EXHIBIT 10.04
AMENDED AND RESTATED
INDEMNITY AGREEMENT
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This Agreement, made by and among Xxxxx Industries, Inc., a Delaware
corporation (the "Company"), and [ ],the undersigned
[officer/director] of the Company (referred to herein individually as an
"Indemnitee").
RECITALS
A. The Company and the Indemnitee recognize that the present state of the
law is too uncertain to provide the directors and officers with adequate and
reliable advance knowledge or guidance with respect to the legal risks and
potential liabilities to which they may become personally exposed as a result of
performing their duties for the Company;
B. The Company believes that the interest of the Company's stockholders
would be best served by contracts with its officers and directors to indemnify
them to the fullest extent permitted by law (as in effect on the date hereof or,
to the extent any amendment may expand such permitted indemnification, as
hereafter in effect) against personal liability for actions taken in the
performance of their duties to the Company;
C. The Board of Directors of the Company has concluded that, to retain
and attract talented and experienced individuals to serve as directors and
officers of the Company and to encourage such individuals to take the business
risks necessary for the success of the Company, it is necessary for the Company
to indemnify contractually its directors and officers and to assume for itself
liability for such expenses and damages in connection with claims against such
directors and officers, in connection with their service to the Company, and has
further concluded that the failure to provide such contractual indemnification
could result in great harm to the Company and its stockholders;
D. The Company desires and has requested the Indemnitee to serve or
continue to serve as a director of the Company, free from undue concern for the
risks and potential liabilities associated with such services to the Company;
and
E. The Company and its directors and officers entered into an
indemnification agreement effective as of December 18, 1991 (the "1991
Agreement"), a form of which is attached hereto, which the Board of Directors
and those continuing directors and officers party to the 1991 Agreement have
concluded in their respective best interests should be amended and restated to
reflect developments in applicable law;
F. The Indemnitee is willing to serve, or continued to serve, the
Company, provided, and on the expressed condition, that he is furnished with the
indemnification provided for in this Agreement.
AGREEMENT
NOW, THEREFORE, the Company and Indemnitee agree as follows:
1. Grant of Indemnification. Subject only to the exclusions set forth in
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Section 2 hereof, the Company hereby agrees to hold harmless and indemnify
Indemnitee:
(a) Against any and all expenses (including attorneys' fees and
disbursements), judgments, fines (including excise taxes assessed with
respect to any Employee Benefit Plan) and amounts paid in settlement
actually and reasonably incurred by the Indemnitee in connection with any
Proceeding (as hereinafter defined) to which the Indemnitee is, was or at
any time becomes a party, or is threatened to be made a party, or in which
the Indemnitee becomes involved, by reason of the fact that the Indemnitee
is, was or at any time becomes a director, officer, employee or agent of
the Company, or is or was serving or at any time serves at the request of
the Company as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan or
other enterprise; and
(b) Otherwise to the fullest extent permitted under the provisions of
Section 145 of the General Corporation Law of the State of Delaware or any
provision of the Company's certificate of incorporation or bylaws;
provided, however, that the Company shall not be obligated, under this
Section 1, to pay any expenses, judgments, fines or amounts paid in
settlement, or any other expenses:
(i) if such payment is prohibited by applicable law, or
(ii) in connection with any Proceeding initiated by the
Indemnitee without authorization from the Company, except for (a) a
Proceeding initiated by Indemnitee to enforce Indemnitee's rights to
indemnification or advancement of expenses hereunder (b) an appeal by
Indemnitee from a Proceeding that was not initiated by Indemnitee, and
(c) a Proceeding initiated by Indemnitee, in his or her capacity as a
director of the Company, to contest the legality of any actions that
resulted (or allegedly resulted) in the removal or failure to elect
such Indemnitee and a majority of the incumbent directors (or their
nominees as directors).
(c) For purposes of this Agreement, a "Proceeding" shall mean any,
threatened, pending or completed investigation, action, suit, arbitration
or other proceeding (including any appeals therefrom), whether civil,
criminal, administrative or investigative in nature, whether before a court
or arbitrator, or before or involving a governmental, administrative or
private entity (including but not limited to an investigation, action,
suit, arbitration or other proceeding initiated by or on behalf of the
Company, an affiliate of the Company, or the Board of Directors or other
fiduciaries of any thereof).
