INDEMNITY AGREEMENT
This
Indemnity Agreement, dated as of April __, 2010, is made by and between Xxxxxx
Mineral & Mining Corp. a Nevada corporation (the “Company”), and
Xxxxxxx X. Xxxx, an individual (the “Indemnitee”).
RECITALS
A. The
Company is aware that competent and experienced persons are increasingly
reluctant to serve as directors, officers or agents of corporations unless they
are protected by comprehensive liability insurance or indemnification, due to
increased exposure to litigation costs and risks resulting from their service to
such corporations, and due to the fact that the exposure frequently bears no
reasonable relationship to the compensation of such directors, officers and
other agents.
B. The
statutes and judicial decisions regarding the duties of directors and officers
are often difficult to apply, ambiguous, or conflicting, and therefore fail to
provide such directors, officers and agents with adequate, reliable knowledge of
legal risks to which they are exposed or information regarding the proper course
of action to take.
C. Plaintiffs
often seek damages in such large amounts and the costs of litigation may be so
enormous (whether or not the case is meritorious), that the defense and/or
settlement of such litigation is often beyond the personal resources of
directors, officers and other agents.
D. The
Company believes that it is unfair for its directors, officers and agents and
the directors, officers and agents of its subsidiaries to assume the risk of
huge judgments and other Expenses which may occur in cases in which the
director, officer or agent received no personal profit and in cases where the
director, officer or agent was not culpable.
E. The
Company recognizes that the issues in controversy in litigation against a
director, officer or agent of a corporation such as the Company or its
subsidiaries are often related to the knowledge, motives and intent of such
director, officer or agent, that he is usually the only witness with knowledge
of the essential facts and exculpating circumstances regarding such matters, and
that the long period of time which usually elapses before the trial or other
disposition of such litigation often extends beyond the time that the director,
officer or agent can reasonably recall such matters; and may extend beyond the
normal time for retirement for such director, officer or agent with the result
that he, after retirement or in the event of his death, his spouse, heirs,
executors or administrators, may be faced with limited ability and undue
hardship in maintaining an adequate defense, which may discourage such a
director, officer or agent from serving in that position.
F. Based
upon their experience as business managers, the Board of Directors of the
Company (the “Board”) has concluded
that, to retain and attract talented and experienced individuals to serve as
directors, officers and agents of the Company and its subsidiaries and to
encourage such individuals to take the business risks necessary for the success
of the Company and its subsidiaries, it is necessary for the Company to
contractually indemnify its directors, officers and agents and the directors,
officers and agents of its subsidiaries, and to assume for itself maximum
liability for Expenses (as defined below) and damages in connection with claims
against such directors, officers and agents in connection with their service to
the Company and its subsidiaries, and has further concluded that the failure to
provide such contractual indemnification could result in great harm to the
Company and its subsidiaries and the Company’s stockholders.
G. Section
78.751 of the Nevada Revised Statutes, under which the Company is organized (the
“Statute”),
empowers the Company to indemnify its directors, officers, employees and agents
by agreement and to indemnify persons who serve, at the request of the Company,
as the directors, officers, employees or agents of other corporations or
enterprises, and expressly provides that the indemnification provided by the
Statute is not exclusive.
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H. The
Company desires and has requested the Indemnitee to serve or continue to serve
as a director, officer or agent of the Company and/or one or more subsidiaries
of the Company free from undue concern for claims for damages arising out of or
related to such services to the Company and/or one or more subsidiaries of the
Company.
I. Indemnitee
is willing to serve, or to continue to serve, the Company and/or one or more
subsidiaries of the Company, provided that he is furnished the indemnity
provided for herein.
