Exhibit 10.9
INDEMNIFICATION AGREEMENT
This Agreement is made as of the _____ day of May 1999, by and between The
Yankee Candle Company, Inc., a Massachusetts corporation (the "Corporation"),
and ___________________ ("Indemnitee"), a director or officer of the
Corporation.
WHEREAS, it is essential to the Corporation to retain and attract as
directors and officers the most capable persons available, and
WHEREAS, the substantial increase in corporate litigation subjects
directors and officers to expensive litigation risks at the same time that the
availability of directors' and officers' liability insurance has been severely
limited, and
WHEREAS, it is the express policy of the Corporation to indemnify its
directors and officers so as to provide them with the maximum possible
protection permitted by law, and
WHEREAS, Indemnitee does not regard the protection available under the
Corporation's Articles of Organization and insurance as adequate in the present
circumstances, and may not be willing to serve or to continue to serve as a
director or officer without adequate protection, and
WHEREAS, the Corporation desires Indemnitee to serve or to continue to
serve as a director or officer of the Corporation.
NOW THEREFORE, the Corporation and Indemnitee do hereby agree as follows:
1. AGREEMENT TO SERVE. Indemnitee agrees to serve or continue to serve as
a director or officer of the Corporation for so long as Indemnitee is duly
elected or appointed or until such time as Indemnitee tenders his/her
resignation in writing.
2. DEFINITIONS. As used in this Agreement:
(a) The term "Proceeding" shall include any threatened, pending or
completed action, suit, or proceeding, whether brought by or in the right of the
Corporation or otherwise and whether of a civil, criminal, administrative or
investigative nature, and any appeal therefrom.
(b) The term "Corporate Status" shall mean the status of a person
who is or was a director or officer of the Corporation, or is or was serving, or
has agreed to serve, at the request of the Corporation, as a director, officer,
employee or agent of another organization or in any capacity with respect to any
employee benefit plan of the Corporation.
(c) The term "Expenses" shall include, without limitation,
attorneys' fees, retainers, court costs, transcript costs, fees of experts,
travel expenses, duplicating costs, printing and binding costs, telephone
charges, postage, delivery service fees and other disbursements or expenses of
the types customarily incurred in connection with investigations, judicial or
administrative proceedings or appeals, but shall not include the amount of
judgments, fines or penalties against Indemnitee or amounts paid in settlement
in connection with such matters.
(d) References to "fines" shall include any excise tax assessed with
respect to any employee benefit plan.
3. INDEMNIFICATION. The Corporation shall indemnify Indemnitee in
accordance with the provisions of this Paragraph 3 if Indemnitee was or is a
party to or threatened to be made a party to or otherwise involved in any
Proceeding by reason of his Corporate Status or by reason of any action alleged
to have been taken or omitted in connection therewith, against all Expenses,
judgments, fines, penalties and amounts paid in settlement incurred by
Indemnitee or on his behalf in connection with such Proceeding to the fullest
extent permitted by the laws of the Commonwealth of Massachusetts in effect on
the date hereof or as such laws may from time to time hereafter be amended to
increase the scope of such permitted indemnification. Notwithstanding the
foregoing provisions of this Paragraph 3, no such indemnification shall be made
in respect of any claim, issue or matter as to which the laws of the
Commonwealth of Massachusetts expressly prohibits such indemnification by reason
of an adjudication of liability of Indemnitee to the Corporation unless and only
to the extent that the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnity for such Expenses, judgments, fines, penalties and amounts
paid in settlement which the court shall deem proper.
4. EXCEPTIONS TO RIGHT OF INDEMNIFICATION. Notwithstanding anything to the
contrary in this Agreement, except as set forth in Paragraph 8, the Corporation
shall not indemnify the Indemnitee in connection with a Proceeding (or part
thereof) initiated by the Indemnitee unless the initiation thereof was approved
by the Board of Directors of the Corporation. Notwithstanding anything to the
contrary in this Agreement, the Corporation shall not indemnify the Indemnitee
to the extent the Indemnitee is reimbursed from the proceeds of insurance, and
in the event the Corporation makes any indemnification payments to the
Indemnitee and the Indemnitee is subsequently reimbursed from the proceeds of
insurance, the Indemnitee shall promptly refund such indemnification payments to
the Corporation to the extent of such insurance reimbursement.