2. Exclusions. The Company shall not be liable under this Agreement to
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make any payment in connection with any Proceeding against the Indemnitee;
(a) (i) in connection with any Proceeding against the Indemnitee
for which payment is actually made to or on behalf of the Indemnitee
under a valid and collectible insurance policy, except in respect to
any deductible amount or excess liability beyond the amount of payment
under such insurance;
(ii) for which payment is actually made to the Indemnitee by
the Company with respect to indemnification of the Indemnitee by the
Company otherwise than pursuant to this Agreement;
(iii) for an accounting of profits made by the Indemnitee from
the Indemnitee's purchase or sale of securities of the Company within
the meaning of Section 16(b) of the Securities Exchange Act of 1934
and amendments thereto or similar provisions of any state statutory
law or common law; or
(b) which payment is not permitted by applicable law.
3. Notice. The Indemnitee shall give to the Company notice in
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writing as soon as practicable of any Proceeding for which indemnity will or
could be sought under this Agreement; provided, however, that any delay in so
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notifying the Company shall not constitute a waiver by Indemnitee of Indemnitees
rights hereunder. Notice to the Company shall be directed to the Company's main
offices, 000 Xxx Xxxxxx Xxxx, Xxxxxx, Xxxxxxx 00000, Attention: Board of
Directors (or such other address as the Company shall designate in writing to
the Indemnitee); notice shall be deemed received if sent by prepaid mail
properly addressed, the date of such notice being the date postmarked.
4. Expenses and Conduct of Proceedinqs.
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(a) Unless prohibited by applicable law, the Company shall promptly
pay in advance of the final disposition of any Proceeding all expenses
(including attorneys' fees and disbursements) incurred by the Indemnitee in
connection with such Proceeding; provided, however, that if applicable law
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shall require an undertaking by or on behalf of the Indemnitee to repay
such expenses if it shall ultimately be determined that Indemnitee is not
entitled to be indemnified by the Company, then any such undertaking shall
be unsecured and shall be accepted without reference to financial ability
to make repayment.
(b) With respect to any Proceeding as to which the Indemnitee
notifies the Company hereunder of the commencement thereof:
(i) The Company will be entitled to participate therein at its
own expense; and
(ii) Except as otherwise provided below, to the extent that it
may wish, the Company jointly with any other indemnifying party
similarly notified will be
entitled to assume the legal representation thereof, with counsel
satisfactory to the Indemnitee. After notice from the Company to the
Indemnitee of its election so to assume legal representation, the
Company will not be liable to the Indemnitee under this Agreement for
any legal or other expenses subsequently incurred by the Indemnitee in
connection with legal representation other than reasonable costs of
investigation or as otherwise provided below. The Indemnitee shall
have the right to employ counsel in such action, suit or proceeding
but the fees and expenses of such counsel incurred after notice from
the Company of its assumption of legal representation shall be at the
expense of the Indemnitee unless (A) the employment of counsel by the
Indemnitee has been authorized by the Company, (B) the Indemnitee
shall have reasonably concluded that there may be a conflict of
interest between the Company and the Indemnitee in the conduct of such
action or (C) the Company shall not in fact have employed counsel to
assume legal representation in such Proceeding within a reasonable
period of time after notice of the claim is given to the Company by
the Indemnitee, in which case the fees and expenses of counsel shall
be at the expense of the Company. The Company shall not be entitled
to assume the conduct of any Proceeding brought by or on behalf of the
Company or as to which the Indemnitee shall have made the conclusion
in (B) above.
(c) The Company shall not be liable to indemnify the Indemnitee under
this Agreement for any amounts paid in settlement of any Proceeding
affected without its written consent. The Company shall not settle any
Proceeding in any manner which would impose any penalty or limitation on
the Indemnitee without the Indemnitee's written consent. Neither the
Company nor the Indemnitee will unreasonably withhold their consent to any
proposed settlement.
