DEED OF INDEMNIFICATION
Exhibit 10.1
DEED OF INDEMNIFICATION
DEED OF INDEMNIFICATION (this “Deed”) by and among Xxxxxx Industries, Ltd., a Bermuda company
(“Xxxxxx Ltd.”), Xxxxxx Industries plc, an Irish public limited company (the “Company”), and
(the “Indemnitee”).
WHEREAS, Xxxxxx Ltd. has effected a scheme of arrangement under Bermuda law (the “Scheme of
Arrangement”) pursuant to which the holders of Class A common shares of Xxxxxx Ltd. (other than
subsidiaries of Xxxxxx Ltd. that held Class A common shares) became shareholders of the Company,
and Xxxxxx Ltd. became a wholly owned subsidiary of the Company;
WHEREAS, it is essential to Xxxxxx Ltd. and the Company that the Company retain and attract as
directors, secretaries, executives and representatives the most capable persons available;
WHEREAS, Indemnitee is a director or secretary of the Company;
WHEREAS, the articles of association of the Company provide that the indemnification provided
therein shall not be exclusive;
WHEREAS, due to restrictions imposed by Irish law, the articles of association of the Company
do not confer indemnification and advancement rights on its directors and secretary as broad as the
indemnification and advancement rights that, prior to the effectiveness of the Scheme of
Arrangement, were provided by the Bye-laws of Xxxxxx Ltd. to its directors and secretary;
WHEREAS, in recognition of the Indemnitee’s need for protection against personal liability in
order to enhance Indemnitee’s continued service to the Company in an effective manner, Xxxxxx Ltd.
and the Company wish to provide in this Deed for the indemnification of and the advancing of
expenses to Indemnitee to the full extent permitted by law and as set forth in this Deed, and, to
the extent insurance is maintained, for the continued coverage of Indemnitee under the Company’s
directors’ and officers’ liability insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee continuing to serve the
Company directly or, at its request, with another enterprise, and intending to be legally bound
hereby, this DEED PROVIDES as follows:
1. Certain Definitions:
(a) Change in Control: shall be deemed to have occurred if (i) any “person” (as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than a
trustee or other fiduciary holding securities under an employee benefit plan of the Company or a
corporation owned directly or indirectly by the shareholders of the Company in substantially the
same proportions as their ownership of shares of the Company, is or becomes the “beneficial owner”
(as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the
Company representing 15% or more of the total voting power represented by the Company’s then
outstanding Voting Securities without the prior approval of the Company’s Board of Directors, or
(ii) during any period of two consecutive years, individuals who at the beginning of such period
constitute the Board of Directors of the Company and any new director whose election by such Board
of Directors or nomination for election by the Company’s shareholders was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority thereof, or (iii) the shareholders of the Company
approve a merger, consolidation or scheme of arrangement of the Company with any other corporation,
other than a merger, consolidation or scheme of arrangement which would result in the Voting
Securities of the Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities of the surviving entity) at
least 80% of the total voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger, consolidation or scheme of arrangement,
or (iv) the shareholders of the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all the Company’s
assets. For purposes of determining whether clause (ii) above has been complied with, the
directors of Xxxxxx Ltd. on the effective date of the Scheme of Arrangement shall be included in
the determination of who the directors of the Company were during the relevant two year period
until the second anniversary of the effective date of the Scheme of Arrangement.
(b) Claim: any threatened, pending or completed action, suit or proceeding, or any inquiry or
investigation, whether conducted by the Company or any other party, that Indemnitee in good faith
believes might lead to the institution of any such action, suit or proceeding, whether civil,
criminal, administrative, investigative or other.
(c) Expenses: include attorneys’ (and other legal advisors’) fees and all other costs,
expenses and obligations paid or incurred in connection with investigating, defending, being a
witness in or participating in (including on appeal) or preparing to defend, be a witness in or
participate in, any Claim relating to any Indemnifiable Event (including all interest, assessments
and other charges paid or payable in connection with or in respect of any of the foregoing).
(d) Judgments: include judgments, fines, penalties and amounts paid in settlement that are
paid or payable in connection with any Claim relating to any Indemnifiable Event (including all
interest, assessments and other charges paid or payable in connection with or in respect of any of
the foregoing).
