COMPENSATION AND INDEMNIFICATION AGREEMENT
This COMPENSATION AND INDEMNIFICATION AGREEMENT is made and
entered into as of the 6th day of May, 1999 (the "Agreement") among OCWEN ASSET
INVESTMENT CORP., a Virginia corporation (the "Company"), and XXXXXX X. XXXXX
and XXXXX X. SMALL (each, a "Director" and together, the "Directors").
WHEREAS, the Company's Board of Directors, pursuant to a
resolution adopted on May 6th, 1999, appointed the Directors as the members of
an independent committee of the Board of Directors of the Company (the "Special
Committee") for the purpose of considering and/or making recommendations to the
Company's Board of Directors with respect to a possible transaction involving
the Company;
WHEREAS, in order to induce the Directors to serve as the
members of the Special Committee and to accept the additional duties,
responsibilities and burdens of such service, the Company wishes to provide them
with the compensation and indemnification arrangements set forth herein; and
WHEREAS, the Directors are willing to serve and continue to
serve as the members of the Special Committee on the terms set forth herein;
NOW, THEREFORE, in consideration of the foregoing, the parties
hereto do hereby agree as follows:
1. SERVICE ON THE SPECIAL COMMITTEE. Each Director hereby
agrees to serve as a member of the Special Committee on the terms provided for
herein so long as such appointment by the Board shall remain in effect. Each
Director may, however, resign from such position at any time and for any reason
and the Special Committee may dissolve by recommending such dissolution to the
Board. The Company's obligation to indemnify each Director as set forth in this
Agreement shall continue in full force and effect notwithstanding any such
termination of appointment, resignation or dissolution.
2. COMPENSATION AND EXPENSE REIMBURSEMENT. In return for his
services as a member of the Special Committee, each Director shall be entitled
to receive from the Company a fee of $1,000.00 for each day such director
performs services as a member of the Special Committee, such per day fee is to
be prorated to reflect the actual amount of time spent by such director during
such day on such services. Such fees shall be payable to the Director upon
submission to the Company's Chief Financial Officer of a written statement
setting forth the dates on which such services were performed. In addition, each
Director shall be reimbursed by the Company for his reasonable out-of-pocket
travel and other expenses incurred in connection with his service on the Special
Committee, in a manner consistent with the Company's reimbursement of expenses
for members of its Board of Directors.
3. INDEMNITY. The Company hereby agrees to hold harmless and
indemnify each Director with respect to his service as a director of the
Company, including without limitation with respect to his service on the Special
Committee and any matter or transaction presented to or considered by the
Special Committee or the Board of Directors, to the full extent authorized or
permitted by law, as such may be amended from time to time, by the Restated and
Amended Articles of Incorporation of the Company (the "Articles"), as such may
be amended from time to time, and by the Bylaws of the Company (the "Bylaws"),
as such may be amended from time to time. In furtherance of the foregoing
indemnification, and without limiting the generality thereof:
(a) PROCEEDINGS AGAINST THE DIRECTOR. Each Director shall
be entitled to the rights of indemnification provided in this Section 3(a) if,
by reason of his Corporate Status (as hereinafter defined), he is, or is
threatened to be made, a party to or participant in any Proceeding (as
hereinafter defined). Pursuant to this Section 3(a), each Director shall be
indemnified against all judgments, penalties, fines, settlements and Expenses
(as hereinafter defined) actually incurred by him or on his behalf in connection
with such Proceeding, unless it is finally judicially established that:
(A) (i) his act or omission was material to the
matter giving rise to the Proceeding; and (ii) either (x) in
the case of conduct in his official capacity with the Company,
he did not believe that his conduct was in the best interests
of the Company, and in all other proceedings, he did not
believe that his conduct was not opposed to the best interests
of the Company or (y) he failed to conduct himself in good
faith; or
(B) (i) in the case of a Proceeding by or in the
right of the Company, he is liable to the Company, or (ii) in
the case of a Proceeding other than by or in the right of the
Company in which it is charged that he received an improper
personal benefit, he is liable to the Company on the basis
that he actually received an improper personal benefit in
money, property or services; or
(C) in the case of any criminal Proceeding, he
had reasonable cause to believe that the act or omission was
unlawful.
