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EXHIBIT 10.30
FORM
MESA INC.
INDEMNIFICATION AGREEMENT
This Agreement ("Agreement") is made and entered into as of
the ____ day of _________, 199__ (the "Effective Date"), by and between MESA
Inc., a Texas corporation (the "Corporation"), and ___________________
("Indemnitee").
RECITALS
A. Highly competent and experienced persons are becoming
more reluctant to serve corporations as directors, executive officers or in
other capacities unless they are provided with adequate protection through
insurance and adequate indemnification against inordinate risks of claims and
actions against them arising out of their service to and activities on behalf
of the corporation.
B. The Board of Directors of the Corporation (the
"Board") has determined that the inability to attract and retain such persons
would be detrimental to the best interests of the Corporation and its
shareholders and that the Corporation should act to assure such persons that
there will be increased certainty of such protection in the future.
C. The Board has also determined that it is reasonable,
prudent and necessary for the Corporation, in addition to purchasing and
maintaining directors' and officers' liability insurance (or otherwise
providing for adequate arrangements of self-insurance), contractually to
obligate itself to indemnify such persons to the fullest extent permitted by
applicable law so that they will serve or continue to serve the Corporation
free from undue concern that they will not be so indemnified.
D. Indemnitee is willing to serve, continue to serve and
to take on additional service for or on behalf of the Corporation on the
condition that he be so indemnified.
E. Article V of the Amended and Restated Bylaws of the
Corporation provide for indemnification, advancement of expenses, arrangements
of insurance and self-insurance and specifically authorize the Corporation to
enter into indemnification agreements that contractually provide to indemnitees
the benefits of the provisions of such Article V and that include related
provisions and which agreements facilitate indemnitees' receipt of such
benefits and such other indemnification protections as may be deemed
appropriate by the Board.
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In consideration of the foregoing and the mutual covenants
herein contained, and other good and valuable consideration, the sufficiency
and receipt of which are hereby acknowledged, the parties hereby agree as
follows:
ARTICLE I
CERTAIN DEFINITIONS
As used herein, the following words and terms shall have the
following respective meanings (whether singular or plural):
"Change in Control" means a change in control of the
Corporation occurring after the Effective Date of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A (or in response to any similar item on any similar schedule or form) under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), whether
or not the Corporation is then subject to such reporting requirement; provided,
however, that, without limitation, such a Change in Control shall be deemed to
have occurred if at any time after the Effective Date (i) any "person" (as such
term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Corporation representing 40% or more of the
combined voting power of the Corporation's then outstanding securities without
the prior approval of at least two-thirds of the members of the Board in office
immediately prior to such person attaining such percentage interest; (ii) the
Corporation is a party to a merger, consolidation, share exchange, sale of
assets or other reorganization, or a proxy contest (a "Business Combination"),
as a consequence of which (x) members of the Board in office immediately prior
to such transaction or event constitute less than a majority of the Board
thereafter or (y) all or substantially all of the individuals and entities who
were the beneficial owners of the Corporation's then outstanding voting
securities immediately prior to such Business Combination fail to beneficially
own, directly or indirectly, more than 50% of the then outstanding voting
securities entitled to vote generally in the election of directors (or similar
body) of the entity resulting from such Business Combination (including,
without limitation, an entity which as a result of such transaction owns the
Corporation or all or substantially all of the Corporation's assets either
directly or through one or more subsidiaries) in proportions not materially
different from their ownership, immediately prior to such Business Combination,
of the Corporation's then outstanding voting securities; or (iii) during any
15-month period, individuals who at the beginning of such period constituted
the Board (including for this purpose any new director whose election or
nomination for election by the Corporation's shareholders was approved by a
vote of at least two-thirds of the directors then still in office who were
directors at the beginning of such period) cease for any reason to constitute
at least a majority of the Board.
"Claim" means an actual or threatened claim or request for
relief.
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"Corporate Status" means the status of a person who is or was
a director, officer, employee, agent or fiduciary 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, venturer, proprietor, trustee,
employee, agent or similar functionary of another foreign or domestic
corporation, partnership, joint venture, sole proprietorship, trust, employee
benefit plan or other enterprise.
"Disinterested Director" with respect to any request by
Indemnitee for indemnification hereunder, means a director of the Corporation
who at the time of the vote is not a named defendant or respondent in the
Proceeding, in respect of which indemnification is sought by Indemnitee.
"Expenses" means 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 or being or preparing to be a witness in, or participating in
(including on appeal), a Proceeding.
"Independent Counsel" means a law firm, or a member of a law
firm, that is experienced in matters of corporation law and neither
contemporaneously is, nor in the five years theretofore has been, retained to
represent: (a) the Corporation or Indemnitee in any matter material to either
such party, (b) any other party to the Proceeding giving rise to a claim for
indemnification hereunder or (c) the beneficial owner, directly or indirectly,
of securities of the Corporation representing 40% or more of the combined
voting power of the Corporation's then outstanding voting securities (other
than, in each such case, with respect to matters concerning the rights of
Indemnitee under this Agreement, or of other indemnitees under similar
indemnification agreements). Notwithstanding the foregoing, the term
"Independent 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 Corporation or Indemnitee in an action to
determine Indemnitee's rights under this Agreement.
"person" shall have the meaning ascribed to such term in
Sections 13(d) and 14(d) of the Exchange Act.