(e) Indemnifiable Event: any event or occurrence related to the fact that Indemnitee is or
was a director, secretary, executive or representative of the Company, or is or was serving at the
request of the Company in accordance with the Company’s “Code of Ethics and Business Conduct,” as a
director, secretary, trustee, executive, employee, agent or representative of another corporation,
domestic or foreign, nonprofit or for profit, partnership, joint venture, employee benefit plan,
trust or other enterprise, or prior to the Transaction Time (as defined in the Scheme of
Arrangement) was a director, secretary, executive or representative of Xxxxxx Ltd., or prior to the
Transaction Time was serving at the request of Xxxxxx Ltd. in accordance with Xxxxxx Ltd.’s “Code
of Ethics and Business Conduct,” as a director, secretary, trustee, executive, employee, agent or
representative of another
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corporation, domestic or foreign, nonprofit or for profit, partnership, joint venture,
employee benefit plan, trust or other enterprise, or by reason of anything done or not done by
Indemnitee in any such capacity, except for any actions by Indemnitee determined by a court to
constitute fraud or dishonesty in the performance of his or her duties to the Company or, prior to
the Transaction Time, to Xxxxxx Ltd.
(f) Reviewing Party: any appropriate person or body consisting of a member or members of the
Company’s Board of Directors or any other person or body appointed by such Board (including the
special, independent counsel referred to in Section 3) who is not a party to the particular Claim
for which Indemnitee is seeking indemnification.
(g) Voting Securities: any securities of the Company that vote generally in the election of
directors.
2. Scope of Indemnification
(a) Indemnification of Judgments and Expenses. In the event Indemnitee was, is or becomes a
party to or witness or other participant in, or is threatened to be made a party to or witness or
other participant in, a Claim by reason of (or arising in part out of) an Indemnifiable Event,
Xxxxxx Ltd. shall indemnify Indemnitee to the fullest extent permitted by law against any and all
Expenses and Judgments arising from or relating to such Claim. Except as otherwise provided in
Section 2(b), such indemnification shall be made as soon as practicable, but in any event not later
than thirty (30) days, after written demand therefor is presented to Xxxxxx Ltd. by or on behalf of
the Indemnitee.
(b) Indemnification and Advance Payment of Expenses. Any and all Expenses indemnifiable
under Sections 2(a) and 2(c) shall, if so requested by the Indemnitee, be paid by Xxxxxx Ltd.
promptly as they are incurred by Indemnitee (any such payment of expenses by Xxxxxx Ltd. is
hereinafter referred to as an “Expense Advance”). Indemnitee shall be obligated, and hereby
agrees, to repay the amount of Expenses so paid only to the extent that Indemnitee shall have been
adjudged by the High Court of Ireland or the court in which such action or suit was brought to be
liable for fraud or dishonesty in the performance of his or her duty to the Company or, prior to
the Transaction Time, to Xxxxxx Ltd. Indemnitee hereby further agrees to reasonably cooperate with
the Company and Xxxxxx Ltd. concerning any Claim.
(c) Indemnification for Additional Expenses. Xxxxxx Ltd. shall indemnify Indemnitee to the
fullest extent permitted by law against any and all expenses (including attorneys’ and other legal
advisors’ fees) that are incurred by Indemnitee in connection with any claim asserted against or
action brought by Indemnitee for (i) indemnification of Expenses or Judgments or advance payment of
Expenses by Xxxxxx Ltd. or the Company, whether under this Deed or under any other agreement, the
Company’s articles of association, Xxxxxx Ltd.’s Bye-laws, statute or rule of law now or hereafter
in effect relating to Claims for Indemnifiable Events and/or (ii) recovery under any directors’ and
officers’ liability insurance policy or policies maintained by the Company, regardless of whether
Indemnitee ultimately is determined to be entitled to such indemnification, advance Expense payment
or insurance recovery, as the case may be.
(d) Partial Indemnity. If Indemnitee is entitled under any provision of this Deed to
indemnification by Xxxxxx Ltd. for some or a portion of the Judgments and Expenses arising from or
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relating to a Claim but not, however, for all of the total amount thereof, Xxxxxx Ltd. shall
nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
(e) Indemnification of Successful Defense Expenses. Notwithstanding any other provision of
this Deed, to the extent that Indemnitee has been successful on the merits or otherwise in defense
of any or all Claims relating in whole or in part to an Indemnifiable Event or in defense of any
issue or matter therein, including dismissal without prejudice, Indemnitee shall be indemnified to
the extent permitted by applicable law by the Company and Xxxxxx Ltd. against all Expenses incurred
in connection therewith.
