DIRECTOR INDEMNITY AGREEMENT
EXHIBIT
10.11
THIS AGREEMENT is made as of , 20 , by and between Xxxxxxxxxxx, Inc., an
Indiana corporation (the “Corporation”), and (the “Director”).
WHEREAS, the Corporation is aware that competent and experienced persons are increasingly
reluctant to serve as directors of corporations unless they are protected by director liability
insurance and/or indemnification, due to the increasing amount of litigation against directors and
the increasing expense of defending such claims, and due to the fact that the exposure frequently
bears no reasonable relationship to the compensation of such directors; and
WHEREAS, it is essential to the Corporation to retain and attract as directors the most
capable and qualified persons available; and
WHEREAS, it is now and has been the express policy of the Corporation to indemnify its
directors so as to provide them with the maximum possible protection permitted by law; and
WHEREAS, the Corporation’s articles of incorporation and the Indiana Business Corporation Law,
by their nonexclusive nature, permit contracts between the Corporation and its directors with
respect to indemnification of directors.
NOW, THEREFORE, the Corporation and the Director agree as follows:
1. Definitions. As used in this Agreement:
(a) “expenses” includes all direct and indirect costs of any type or nature whatsoever
(including, without limitation, all attorneys’ fees and related disbursements and other
out-of-pocket costs) actually and reasonably incurred by the Director in connection with the
investigation, defense, settlement or appeal of a proceeding or establishing or enforcing a right
to indemnification or advancement of expenses under this Agreement; provided, however, that
expenses shall not include any judgments, fines, ERISA excise taxes or penalties or amounts paid in
settlement of a proceeding.
(b) “proceeding” includes, without limitation, any threatened, pending, or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation, administrative hearing or
any other proceeding, whether civil, criminal, administrative, or investigative and whether formal
or informal, whether by a third party or by or in the right of the Corporation, by reason of the
fact that the Director is or was a director of the Corporation or, while a director of the
Corporation, is or was serving at the request of the Corporation as a director, officer, partner,
member, manager, trustee, employee, fiduciary, or agent of another foreign or domestic corporation,
partnership, limited liability company, joint venture, trust, employee benefit plan, or other
enterprise, or an affiliate of the Corporation, whether for profit or not.
2. Indemnity. The Corporation shall indemnify the Director in accordance with the
provisions of this Section 2 if the Director is a party to or threatened to be made a party to any
proceeding against all expenses, judgments, fines (including any excise tax or penalty assessed
with respect to any employee benefit plan) and amounts paid in settlement actually and reasonably
incurred by the Director in connection with such proceeding, but only (a) if the Director acted in
good faith, and (b) (i) in the case of conduct in the Director’s official capacity with the
Corporation, if the Director acted in a manner which the Director reasonably believed to be in the
best interests of the Corporation, or (ii) in the case of conduct other than in the Director’s
official capacity with the Corporation, if the Director acted in a manner which the Director
reasonably believed was at least not opposed to the best interests of the Corporation, and (c) in
the case of a criminal proceeding, the Director had reasonable cause to believe that the Director’s
conduct was lawful or had no reasonable cause to believe that the Director’s conduct was unlawful,
and (d) if required by the Indiana Business Corporation Law, as amended or as may be amended,
revised or superseded (the “Act”), the Corporation makes a determination that indemnification of
the Director is permissible because the Director has met the standard of conduct as set forth in
the Act.
3. Indemnification of Expenses of Successful Party. Notwithstanding any other
provisions of this Agreement, to the extent that the Director has been wholly successful, on the
merits or otherwise, in the defense of any proceeding or in defense of any claim, issue or matter
therein, including the dismissal of an action without prejudice, the Corporation shall indemnify
the Director against all expenses incurred in connection therewith.
4. Additional Indemnification. Notwithstanding any limitation in Sections 2 or 3, the
Corporation shall indemnify the Director to the full extent authorized or permitted by any
amendments to or replacements of the Act adopted after the date of this Agreement that increase the
extent to which a corporation may indemnify its directors if the Director is a party to or
threatened to be made a party to any proceeding against all expenses, judgments, fines (including
any excise tax or penalty assessed with respect to any employee benefit plan) and amounts paid in
settlement actually and reasonably incurred by the Director in connection with such proceeding.