(b) INDEMNIFICATION FOR EXPENSES OF A PARTY WHO IS WHOLLY
OR PARTLY SUCCESSFUL. Notwithstanding any other provision of this Agreement, to
the extent that a Director is, by reason of his Corporate Status, a party to and
is successful, on the merits or otherwise, in any Proceeding, he shall be
indemnified to the maximum extent permitted by law against all Expenses incurred
by him or on his behalf in connection with such Proceeding. If a Director is not
wholly successful in such Proceeding but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in such
Proceeding, the Company shall indemnify such Director against all Expenses
incurred by him or on his behalf in connection with each successfully resolved
claim, issue or matter. For purposes of this Section and without limitation, the
termination of any claim, issue or matter in such a Proceeding by dismissal,
with or without prejudice, shall be deemed to be a successful result as to such
claim, issue or matter.
4. ADDITIONAL INDEMNITY. In addition to, and without regard
to any limitations on, the indemnification provided for in Section 3, the
Company shall and hereby does indemnify and hold harmless each Director against
all judgments, penalties, fines, settlements and Expenses actually incurred by
him or on his behalf if, by reason of his Corporate Status he is, or is
threatened to be made, a party to or participant in any Proceeding (including a
Proceeding by or in the right of the Company). The only limitation that shall
exist upon the Company's obligations pursuant to this Agreement shall be that
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the Company shall not be obligated to make any payment to a Director that is
finally determined (under the procedures, and subject to the presumptions, set
forth in Sections 8 and 9 hereof) to be unlawful under Virginia law or be
prohibited by the Articles or Bylaws as they exist at the time of execution of
this Agreement; provided, however, that if such Indemnity or advancement of
Expenses is prohibited by the Articles and Bylaws as they exist at the time of
this Agreement but permitted by the Articles and Bylaws as they exist at the
time that such Indemnity or advancement of Expenses is sought, then such
Indemnity or advancement of Expenses shall be permitted.
5. CONTRIBUTION IN THE EVENT OF JOINT LIABILITY. (a) Whether
or not the indemnification provided in Sections 3 and 4 hereof is available, in
respect of any threatened, pending or completed Proceeding in which the Company
is jointly liable with any Director (or would be if joined in such Proceeding),
the Company shall pay, in the first instance, the entire amount of any judgment
or settlement of such Proceeding without requiring such Director to contribute
to such payment and the Company hereby waives and relinquishes any right of
contribution it may have against such Director. The Company shall not enter into
any settlement of any Proceeding in which the Company is jointly liable with a
Director (or would be if joined in such Proceeding) unless such settlement
provides for a full and final release of all claims asserted against such
Director.
(b) Without diminishing or impairing the obligations of the
Company set forth in the preceding subparagraph, if, for any reason, a Director
shall elect or be required to pay all or any portion of any judgment or
settlement in any threatened, pending or completed Proceeding in which the
Company is jointly liable with such Director (or would be if joined in such
Proceeding), the Company shall contribute to the amount of Expenses, judgments,
fines and amounts paid in settlement actually incurred and paid or payable by
such Director in proportion to the relative benefits received by the Company and
all officers, directors or employees of the Company (other than such Director)
who are jointly liable with him (or would be if joined in such Proceeding), on
the one hand, and the Director, on the other hand, from the transaction from
which such Proceeding arose; PROVIDED, HOWEVER, that the proportion determined
on the basis of relative benefit may, to the extent necessary to conform to law,
be further adjusted by reference to the relative fault of the Company and all
officers, directors or employees of the Company (other than such Director) who
are jointly liable with the Director (or would be if joined in such Proceeding),
on the one hand, and the Director, on the other hand, in connection with the
events that resulted in such Expenses, judgments, fines or settlement amounts,
as well as any other equitable considerations which the law may require to be
considered. The relative fault of the Company and all officers, directors or
employees of the Company (other than the Director) who are jointly liable with
him (or would be if joined in such Proceeding), on the one hand, and the
Director, on the other hand, shall be determined by reference to, among other
things, the degree to which their actions were motivated by intent to gain
personal profit or advantage, the degree to which their liability is primary or
secondary, and the degree to which their conduct is active or passive.
