WAIVER. 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.
10. 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 Director, 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.
11. NO DUPLICATION OF PAYMENTS. The Company shall not be liable
under this Agreement to make any payment in connection with any claim
made against Director to the extent Director has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of
the amounts otherwise indemnifiable hereunder.
12. 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, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Director
continues to serve as a director (or in one of the capacities
enumerated in Section 8(d) hereof) of the Company or of any other
enterprise at the Company's request.
5
13. 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, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed as of October 5, 1995.
XXXXXXXXXXX ENTERRA, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: President
/s/ Xxxxx X. Xxxxxxx
--------------------------------
Xxxxx X. Xxxxxxx
INDEMNIFICATION AGREEMENT
This AGREEMENT, effective as of October 5, 1995 is between Xxxxxxxxxxx
Enterra, Inc., a Delaware corporation (the "Company"), and M. Xxxxxxx Xxxxx (the
"Officer"), an officer of the Company;
WHEREAS, in recognition of Officer's need for substantial protection
against personal liability in order to enhance Officer's continued service
to the Company in an effective manner and of Officer's reliance on the
provisions of the Company's By-Laws requiring indemnification of the
Officer under certain circumstances, and in part to provide Officer with
specific contractual assurance that the protection promised by such By-Laws
will be available to Officer (regardless of, among other things, any
amendment to or revocation of such By-Laws, any change in the composition
of the Company's Board of Directors or any acquisition transaction relating
to the Company), the Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to, Officer 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 Officer under the Company's directors' and
officers' liability insurance policies.
NOW THEREFORE, in consideration of the premises and of Officer agreeing to
serve or continuing to serve the Company directly or, at its request, with
another enterprise, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. BASIC INDEMNIFICATION ARRANGEMENT
(a) In the event Officer 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 (as defined hereinafter) by
reason of (or arising in part out of) an Indemnifiable Event (as
defined hereinafter), the Company shall indemnify Officer to the
fullest extent permitted by law as soon as practicable, but in any
event no later than 30 days after written demand is presented to the
Company, against any and all Expenses (as defined hereinafter),
judgments, fines, penalties and amounts paid in settlement of such
Claim. If so requested by Officer, the Company shall advance (within
ten business days after such written request) any and all Expenses to
Officer (an "Expense Advance"). Notwithstanding anything in this
Agreement to the contrary, and except as provided in Section 3 hereof,
prior to a Change in Control (as defined hereinafter), Officer shall
not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Officer against the Company or
any director or officer of the Company, unless the Company has joined
in or consented to the initiation of such Claim.
1
(b) Notwithstanding the foregoing, (i) the obligations of the Company
under Section 1(a) shall be subject to the condition that the
Reviewing Party (as defined hereinafter) shall not have determined (in
a written opinion, in any case in which the special independent
counsel referred to in Section 2 hereof is involved) that Officer
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 1(a) shall be subject to the condition that, if, when and
to the extent that the Reviewing Party determines that Officer would
not be permitted to be so indemnified under applicable law, the
Company shall be entitled to be reimbursed by Officer (who hereby
agrees to reimburse the Company) for all such amounts theretofore
paid; provided, however, that if Officer has commenced legal
proceedings in a court of competent jurisdiction to secure a
determination that Officer should be indemnified under applicable law,
any determination made by the Reviewing Party that Officer would not
be permitted to be indemnified under applicable law shall not be
binding and Officer 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 not been a Change in Control, the
Reviewing Party shall be selected by the Board of Directors, and if
there has been such a Change in Control, the Reviewing Party shall be
the special independent counsel referred to in Section 2 hereof. If
there has been no determination by the Reviewing Party or if the
Reviewing Party determines that Officer substantively would not be
permitted to be indemnified in whole or in part under applicable law,
Officer shall have the right to commence litigation in any court in
the states of Texas or Delaware having subject matter jurisdiction
thereof and in which venue is proper, seeking an initial determination
by the court or challenging any such determination by the Reviewing
Party or any aspect thereof, and the Company hereby consents to
service of process and to appear in any such proceeding. Any
determination by the Reviewing Party otherwise shall be conclusive and
binding on the Company and Officer.