AGREEMENT
NOW,
THEREFORE, the parties hereto, intending to be legally bound, hereby agree as
follows:
1. Definitions.
(a) Agent. For
the purposes of this Agreement, “Agent” of the Company means any person who is
or was a director, officer, employee or other agent of the Company or a
Subsidiary of the Company; or is or was serving at the request of, for the
convenience of, or to represent the interests of the Company or a Subsidiary of
the Company as a director, officer, employee or agent of another foreign or
domestic corporation, partnership, joint venture, trust or other enterprise; or
was a director, officer, employee or agent of a foreign or domestic corporation
which was a predecessor corporation of the Company or a Subsidiary of the
Company, or was a director, officer, employee or agent of another enterprise at
the request of, for the convenience of, or to represent the interests of such
predecessor corporation.
(b) Expenses. For
purposes of this Agreement, “Expenses” include all out-of-pocket costs of any
type or nature whatsoever (including, without limitation, all attorneys’ fees
and related disbursements), actually and reasonably incurred by the Indemnitee
in connection with either the investigation, defense or appeal of a Proceeding
or establishing or enforcing a right to indemnification under this Agreement or
the Statute or otherwise; provided, however, that “Expenses” shall not include
any judgments.
(c) Proceeding. For
the purposes of this Agreement, “Proceeding” means any threatened, pending, or
completed action, suit or other proceeding, whether civil, criminal,
administrative, or investigative.
(d) Subsidiary. For
purposes of this Agreement, “Subsidiary” means any corporation of which more
than 50% of the outstanding voting securities are owned directly or indirectly
by the Company, by the Company and one or more other subsidiaries, or by one or
more other subsidiaries.
2. Agreement to
Serve. The Indemnitee agrees to serve and/or continue to serve
as Agent of the Company, at its will (or under separate agreement, if such
agreement exists), in the capacity Indemnitee currently serves as an Agent of
the Company, so long as he is duly appointed or elected and qualified in
accordance with the applicable provisions of the Bylaws of the Company or any
Subsidiary of the Company or until such time as he tenders his resignation in
writing; provided, however, that nothing contained in this Agreement is intended
to create any right to continued employment by Indemnitee.
3. Liability
Insurance.
(a) Maintenance of D&O
Insurance. The Company hereby covenants and agrees that, so
long as the Indemnitee shall continue to serve as an Agent of the Company and
thereafter so long as the Indemnitee shall be subject to any possible Proceeding
by reason of the fact that the Indemnitee was an Agent of the Company, the
Company shall promptly obtain and maintain in full force and effect directors’
and officers’ liability insurance (“D&O Insurance”) in reasonable amounts
from established and reputable insurers.
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(b) Rights and
Benefits. In all policies of D&O Insurance, the Indemnitee
shall be named as an insured in such a manner as to provide the Indemnitee the
same rights and benefits as are accorded to the most favorably insured of the
Company’s directors, if the Indemnitee is a director; or of the Company’s
officers, if the Indemnitee is not a director of the Company but is an officer;
or of the Company’s key employees, if the Indemnitee is not a director or
officer but is a key employee.
4. Mandatory
Indemnification. Subject to Section 9 below, the Company shall
indemnify the Indemnitee as follows:
(a) Successful
Defense. To the extent the Indemnitee has been successful on
the merits or otherwise in defense of any Proceeding (including, without
limitation, an action by or in the right of the Company) to which the Indemnitee
was a party by reason of the fact that he is or was an Agent of the Company at
any time, against all Expenses of any type whatsoever actually and reasonably
incurred by him in connection with the investigation, defense or appeal of such
Proceeding.
(b) Third Party
Actions. If the Indemnitee is a person who was or is a party
or is threatened to be made a party to any Proceeding (other than an action by
or in the right of the Company) by reason of the fact that he is or was an Agent
of the Company, or by reason of anything done or not done by him in any such
capacity, the Company shall indemnify the Indemnitee against any and all
Expenses and liabilities of any type whatsoever (including, but not limited to,
judgments, fines, ERISA excise taxes and penalties, and amounts paid in
settlement) actually and reasonably incurred by him in connection with the
investigation, defense, settlement or appeal of such Proceeding, provided the
Indemnitee acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Company and its stockholders, and,
with respect to any criminal action or Proceeding, had no reasonable cause to
believe his conduct was unlawful.