"Potential Change in Control" shall be deemed to have occurred
if (i) the Corporation enters into an agreement, the consummation of which
would result in the occurrence of a Change in Control; (ii) any person
(including the Corporation) publicly announces an intention to take or consider
taking actions that, if consummated, would constitute a Change in Control; or
(iii) the Board adopts a resolution to the effect that, for purposes of this
Agreement, a Potential Change of Control has occurred.
"Proceeding" means any threatened, pending or completed
action, suit, arbitration, investigation, alternate dispute resolution
mechanism, administrative hearing or any other
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proceeding whether civil, criminal, administrative, arbitrative or
investigative and whether or not based upon events occurring, or actions taken,
before the date hereof (except any of the foregoing initiated by Indemnitee
pursuant to Article VI or Section 7.19 to enforce his rights under this
Agreement), and any appeal in or related to any such action, suit, arbitration,
investigation, hearing or proceeding and any inquiry or investigation that
could lead to any appeal in or related to, any such action, suit, arbitration,
alternative dispute resolution mechanism, hearing or other proceeding.
"TBCA" means the Texas Business Corporation Act and any
successor statute thereto as either of them may from time to time be amended.
ARTICLE II
SERVICES BY INDEMNITEE
Indemnitee agrees to serve, or continue to serve, as
_________________ of the Corporation. Indemnitee may from time to time also
agree to serve, as the Corporation may request from time to time, as a
director, officer, partner, venturer, proprietor, trustee, employee, agent,
fiduciary or similar functionary of another foreign or domestic corporation,
partnership, joint venture, sole proprietorship, trust, employee benefit plan
or other enterprise. Indemnitee and the Corporation each acknowledge that they
have entered into this Agreement as a means of inducing Indemnitee to serve,
or continue to serve, the Corporation in such capacities. Indemnitee may at
any time and for any reason resign from such position or positions (subject to
any other contractual obligation or any obligation imposed by operation of
law). The Corporation shall have no obligation under this Agreement to
continue Indemnitee in any such position or positions.
ARTICLE III
INDEMNIFICATION
Section 3.1 General. The Corporation shall indemnify,
and advance Expenses, to Indemnitee to the fullest extent permitted by
applicable law in effect on the date hereof and to such greater extent as
applicable law may thereafter from time to time permit. The rights of
Indemnitee provided under the preceding sentence shall include, but shall not
be limited to, the right to be indemnified and to have Expenses advanced in all
Proceedings to the fullest extent permitted by Article 2.02-1 of the TBCA. The
provisions set forth in this Agreement are provided in addition to and as a
means of furtherance and implementation of, and not in limitation of, the
obligations expressed in this Article III. No requirement, condition to or
limitation of any right to indemnification under this Article III, or to
advancement of Expenses under Articles III and IV shall in any way limit the
rights of Indemnitee under Section 7.3.
Section 3.2 Additional Indemnity of the Corporation.
Indemnitee shall be entitled to indemnification pursuant to this Section 3.2
if, by reason of his Corporate Status, he is, or is
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threatened to be made, a party to any Proceeding (except to the extent limited
by Section 3.3). Pursuant to this Section 3.2, Indemnitee shall be indemnified
against reasonable Expenses, judgments, penalties (including excise or similar
taxes), fines and amounts paid in settlement (including all interest,
assessments and other charges paid or payable in connection with any such
Expenses, judgments, penalties, fines and amounts paid in settlement) actually
incurred by him or on his behalf in connection with such Proceeding or any
Claim, issue or matter therein, if (1) he conducted himself in good faith; (2)
he reasonably believed: (a) in the case of conduct in his official capacity,
that his conduct was in the Corporation's best interest; and (b) in all other
cases, that his conduct was at least not opposed to the Corporation's best
interests and, (3) in the case of any criminal Proceeding, had no reasonable
cause to believe his conduct was unlawful. Nothing in this Section 3.2 shall
limit the benefits of Section 3.1 or any other Section hereunder.
Section 3.3 Limitation on Indemnity. The indemnification
otherwise available to an Indemnitee under Section 3.2 shall be limited to the
extent set forth in this Section 3.3. If an Indemnitee is found liable to the
Corporation or is found liable on the basis that personal benefit was
improperly received by the Indemnitee whether or not the benefit resulted from
an action taken in Indemnitee's official capacity the Indemnitee shall, with
respect to the Claim, issue or matter in the Proceeding in which such finding
is made, be indemnified only against reasonable Expenses actually incurred by
him in connection with that Claim, issue or matter. Notwithstanding the
foregoing, no indemnification against such Expenses shall be made in respect of
any Claim, issue or matter in such Proceeding as to which Indemnitee shall have
been adjudged to be liable for willful or intentional misconduct in the
performance of his duty to the Corporation; provided, however, that, if
applicable law so permits, indemnification against such Expenses shall
nevertheless be made by the Corporation in such event if and only to the extent
that the court in which such Proceeding shall have been brought or is pending,
shall determine.