2. CHANGE IN CONTROL. The Company agrees that if there is a Change
in Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control), then with
respect to all matters thereafter arising concerning the rights of
Officer 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 special independent counsel selected by
Officer and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services
for the Company or Officer within the last five years (other than in
connection with such matters). Such counsel, among other things,
shall render its written opinion to the Company and Officer as to
whether and to what extent Officer would be permitted to be
indemnified under applicable law. The Company agrees to pay the
reasonable fees of the special, independent counsel referred to above
and to
2
fully indemnify 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.
3. INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify Officer against any and all expenses (including attorneys'
fees) and, if requested by Officer, shall (within ten business days
after such written request) advance such expenses to Officer, which
are incurred by Officer in connection with any claim asserted against
or action brought by Officer 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 Officer ultimately is determined to
be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
4. PARTIAL INDEMNITY, ETC. If Officer is entitled under any
provision of this Agreement to indemnification by the Company of 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 Officer for
the portion thereof to which Officer is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Officer 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, Officer shall be indemnified against all
Expenses incurred in connection therewith. In connection with any
determination by the Reviewing Party or otherwise as to whether
Officer is entitled to be indemnified hereunder, the burden of proof
shall be on the Company to establish that Officer is not so entitled.
5. NO PRESUMPTION. For purposes of this Agreement, the termination of
any action, suit or proceeding by judgment, order, settlement (whether
with or without court approval), conviction, or plea of nolo
contendere, or its equivalent, shall not create a presumption that
Officer 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.
6. NON-EXCLUSIVITY, ETC. The rights of Officer hereunder shall be in
addition to any other rights Officer may have under the Company's By-
Laws or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether
by statute or judicial decision) or the Company's By-Laws permits
greater indemnification by agreement than would be afforded currently
under the Company's By-Laws and this Agreement, it is the intent of
the parties hereto that Officer shall enjoy by this Agreement the
greater benefits so afforded by such change.
3
7. LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Officer 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 officer.
8. CERTAIN DEFINITIONS.
(a) CHANGE IN CONTROL: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
Voting Securities (as defined hereinafter), or (ii) during any period
of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the stockholders of
the Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding
or by being converted into Voting Securities of the surviving entity)
at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or the stockholders of
the Company approve a plan of complete liquidation of the Company or
an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.
(b) CLAIM: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation whether conducted by the
Company or any other party, whether civil, criminal, administrative or
investigative.
(c) 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.
4
(d) INDEMNIFIABLE EVENT: any event or occurrence related to the fact
that Officer 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, employee benefit
plan, trust or other enterprise, or by reason of anything done or not
done by Officer in any such capacity.
(e) REVIEWING PARTY: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special
independent counsel referred to in Section 2) who is not a party to
the particular Claim for which Officer is seeking indemnification.
(f) VOTING SECURITIES: any securities of the Company which vote
generally in the election of directors.
9. AMENDMENTS AND WAIVER. 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.
10. 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 Officer, 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.
11. NO DUPLICATION OF PAYMENTS. The Company shall not be liable
under this Agreement to make any payment in connection with any claim
made against Officer to the extent Officer has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of
the amounts otherwise indemnifiable hereunder.
12. 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, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Officer
continues to serve as a director or officer (or in one of the
capacities enumerated in Section 8(d) hereof) of the Company or of any
other enterprise at the Company's request.
5
13. 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, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed as of October 5, 1995.