(f) Exhaustion of Remedies. Prior to making a written demand for indemnification or an
Expense Advance, Indemnitee shall (i) seek such indemnification or Expense Advance, as applicable,
under any applicable insurance policy and (ii) request that the Company consider in its discretion
whether to make such indemnification or Expense Advance, as applicable. Upon any such request by
Indemnitee of the Company, the Company shall consider whether to make such indemnification or
Expense Advance, as applicable, based on the facts and circumstances related to the request. The
Company may require, as a condition to making any indemnification or Expense Advance that
Indemnitee enter into an agreement providing for such indemnification or Expense Advance, as
applicable, to be made subject to substantially the same terms and conditions applicable to an
indemnification or Expense Advance, as applicable, by Xxxxxx Ltd. hereunder. In the event
indemnification or Expense Advance, as applicable, is not received pursuant to an insurance policy,
or from the Company, within 60 calendar days of the later of Indemnitee’s request of the insurer
and Indemnitee’s request of the Company as provided in clause (ii) of the first sentence of this
Section 2(f), Indemnitee may make written demand on Xxxxxx Ltd. for indemnification pursuant to
Section 2(a) or make a request for Expense Advance pursuant to Section 2(b).
3. Reviewing Party Determinations.
(a) General Rules. The Reviewing Party, in its discretion, may review the rights of
Indemnitee to indemnity payments under this Deed. Notwithstanding the provisions of Section 2, the
obligations of Xxxxxx Ltd. under Section 2(a) shall be subject to the condition that the Reviewing
Party shall not have determined (in a written opinion, in any case in which the special,
independent counsel referred to in Section 4 hereof is involved) that Indemnitee would not be
permitted to be indemnified under applicable law; provided, however, that if Indemnitee has
commenced, or thereafter commences, legal proceedings in a court of competent jurisdiction to
secure a determination that Indemnitee should be indemnified under applicable law, any
determination made by the Reviewing Party that Indemnitee would not be permitted to be indemnified
under applicable law shall not be binding until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been exhausted or lapsed) and any such
determination by the Reviewing Party shall be modified, to the extent necessary, to conform to such
final judicial determination.
(b) Selection of Reviewing Party. If there has not been a Change in Control, the Reviewing
Party shall be selected by the Board of Directors of the Company as soon as practicable after
notice of a claim for indemnification. If there has been such a Change in Control, the Reviewing
Party shall be the special, independent counsel referred to in Section 4 hereof.
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(c) Judicial Review. If there has been no determination by the Reviewing Party or
if the Reviewing Party determines that Indemnitee substantially would not be permitted to be
indemnified in whole or in part under applicable law, Indemnitee shall have the right to commence
litigation in any court having subject matter jurisdiction thereof seeking an initial determination
by the court or challenging any such determination by the Reviewing Party or any aspect thereof,
and the Company and Xxxxxx Ltd. hereby consent to service of process and to appear in any such
proceeding. Any determination by the Reviewing Party otherwise shall be conclusive and binding on
the Company, Xxxxxx Ltd. and Indemnitee.
(d) Burden of Proof. In connection with any determination by the Reviewing Party pursuant to
Section 3(a), or by a court of competent jurisdiction pursuant to Section 3(c) or otherwise, as to
whether Indemnitee is entitled to be indemnified hereunder, the burden of proof shall be on the
Company and/or Xxxxxx Ltd., as applicable, to establish by clear and convincing evidence that
Indemnitee is not so entitled.
4. Change in Control. The Company and Xxxxxx Ltd. agree that if there is a Change in Control
of the Company then with respect to all matters thereafter arising concerning the rights of
Indemnitee to indemnity payments under this Deed or under any other agreement, the Company’s
articles of association, Xxxxxx Ltd.’s Bye-laws, statute or rule of law now or hereafter in effect
relating to Claims for Indemnifiable Events, the Company and Xxxxxx Ltd. shall seek legal advice
only from special, independent counsel selected by Indemnitee and approved by the Company (which
approval shall not be unreasonably withheld), and who has not otherwise performed services for the
Company, Xxxxxx Ltd. or Indemnitee within the last five years (other than in connection with such
matters). Such counsel, among other things, shall render its written opinion to the Company,
Xxxxxx Ltd. and Indemnitee as to whether and to what extent the Indemnitee would be permitted to be
indemnified under applicable law. Xxxxxx Ltd. agrees to pay the reasonable fees of the special,
independent counsel referred to above and to indemnify fully such counsel against any and all
expenses (including attorneys’ and other legal advisors’ fees), claims, liabilities and damages
arising out of or relating to this Deed or its engagement pursuant hereto.