ARTICLE IV
EXPENSES
Section 4.1 Expenses of a Party Who Is Wholly or Partly
Successful. Notwithstanding any other provision of this Agreement to the
contrary (except as set forth in Section 7.2(c) or 7.16), and without a
requirement for any determination described in Section 5.2, the Corporation
shall indemnify Indemnitee against all Expenses actually and reasonably
incurred by him or on his behalf in connection with any Proceeding to which
Indemnitee was or is a named defendant or respondent by reason of his Corporate
Status and in which Indemnitee is wholly successful, on the merits or otherwise
in the defense of the Proceeding. If Indemnitee is not wholly successful, on
the merits or otherwise, in a Proceeding but is successful, on the merits or
otherwise, as to any Claim, issue or matter in such Proceeding, the Corporation
shall indemnify Indemnitee against all Expenses actually and reasonably
incurred by him or on his behalf relating to each successfully resolved Claim,
issue or matter. For purposes of this Section 4.1 and without limitation, the
termination of a Claim, issue or matter in a Proceeding by dismissal, with or
without prejudice, shall be deemed to be a successful result as to such Claim,
issue or matter.
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Section 4.2 Expenses of a Witness or Non-Party.
Notwithstanding any other provision of this Agreement to the contrary, to the
extent that Indemnitee is, by reason of his Corporate Status, a witness or
otherwise participates in any Proceeding at a time when he is not named a
defendant or respondent in the Proceeding, he shall be indemnified against all
Expenses actually and reasonably incurred by him or on his behalf in connection
therewith.
Section 4.3 Advancement of Expenses. The Corporation
shall pay all reasonable Expenses incurred by or on behalf of Indemnitee in
connection with any Proceeding, whether brought by the Corporation or
otherwise, in advance of any determination respecting entitlement to
indemnification pursuant to Article V hereof within 10 days after the receipt
by the Corporation of (a) a written request from Indemnitee requesting such
payment or payments from time to time, whether prior to or after final
disposition of such Proceeding, and (b) a written affirmation from Indemnitee
of his good faith belief that he has met the standard of conduct necessary for
indemnification under Article III. Such statement or statements shall
reasonably evidence the Expenses incurred by Indemnitee. Indemnitee hereby
undertakes and agrees that he will reimburse and repay the Corporation for any
Expenses so advanced to the extent that it shall ultimately be determined (in a
final adjudication by a court from which there is no further right of appeal or
in a final adjudication of an arbitration pursuant to Section 6.1 if Indemnitee
elects to seek such arbitration) that Indemnitee is not entitled to be
indemnified by the Corporation against such Expenses.
ARTICLE V
PROCEDURE FOR DETERMINATION OF ENTITLEMENT
TO INDEMNIFICATION
Section 5.1 Request by Indemnitee. To obtain
indemnification under this Agreement, Indemnitee shall submit to the
Corporation a written request, including therein or therewith such
documentation and information as is reasonably available to Indemnitee and is
reasonably necessary to determine whether and to what extent Indemnitee is
entitled to indemnification. The Secretary or an Assistant Secretary of the
Corporation shall, promptly upon receipt of such a request for indemnification,
advise the Board in writing that Indemnitee has requested indemnification.
Section 5.2 Determination of Request. Upon written
request by Indemnitee for indemnification pursuant to the first sentence of
Section 5.1 hereof, a determination, if required by applicable law, with
respect to Indemnitee's entitlement thereto shall be made in the specific case
as follows:
(a) If a Potential Change in Control or a Change in
Control shall have occurred, by Independent Counsel (selected in
accordance with Section 5.3) in a written opinion to the Board, a copy
of which shall be delivered to Indemnitee, unless Indemnitee shall
request that
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such determination be made by the Board, or a committee of the Board,
in which case by the person or persons or in the manner provided for
in clause (i) or (ii) of paragraph (b) below;
(b) If a Potential Change in Control or a Change in
Control shall not have occurred, by the Board by a majority vote of a
quorum of the Board consisting of Disinterested Directors, or if
there are no Disinterested Directors, or if a quorum of the Board
consisting of Disinterested Directors is not obtainable, by a majority
vote of a committee of the Board designated to act in the matter by a
majority vote of the entire Board, consisting solely of two or more
Disinterested Directors, by Independent Counsel selected by the Board
or a committee of the Board by a vote as set forth in clauses (i) or
(ii) of this paragraph (b), or if such quorum is not obtainable or
such a committee cannot be established, by a majority vote of all
directors, or (iv) if Indemnitee and the Corporation agree, by the
shareholders of the Corporation in a vote that excludes the shares
held by directors who are not Disinterested Directors; or
(c) As provided in Section 5.5(b).
If it is so determined that Indemnitee is entitled to indemnification
hereunder, payment to Indemnitee shall be made within 10 days after such
determination. Indemnitee shall cooperate with the person or persons making
such determination with respect to Indemnitee's entitlement to indemnification,
including providing to such person upon reasonable advance request any
documentation or information that is not privileged or otherwise protected from
disclosure and that is reasonably available to Indemnitee and reasonably
necessary to such determination. Any costs or expenses (including attorneys'
fees and disbursements) incurred by Indemnitee in so cooperating with the
person or persons making such determination shall be borne by the Corporation
(irrespective of the determination as to Indemnitee's entitlement to
indemnification) and the Corporation shall indemnify and hold harmless
Indemnitee therefrom.