XXXXXXXXXXX ENTERRA, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Chairman, President and
Chief Executive Officer
/s/ M. Xxxxxxx Xxxxx
--------------------------------
M. Xxxxxxx Xxxxx
INDEMNIFICATION AGREEMENT
This AGREEMENT, effective as of October 5, 1995 is between Xxxxxxxxxxx
Enterra, Inc., a Delaware corporation (the "Company"), and Xxxxxx X. Xxxxx (the
"Officer"), an officer of the Company;
WHEREAS, in recognition of Officer's need for substantial protection
against personal liability in order to enhance Officer's continued service
to the Company in an effective manner and of Officer's reliance on the
provisions of the Company's By-Laws requiring indemnification of the
Officer under certain circumstances, and in part to provide Officer with
specific contractual assurance that the protection promised by such By-Laws
will be available to Officer (regardless of, among other things, any
amendment to or revocation of such By-Laws, any change in the composition
of the Company's Board of Directors or any acquisition transaction relating
to the Company), the Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to, Officer 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 Officer under the Company's directors' and
officers' liability insurance policies.
NOW THEREFORE, in consideration of the premises and of Officer agreeing to
serve or continuing to serve the Company directly or, at its request, with
another enterprise, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. BASIC INDEMNIFICATION ARRANGEMENT
(a) In the event Officer 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 (as defined hereinafter) by
reason of (or arising in part out of) an Indemnifiable Event (as
defined hereinafter), the Company shall indemnify Officer to the
fullest extent permitted by law as soon as practicable, but in any
event no later than 30 days after written demand is presented to the
Company, against any and all Expenses (as defined hereinafter),
judgments, fines, penalties and amounts paid in settlement of such
Claim. If so requested by Officer, the Company shall advance (within
ten business days after such written request) any and all Expenses to
Officer (an "Expense Advance"). Notwithstanding anything in this
Agreement to the contrary, and except as provided in Section 3 hereof,
prior to a Change in Control (as defined hereinafter), Officer shall
not be entitled to indemnification pursuant to this Agreement in
connection with any Claim initiated by Officer against the Company or
any director or officer of the Company, unless the Company has joined
in or consented to the initiation of such Claim.
1
(b) Notwithstanding the foregoing, (i) the obligations of the Company
under Section 1(a) shall be subject to the condition that the
Reviewing Party (as defined hereinafter) shall not have determined (in
a written opinion, in any case in which the special independent
counsel referred to in Section 2 hereof is involved) that Officer
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 1(a) shall be subject to the condition that, if, when and
to the extent that the Reviewing Party determines that Officer would
not be permitted to be so indemnified under applicable law, the
Company shall be entitled to be reimbursed by Officer (who hereby
agrees to reimburse the Company) for all such amounts theretofore
paid; provided, however, that if Officer has commenced legal
proceedings in a court of competent jurisdiction to secure a
determination that Officer should be indemnified under applicable law,
any determination made by the Reviewing Party that Officer would not
be permitted to be indemnified under applicable law shall not be
binding and Officer 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 not been a Change in Control, the
Reviewing Party shall be selected by the Board of Directors, and if
there has been such a Change in Control, the Reviewing Party shall be
the special independent counsel referred to in Section 2 hereof. If
there has been no determination by the Reviewing Party or if the
Reviewing Party determines that Officer substantively would not be
permitted to be indemnified in whole or in part under applicable law,
Officer shall have the right to commence litigation in any court in
the states of Texas or Delaware having subject matter jurisdiction
thereof and in which venue is proper, seeking an initial determination
by the court or challenging any such determination by the Reviewing
Party or any aspect thereof, and the Company hereby consents to
service of process and to appear in any such proceeding. Any
determination by the Reviewing Party otherwise shall be conclusive and
binding on the Company and Officer.