(c) Derivative
Actions. If the Indemnitee is a person who was or is a party
or is threatened to be made a party to any Proceeding by or in the right of the
Company by reason of the fact that he is or was an Agent of the Company, or by
reason of anything done or not done by him in any such capacity, the Company
shall indemnify the Indemnitee against all Expenses actually and reasonably
incurred by him in connection with the investigation, defense, settlement, or
appeal of such Proceeding, provided the Indemnitee acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the Company and its stockholders; except that no indemnification under this
subsection 4(c) shall be made in respect to any claim, issue or matter as to
which such person shall have been finally adjudged to be liable to the Company
by a court of competent jurisdiction unless and only to the extent that the
court in which such Proceeding was brought shall determine upon application
that, despite the adjudication of liability but in view of all the circumstances
of the case, such person is fairly and reasonably entitled to indemnity for such
amounts which the court shall deem proper.
(d) Actions where Indemnitee is
Deceased. If the Indemnitee is a person who was or is a party
or is threatened to be made a party to any Proceeding by reason of the fact that
he is or was an Agent of the Company, or by reason of anything done or not done
by him in any such capacity, and if prior to, during the pendency or after
completion of such Proceeding Indemnitee becomes deceased, the Company shall
indemnify the Indemnitee’s heirs, executors and administrators against any and
all Expenses and liabilities of any type whatsoever (including, but not limited
to, judgments, fines, ERISA excise taxes and penalties, and amounts paid in
settlement) actually and reasonably incurred to the extent Indemnitee would have
been entitled to indemnification pursuant to Sections 4(a), 4(b), or 4(c) above
were Indemnitee still alive.
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(e) Notwithstanding
the foregoing, the Company shall not be obligated to indemnify the Indemnitee
for Expenses or liabilities of any type whatsoever (including, but not limited
to, judgments, fines, ERISA excise taxes and penalties, and amounts paid in
settlement) for which payment is actually made to or on behalf of Indemnitee
under a valid and collectible insurance policy of D&O Insurance, or under a
valid and enforceable indemnity clause, by-law or agreement.
5. Partial
Indemnification. If the Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of any Expenses or liabilities of any type whatsoever (including, but
not limited to, judgments, fines, ERISA excise taxes and penalties, and amounts
paid in settlement) incurred by him in the investigation, defense, settlement or
appeal of a Proceeding, but not entitled, however, to indemnification for all of
the total amount hereof, the Company shall nevertheless indemnify the Indemnitee
for such total amount except as to the portion hereof to which the Indemnitee is
not entitled.
6. Mandatory Advancement of
Expenses. Subject to Section 8(a) below, the Company shall
advance all Expenses incurred by the Indemnitee in connection with the
investigation, defense, settlement or appeal of any Proceeding to which the
Indemnitee is a party or is threatened to be made a party by reason of the fact
that the Indemnitee is or was an Agent of the Company. Indemnitee
hereby undertakes to repay such amounts advanced only if, and to the extent
that, it shall be determined ultimately that the Indemnitee is not entitled to
be indemnified by the Company as authorized hereby. The advances to
be made hereunder shall be paid by the Company to the Indemnitee within twenty
(20) days following delivery of a written request therefor by the Indemnitee to
the Company. In the event that the Company fails to pay Expenses as
incurred by the Indemnitee as required by this paragraph, Indemnitee may seek
mandatory injunctive relief from any court having jurisdiction to require the
Company to pay Expenses as set forth in this paragraph. If Indemnitee
seeks mandatory injunctive relief pursuant to this paragraph, it shall not be a
defense to enforcement of the Company’s obligations set forth in this paragraph
that Indemnitee has an adequate remedy at law for damages.
7. Notice and Other
Indemnification Procedures.