(c) The Company hereby agrees to fully indemnify and hold each
Director harmless from any claims of contribution which may be brought by
officers, directors or employees of the Company who may be jointly liable with
such Director.
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6. INDEMNIFICATION FOR EXPENSES OF A WITNESS. Notwithstanding
any other provision of this Agreement, to the extent that a Director is, by
reason of his Corporate Status, a witness in any Proceeding to which such
Director is not a party or participant, he shall be indemnified against all
Expenses incurred by him or on his behalf in connection therewith.
7. ADVANCEMENT OF EXPENSES. Notwithstanding any other
provision of this Agreement, the Company shall advance all Expenses incurred by
or on behalf of a Director in connection with any Proceeding by reason of such
Director's Corporate Status within ten days after the receipt by the Company of
a statement or statements from such Director requesting such advance or advances
from time to time, whether prior to or after final disposition of such
Proceeding. Such statement or statements shall reasonably evidence the Expenses
incurred by the Director and shall include or be preceded or accompanied by a
written affirmation by such Director of his good faith belief that the standard
of conduct necessary for indemnification by the Company has been met and a
written undertaking by or on behalf of such Director to repay any Expenses
advanced if it shall ultimately be finally judicially determined that the
applicable standard of conduct has not been met. Any undertakings to repay
pursuant to this Section 7 shall be unlimited, unsecured general obligations of
the Director and shall be interest free; any advances pursuant to this Section 7
shall be unsecured and interest free. Notwithstanding the foregoing, the
obligation of the Company to advance Expenses pursuant to this Section 7 shall
be subject to the condition that, if, when and to the extent that the Company
determines that a Director would not be permitted to be indemnified under
applicable law, the Company shall be entitled to be reimbursed, within thirty
(30) days of such determination, by him for all such amounts theretofore paid;
PROVIDED, HOWEVER, that if such Director has commenced or thereafter commences
legal proceedings in a court of competent jurisdiction to secure a determination
that he should be indemnified under applicable law, any determination made by
the Company that such Director would not be permitted to be indemnified under
applicable law shall not be binding and such Director shall not be required to
reimburse the Company for any advance of Expenses until a final judicial
determination is made with respect thereto.
8. PROCEDURES AND PRESUMPTIONS FOR DETERMINATION OF
ENTITLEMENT TO INDEMNIFICATION. It is the intent of this Agreement to secure for
each Director rights of indemnity that are as favorable as may be permitted
under the law and public policy of the State of Virginia. Accordingly, the
parties agree that the following procedures and presumptions shall apply in the
event of any question as to whether a Director is entitled to indemnification
under this Agreement:
(a) To obtain indemnification (including, but not limited
to, the advancement of Expenses and contribution by the Company) under this
Agreement, a Director shall submit to the Company a written request, including
therein or therewith such documentation and information as is reasonably
available to such Director and is reasonably necessary to determine whether and
to what extent a Director is entitled to indemnification. The Secretary of the
Company shall, promptly upon receipt of such a request for indemnification,
advise the Board of Directors in writing that such Director has requested
indemnification.
(b) Upon written request by a Director for
indemnification pursuant to the first sentence of Section 8(a) hereof, a
determination, if required by applicable law, with respect to a Director's
entitlement thereto shall be made in the specific case by one of the following
three methods, which shall be at the election of such Director: (1) by the Board
of Directors by a majority vote of a quorum consisting of the Disinterested
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Directors, or, if such a quorum cannot be obtained, then by a majority vote of a
committee of the Board of Directors consisting solely of two or more
Disinterested Directors duly designated to act in the matter by a majority vote
of the full Board of Directors in which the Directors who are parties to or
participants in the Proceeding may participate, or (2) by Special Counsel, or
(3) by vote of the stockholders of the Company in which shares held by Directors
who are parties to or participants in the Proceeding may not be voted.
