INDEMNITY AGREEMENT
This Indemnity Agreement ("Agreement") is made as of January ___, 1998,
by and between Hawker Pacific Aerospace, a California corporation (the
"Corporation"), and ___________ ___________________________, an individual
(the "Indemnitee"), a director and/or officer of the Corporation.
R E C I T A L S
A. The Corporation and the Indemnitee recognize that the
interpretation of statutes, regulations, court opinions and the Corporation's
Articles of Incorporation and bylaws is too uncertain to provide the
Corporation's officers and directors with adequate guidance with respect to
the legal risks and potential liabilities to which they may become personally
exposed as a result of performing their duties in good faith for the
Corporation.
B. The Corporation and the Indemnitee are aware of the substantial
increase in the number of lawsuits filed against corporate officers and
directors.
C. The Corporation and the Indemnitee recognize that the cost of
defending against such lawsuits, whether or not meritorious, may impose
substantial economic hardship upon the Corporation's officers and directors.
D. The Corporation and the Indemnitee recognize that the legal risks,
potential liabilities and expenses of defense associated with litigation
against officers and directors arising or alleged to arise from the conduct
of the affairs of the Corporation are frequently excessive in view of the
amount of compensation received by the Corporation's officers and directors,
and thus may act as a significant deterrent to the ability of the Corporation
to obtain experienced and capable officers and directors.
E. Section 317 of the California General Corporation Law, which sets
forth certain provisions relating to the indemnification of officers and
directors (among others) of a California corporation by such corporation, is
specifically not exclusive of other rights to which those indemnified
thereunder may be entitled under any bylaw, agreement, vote of shareholders
or disinterested directors, or otherwise.
F. In order to induce capable persons such as the Indemnitee to serve
or continue to serve as officers or directors of the Corporation and to
enable them to perform their duties to the Corporation secure in the
knowledge that certain
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expenses and liabilities that may be incurred by them will be borne by the
Corporation, the Board of Directors of the Corporation has determined, after
due consideration and investigation of the terms and provisions of this
Agreement and the various other options available to the Corporation and the
Indemnitee in lieu of this Agreement, that the following Agreement is in the
best interests of the Corporation and its shareholders.
G. The Corporation desires to have the Indemnitee serve or continue to
serve as an officer and/or director of the Corporation, and the Indemnitee
desires to serve or continue to serve as an officer and/or director of the
Corporation provided, and on the express condition, that he is furnished with
the indemnity set forth below.
A G R E E M E N T
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth below, the Corporation and the Indemnitee agree as follows:
1. CONTINUED SERVICE. The Indemnitee agrees to serve or continue to
serve as a director and/or officer of the Corporation for so long as he is
duly elected or appointed or until such time as he resigns in writing,
subject to the terms of any applicable employment agreement.
2. DEFINITIONS.
(a) The term "Proceeding" shall include any threatened, pending or
completed action, suit or proceeding, whether brought in the name of the
Corporation or otherwise and whether of a civil, criminal or administrative
or investigative nature, including, but not limited to, actions, suits or
proceedings brought under or predicated upon the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, their respective
state counterparts or any rule or regulation promulgated thereunder, in which
the Indemnitee may be or may have been involved as a party or otherwise by
reason of the fact that the Indemnitee is or was a director and/or officer of
the Corporation, by reason of any action taken by him or of any inaction on
his part while acting as such director and/or officer, or by reason of the
fact that he is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, whether or not he is serving in
such capacity at the time any indemnified liability or reimbursable expense
is incurred.
(b) The term "Expenses" shall include, but shall not be limited to,
damages, judgments, fines, settlements and charges, costs, expenses of
investigation and expenses of
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defense of legal actions, suits, proceedings or claims and appeals therefrom,
and expenses of appeal, attachment or similar bonds. "Expenses" shall not
include any judgments, fines or penalties actually levied against the
Indemnitee which the Corporation is prohibited by applicable law from paying.
3. INDEMNITY IN THIRD-PARTY PROCEEDINGS. Subject to Paragraph 8, the
Corporation shall indemnify the Indemnitee in accordance with the provisions
of this Paragraph 3 if the Indemnitee is a party to, threatened to be made a
party to or otherwise involved in any Proceeding (other than a Proceeding by
the Corporation itself to procure a judgment in its favor), by reason of the
fact that the Indemnitee is or was a director and/or officer of the
Corporation or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against all Expenses actually and
reasonably incurred by the Indemnitee in connection with the defense or
settlement of such Proceeding, provided it is determined, pursuant to
Paragraph 7 or by the court before which such action was brought, that the
Indemnitee acted in good faith and in a manner that he reasonably believed to
be in the best interests of the Corporation and, in the case of a criminal
proceeding, had no reasonable cause to believe that his conduct was unlawful.
The termination of any such Proceeding by judgment, order of court,
settlement, conviction or upon a plea of NOLO CONTENDERE or its equivalent
shall not, of itself, create a presumption that the Indemnitee did not act in
good faith or in a manner that he reasonably believed to be in the best
interests of the Corporation, and with respect to any criminal proceeding,
that such person had reasonable cause to believe that his conduct was
unlawful.