(a) Promptly
after receipt by the Indemnitee of notice of the commencement of or the threat
of commencement of any Proceeding, the Indemnitee shall, if the Indemnitee
believes that indemnification with respect thereto may be sought from the
Company under this Agreement, notify the Company of the commencement or threat
of commencement thereof.
(b) If, at
the time of the receipt of a notice of the commencement of a Proceeding pursuant
to Section 7(a) hereof, the Company has D&O Insurance in effect, the Company
shall give prompt notice of the commencement of such Proceeding to the insurers
in accordance with the procedures set forth in the respective
policies. The Company shall thereafter take all necessary or
desirable action to cause such insurers to pay, on behalf of the Indemnitee, all
amounts payable as a result of such Proceeding in accordance with the terms of
such policies.
(c) In the
event the Company shall be obligated to pay the Expenses of any Proceeding
against the Indemnitee, the Company, if appropriate, shall be entitled to assume
the defense of such Proceeding, with counsel approved by the Indemnitee, upon
the delivery to the Indemnitee of written notice of its election so to
do. After delivery of such notice, approval of such counsel by the
Indemnitee and the retention of such counsel by the Company, the Company will
not be liable to the Indemnitee under this Agreement for any fees of counsel
subsequently incurred by the Indemnitee with respect to the same Proceeding,
provided that (i) the Indemnitee shall have the right to employ his counsel in
any such Proceeding at the Indemnitee’s expense; and (ii) if (A) the employment
of counsel by the Indemnitee has been previously 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 any such
defense, or (C) the Company shall not, in fact, have employed counsel to assume
the defense of such Proceeding, then the fees and Expenses of Indemnitee’s
counsel shall be at the expense of the Company.
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8. Exceptions. Any
other provision herein to the contrary notwithstanding, the Company shall not be
obligated pursuant to the terms of this Agreement:
(a) Claims Initiated by
Indemnitee. To indemnify or advance Expenses to the Indemnitee
with respect to Proceedings or claims initiated or brought voluntarily by the
Indemnitee and not by way of defense, unless (i) such indemnification is
expressly required to be made by law, (ii) the Proceeding was authorized by the
Board, (iii) such indemnification is provided by the Company, in its sole
discretion, pursuant to the powers vested in the Company under the Laws of the
State of Nevada or (iv) the Proceeding is brought to establish or enforce a
right to indemnification under this Agreement or any other statute or law or
otherwise as required under the Statute;
(b) Lack of Good
Faith. To indemnify the Indemnitee for any Expenses incurred
by the Indemnitee with respect to any Proceeding instituted by the Indemnitee to
enforce or interpret this Agreement, if a court of competent jurisdiction
determines that each of the material assertions made by the Indemnitee in such
Proceeding was not made in good faith or was frivolous; or
(c) Unauthorized
Settlements. To indemnify the Indemnitee under this Agreement
for any amounts paid in settlement of a Proceeding unless the Company consents
to such settlement, which consent shall not be unreasonably
withheld.
9. Non-exclusivity. The
provisions for indemnification and advancement of Expenses set forth in this
Agreement shall not be deemed exclusive of any other rights which the Indemnitee
may have under any provision of law, the Company’s Certificate of Incorporation
(as the same may be amended from time to time) or Bylaws, the vote of the
Company’s stockholders or disinterested directors, other agreements, or
otherwise, both as to action in his official capacity and to action in another
capacity while occupying his position as an Agent of the Company, and the
Indemnitee’s rights hereunder shall continue after the Indemnitee has ceased
acting as an Agent of the Company and shall inure to the benefit of the heirs,
executors and administrators of the Indemnitee.