5. Determination of Entitlement to Indemnification. No determination of
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the Indemnitee's entitlement to indemnification in the specific case shall be
made unless required by applicable law; provided however, that if and only if a
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determination of the Indemnitee entitlement to indemnification in the specific
case is required by applicable law, then any such determination shall be made in
the following manner:
(a) If the Indemnitee shall so request, or if the Board of Directors
shall so resolve by a majority vote of directors who are not parties to the
subject Proceeding, even though less than a quorum, such determination
shall be made by Independent Counsel (as hereinafter defined) in a written
opinion to the Board of Directors, a copy of which shall be delivered to
Indemnitee.
(i) The Independent Counsel shall be selected by a majority vote
of the Board of Directors from a list of at least two separate
Independent Counsel provided by Indemnitee. Within seven (7) days
after receipt of such list, the Company shall either advise Indemnitee
of the Independent Counsel so selected or deliver a written objection
to such list of Independent Counsel. Such objection may be asserted
only on the ground that the Independent Counsel identified in the
list do not meet the requirements of "Independent Counsel" as defined
herein, and the objection shall set forth with particularity the
factual basis of such assertion. The Indemnitee may then give the
Company a list identifying two alternative separate Independent
Counsel, and the procedure for selecting or objecting to such
Independent Counsel set forth above shall again be followed.
(ii) For purposes of this Agreement, "Independent Counsel",
shall mean a law firm, or a member of a law firm, that is experienced
in matters of corporation law and neither currently is, nor in the
past five (5) years has been, retained to represent (A) the Company,
any affiliate of the Company, or Indemnitee in any matter material to
either such party, or (B) any other party to the Proceeding giving
rise to a claim for indemnification hereunder. 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 Company or Indemnitee in an action to determine Indemnitee's
rights under this Agreement.
(iii) The Company shall pay any and all reasonable fees and
expenses of Independent Counsel incurred by such Independent Counsel
in connection with action pursuant to this Agreement, and the Company
shall pay all reasonable fees and expenses incident to the selection
procedure described herein. Upon the commencement of any judicial
proceeding or arbitration pursuant to Section 6 of this Agreement,
Independent Counsel shall be discharged and relieved of any further
responsibility in such capacity (subject to the applicable standards
of professional conduct then prevailing.)
(b) Absent a request by Indemnitee or a resolution by the Board of
Directors pursuant to Section 5(a) of this Agreement for a determination by
Independent Counsel, any determination required by law may be made (i) by
the Board of Directors acting by a majority vote of the directors who are
not parties to the subject Proceeding, even though less than a quorum, or
(ii) by a committee of such directors designated by majority vote of such
directors, even though less than a quorum, or (iii) by the stockholders of
the Company.
(c) The Indemnitee shall cooperate with the person, persons, or
entity making such determination with respect to Indemnitee'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 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,
persons or entity making such determination shall be borne by the Company
(irrespective of the determination as to Indemnitee's entitlement to
indemnification) and the Company hereby indemnities and agrees to hold
Indemnitee harmless therefrom.
(d) If the person, persons or entity empowered or selected under
Section 5(a) or 5(b) of this Agreement to determine whether Indemnitee is
entitled to indemnification shall not have made a determination within
ninety (90) days after receipt by the Company of the request therefor, the
requisite determination of entitlement to indemnification shall be deemed
to have been made and Indemnitee shall be entitled to such indemnification,
absent a prohibition of such indemnification by applicable law.
6. Remedies of Indemnitee.
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(a) In the event that:
(i) a determination is made pursuant to Section 5 of this
Agreement that Indemnitee is not entitled to indemnification under
this Agreement;
(ii) advancement of expenses is not timely made pursuant to
Section 4 of this agreement;
(iii) the determination of entitlement to indemnification is to
be made by Independent Counsel pursuant to Section 5(a) of this
Agreement and such determination shall not have been made and
delivered in a written opinion within ninety (90) days after receipt
by the Company of the request for indemnification, or
(iv) payment of indemnification is not made pursuant to Section
1 of this Agreement within ninety (90) days after receipt by the
Company of a written request therefor, or
(v) payment of indemnification is not made within ten (10)
days after a determination has been made that Indemnitee is entitled
to indemnification or such determination is deemed to have been made
pursuant to Section 5 of this Agreement,
Indemnitee shall be entitled to an adjudication in any court of competent
jurisdiction 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 rules of
the American Arbitration Association. The Company shall not oppose
Indemnitee's right to seek any such adjudication or award in arbitration.