Section 5.3 Independent Counsel. If a Potential Change
in Control or a Change in Control shall not have occurred and the determination
of entitlement to indemnification is to be made by Independent Counsel, the
Independent Counsel shall be selected by (a) a majority vote of the
Disinterested Directors, even though less than a quorum of the Board or (b) if
there are no Disinterested Directors, by a majority vote of the Board, and the
Corporation shall give written notice to Indemnitee, within 10 days after
receipt by the Corporation of Indemnitee's request for indemnification,
specifying the identity and address of the Independent Counsel so selected. If
a Potential Change in Control or a Change in Control shall have occurred and
the determination of entitlement to indemnification is to be made by
Independent Counsel, the Independent Counsel shall be selected by Indemnitee,
and Indemnitee shall give written notice to the Corporation, within 10 days
after submission of Indemnitee's request for indemnification, specifying the
identity and address of the Independent Counsel so selected (unless Indemnitee
shall request that such selection be made by the Disinterested Directors or a
committee of the Board, in which event the Corporation shall give written
notice to Indemnitee within 10 days after receipt of
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Indemnitee's request for the Board or a committee of the Disinterested
Directors to make such selection, specifying the identity and address of the
Independent Counsel so selected). In either event, (i) such notice to
Indemnitee or the Corporation, as the case may be, shall be accompanied by a
written affirmation of the Independent Counsel so selected that it satisfies
the requirements of the definition of "Independent Counsel" in Article I and
that it agrees to serve in such capacity and (ii) Indemnitee or the
Corporation, as the case may be, may, within seven days after such written
notice of selection shall have been given, deliver to the Corporation or to
Indemnitee, as the case may be, a written objection to such selection. Any
objection to selection of Independent Counsel pursuant to this Section 5.3 may
be asserted only on the ground that the Independent Counsel so selected does
not meet the requirements of the definition of "Independent Counsel" in Article
I, and the objection shall set forth with particularity the factual basis of
such assertion. If such written objection is timely made, the Independent
Counsel so selected may not serve as Independent Counsel unless and until a
court of competent jurisdiction (the "Court") has determined that such
objection is without merit. In the event of a timely written objection to a
choice of Independent Counsel, the party originally selecting the Independent
Counsel shall have seven days to make an alternate selection of Independent
Counsel and to give written notice of such selection to the other party, after
which time such other party shall have five days to make a written objection to
such alternate selection. If, within 30 days after submission of Indemnitee's
request for indemnification pursuant to Section 5.1, no Independent Counsel
shall have been selected and not objected to, either the Corporation or
Indemnitee may petition the Court for resolution of any objection that shall
have been made by the Corporation or Indemnitee to the other's selection of
Independent Counsel and/or for the appointment as Independent Counsel of a
person selected by the Court or by such other person as the Court shall
designate, and the person with respect to whom an objection is so resolved or
the person so appointed shall act as Independent Counsel under Section 5.2.
The Corporation shall pay any and all reasonable fees and expenses incurred by
such Independent Counsel in connection with acting pursuant to Section 5.2, and
the Corporation shall pay all reasonable fees and expenses incident to the
procedures of this Section 5.3, regardless of the manner in which such
Independent Counsel was selected or appointed. Upon the due commencement of
any judicial proceeding or arbitration pursuant to Section 6.1, Independent
Counsel shall be discharged and relieved of any further responsibility in such
capacity (subject to the applicable standards of professional conduct then
prevailing).
Section 5.4 Establishment of a Trust. In the event of a
Potential Change in Control or a Change in Control, the Corporation shall, upon
written request by the Indemnitee, create a trust for the benefit of the
Indemnitee (the "Trust") and from time to time upon written request of the
Indemnitee shall fund the Trust in an amount equal to all liabilities
reasonably anticipated at the time to be incurred in connection with any Claim.
The amount to be deposited in the Trust pursuant to the foregoing funding
obligation shall be determined by the Independent Counsel. The terms of the
Trust shall provide that, upon a Change in Control, (i) the Trust shall not be
revoked or the principal thereof invaded, without the written consent of the
Indemnitee; (ii) the trustee of the Trust shall advance, within ten business
days of a request by Indemnitee, any and all reasonable Expenses to Indemnitee,
any required determination concerning the reasonableness of the Expenses to be
made by the Independent Counsel; (iii) the Trust shall
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continue to be funded by the Corporation in accordance with the funding
obligation set forth above; (iv) the trustee of the Trust shall promptly pay to
Indemnitee all amounts for which Indemnitee shall be entitled to
indemnification pursuant to this Agreement; and (v) all unexpended funds in the
Trust shall revert to the Corporation upon a final determination by the
Independent Counsel or a court of competent jurisdiction, as the case may be,
that Indemnitee has been fully indemnified under the terms of this Agreement.
The trustee of the Trust shall be chosen by Indemnitee, and shall be an
institution that is not affiliated with the Indemnitee. Nothing in this
Section 5.4 shall relieve the Company of any of its obligations under this
Agreement.
Section 5.5 Presumptions and Effect of Certain
Proceedings.
(a) The Indemnitee shall be presumed to be entitled to
indemnification under this Agreement upon submission of a request for
indemnification under Section 5.1, and the Corporation shall have the burden of
proof in overcoming that presumption in reaching a determination contrary to
that presumption. Such presumption shall be used by Independent Counsel (or
other person or persons determining entitlement to indemnification) as a basis
for a determination of entitlement to indemnification unless the Corporation
provides information sufficient to overcome such presumption by clear and
convincing evidence or the investigation, review and analysis of Independent
Counsel (or such other person or persons) convinces him by clear and convincing
evidence that the presumption should not apply.