5. Exclusions. Notwithstanding any provision in this Agreement, the Corporation shall
not be obligated under this Agreement to make any indemnity or advance expenses in connection with
any claim made against the Director:
(a) for which payment has actually been made to or on behalf of the Director under any
insurance policy or other indemnity provision, except with respect to any excess beyond the amount
paid under such insurance or other indemnity provision;
(b) if a court having jurisdiction in the matter shall finally determine that the Director
derived an improper personal benefit from any transaction;
(c) if a court having jurisdiction in the matter shall finally determine that the Director is
liable for disgorgement of profits resulting from the purchase and sale or sale and purchase by the
Director of securities of the Corporation in violation of Section 16(b) of the Securities
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Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local
statutory law or common law;
(d) if a court having jurisdiction in the matter shall finally determine that such
indemnification is not lawful under any applicable statute or public policy (in this respect, if
applicable, both the Corporation and the Director have been advised that the Securities and
Exchange Commission takes the position that indemnification for liabilities arising under the
federal securities laws is against public policy and is, therefore, unenforceable and that claims
for indemnification should be submitted to appropriate courts for adjudication); or
(e) in connection with any proceeding (or part thereof) initiated by the Director against the
Corporation or its directors, officers or employees, unless (i) such indemnification is expressly
required to be made by law, (ii) the proceeding was authorized by the Board of Directors of the
Corporation, (iii) such indemnification is provided by the Corporation, in its sole discretion,
pursuant to the powers vested in the Corporation under applicable law, or (iv) the proceeding is
initiated pursuant to Section 8 hereof and the Director is successful in whole or in part in such
proceeding.
6. Advancement of Expenses. The expenses incurred by the Director in any proceeding
shall be paid promptly by the Corporation upon demand and in advance of final disposition of the
proceeding at the written request of the Director, if (a) the Director furnishes the Corporation
with a written affirmation of the Director’s good faith belief that the Director has met the
standard of conduct required by the Act or this Agreement, (b) the Director furnishes the
Corporation with a written undertaking to repay such advance to the extent that it is ultimately
determined that the Director did not meet the standard of conduct that would entitle the Director
to indemnification, and (c) if required by the Act, the Corporation makes a determination that the
facts known to those making the determination would not preclude indemnification under the Act.
Such advances shall be made without regard to the Director’s ability to repay such expenses.
7. Notification and Defense of Claim. As soon as practicable after receipt by the
Director of notice of the commencement of any proceeding, the Director will, if a claim in respect
thereof is to be made against the Corporation under this Agreement, notify the Corporation of the
commencement thereof; provided, however, that the omission so to notify the Corporation will not
relieve the Corporation from any liability which it may have to the Director otherwise than under
this Agreement. With respect to any such proceeding as to which the Director notifies the
Corporation of the commencement thereof:
(a) The Corporation will be entitled to participate therein at its own expense.
(b) Except as otherwise provided below, the Corporation may, at its option and jointly with
any other indemnifying party similarly notified and electing to assume such defense, assume the
defense thereof, with legal counsel reasonably satisfactory to the Director. The Director shall
have the right to employ separate counsel in such proceeding, but the Corporation shall not be
liable to the Director under this Agreement, including Section 6 hereof, for the fees and expenses
of such counsel incurred after notice from the Corporation of its assumption of the
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defense,
unless (i) the Director reasonably concludes that there may be a conflict of interest
between the Corporation and the Director in the conduct of the defense of such proceeding or (ii)
the Corporation does not employ counsel to assume the defense of such proceeding. The Corporation
shall not be entitled to assume the defense of any proceeding brought by the Corporation or as to
which the Director shall have made the conclusion provided for in (i) above.
(c) If two or more persons who may be entitled to indemnification from the Corporation,
including the Director, are parties to any proceeding, the Corporation may require the Director to
engage the same legal counsel as the other parties. The Director shall have the right to employ
separate legal counsel in such proceeding, but the Corporation shall not be liable to the Director
under this Agreement, including Section 6 hereof, for the fees and expenses of such counsel
incurred after notice from the Corporation of the requirement to engage the same counsel as other
parties, unless the Director reasonably concludes that there may be a conflict of interest between
the Director and any of the other parties required by the Corporation to be represented by the same
legal counsel.
(d) The Corporation shall not be liable to indemnify the Director under this Agreement for any
amounts paid in settlement of any proceeding effected without its written consent in advance which
consent shall not be unreasonably withheld. The Corporation shall be permitted to settle any
proceeding the defense of which it assumes, except the Corporation shall not settle any action or
claim in any manner which would impose any penalty or limitation on the Director without the
Director’s written consent, which consent shall not be unreasonably withheld.