10. Enforcement. Any
right to indemnification or advances granted by this Agreement to Indemnitee
shall be enforceable by or on behalf of Indemnitee in any court of competent
jurisdiction if (i) the claim for indemnification or advances is denied, in
whole or in part, or (ii) no disposition of such claim is made within ninety
(90) days of request therefor. Indemnitee, in such enforcement action, if
successful in whole or in part, shall be entitled to be paid also the expense of
prosecuting his claim. It shall be a defense to any action for which
a claim for indemnification is made under this Agreement (other than an action
brought to enforce a claim for Expenses pursuant to Section 6 hereof, provided
that the required undertaking has been tendered to the Company) that Indemnitee
is not entitled to indemnification because of the limitations set forth in
Sections 4 and 8 hereof. Neither the failure of the Corporation
(including its Board of Directors or its stockholders) to have made a
determination prior to the commencement of such enforcement action that
indemnification of Indemnitee is proper in the circumstances, nor an actual
determination by the Company (including its Board of Directors or its
stockholders) that such indemnification is improper, shall be a defense to the
action or create a presumption that Indemnitee is not entitled to
indemnification under this Agreement or otherwise.
11. Subrogation. In
the event of payment under this Agreement, the Company shall be subrogated to
the extent of such payment to all of the rights of recovery of Indemnitee, who
shall execute all documents required and shall do all acts that may be necessary
to secure such rights and to enable the Company effectively to bring suit to
enforce such rights.
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12. Survival of
Rights.
(a) All
agreements and obligations of the Company contained herein shall continue during
the period Indemnitee is an Agent of the Company and shall continue thereafter
so long as Indemnitee shall be subject to any possible claim or threatened,
pending or completed action, suit or Proceeding, whether civil, criminal,
arbitrational, administrative or investigative, by reason of the fact that
Indemnitee was serving in the capacity referred to herein.
(b) The
Company shall require any successor to the Company (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business or assets of the Company, expressly to assume and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform if no such succession had taken place.
13. Interpretation of
Agreement. It is understood that the parties hereto intend
this Agreement to be interpreted and enforced so as to provide indemnification
to the Indemnitee to the fullest extent permitted by law including those
circumstances in which indemnification would otherwise be
discretionary.
14. Severability. If
any provision or provisions of this Agreement shall be held to be invalid,
illegal or unenforceable for any reason whatsoever, (i) the validity, legality
and enforceability of the remaining provisions of the Agreement (including
without limitation, all portions of any paragraphs of this Agreement containing
any such provision held to be invalid, illegal or unenforceable, that are not
themselves invalid, illegal or unenforceable) shall not in any way be affected
or impaired thereby, and (ii) to the fullest extent possible, the provisions of
this Agreement (including, without limitation, all portions of any paragraph of
this Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable) shall
be construed so as to give effect to the intent manifested by the provision held
invalid, illegal or unenforceable and to give effect to Section 13
hereof.
15. Modification and
Waiver. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provisions hereof (whether or
not similar) nor shall such waiver constitute a continuing waiver.
16. Notice. All
notices, requests, demands and other communications under this Agreement shall
be in writing and shall be deemed duly given (i) if delivered by hand and
receipted for by the party addressee or (ii) if mailed by certified or
registered mail with postage prepaid, on the third business day after the
mailing date. Notice shall be addressed to the Company at its
principal executive office and to the Indemnitee at the address that is most
recently provided to the Company.
17. Governing
Law. This Agreement shall be governed exclusively by and
construed according to the laws of the State of California as applied to
contracts between California residents entered into and to be performed entirely
within California.
18. Counterparts. This
Agreement may be executed in one or more counterparts, each of which will be
deemed an original, but all of which together shall constitute one
instrument. This Agreement may be executed via facsimile or pdf with
the same validity as if it were an ink-signed document.
[Remainder
of Page Intentionally Left Blank]
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The
parties hereto have entered into this Indemnity Agreement effective as of the
date first above written.
| COMPANY: | ||
| XXXXXX MINERAL & MINING CORP. | ||
| By: | ||
| Name: | ||
| Its: | ||
| INDEMNITEE: | ||
| XXXXXXX X. XXXX, an individual | ||
[Signature
Page to Indemnity Agreement]
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