(b) In the event that a determination shall have been made pursuant
to Section 5 of this Agreement that Indemnitee is not entitled to
indemnification, any judicial proceeding or arbitration commenced pursuant
to this Section 6 shall be conducted in all respects as a de novo trial, or
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arbitration, on the merits and Indemnitee shall not be prejudiced by reason
of that adverse determination. In any judicial proceeding or arbitration
commenced pursuant to this Section 6, the Company shall have the burden of
proving that Indemnitee is not entitled to indemnification or advancement
of expenses, as the case may be.
(c) If a determination shall have been made or deemed to have been
made pursuant to Section 5 of this Agreement that Indemnitee is entitled to
indemnification, the Company shall be bound by such determination in any
judicial proceeding or arbitration commenced pursuant to this Section 6.
(d) The Company shall be precluded from asserting in any judicial
proceeding or arbitration commenced pursuant to this Section 6 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 Company is bound by all the provisions of this
Agreement.
(e) To the extent permitted by then applicable law, in the event that
Indemnitee, pursuant to this Section 6, seeks a judicial adjudication of or
an award in arbitration to enforce his rights under, or to recover damages
for breach of, this Agreement, if successful in whole or part, Indemnitee
shall be entitled to recover from the Company, and shall be indemnified by
the Company against, any and all expenses (including attorneys' fees and
disbursements) actually and reasonably incurred by him in such judicial
adjudication or arbitration.
7. Presumptions and Effect of Proceedings. The termination of any
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Proceeding or of any claim, issue or matter therein, by judgment, order,
settlement or conviction, or upon a plea of nolo contendre or its equivalent,
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shall not of itself create a presumption that Indemnitee did not act in good
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Company, or, with respect to any criminal action or
proceeding, 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 Indemnitee shall have been so adjudged by a court of
competent jurisdiction after exhaustion of all appeals therefrom.
8. Subrogation. In the event of payment under this Agreement, the
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Company shall be subrogated to the extent of such payment to all of the rights
of recovery of the Indemnitee, who shall execute all papers required and shall
do everything that may be necessary to secure such rights, including the
execution of such documents necessary to enable the Company effectively to bring
suit to enforce such rights.
9. Counterparts. This Agreement may be executed in counterparts, all of
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which taken together shall constitute one instrument.
10. Non-exclusivity. Nothing herein shall be deemed to diminish or
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otherwise restrict the Indemnitee's right to indemnification under any provision
of the Certificate of incorporation or By-Laws of the Company.
11. Governance Law. This Agreement shall be governed by and construed in
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accordance with Delaware law. To the extent permitted by applicable law, the
parties hereby waive any provisions of law which render any provision of this
Agreement unenforceable in any respect.
12. Severability. The provisions of this Agreement are severable, and if
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any clause or provision hereof shall be held invalid or unenforceable in whole
or in part, then such invalidity or unenforceability shall affect only such
clause or provision, or part thereof, and shall not in any manner affect such
clause or provision to the extent that such clause or provision is valid or
enforceable, and shall not in any manner affect any other clause or provision of
this Agreement.
13. Successors and Assigns. This Agreement shall be binding upon all
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successors and assigns of the Company (including any transferee of all or
substantially all of its assets and any successor by merger or operation of law)
and shall inure to the benefit of the heirs, personal representatives and estate
of each Indemnitee.
14. Continuation of Obligations. All agreements and obligations of the
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Company contained herein shall be effective with respect to the Indemnitee as of
the date that Indemnitee first became a director, officer, employee or agent of
the Company (or is or was serving at the request of the Company as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise), as if entered into by and
between the Company and such Indemnitee on that date, and shall continue in
effect thereafter so long as the Indemnitee shall be subject to any possible
Proceeding by reason of the fact that the Indemnitee was a director or officer
of the Company or serving in any other capacity referred to herein.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and signed as of the 13th day of August, 1999.
XXXXX INDUSTRIES, INC.:
Dated: August 20, 1999 By:____________________________________
Xxxxxxx X. Key, President,
INDEMNITEE:
Dated: August 20, 1999 By:____________________________________
[ ], Director