5. No Presumption. For purposes of this Deed, the termination of any claim, action, suit or
proceeding, by judgment, order, settlement (whether with or without court approval) or conviction,
or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that
Indemnitee failed to meet any particular standard of conduct or have any particular belief or that
a court has determined that indemnification is not permitted by applicable law. In addition,
neither the failure of the Reviewing Party to have made a determination as to whether Indemnitee
has met any particular standard of conduct or had any particular belief, nor an actual
determination by the Reviewing Party that Indemnitee has not met such standard of conduct or did
not have such belief, prior to the commencement of legal proceedings by Indemnitee to secure a
judicial determination that Indemnitee should be indemnified under applicable law shall be a
defense to Indemnitee’s claim or create a presumption that Indemnitee has not met any particular
standard of conduct or did not have any particular belief.
6. Non-exclusivity. The rights of the Indemnitee hereunder shall be in addition to any other
rights Indemnitee may now or hereafter have to indemnification by the Company or Xxxxxx
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Ltd. More specifically, the Parties intend that Indemnitee shall be entitled to
indemnification to the maximum extent permitted by any or all of the following:
(a) The fullest benefits provided by the Company’s articles of association and Xxxxxx
Ltd.’s Bye-laws in effect on the date hereof, a copy of the relevant portions of which are
attached hereto as Exhibit I;
(b) The fullest benefits provided by the articles of association or their equivalent of
the Company and the Bye-laws or their equivalent of Xxxxxx Ltd. in effect at the time the
Indemnifiable Event occurs or at the time Expenses are incurred by Indemnitee;
(c) The fullest benefits allowable under Irish or Bermuda law, as applicable, in effect
at the date hereof or as the same may be amended to the extent that such benefits are
increased thereby;
(d) The fullest benefits allowable under the law of the jurisdiction under which Xxxxxx
Ltd. exists at the time the Indemnifiable Event occurs or at the time Expenses are incurred
by the Indemnitee; and
(e) Such other benefits as are or may be otherwise available to Indemnitee pursuant to
this Deed, any other agreement or otherwise.
The parties intend that a combination of two or more of the benefits referred to in (a)
through (e) shall be available to Indemnitee to the extent that the document or law providing for
such benefits does not require that the benefits provided therein be exclusive of other benefits.
The Company and Xxxxxx Ltd. hereby undertake to use their best efforts to assist Indemnitee, in all
proper and legal ways, to obtain all such benefits to which Indemnitee is entitled.
7. Liability Insurance. The rights of the Indemnitee hereunder shall also be in addition to
any other rights Indemnitee may now or hereafter have under policies of insurance maintained by the
Company or otherwise. To the extent the Company maintains an insurance policy or policies
providing directors’ and officers’ liability insurance, 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 Company director, secretary, executive or representative.
The Company shall seek to maintain insurance coverage in the amount of the present policy
limits and with the present scope of coverage for so long as Indemnitee’s services are covered
hereunder, provided and to the extent that such insurance is available on a basis acceptable to the
Company. In the event that such insurance becomes unavailable in the amount of the present policy
limits or in the present scope of coverage at premium costs and on other terms acceptable to the
Company, then the Company may forego maintenance of all or a portion of such insurance coverage.
However, in the event of any reduction in (or cancellation of) such insurance coverage (whether
voluntary or involuntary), the Company shall, and hereby agrees to, stand as a self-insurer with
respect to the coverage, or portion thereof, not retained, and shall, to the extent permitted by
applicable law, indemnify the Indemnitee against any loss arising out of the reduction in or
cancellation of such insurance coverage.
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8. Escrow Fund. As collateral security for its obligations hereunder (including specifically
its indemnity obligations (other than Judgments) and other
obligations pursuant to Sections 2, 6
and 7) and under similar agreements with other directors, secretaries, executives and
representatives, in the event of a Change in Control, Xxxxxx Ltd. shall dedicate and maintain, for
a period of five years following the Change of Control, an escrow account in the aggregate of TEN
MILLION DOLLARS (US$10,000,000) by depositing assets or bank letters of credit in escrow or
reserving lines of credit that may be drawn down by an escrow agent in said amount (the “Escrow
Reserve”). Xxxxxx Ltd. shall promptly following establishment of the Escrow Reserve provide
Indemnitee with a true and complete copy of the agreement relating to the establishment and
operation of the Escrow Reserve, together with such additional documentation or information with
respect to the Escrow Reserve as Indemnitee may from time to time reasonably request. Xxxxxx Ltd.
shall promptly following establishment of the Escrow Reserve deliver an executed copy of this Deed
to the escrow agent for the Escrow Reserve to evidence to that agent that Indemnitee is a
beneficiary of that Escrow Reserve and shall deliver to Indemnitee the escrow agent’s signed
receipt evidencing that delivery.