(c) If the determination of entitlement to
indemnification is to be made by Special Counsel pursuant to Section 8(b)
hereof, the Special Counsel shall be selected as provided in this Section 8(c).
The Special Counsel shall be selected by the Board of Directors by a majority
vote of a quorum consisting of the Disinterested Directors, or, if such a quorum
cannot be obtained, then by a majority vote of a committee of the Board of
Directors consisting solely of two or more Disinterested Directors duly
designated to act in the matter by a majority vote of the full Board of
Directors in which the Directors who are parties to or participants in the
Proceeding may participate, or, if the requisite quorum of the full Board of
Directors cannot be obtained therefor and the committee cannot be established,
by a majority vote of the full Board of Directors in which the Directors who are
parties to or participants in the Proceeding may participate. The Company shall
pay any and all reasonable fees and expenses of Special Counsel incurred by such
Special Counsel in connection with acting pursuant to Section 8(b) hereof, and
the Company shall pay all reasonable fees and expenses incident to the
procedures of this Section 8(c), regardless of the manner in which such Special
Counsel was selected or APPOINTED. Notwithstanding the foregoing, in the event
there has been a change in the composition of a majority of the Board of
Directors after the date of the alleged act or omission with respect to which
indemnification is claimed, any determination as to indemnification and
advancement of expenses with respect to any claim for indemnification made
pursuant to this Article shall be made only by Special Counsel agreed upon by
the Board of Directors and the applicant. If the Board of Directors and the
applicant are unable to agree upon such special legal counsel the Board of
Directors and the applicant each shall select a nominee, and the nominees shall
select such Special Counsel.
(d) In making a determination with respect to entitlement
to indemnification hereunder, the person or persons or entity making such
determination shall presume (unless there is clear and convincing evidence to
the contrary) that a Director is entitled to indemnification under this
Agreement if such Director has submitted a request for indemnification in
accordance with Section 8(a) of this Agreement.
(e) A Director's act or omission shall not be deemed to
be material to the matter giving rise to the Proceeding if his act or omission
was not a significant and substantial factor in bringing about the Proceeding,
and a Director shall not be deemed to have failed to conduct himself in good
faith if such Director's action is based on the records or books of account of
the Company, including financial statements, or on information supplied to such
Director by the officers of the Company in the course of their duties whom the
Director believes in good faith to be reliable and competent, or on the advice
of legal counsel for the Company or the Special Committee which the Director
believes in good faith to be within the professional or expert competence of
such counsel, or on information or records given or reports made to the Company
or the Special Committee by an independent certified public accountant, by a
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financial advisor or by an appraiser or other expert selected with reasonable
care by the Company or the Special Committee. In addition, the knowledge and/or
actions, or failure to act, of any director, officer, agent or employee of the
Company shall not be imputed to a Director for purposes of determining the right
to indemnification under this Agreement. Whether or not the foregoing provisions
of this Section 8(e) are satisfied, it shall in any event be presumed (unless
there is clear and convincing evidence to the contrary) that each Director's
acts or omissions have not been material to the matter giving rise to the
Proceeding, that each Director has conducted himself in good faith, and the
Director did not receive an improper personal benefit in money, property or
services.
(f) The Company acknowledges that a settlement or other
disposition short of final judgment may be successful if it permits a party to
avoid expense, delay, distraction, disruption and uncertainty. In the event that
any Proceeding to which a Director is a party is resolved in any manner other
than by a final adverse judgment against such Director (including, without
limitation, settlement of such Proceeding with or without payment of money or
other consideration) it shall be presumed (unless there is clear and convincing
evidence to the contrary) that such Director has been successful on the merits
or otherwise in such Proceeding; provided, however, that such settlement will
not be entered into without the prior consent of the Board of Directors of the
Company by a majority vote of a quorum consisting of the Disinterested
Directors, or, if such a quorum cannot be obtained, then by a majority vote of a
committee of the Board of Directors consisting solely of two or more
Disinterested Directors duly designated to act in the matter by a majority vote
of the full Board of Directors in which the Directors who are parties to or
participants in the Proceeding may participate, or, if the requisite quorum of
the full Board of Directors cannot be obtained therefor and the committee cannot
be established, by a majority vote of the full Board of Directors in which the
Directors who are parties to or participants in the Proceeding may participate.