5. NOTIFICATION AND DEFENSE OF CLAIM. As a condition precedent to his
right to be indemnified, the Indemnitee must notify the Corporation in writing
as soon as practicable of any Proceeding for which indemnity will or could be
sought by him and provide the Corporation with a copy of any summons, citation,
subpoena, complaint, indictment, information or other document relating to such
Proceeding with which he is served. With respect to any Proceeding of which the
Corporation is so notified, the Corporation will be entitled to participate
therein at its own expense and/or to assume, with legal counsel reasonably
acceptable to the Indemnitee, the defense thereof at its own expense. After
notice from the Corporation to the Indemnitee of its election so to assume such
defense, the Corporation shall not be liable to the Indemnitee for any legal or
other expenses subsequently incurred by the Indemnitee in connection with such
claim, other than as provided below in this Paragraph 5. The Indemnitee shall
have the right to employ his own counsel in connection with such claim, but the
fees and expenses of such counsel incurred after notice from the Corporation of
its assumption of the defense thereof shall be at the expense of the Indemnitee
unless (i) the employment of counsel by the Indemnitee has been authorized by
the Corporation, (ii) counsel to the Indemnitee shall have reasonably concluded
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that there may be a conflict of interest or position on any significant issue
between the Corporation and the Indemnitee in the conduct of the defense of such
action, or (iii) the Corporation shall not in fact have employed counsel to
assume the defense of such action, in each of which cases the fees and expenses
of counsel for the Indemnitee shall be at the expense of the Corporation, except
as otherwise expressly provided by this Agreement. The Corporation shall not be
entitled, without the consent of the Indemnitee, to assume the defense of any
claim brought by or in the right of the Corporation or as to which counsel for
the Indemnitee shall have reasonably made the conclusion provided for in clause
(ii) above.
6. ADVANCEMENT OF EXPENSES. Subject to the provisions of Paragraph 7
below, in the event that the Corporation does not assume the defense pursuant to
Paragraph 5 of this Agreement of any Proceeding to which Indemnitee was or is a
party or is threatened to be made a party by reason of his Corporate Status or
by reason of any action alleged to have been taken or omitted in connection
therewith and of which the Corporation receives notice under this Agreement, any
Expenses incurred by the Indemnitee in defending such Proceeding shall be paid
by the Corporation in advance of the final disposition of such matter; PROVIDED,
HOWEVER, that the payment of such Expenses incurred by the Indemnitee in advance
of the final disposition of such matter shall be made only upon receipt of an
undertaking by or on behalf of the Indemnitee to repay all amounts so advanced
in the event that it shall ultimately be determined that the Indemnitee is not
entitled to be indemnified by the Corporation as authorized in this Agreement.
Such undertaking shall be accepted without reference to the financial ability of
the Indemnitee to make repayment.
7. PROCEDURE FOR INDEMNIFICATION. In order to obtain indemnification or
advancement of Expenses pursuant to Paragraphs 3 or 6 of this Agreement,
Indemnitee shall submit to the Corporation a written request, including in such
request 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 or advancement of Expenses. Any such
indemnification or advancement of Expenses shall be made promptly, and in any
event within 60 days after receipt by the Corporation of the written request of
the Indemnitee, unless the Corporation determines within such 60-day period that
such Indemnitee did not meet the applicable standard of conduct set forth in
Paragraph 3 or 6. Such determination shall be made in each instance by (a) a
majority vote of a quorum of the directors of the Corporation, (b) a majority
vote of a quorum of the outstanding shares of stock of all classes entitled to
vote for directors, voting as a single class, which quorum shall consist of
shareholders who are not at that time parties to the Proceeding, (c) independent
legal counsel (who may, to the extent permitted by law, be regular legal counsel
to the Corporation), or (d) a court of competent jurisdiction.
8. REMEDIES. The right to indemnification or advancement of Expenses as
provided by this Agreement shall be enforceable by the Indemnitee in any court
of competent jurisdiction if the Corporation denies such request, in whole or in
part, or if no disposition thereof is made within the 60-day period referred to
above in Paragraph 7. Unless otherwise required by law, the burden of proving
that indemnification is not appropriate shall be on the Corporation. Neither the
failure of the Corporation to have made a determination prior to the
commencement of such action that indemnification is proper in the circumstances
because Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Corporation pursuant to
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Paragraph 7 that Indemnitee has not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that Indemnitee has not
met the applicable standard of conduct. Indemnitee's expenses (of the type
described in the definition of "Expenses" in Paragraph 2(c)) reasonably incurred
in connection with successfully establishing his right to indemnification, in
whole or in part, in any such Proceeding shall also be indemnified by the
Corporation.
9. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Corporation for some or a portion of
the Expenses, judgments, fines, penalties or amounts paid in settlement actually
and reasonably incurred by him or on his behalf in connection with any
Proceeding but not, however, for the total amount thereof, the Corporation shall
nevertheless indemnify Indemnitee for the portion of such Expenses, judgments,
fines, penalties and amounts paid in settlement to which Indemnitee is entitled.