(b) If the person or persons empowered or selected under
Article V of this Agreement to determine whether Indemnitee is entitled to
indemnification shall not have made a determination within 60 days after
receipt by the Corporation of the request by Indemnitee therefor, the requisite
determination of entitlement to indemnification shall be deemed to have been
made and Indemnitee shall be entitled to such indemnification, absent (i) a
knowing misstatement by Indemnitee of a material fact, or knowing omission of a
material fact necessary to make Indemnitee's statement not materially
misleading, in connection with the request for indemnification, or (ii) a
prohibition of such indemnification under applicable law; provided, however,
that such 60-day period may be extended for a reasonable time, not to exceed an
additional 30 days, if the person making the determination with respect to
entitlement to indemnification in good faith requires such additional time for
the obtaining or evaluating of documentation and/or information relating to
such determination; and provided, further, that the 60-day limitation set forth
in this Section 5.5(b) shall not apply and such period shall be extended as
necessary (i) if within 30 days after receipt by the Corporation of the request
for indemnification under Section 5.1 Indemnitee and the Corporation have
agreed, and the Board has resolved to submit such determination to the
shareholders of the Corporation pursuant to Section 5.2(b) for their
consideration at an annual meeting of shareholders to be held within 90 days
after such agreement and such determination is made thereat, or a special
meeting of shareholders is called within 30 days after such receipt for the
purpose of making such determination, such meeting is held for such purpose
within 60 days after having been so called and such determination is made
thereat, or (ii) if the determination of entitlement to indemnification is to
be made by Independent Counsel pursuant to Section 5.2(a) of this Agreement, in
which case the applicable period shall be as set forth in Section 6.1(c).
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(c) The termination of any Proceeding or of any Claim,
issue or matter by judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere or its equivalent,
shall not (except as otherwise expressly provided in this Agreement) by itself
adversely affect the rights of Indemnitee to indemnification or create a
presumption that Indemnitee did not conduct himself in good faith or in a
manner that he reasonably believed in the case of conduct in his official
capacity, that was in the best interests of the Corporation or, in all other
cases, that was not opposed to the best interests of the Corporation or, with
respect to any criminal Proceeding, that Indemnitee had reasonable cause to
believe that his conduct was unlawful. Indemnitee shall be deemed to have been
found liable in respect of any Claim, issue or matter only after he shall have
been so adjudged by the Court after exhaustion of all appeals therefrom.
ARTICLE VI
CERTAIN REMEDIES OF INDEMNITEE
Section 6.1 Indemnitee Entitled to Adjudication in an
Appropriate Court. If (a) a determination is made pursuant to Article V that
Indemnitee is not entitled to indemnification under this Agreement; (b) there
has been any failure by the Corporation to make timely payment or advancement
of any amounts due hereunder; or (c) the determination of entitlement to
indemnification is to be made by Independent Counsel pursuant to Section 5.2
and such determination shall not have been made and delivered in a written
opinion within 90 days after the latest of (i) such Independent Counsel's being
appointed, (ii) the overruling by the Court of objections to such counsel's
selection or (iii) expiration of all periods for the Corporation or Indemnitee
to object to such counsel's selection, Indemnitee shall be entitled to commence
an action seeking an adjudication in the Court of his entitlement to such
indemnification or advancement of Expenses. Alternatively, Indemnitee, at his
option, may seek an award in arbitration to be conducted by a single arbitrator
pursuant to the commercial arbitration rules of the American Arbitration
Association. Indemnitee shall commence such action seeking an adjudication or
an award in arbitration within 180 days following the date on which Indemnitee
first has the right to commence such action pursuant to this Section 6.1, or
such right shall expire. The Corporation agrees not to oppose Indemnitee's
right to seek any such adjudication or award in arbitration.
Section 6.2 Adverse Determination Not to Affect any
Judicial Proceeding. If a determination shall have been made pursuant to
Article V that Indemnitee is not entitled to indemnification under this
Agreement, any judicial proceeding or arbitration commenced pursuant to this
Article VI shall be conducted in all respects as a de novo trial or arbitration
on the merits, and Indemnitee shall not be prejudiced by reason of such initial
adverse determination. In any judicial proceeding or arbitration commenced
pursuant to this Article VI, Indemnitee shall be presumed to be entitled to
indemnification or advancement of Expenses, as the case may be, under this
Agreement and the Corporation shall have the burden of proof in overcoming such
presumption and to show by clear and convincing evidence that Indemnitee is not
entitled to indemnification or advancement of Expenses, as the case may be.
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Section 6.3 Corporation Bound by Determination Favorable
to Indemnitee in any Judicial Proceeding or Arbitration. If a determination
shall have been made or deemed to have been made pursuant to Article V that
Indemnitee is entitled to indemnification, the Corporation shall be irrevocably
bound by such determination in any judicial proceeding or arbitration commenced
pursuant to this Article VI, and shall be precluded from asserting that such
determination has not been made or that the procedure by which such
determination was made is not valid, binding and enforceable, in each such case
absent (a) a knowing misstatement by Indemnitee of a material fact, or a
knowing omission of a material fact necessary to make a statement by Indemnitee
not materially misleading, in connection with the request for indemnification
or (b) a prohibition of such indemnification under applicable law.