(g) Each Director shall cooperate with the person,
persons or entity making such determination with respect to such Director's
entitlement to indemnification, including providing to such person, persons or
entity upon reasonable advance request any documentation or information which is
not privileged or otherwise protected from disclosure and which is reasonably
available to such Director and reasonably necessary to such determination. Any
Special Counsel, member of the Board of Directors, or stockholder of the Company
shall act reasonably and in good faith in making a determination under the
Agreement of a Director's entitlement to indemnification. Any costs or expenses
(including attorneys' fees and disbursements) incurred by a Director in so
cooperating with the person, persons or entity making such determination shall
be borne by the Company (irrespective of the determination as to such Director's
entitlement to indemnification) and the Company hereby indemnifies and agrees to
hold each Director harmless therefrom.
(h) The authorization of indemnification shall be made in
the same manner enumerated in Section 8(b) hereof as the determination of a
Director's entitlement to indemnification; PROVIDED, HOWEVER, that if the
determination of entitlement to indemnification is made by Special Counsel
pursuant to Section 8(b)(2) hereof, the authorization of indemnification shall
be made by the Board of Directors by a majority vote of a quorum consisting of
the Disinterested Directors, or, if such a quorum cannot be obtained, then by a
majority vote of a committee of the Board of Directors consisting solely of two
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or more Disinterested Directors duly designated to act in the matter by a
majority vote of the full Board of Directors in which the Directors who are
parties to or participants in the Proceeding may participate, or, if the
requisite quorum of the full Board of Directors cannot be obtained therefor and
the committee cannot be established, by a majority vote of the full Board of
Directors in which the Directors who are parties to or participants in the
Proceeding may participate.
9. REMEDIES.
(a) In the event that (i) a determination is made
pursuant to Section 8 of this Agreement that a Director is not entitled to
indemnification under this Agreement, (ii) a Director determines to seek court
ordered indemnification pursuant to Section 13.1-700.1 of the Virginia Stock
Corporation Act, (iii) advancement of Expenses is not timely made pursuant to
Section 7 of this Agreement, (iv) no determination of entitlement to
indemnification shall have been made pursuant to Section 8(b) of this Agreement
within 90 days after receipt by the Company of the request for indemnification,
(v) payment of indemnification is not made pursuant to this Agreement within ten
(10) days after receipt by the Company of a written request therefor, or (vi)
payment of indemnification is not made within ten (10) days after a
determination has been made that a Director is entitled to indemnification or
such determination is deemed to have been made pursuant to Section 8 of this
Agreement, such Director shall be entitled to an adjudication in an appropriate
court of the Commonwealth of Virginia, or in any other court of competent
jurisdiction, of his entitlement to such indemnification. The Company shall not
oppose a Director's right to seek any such adjudication; provided, however that
in the circumstances described in subsections (i) and (ii) hereof, this sentence
shall not operate to prevent the Company from contesting the Director's
substantive right to be indemnified.
(b) In the event that a determination shall have been
made pursuant to Section 8(b) of this Agreement that a Director is not entitled
to indemnification, any judicial proceeding commenced pursuant to this Section 9
shall be conducted in all respects as a de novo trial, on the merits and such
Director shall not be prejudiced by reason of that adverse determination.
(c) If a determination shall have been made pursuant to
Section 8(b) of this Agreement that a Director is entitled to indemnification,
the Company shall be bound by such determination in any judicial proceeding
commenced pursuant to this Section 9, absent a prohibition of such
indemnification under applicable law.
(d) In the event that a Director, pursuant to this
Section 9, seeks a judicial adjudication of his rights under, or to recover
damages for breach of, or otherwise to enforce the terms of, this Agreement or
the Articles or Virginia law with respect to indemnification or advancement of
Expenses, or to recover under any directors' and officers' liability insurance
policies maintained by the Company, the Company shall pay on his behalf, in
advance, any and all expenses (of the types described in the definition of
Expenses in Section 15 of this Agreement) incurred by him in such judicial
adjudication, regardless of whether such Director ultimately is determined to be
entitled to such indemnification, advancement of expenses or insurance recovery.