2. CHANGE IN CONTROL. The Company agrees that if there is a Change
in Control of the Company (other than a Change in Control which has
been approved by a majority of the Company's Board of Directors who
were directors immediately prior to such Change in Control), then with
respect to all matters thereafter arising concerning the rights of
Officer 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 special independent counsel selected by
Officer and approved by the Company (which approval shall not be
unreasonably withheld), and who has not otherwise performed services
for the Company or Officer within the last five years (other than in
connection with such matters). Such counsel, among other things,
shall render its written opinion to the Company and Officer as to
whether and to what extent Officer would be permitted to be
indemnified under applicable law. The Company agrees to pay the
reasonable fees of the special, independent counsel referred to above
and to
2
fully indemnify 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.
3. INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify Officer against any and all expenses (including attorneys'
fees) and, if requested by Officer, shall (within ten business days
after such written request) advance such expenses to Officer, which
are incurred by Officer in connection with any claim asserted against
or action brought by Officer 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 Officer ultimately is determined to
be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be.
4. PARTIAL INDEMNITY, ETC. If Officer is entitled under any
provision of this Agreement to indemnification by the Company of 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 Officer for
the portion thereof to which Officer is entitled. Moreover,
notwithstanding any other provision of this Agreement, to the extent
that Officer 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, Officer shall be indemnified against all
Expenses incurred in connection therewith. In connection with any
determination by the Reviewing Party or otherwise as to whether
Officer is entitled to be indemnified hereunder, the burden of proof
shall be on the Company to establish that Officer is not so entitled.
5. NO PRESUMPTION. For purposes of this Agreement, the termination of
any action, suit or proceeding by judgment, order, settlement (whether
with or without court approval), conviction, or plea of nolo
contendere, or its equivalent, shall not create a presumption that
Officer 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.
6. NON-EXCLUSIVITY, ETC. The rights of Officer hereunder shall be in
addition to any other rights Officer may have under the Company's By-
Laws or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether
by statute or judicial decision) or the Company's By-Laws permits
greater indemnification by agreement than would be afforded currently
under the Company's By-Laws and this Agreement, it is the intent of
the parties hereto that Officer shall enjoy by this Agreement the
greater benefits so afforded by such change.
3
7. LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers'
liability insurance, Officer 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 officer.
8. CERTAIN DEFINITIONS.
(a) CHANGE IN CONTROL: shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
Voting Securities (as defined hereinafter), or (ii) during any period
of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, or (iii) the stockholders of
the Company approve a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding
or by being converted into Voting Securities of the surviving entity)
at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or the stockholders of
the Company approve a plan of complete liquidation of the Company or
an agreement for the sale or disposition by the Company of all or
substantially all the Company's assets.
(b) CLAIM: any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation whether conducted by the
Company or any other party, whether civil, criminal, administrative or
investigative.
(c) 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.
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(d) INDEMNIFIABLE EVENT: any event or occurrence related to the fact
that Officer 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, employee benefit
plan, trust or other enterprise, or by reason of anything done or not
done by Officer in any such capacity.
(e) REVIEWING PARTY: any appropriate person or body consisting of a
member or members of the Company's Board of Directors or any other
person or body appointed by the Board (including the special
independent counsel referred to in Section 2) who is not a party to
the particular Claim for which Officer is seeking indemnification.
(f) VOTING SECURITIES: any securities of the Company which vote
generally in the election of directors.
9. AMENDMENTS AND WAIVER. 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.
10. 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 Officer, 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.
11. NO DUPLICATION OF PAYMENTS. The Company shall not be liable
under this Agreement to make any payment in connection with any claim
made against Officer to the extent Officer has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of
the amounts otherwise indemnifiable hereunder.
12. 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, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Officer
continues to serve as a director or officer (or in one of the
capacities enumerated in Section 8(d) hereof) of the Company or of any
other enterprise at the Company's request.
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13. 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, and the remaining provisions shall remain enforceable
to the fullest extent permitted by law.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed as of October 5, 1995.
XXXXXXXXXXX ENTERRA, INC.
By: /s/ Xxxxxx Xxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Chairman, President and
Chief Executive Officer
/s/ Xxxxxx X. Xxxxx
--------------------------------
Xxxxxx X. Xxxxx
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