10. MAINTENANCE OF D&O INSURANCE.
(a) The Corporation hereby covenants and agrees with Indemnitee
that, so long as Indemnitee shall continue to serve as a director or officer of
the Corporation and thereafter so long as Indemnitee shall be subject to any
possible claim or threatened, pending or completed Proceeding, whether civil,
criminal or investigative, by reason of Indemnitee's Corporate Status, the
Corporation shall maintain in full force and effect (i) the directors' and
officers' liability insurance issued by the insurer and having the policy amount
and deductible as currently in effect with respect to directors and officers of
the Corporation, and (ii) any replacement or substitute policies issued by one
or more reputable insurers providing in all respects coverage at least
comparable to and in the same amount as that currently provided under such
existing policy (collectively, "D&O Insurance").
(b) In all policies of D&O Insurance, Indemnitee shall be named as
an insured in such a manner as to provide Indemnitee the same rights and
benefits, subject to the same limitations, as are accorded to the Corporation's
directors or officers most favorably insured by such policy.
(c) Notwithstanding anything to the contrary set forth in (a) above,
the Corporation shall have no obligation to maintain D&O Insurance if the
Corporation determines in good faith that such insurance is not reasonably
available, the premium cost for such insurance is disproportionate to the amount
of coverage provided or the coverage provided by such insurance is limited by
exclusions so as to provide an insufficient benefit.
11. NO DUPLICATIVE PAYMENT. 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
(net of Expenses incurred in collecting such payment) under any insurance
policy, contract, agreement or otherwise.
12. SUBROGATION. In the event of any payment under this Agreement, the
Corporation shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee,
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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.
13. TERM OF AGREEMENT. This Agreement shall continue until and terminate
upon the later of (a) six years after the date that Indemnitee shall have ceased
to serve as a director or officer of the Corporation or, at the request of the
Corporation, as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, or (b) the final
termination of all Proceedings pending on the date set forth in clause (a) in
respect of which Indemnitee is granted rights of indemnification or advancement
of Expenses hereunder and of any proceeding commenced by Indemnitee pursuant to
Paragraph 8 of this Agreement relating thereto.
14. INDEMNIFICATION HEREUNDER NOT EXCLUSIVE. The indemnification and
advancement of Expenses provided by this Agreement shall not be deemed exclusive
of any other rights to which Indemnitee may be entitled under the Articles of
Organization, the By-Laws, any agreement, any vote of shareholders or directors,
the Massachusetts Business Corporation Law, any other law (common or statutory),
or otherwise, both as to action in his official capacity and as to action in
another capacity while holding office for the Corporation. To the extent
Indemnitee would be prejudiced thereby, no amendment, alteration, rescission or
replacement of this Agreement or any provision hereof shall be effective as to
Indemnitee with respect to any action taken or omitted by such Indemnitee in
Indemnitee's position with the Corporation or any other entity which Indemnitee
is or was serving at the request of the Corporation prior to such amendment,
alteration, rescission or replacement.
15. ENTIRE AGREEMENT. Subject to the provisions of Section 14 hereof, this
Agreement constitutes the entire understanding between the parties and
supersedes all proposals, commitments, writings, negotiations and
understandings, oral and written, and all other communications between the
parties relating to the subject matter hereof.
16. NO SPECIAL RIGHTS. Nothing contained herein shall confer upon
Indemnitee any right to continue to serve as an officer or director of the
Corporation for any period of time, or at any particular rate of compensation.
17. SAVINGS CLAUSE. If this Agreement or any portion thereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify Indemnitee as to Expenses, judgments,
fines, penalties and amounts paid in settlement with respect to any Proceeding
to the full extent permitted by any applicable portion of this Agreement that
shall not have been invalidated and to the fullest extent permitted by
applicable law.
18. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall constitute the original.
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19. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Corporation and its successors and assigns and shall inure to the benefit of the
estate, heirs, executors, administrators and personal representatives of
Indemnitee.
20. HEADINGS. The headings of the paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.
21. 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 provision hereof nor shall any
such waiver constitute a continuing waiver.
22. NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been given (i) when
delivered by hand or (ii) if mailed by certified or registered mail with postage
prepaid, on the third day after the date on which it is so mailed:
(a) if to the Indemnitee, to the address appearing on the
signature page of this Agreement.
with a copy to:
(b) if to the Corporation, to:
The Yankee Candle Company, Inc.
000 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: President
with a copy to:
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxx, Esq.
or to such other address as may have been furnished to Indemnitee by the
Corporation or to the Corporation by Indemnitee, as the case may be.
23. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
or caused this Agreement to be duly executed as of the day and year first above
written.
THE YANKEE CANDLE COMPANY, INC.
Attest: By:
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By: Name:
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Name: Title:
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INDEMNITEE:
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Name:
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Address:
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