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(e) The Company shall be precluded from asserting in any
judicial proceeding commenced pursuant to this Section 9 that the procedures and
presumptions of this Agreement are not valid, binding and enforceable and shall
stipulate in any such court that the Company is bound by all the provisions of
this Agreement.
10. NON-EXCLUSIVITY; SURVIVAL OF RIGHTS; INSURANCE;
SUBROGATION.
(a) The rights of indemnification as provided by this
Agreement shall not be deemed exclusive of any other rights to which a Director
may at any time be entitled under applicable law, the Articles, the Bylaws, a
resolution of stockholders or directors, an agreement or otherwise. No
amendment, alteration or repeal of this Agreement or of any provision hereof
shall limit or restrict any right of any Director under this Agreement in
respect of any action taken or omitted by such Director in his Corporate Status
prior to such amendment, alteration or repeal. To the extent that a change in
the law, whether by statute or judicial decision, or a change in the Articles or
Bylaws, permits greater indemnification than would be afforded currently under
the Articles and Bylaws and this Agreement, it is the intent of the parties
hereto that each Director shall enjoy by this Agreement the greater benefits so
afforded by such change. No right or remedy herein conferred is intended to be
exclusive of any other right or remedy, and every other right and remedy shall
be cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other right or remedy.
(b) To the extent that the Company, directly or through a
subsidiary or an affiliate, maintains an insurance policy or policies providing
liability insurance (or similar protection, including, to the extent not
inconsistent with applicable law, a trust fund, letter of credit, or surety
bond) for directors, officers, employees, or agents or fiduciaries of the
Company or directors, officers, partners, trustees, employees, or agents or
fiduciaries of any other corporation, partnership, joint venture, trust, other
enterprise or employee benefit plan which directors, officers, employees, or
agents or fiduciaries of the Company serve at the request of the Company, each
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 such
director, officer, employee or agent under such policy or policies.
(c) In the event of any payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery of a Director, who shall execute all papers required and take all
action necessary to secure such rights, including execution of such documents as
are necessary to enable the Company to bring suit to enforce such rights.
(d) The Company shall not be liable under this Agreement
to make any payment of amounts otherwise indemnifiable hereunder if and to the
extent that a Director has otherwise actually received such payment under any
insurance policy, contract, agreement or otherwise.
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(e) The Company shall at all times maintain a directors
indemnity insurance policy insuring the Directors with aggregate coverage (both
as to dollar limits of coverage, and as to the subject matter insured against)
not less than that in effect at the time of this Agreement. Such indemnity
insurance policy shall be maintained in force for not less than six years from
the date of consummation or abandonment of the transaction or transactions which
the Special Committee was appointed to consider or does consider. If at any time
during the period commencing on the date of renewal of the policy in effect on
the date of execution of this Agreement and ending at the end of such sixth
year, such coverage is not reasonably available in the insurance market, the
Company shall be obligated to purchase for the Directors such directors
indemnity insurance insuring only the Directors as it is able to purchase for an
annual premium equal to twice the annual insurance premium paid by the Company
for directors indemnity insurance during the year 1999, provided that in the
sixth year the Company shall not be obligated to pay a premium for such
insurance in excess of the premium paid in the fifth year.
11. EXCEPTION TO RIGHT OF INDEMNIFICATION. Notwithstanding any
other provision of this Agreement, a Director shall not be entitled to
indemnification under this Agreement with respect to any Proceeding brought by
him against the Company, either in his own right or in the right of the Company,
or any claim in such Proceeding, unless (a) the bringing of such Proceeding or
making of such claim shall have been approved unanimously by the Board of
Directors or (b) such Proceeding is being brought by such Director to assert his
rights under this Agreement.