9. Period of Limitations. No legal action shall be brought and no cause of action shall be
asserted by or on behalf of the Company, Xxxxxx Ltd. or any of their respective affiliates against
Indemnitee, Indemnitee’s spouse, heirs, executors or personal or legal representatives after the
expiration of two years from the date of accrual of such cause of action, and any claim or cause of
action of the Company, Xxxxxx Ltd. or any of their respective affiliates shall be extinguished and
deemed released unless asserted by the timely filing of legal action within such two-year period;
provided, however, that if any shorter period of limitations is otherwise applicable to any such
cause of action such shorter period shall govern.
10. Amendments, Etc. No supplement, modification or amendment of this Deed shall be binding
unless executed in writing by each of the parties hereto. No waiver of any of the provisions of
this Deed shall be deemed or shall constitute a waiver of any other provisions thereof (whether or
not similar) nor shall such waiver constitute a continuing waiver.
11. Subrogation. In the event of payment under this Deed, the Company or Xxxxxx Ltd., as
applicable, 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 shall do everything that may be necessary to
secure such rights, including the execution of such documents necessary to enable the Company or
Xxxxxx Ltd. as applicable, effectively to bring suit to enforce such rights.
12. No Duplication of Payments. Neither the Company nor Xxxxxx Ltd. shall be liable under
this Deed to make any payment in connection with any Claim made against Indemnitee to the extent
Indemnitee has otherwise actually received payment (under any insurance policy, the Company’s
articles of association, Xxxxxx Ltd.’s Bye-laws or otherwise) of the amounts otherwise
indemnifiable hereunder.
13. Binding Effect, Etc. This Deed shall be binding upon and inure to the benefit of and be
enforceable by the parties hereto and their respective successors, assigns, including any direct or
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indirect successor by purchase, merger, consolidation or otherwise to all or substantially all
of the business and/or assets of the Company or Xxxxxx Ltd., as applicable, spouses, heirs, and
personal and legal representatives. This Deed shall continue in effect regardless of whether
Indemnitee continues to serve as a director, secretary, executive or representative of the Company
or of any other enterprise at the Company’s request.
14. Severability. The provisions of this Deed shall be severable in the event that any of
the provisions hereof (including any provision within a single section, paragraph or sentence) are
held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable, and the
remaining provisions shall remain enforceable to the fullest extent permitted by law.
15. Governing Law. This Deed shall be governed by and construed and enforced in accordance
with the laws of Ireland applicable to contracts made and to be performed in Ireland
without giving effect to the principles of conflicts of laws. For purposes of this Deed, the
Indemnitee, Company and Xxxxxx Ltd. submit to the non-exclusive jurisdiction of state and federal
courts sitting in the city of Houston, Texas.
16. Obligations of the Company. In the event a Claim results in a Judgment in Indemnitee’s
favor or otherwise is disposed of in a manner that allows the Company to indemnify Indemnitee in
connection with such Claim under the Company’s articles of association as then in effect, the
Company will provide such indemnification to Indemnitee and will reimburse Xxxxxx Ltd. for any
indemnification or Expense Advance previously made by Xxxxxx Ltd. in connection with such Claim.
Notwithstanding any other provision of this Deed (other than the preceding sentence and Section
2(e)), the Company shall not have any obligation under this Deed to provide indemnification or
Expense Advance to Indemnitee.
17. Prior
Agreements. This Deed shall supersede any prior indemnification
agreements and/or
arrangements between Xxxxxx Ltd. and the Indemnitee.
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IN WITNESS of which this document has been executed and delivered as a deed this ___day of
, 20_.
| GIVEN under the common seal of | ||||
| XXXXXX INDUSTRIES PLC | ||||
by |
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| Director | ||||
| Director / Secretary | ||||
| EXECUTED and delivered as a Deed | ||||
by |
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| the duly authorized representative | Name | |||
| of XXXXXX INDUSTRIES, LTD. | ||||
| Title | ||||
| SIGNED, SEALED AND DELIVERED | ||||
by |
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| INDEMNITEE | Name: | |||
| Title: | ||||
Witness: |
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Address: |
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Occupation: |
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Exhibit I
Extract of Indemnification provisions from the Company’s Articles of Association and
Xxxxxx Ltd.’s Bye-laws
Xxxxxx Ltd.’s Bye-laws
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