4. INDEMNITY IN PROCEEDINGS BY OR IN THE NAME OF THE CORPORATION.
Subject to Paragraph 8, the Corporation shall indemnify the Indemnitee against
all Expenses actually and reasonably incurred by the Indemnitee in connection
with the defense or settlement of any Proceeding by or in the name of the
Corporation to procure a judgment in its favor by reason of the fact that the
Indemnitee was or is a director and/or officer of the Corporation or is or was
serving at the request of the Corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, but only if he acted in good faith and in a manner that he
reasonably believed to be in the best interests of the Corporation and its
shareholders; provided, however, that no indemnification for Expenses shall be
made under this Paragraph 4 with respect to any claim, issue or matter as to
which the Indemnitee shall have been adjudged to be liable to the Corporation,
unless and only to the extent that any court in which such Proceeding is brought
shall determine upon application that despite the adjudication of liability, but
in view of all the circumstances of the case, the Indemnitee is
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fairly and reasonably entitled to indemnity for such expenses as such court
shall deem proper.
5. INDEMNIFICATION OF EXPENSES OF SUCCESSFUL PARTY. Notwithstanding
any other provisions of this Agreement, to the extent that the Indemnitee has
been successful on the merits or otherwise in defense of any Proceeding or in
defense of any claim, issue or matter therein, including the dismissal of an
action without prejudice, the Indemnitee shall be indemnified against all
Expenses incurred in connection therewith.
6. ADVANCES OF EXPENSES. Expenses incurred by the Indemnitee pursuant
to Paragraphs 3 and 4 in any Proceeding shall be paid by the Corporation in
advance of the determination of such Proceeding at the written request of the
Indemnitee, if the Indemnitee shall undertake to repay such amount to the
extent that it is ultimately determined that the Indemnitee is not entitled
to indemnification.
7. RIGHT OF INDEMNITEE TO INDEMNIFICATION UPON APPLICATION; PROCEDURE
UPON APPLICATION. Any indemnification or advance under Xxxxxxxxx 0, 0 xx 0
xxxxx xx made no later than 30 days after receipt of the written request of
the Indemnitee therefor, unless a determination is made within said 30-day
period by (a) the Board of Directors of the Corporation by a majority vote of
a quorum thereof consisting of directors who were not parties to such
Proceedings, or (b) independent legal counsel in a written opinion (which
counsel shall be appointed if such a quorum is not obtainable) that the
Indemnitee has not met the relevant standards for indemnification set forth
in Paragraphs 3 and 4.
The right to indemnification or advances as provided by this Agreement
shall be enforceable by the Indemnitee in any court of competent
jurisdiction. The Corporation shall bear the burden of proving that
indemnification or advances are not appropriate. The failure of the
Corporation to have made a determination that indemnification or advances are
proper in the circumstances shall not be a defense to the action or create a
presumption that the Indemnitee has not met the applicable standard of
conduct. The Indemnitee's Expenses incurred in connection with successfully
establishing his right to indemnification or advances, in whole or in part,
in any such Proceeding shall also be indemnified by the Corporation.
8. INDEMNIFICATION HEREUNDER NOT EXCLUSIVE.
(a) Notwithstanding any other provision of this Agreement, the
Company shall not indemnify Indemnitee for any act or omission or transactions
for which indemnification is expressly prohibited by Section 204(a)(11) of the
California General Corporation Law.
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(b) The right to indemnification provided by this Agreement shall
not be exclusive of any other rights to which the Indemnitee may be entitled
under the Corporation's Articles of Incorporation, bylaws, any agreement, any
vote of shareholders or disinterested directors, the California General
Corporation Law or otherwise, both as to action in his official capacity and
as to action in another capacity while holding such office. The
indemnification under this Agreement shall continue as to the Indemnitee even
though he may have ceased to be a director or officer, and shall inure to the
benefit of the heirs and personal representatives of the Indemnitee.
9. PARTIAL INDEMNIFICATION. If the Indemnitee is entitled under any
provision of this Agreement to indemnification by the Corporation for a
portion of his Expenses actually and reasonably incurred by him in any
Proceeding but not, however, for the total amount thereof, the Corporation
shall nevertheless indemnify the Indemnitee for the portion of such Expenses
to which the Indemnitee is entitled.
10. SEVERABILITY. If any provision of this Agreement or the
application of any provision hereof to any person or circumstance is held
invalid, unenforceable or otherwise illegal, the remainder of this Agreement
and the application of such provision to other persons or circumstances shall
not be affected, and the provision so held to be invalid, unenforceable or
otherwise illegal shall be revised to the extent (and only to the extent)
necessary to make it enforceable, valid and legal.
11. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of California, without giving effect
to the principles of conflict of laws thereof.
12. NOTICES. The Indemnitee shall, as a condition precedent to his right
to be indemnified under this Agreement, give to the Corporation written notice
as soon as practicable of any claim made against him for which indemnity will or
could be sought under this Agreement. Notice to the Corporation shall be
directed to Hawker Pacific Aerospace 00000 Xxxxxxx Xxx, Xxx Xxxxxx, Xxxxxxxxxx
00000, Attention: President (or at such other address or to the attention of
such other person as the Corporation shall designate in writing to the
Indemnitee). Notices to the Indemnitee shall be sent to the Indemnitee at the
address set forth after his name on the signature page of this Agreement (or at
such other add-
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resses the Indemnitee shall designate in writing to the Corporation).
HAWKER PACIFIC AEROSPACE
By:
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Title:
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INDEMNITEE
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(Print Name)
Address:
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