8. Enforcement. Any right to indemnification or advances granted by this Agreement to
the Director shall be enforceable by or on behalf of the Director in any court of competent
jurisdiction if (i) the claim for indemnification or advances is denied, in whole or in part, or
(ii) no disposition of such claim is made within 90 days of a written request therefor. The
Director, in such enforcement action, if successful in whole or in part, shall be entitled to be
paid also the expense of prosecuting the claim. Neither the failure of the Corporation (including
its Board of Directors or its shareholders) to make a determination prior to the commencement of
such enforcement action that indemnification of the Director is proper in the circumstances, nor an
actual determination by the Corporation (including its Board of Directors or its shareholders) that
such indemnification is improper, shall be a defense to the action or create a presumption that the
Director is not entitled to indemnification under this Agreement or otherwise. The termination of
any proceeding by judgment, order of court, settlement, conviction or upon a plea of nolo
contendere, or its equivalent, shall not, of itself, create a presumption that the Director is not
entitled to indemnification under this Agreement or otherwise.
9. Partial Indemnification. If the Director is entitled under any provisions of this
Agreement to indemnification by the Corporation for some or a portion of the expenses, judgments,
fines (including any excise tax or penalty assessed with respect to any employee benefit plan) and
amounts paid in settlement actually and reasonably incurred by the Director in the investigation,
defense, appeal or settlement of any proceeding but not, however, for the total amount thereof, the
Corporation shall indemnify the Director for the portion of such expenses,
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judgments,
fines (including any excise tax or penalty assessed with respect to any employee benefit plan) and
amounts paid in settlement to which the Director is entitled.
10. Term. The term of this Agreement shall begin on the date first written above and
shall terminate at such time as the Director no longer serves as a director of the Corporation,
subject to the survival of rights of indemnification set forth in paragraph 11 below.
11. Nonexclusivity; Survival; Successors and Assigns. The indemnification and advance
payment of expenses as provided by this Agreement shall not be deemed exclusive of any other rights
to which the Director may be entitled under the Corporation’s articles of incorporation, the
by-laws, any other agreement, any vote of shareholders or disinterested directors, the Act, or
otherwise, both as to action in the Director’s official capacity and as to action in another
capacity while holding such office. The right of the Director to indemnification under this
Agreement shall vest at the time of occurrence or performance of any event, act or omission or any
alleged event, act or omission giving rise to any action, suit or proceeding and, once vested,
shall survive any actual or purported termination of this Agreement by the Corporation or its
successors or assigns whether by operation of law or otherwise and shall survive termination of the
Director’s services to the Corporation and shall inure to the benefit of the heirs, personal
representatives and estate of the Director. This Agreement shall be binding, and the Corporation
shall take such action to ensure that it is binding, upon all successors and assigns of the
Corporation, including any transferee of all or substantially all of its assets and any successor
by merger, consolidation, or operation of law.
12. Severability. If this Agreement or any portion thereof is invalidated on any
ground by any court of competent jurisdiction, the Corporation shall indemnify the Director as to
expenses, judgments, fines (including any excise tax or penalty assessed with respect to any
employee benefit plan) and amounts paid in settlement with respect to any proceeding to the full
extent permitted by any applicable portion of this Agreement that is not invalidated or by any
other applicable law.
13. Subrogation. In the event of payment under this Agreement, the Corporation shall
be subrogated to the extent of such payment to all of the rights of recovery of the Director, who
shall execute all documents required and shall do all acts necessary or desirable to secure such
rights and to enable the Corporation effectively to bring suit to enforce such rights.
14. Modification 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 constitute a waiver of any other provisions hereof
(whether or nor similar) nor shall such waiver constitute a continuing waiver.
15. Notices. All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given (i) if delivered by hand and receipted
for by the party to whom such notice or other communication shall have been directed, at the time
of such delivery, or (ii) if mailed by certified or registered mail, return receipt requested, with
postage prepaid, three (3) business days after deposit into the United States mail
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if to an address in the United States, or if delivered by recognized overnight courier three (3) business days after
receipt by such courier if to an address outside the United States:
| (a) | If to the Director, at the address indicated above. | ||
| (b) | If to the Corporation, to: |
Xxxxxxxxxxx, Inc.
Xxx Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
Xxx Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
or to such other address as may have been furnished to either party by the other party.
16. Counterparts. This Agreement may be executed in any number of counterparts, which
shall together constitute one agreement.
17. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Indiana, without giving effect to conflicts of laws principles
requiring application of the substantive laws of another jurisdiction.
18. Scope of Agreement. This Agreement constitutes the entire agreement between the
parties hereto for the purposes herein contained, and this Agreement shall supercede any other
agreements, understandings, representations, or warranties, oral or written, relating to the
subject matter of this Agreement, which shall be deemed to exist or to bind any of the parties
hereto or their respective successors or assigns, except as expressly referred to herein.
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as of the date first
written above.
| XXXXXXXXXXX, INC. | DIRECTOR | |||||
By: |
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| Senior Vice President, General Counsel | ||||||
| and Secretary | ||||||
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