12. DURATION OF AGREEMENT. All agreements and obligations of
the Company contained herein shall continue during the period a Director is
serving as a member of the Special Committee or as an officer or director of the
Company (or is or was serving at the request of the Company as a director,
officer, partner, trustee, employee or agent or fiduciary of another
corporation, partnership, joint venture, trust, other enterprise or employee
benefit plan) and shall continue thereafter so long as such Director shall be
subject to any Proceeding (or any proceeding commenced under Section 8 hereof)
by reason of his Corporate Status, whether or not he is acting or serving in any
such capacity at the time any liability or expense is incurred for which
indemnification can be provided under this Agreement. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business or assets of the Company), assigns, spouses,
heirs, executors and personal and legal representatives. This Agreement shall
continue in effect regardless of whether a Director continues to serve as a
member of the Special Committee or as an officer or director of the Company or
any other enterprise at the Company's request.
13. SECURITY. To the extent requested by a Director and
approved by the Board of Directors, the Company may at any time and from time to
time provide security to a Director for the Company's obligations hereunder
through an irrevocable bank line of credit, funded trust or other collateral.
Any such security, once provided to a Director, may not be revoked or released
without the prior written consent of such Director.
14. ENFORCEMENT. (a) The Company expressly confirms and agrees
that it has entered into this Agreement and assumed the obligations imposed on
it hereby in order to induce the Director to serve as a member of the Special
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Committee, and the Company acknowledges that such Director is relying upon this
Agreement in serving as a member of the Special Committee.
(b) This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings, oral, written and implied, between the
parties hereto with respect to the subject matter hereof.
15. DEFINITIONS. For purposes of this Agreement:
(a) "Corporate Status" describes the status of a person who is
or was a director of the Company or a member of the Special Committee or was
otherwise a director, officer, partner, trustee, employee, agent or fiduciary of
any other corporation, partnership, joint venture, trust, employee benefit plan
or other enterprise of which such person is or was serving at the express
written request of the Company.
(b) "Disinterested Director" means a director of the Company
who is not at the relevant time a party to the Proceeding in respect of which
indemnification is sought by a Director.
(c) "Expenses" shall include all attorneys' fees, retainers,
court costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, participating, or being or preparing to be a
witness in a Proceeding.
(d) "Special Counsel" means a law firm, or a member of a law
firm, that is experienced in matters of corporation law and neither presently
is, nor in the past five years has been, retained to represent: (i) the Company
or any Director in any matter material to either such party (other than with
respect to matters concerning any such Director under this Agreement), or (ii)
any other party to the Proceeding giving rise to a claim for indemnification
hereunder. Notwithstanding the foregoing, the term "Special Counsel" shall not
include any person who, under the applicable standards of professional conduct
then prevailing, would have a conflict of interest in representing either the
Company or any Director in an action to determine such Director's rights under
this Agreement. The Company agrees to pay the reasonable fees of the Special
Counsel referred to above and to fully indemnify such counsel against any and
all Expenses, claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto.
(e) "Proceeding" includes any threatened, pending or completed
action, suit, arbitration, alternate dispute resolution mechanism,
investigation, inquiry, administrative hearing or any other actual, threatened
or completed proceeding, whether brought by or in the right of the Company or
otherwise and whether civil, criminal, administrative or investigative, in which
a Director was, is or will be involved as a party or otherwise, by reason of the
fact that such Director is or was a member of the Special Committee or a member
of any committee of the Board of Directors or a director of the Company, by
reason of any action taken by him or of any inaction on his part while acting as
10
a member of the Special Committee or as a member of any committee of the Board
of Directors or as a director of the Company, or by reason of the fact that he
is or was serving at the request of the Company as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise; in each case whether or not he is acting or serving in any such
capacity at the time any liability or expense is incurred for which
indemnification can be provided under this Agreement; and excluding one
initiated by a Director pursuant to Section 8 of this Agreement to enforce his
rights under this Agreement.
16. SEVERABILITY. If any provision or provisions of this
Agreement shall be held by a court of competent jurisdiction to be invalid,
void, illegal or otherwise unenforceable for any reason whatsoever: (a) the
validity, legality and enforceability of the remaining provisions of this
Agreement (including, without limitation, each portion of any section of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that is not itself invalid, illegal or unenforceable) shall not
in any way be affected or impaired thereby and shall remain enforceable to the
fullest extent permitted by law; and (b) to the fullest extent possible, the
provisions of this Agreement (including, without limitation, each portion of any
section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall be construed so as to give effect to the intent manifested thereby.