Section 6.4 Corporation Bound by the Agreement. The
Corporation shall be precluded from asserting in any judicial proceeding or
arbitration commenced pursuant to this Article VI that the procedures and
presumptions of this Agreement are not valid, binding and enforceable and shall
stipulate in any such court or before any such arbitrator that the Corporation
is bound by all the provisions of this Agreement.
Section 6.5 Indemnitee Entitled to Expenses of Judicial
Proceeding. If Indemnitee seeks a judicial adjudication of or an award in
arbitration to enforce his rights under, or to recover damages for breach of,
this Agreement, Indemnitee shall be entitled to recover from the Corporation,
and the Corporation shall indemnify Indemnitee against, any and all expenses
(of the types described in the definition of Expenses in Article I) actually
and reasonably incurred by him in such judicial adjudication or arbitration but
only if Indemnitee prevails therein. If it shall be determined in such
judicial adjudication or arbitration that Indemnitee is entitled to receive
part but not all of the indemnification or advancement of expenses or other
benefit sought, the expenses incurred by Indemnitee in connection with such
judicial adjudication or arbitration shall be equitably allocated between the
Corporation and Indemnitee. Notwithstanding the foregoing, if a Change in
Control shall have occurred, Indemnitee shall be entitled to indemnification
under this Section 6.5 regardless of whether Indemnitee ultimately prevails in
such judicial adjudication or arbitration.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Non-Exclusivity. The rights of Indemnitee to
receive indemnification and advancement of Expenses under this Agreement shall
not be deemed exclusive of any other rights to which Indemnitee may at any time
be entitled under applicable law, the Articles of Incorporation or Bylaws of
the Corporation, any other agreement, vote of shareholders or a resolution of
directors, or otherwise. No amendment or alteration of the Articles of
Incorporation or Bylaws of the Corporation or any provision thereof shall
adversely affect Indemnitee's rights hereunder and such rights shall be in
addition to any rights Indemnitee may have under the Corporation's Articles of
Incorporation, Bylaws and the TBCA or otherwise. To the extent that there is a
change in the TBCA or other applicable law (whether by statute or judicial
decision) that allows
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greater indemnification by agreement than would be afforded currently under the
Corporation's Articles of Incorporation or Bylaws and this Agreement, it is the
intent of the parties hereto that the Indemnitee shall enjoy by virtue of this
Agreement the greater benefit so afforded by such change.
Section 7.2 Insurance and Subrogation.
(a) To the extent that the Corporation maintains an
insurance policy or policies providing liability insurance for directors,
officers, employees, agents or fiduciaries of the Corporation or for directors
of the Corporation serving at the request of the Corporation as directors,
officers, partners, venturers, proprietors, trustees, employees, agents,
fiduciaries or similar functionaries of another foreign or domestic
corporation, partnership, joint venture, sole proprietorship, trust, employee
benefit plan or other enterprise, Indemnitee 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, agent or fiduciary
under such policy or policies.
(b) In the event of any payment by the Corporation under
this Agreement, the Corporation shall be subrogated to the extent of such
payment to all of the rights of recovery of Indemnitee, 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 Corporation to bring
suit to enforce such rights.
(c) The Corporation shall not be liable under this
Agreement to make any payment of amounts otherwise indemnifiable hereunder if
and to the extent that Indemnitee has otherwise actually received such payment
under the Corporation's Articles of Incorporation or Bylaws or any insurance
policy, contract, agreement or otherwise.
Section 7.3 Self Insurance of the Corporation; Other
Arrangements. The parties hereto recognize that the Corporation may, but is
not required to, procure or maintain insurance or other similar arrangements,
at its expense, to protect itself and any person, including the Indemnitee, who
is or was a director, officer, employee, agent or fiduciary of the Corporation
or who is or was serving at the request of the Corporation as a director,
officer, partner, venturer, proprietor, trustee, employee, agent, fiduciary or
similar functionary of another foreign or domestic corporation, partnership,
joint venture, sole proprietorship, trust, employee benefit plan or other
enterprise against any expense, liability or loss asserted against or incurred
by such person, in such a capacity or arising out of his status as such a
person, whether or not the Corporation would have the power to indemnify such
person against such expense or liability or loss.
In considering the cost and availability of such insurance,
the Corporation, (through the exercise of the business judgment of its
directors and officers), may from time to time, purchase insurance which
provides for any and all of (i) deductibles, (ii) limits on payments required
to be made by the insurer or (iii) coverage which may not be as comprehensive
as that previously included in insurance purchased by the Corporation or its
predecessors. The purchase of insurance with
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deductibles, limits on payments and coverage exclusions, even if in the best
interest of the Corporation, may not be in the best interest of the Indemnitee.
As to the Corporation, purchasing insurance with deductibles, limits on
payments and coverage exclusions is similar to the Corporation's practice of
self-insurance in other areas. In order to protect Indemnitee who would
otherwise be more fully or entirely covered under such policies, the
Corporation shall indemnify and hold Indemnitee harmless to the extent (i) of
such deductibles, (ii) of amounts exceeding payments required to be made by an
insurer or (iii) that prior policies of officer's and director's liability
insurance held by the Corporation or its predecessors would have provided for
payment to Indemnitee, if by reason of his Corporate Status he is or is
threatened to be made a party to any Proceeding. The obligation of the
Corporation in the preceding sentence shall be without regard to whether the
Corporation would otherwise be entitled to indemnify such officer or director
under the other provisions of this Agreement, or under any law, agreement, vote
of shareholders or directors or other arrangement.