17. MODIFICATION AND WAIVER. No supplement, modification,
termination or amendment of this Agreement shall be binding unless executed in
writing by 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.
18. NOTICE BY DIRECTORS. Each Director agrees promptly to
notify the Company in writing upon being served with any summons, citation,
subpoena, complaint, indictment, information or other document relating to any
Proceeding or matter which may be subject to indemnification covered hereunder.
The failure to so notify the Company shall not relieve the Company of any
obligation which it may have to such Director under this Agreement or otherwise.
19. NOTICES. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if (i) delivered by and receipted for by the party to whom said
notice or other communication shall have been directed or if (ii) mailed by
certified or registered mail with postage prepaid, on the third business day
after the date on which it is so mailed:
(a) If to Xx. Xxxxx, to:
Xxxxxx X. Xxxxx
C/O Xxxxx X. Xxxxxx, Esq.
XxXxxxx Xxxxx Battle & Xxxxxx LLP
Washington Square
0000 Xxxxxxxxxxx Xxxxxx, XX
Xxxxx 0000
Xxxxxxxxxx, XX 00000
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with a copy to:
Xxxxx X. Xxxxxx, Esq.
XxXxxxx Xxxxx Battle & Xxxxxx LLP
Washington Square
0000 Xxxxxxxxxxx Xxxxxx, XX
Xxxxx 0000
Xxxxxxxxxx, XX 00000
(b) If to Mr. Small, to:
Xxxxx X. Small
Xxxxxxxxx and Xxxx Company
0 Xxxx Xxxxxx
Xxxxxxx, XX 00000
with a copy to:
Xxxxx X. Xxxxxx, Esq.
XxXxxxx Xxxxx Battle & Xxxxxx LLP
Washington Square
0000 Xxxxxxxxxxx Xxxxxx, XX
Xxxxx 0000
Xxxxxxxxxx, XX 000000
(c) If to the Company, to:
Ocwen Asset Investment Corp.
0000 Xxxx Xxxxx Xxxxx Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxx
with a copy to:
Ocwen Asset Investment Corp.
Attn: Secretary
1675 Palm Beach Lakes Blvd.
Suite 0000
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
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or to such other address as may have been furnished to the Directors by the
Company or to the Company by a Director, as the case may be.
20. IDENTICAL COUNTERPARTS. This Agreement may be executed in
one or more counterparts, each of which shall for all purposes be deemed to be
an original but all of which together shall constitute one and the same
Agreement. Only one such counterpart signed by the party against whom
enforceability is sought needs to be produced to evidence the existence of this
Agreement.
21. HEADINGS. The headings of the paragraphs of this Agreement
are inserted for convenience only and shall not be deemed to constitute part of
this Agreement or to affect the construction thereof.
22. GOVERNING LAW. The parties agree that this Agreement shall
be governed by, and construed and enforced in accordance with, the laws of the
Commonwealth of Virginia without application of the conflict of laws principles
thereof.
23. ARTICLES AND BYLAWS. Notwithstanding any provision in this
Agreement, no Indemnity nor advancement of Expenses shall be provided hereunder
to any Director to the extent that such indemnity or advancement is prohibited
by the Articles and Bylaws as they exist at the time of this Agreement;
provided, however, that if such Indemnity or advancement of Expenses is
prohibited by the Articles and Bylaws as they exist at the time of this
Agreement but permitted by the Articles and Bylaws as they exist at the time
that such Indemnity or advancement of Expenses is sought, then such Indemnity or
advancement of Expenses shall be permitted.
(The remainder of this page is intentionally left blank)
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
Ocwen Asset Investment Corp.
By: /s/ XXXXXXXXX X. XXXXX
-----------------------
Name: Xxxxxxxxx X. Xxxxx
Title: President
/s/ XXXXXX X. XXXXX
-----------------------
Xxxxxx X. Xxxxx
/s/ XXXXX X. SMALL
-----------------------
Xxxxx X. Small
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