Notwithstanding the foregoing provisions of this Section 7.3, the Indemnitee
shall not be entitled to indemnification for the results of his conduct that is
intentionally adverse to the interests of the Corporation. Without limiting
the generality of any provision of this Agreement, the procedures in Article V
hereof shall, to the extent applicable, be used for determining entitlement to
indemnification under this Section 7.3. This Section 7.3 is authorized by
Section 2.02-1(R) of the TBCA as in effect on the date hereof, and is intended
to establish further an arrangement of self- insurance and an "other
arrangement" pursuant to that section.
Section 7.4 Certain Settlement Provisions. The
Corporation shall have no obligation to indemnify Indemnitee under this
Agreement for amounts paid in settlement of a Proceeding or Claim without the
Corporation's prior written consent. The Corporation shall not settle any
Proceeding or Claim in any manner that would impose any fine or other
obligation on Indemnitee without Indemnitee's prior written consent. Neither
the Corporation nor Indemnitee shall unreasonably withhold their consent to any
proposed settlement.
Section 7.5 Exculpation of Directors. If Indemnitee is
or was a director of the Corporation, he shall not in that capacity be liable
to the Corporation or its shareholders for monetary damages for an act or
omission in Indemnitee's capacity as a director, except that Indemnitee's
liability shall not be eliminated or limited for: (a) a breach of Indemnitee's
duty of loyalty to the Corporation or its shareholders; (b) an act or omission
not in good faith or that involves intentional misconduct or a knowing
violation of the law; (c) a transaction from which Indemnitee received an
improper benefit, whether or not the benefit resulted from an action taken
within the scope of Indemnitee's office; or (d) an act or omission for which
the liability of Indemnitee is expressly provided for by statute.
Section 7.6 Duration of Agreement. This Agreement shall
continue for so long as Indemnitee serves as a director, officer, employee,
agent or fiduciary of the Corporation or, at the request of the Corporation, as
a director, officer, partner, venturer, proprietor, trustee, employee, agent or
similar functionary of another foreign or domestic corporation, partnership,
joint venture, sole proprietorship, trust, employee benefit plan or other
enterprise, and thereafter shall survive until and terminate upon the later to
occur of: (a) the expiration of 20 years after the
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latest date that Indemnitee shall have ceased to serve in any such capacity;
(b) the final termination of all pending Proceedings in respect of which
Indemnitee is granted rights of indemnification or advancement of Expenses
hereunder and of any proceeding commenced by Indemnitee pursuant to Article VI
relating thereto; or (c) the expiration of all statutes of limitation
applicable to possible Claims arising out of Indemnitee's Corporate Status.
Section 7.7 Notice by Each Party. Indemnitee shall
promptly notify the Corporation in writing upon being served with any summons,
citation, subpoena, complaint, indictment, information or other document or
communication relating to any Proceeding or Claim for which Indemnitee may be
entitled to indemnification or advancement of Expenses hereunder; provided,
however, that any failure of Indemnitee to so notify the Corporation shall not
adversely affect Indemnitee's rights under this Agreement except to the extent
the Corporation shall have been materially prejudiced as a direct result of
such failure. The Corporation shall promptly notify Indemnitee in writing, as
to the pendency of any Proceeding or Claim that may involve a claim against the
Indemnitee for which Indemnitee may be entitled to indemnification or
advancement of Expenses hereunder.
Section 7.8 Amendment. This Agreement may not be
modified or amended except by a written instrument executed by or on behalf of
each of the parties hereto.
Section 7.9 Waivers. The observance of any term of this
Agreement may be waived (either generally or in a particular instance and
either retroactively or prospectively) by the party entitled to enforce such
term only by a writing signed by the party against which such waiver is to be
asserted. Unless otherwise expressly provided herein, no delay on the part of
any party hereto in exercising any right, power or privilege hereunder shall
operate as a waiver thereof, nor shall any waiver on the part of any party
hereto of any right, power or privilege hereunder operate as a waiver of any
other right, power or privilege hereunder nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder.
Section 7.10 Entire Agreement. This Agreement and the
documents expressly referred to herein constitute the entire agreement between
the parties hereto with respect to the matters covered hereby, and any other
prior or contemporaneous oral or written understandings or agreements with
respect to the matters covered hereby are expressly superseded by this
Agreement.
Section 7.11 Severability. If any provision of this
Agreement (including any provision within a single section, paragraph or
sentence) or the application of such provision to any person or circumstance,
shall be judicially declared to be invalid, unenforceable or void, such
decision will not have the effect of invalidating or voiding the remainder of
this Agreement or affect the application of such provision to other persons or
circumstances, it being the intent and agreement of the parties that this
Agreement shall be deemed amended by modifying such provision to the extent
necessary to render it valid, legal and enforceable while preserving its
intent, or if such modification is not possible, by substituting therefor
another provision that is
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valid, legal and unenforceable and that achieves the same objective. Any such
finding of invalidity or unenforceability shall not prevent the enforcement of
such provision in any other jurisdiction to the maximum extent permitted by
applicable law.
Section 7.12 Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given upon (a) transmitter's
confirmation of a receipt of a facsimile transmission, (b) confirmed delivery
of a standard overnight courier or when delivered by hand or (c) the expiration
of five business days after the date mailed by certified or registered mail
(return receipt requested), postage prepaid, to the parties at the following
addresses (or at such other addresses for a party as shall be specified by like
notice):
If to the Corporation, to it at:
MESA Inc.
0000 Xxxxxxxx Xxxxxx Xxxx
0000 Xxxxx X'Xxxxxx Xxxx.
Xxxxxx, Xxxxx 00000-0000
Attn: Chief Financial Officer
If to Indemnitee, to him at:
-------------------------------
MESA Inc.
0000 Xxxxxxxx Xxxxxx Xxxx
0000 Xxxxx X'Xxxxxx Xxxx.
Xxxxxx, Xxxxx 00000-0000
or to such other address or to such other individuals as any party shall have
last designated by notice to the other parties. All notices and other
communications given to any party in accordance with the provisions of this
Agreement shall be deemed to have been given when delivered or sent to the
intended recipient thereof in accordance with the provisions of this Section
7.12.
Section 7.13 Governing Law. This Agreement shall be
construed in accordance with and governed by the laws of the State of Texas
without regard to the principles of conflict of laws.
Section 7.14 Certain Construction Rules.
(a) The article and section headings contained in
this Agreement are for reference purposes only and shall not affect in
any way the meaning or interpretation of this Agreement. As used in
this Agreement, unless otherwise provided to the contrary, (1) all
references to days shall be deemed references to calendar days and (2)
any reference
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to a "Section" or "Article" shall be deemed to refer to a section or
article of this Agreement. The words "hereof," "herein" and
"hereunder" and words of similar import referring to this Agreement
refer to this Agreement as a whole and not to any particular provision
of this Agreement. Whenever the words "include," "includes" or
"including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation." Unless otherwise
specifically provided for herein, the term "or" shall not be deemed to
be exclusive. Whenever the context may require, any pronoun used in
this Agreement shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns, pronouns and verbs shall
include the plural and vice versa.
(b) For purposes of this Agreement, references to
"other enterprises" shall include employee benefit plans; references
to "fines" shall include any excise taxes assessed on a person with
respect to any employee benefit plan; references to "serving at the
request of the Corporation" shall include any service as a director,
officer, employee or agent of the Corporation which imposes duties on,
or involves services by, such director, nominee, officer, employee or
agent with respect to an employee benefit plan, its participants or
beneficiaries; and action taken or omitted by a director with respect
to an employee benefit plan in the performance of his duties for a
purpose reasonably believed by him to be in the interest of the
participants and beneficiaries of the employee benefit plan shall be
deemed to be for a purpose that is "not opposed to the best interests
of the Corporation" as referred to in this Agreement.
Section 7.15 Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall be deemed to be an
original and all of which together shall be deemed to be one and the same
instrument, notwithstanding that both parties are not signatories to the
original or same counterpart.
Section 7.16 Certain Persons Not Entitled to
Indemnification. Notwithstanding any other provision of this Agreement,
Indemnitee shall not be entitled to indemnification or advancement of Expenses
hereunder with respect to any Proceeding or any Claim, issue or matter therein,
brought or made by such person against the Corporation, except as specifically
provided in Article V or Article VI hereof.
Section 7.17 Indemnification for Negligence, Gross
Negligence, etc. Without limiting the generality of any other provision
hereunder, it is the express intent of this Agreement that Indemnitee be
indemnified and Expenses be advanced regardless of Indemnitee's acts of
negligence, gross negligence, intentional or willful misconduct to the extent
that indemnification and advancement of Expenses is allowed pursuant to the
terms of this Agreement and under applicable law.
Section 7.18 Mutual Acknowledgment. Both the Corporation
and Indemnitee acknowledge that in certain instances, applicable law or public
policy may prohibit the Corporation from indemnifying the directors, officers,
employees, agents or fiduciaries of the Corporation under
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this Agreement or otherwise. Indemnitee understands and acknowledges that the
Corporation has undertaken or may be required in the future to undertake with
the Securities Exchange Commission to submit the question of indemnification to
a court in certain circumstances for a determination of the Corporation's right
under public policy to indemnify Indemnitee.
Section 7.19 Enforcement. The Corporation agrees that its
execution of this Agreement shall constitute a stipulation by which it shall be
irrevocably bound in any court or arbitration in which a proceeding by
Indemnitee for enforcement of his rights hereunder shall have been commenced,
continued or appealed, that its obligations set forth in this Agreement are
unique and special, and that failure of the Corporation to comply with the
provisions of this Agreement will cause irreparable and irremediable injury to
Indemnitee, for which a remedy at law will be inadequate. As a result, in
addition to any other right or remedy he may have at law or in equity with
respect to breach of this Agreement, Indemnitee shall be entitled to injunctive
or mandatory relief directing specific performance by the Corporation of its
obligations under this Agreement.
Section 7.20 Successors and Assigns. All of the terms and
provisions of this Agreement shall be binding upon, shall inure to the benefit
of and shall be enforceable by the parties hereto and their respective
successors, assigns, heirs, executors, administrators, legal representatives.
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IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered to be effective as of the date first above written.
MESA INC.
By:
------------------------------------------
Xxxxxxx X. Xxxxxxx
Senior Vice President and Chief
Financial Officer
INDEMNITEE:
---------------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
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