INDEMNIFICATION AGREEMENT
Exhibit 10.1
INDEMNIFICATION AGREEMENT, made and executed effective as of the 20th day of October, 2006, by
and between CARMIKE CINEMAS, INC., a Delaware corporation (the “Company”), and Xxxxx X. Xxxxxx, an
individual resident of California (the “Indemnitee”).
WHEREAS, the Company is aware that, in order to induce highly competent persons to serve the
Company as directors or officers or in other capacities, the Company must provide such persons with
adequate protection through insurance and indemnification against inordinate risks of claims and
actions against them arising out of their service to and activities on behalf of the Company;
WHEREAS, the Company recognizes that the increasing difficulty in obtaining directors’ and
officers’ liability insurance, the increases in the cost of such insurance and the general
reductions in the coverage of such insurance have increased the difficulty of attracting and
retaining such persons;
WHEREAS, the Board of Directors of the Company has determined that it is essential to the best
interests of the Company’s stockholders that the Company act to assure such persons that there will
be increased certainty of such protection in the future;
WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate
itself to indemnify such persons to the fullest extent permitted by applicable law so that they
will continue to serve the Company free from undue concern that they will not be so indemnified;
and
WHEREAS, the Indemnitee is willing to serve, continue to serve, and take on additional service
for or on behalf of the Company on the condition that he/she be so indemnified.
NOW, THEREFORE, in consideration of the premises and the mutual promises and covenants
contained herein, and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and Indemnitee do hereby agree as follows:
1. Service by the Indemnitee. The Indemnitee agrees to serve and/or continue to serve as a
director or officer of the Company faithfully and will discharge his/her duties and
responsibilities to the best of his/her ability so long as the Indemnitee is duly elected or
qualified in accordance with the provisions of the Amended and Restated Certificate of
Incorporation, as amended (the “Certificate”), and Amended and Restated By-laws, as amended (the
“By-laws”) of the Company and the General Corporation Law of the State of Delaware, as amended (the
“DGCL”), or until his/her earlier death, resignation or removal. The Indemnitee may at any time
and for any reason resign from such position (subject to any other contractual obligation or other
obligation imposed by operation by law), in which event the Company shall have no obligation under
this Agreement to continue the Indemnitee in any such position. Nothing in this Agreement shall
confer upon the Indemnitee the right to continue in the employ of the Company or as a director of
the Company or affect the right of the Company to terminate the Indemnitee’s
employment at any time in the sole discretion of the Company, with or without cause, subject
to any contract rights of the Indemnitee created or existing otherwise than under this Agreement.
2. Indemnification. The Company shall indemnify the Indemnitee against all Expenses (as
defined below), judgments, fines and amounts paid in settlement actually and reasonably incurred by
the Indemnitee as provided in this Agreement to the fullest extent permitted by the Certificate,
By-laws and DGCL or other applicable law in effect on the date of this Agreement and to any greater
extent that applicable law may in the future from time to time permit. Without diminishing the
scope of the indemnification provided by this Section 2, the rights of indemnification of the
Indemnitee provided hereunder shall include, but shall not be limited to, those rights hereinafter
set forth, except that no indemnification shall be paid to the Indemnitee:
(a) on account of any suit in which judgment is rendered against the Indemnitee
for disgorgement of profits made from the purchase or sale by the Indemnitee of
securities of the Company pursuant to the provisions of Section 16(b) of the
Securities Exchange Act of 1934, as amended (the “Act”), or similar provisions of
any federal, state or local statutory law;
(b) on account of conduct of the Indemnitee which is finally adjudged by a
court of competent jurisdiction to have been knowingly fraudulent or to constitute
willful misconduct;
(c) in any circumstance where such indemnification is expressly prohibited by
applicable law;
(d) with respect to liability for which payment is actually made to the
Indemnitee under a valid and collectible insurance policy or under a valid and
enforceable indemnity clause, By-law or agreement (other than this Agreement),
except in respect of any liability in excess of payment under such insurance,
clause, By-law or agreement;
(e) if a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful (and, in this respect, both the
Company and the Indemnitee have been advised that it is the position of the
Securities and Exchange Commission that indemnification for liabilities arising
under the federal securities laws is against public policy and is, therefore,
unenforceable, and that claims for indemnification should be submitted to the
appropriate court for adjudication); or
(f) in connection with any proceeding by the Indemnitee against the Company or
its directors, officers, employees or other Indemnitees, (i) unless such
indemnification is expressly required to be made by law, (ii) unless the proceeding
was authorized by the Board of Directors of the Company, (iii) unless such
indemnification is provided by the Company, in its sole discretion, pursuant to the
powers vested in the Company under applicable law, or (iv) except as provided in
Sections 11 and 13 hereof.
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3. Actions or Proceedings Other Than an Action by or in the Right of the Company. The
Indemnitee shall be entitled to the indemnification rights provided in this Section 3 if the
Indemnitee was or is a party or is threatened to be a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or investigative in nature,
other than an action by or in the right of the Company, by reason of the fact that the Indemnitee
is or was a director, officer, employee, agent or fiduciary of the Company, or is or was serving at
the request of the Company as a director, officer, employee, agent or fiduciary of any other
entity, including, but not limited to, another corporation, partnership, limited liability company,
employee benefit plan, joint venture, trust or other enterprise, or by reason of any act or
omission by him/her in such capacity. Pursuant to this Section 3, the Indemnitee shall be
indemnified against all Expenses, judgments, penalties (including excise and similar taxes), fines
and amounts paid in settlement which were actually and reasonably incurred by the Indemnitee in
connection with such action, suit or proceeding (including, but not limited to, the investigation,
defense or appeal thereof), if the Indemnitee acted in good faith and in a manner the Indemnitee
reasonably believed to be in or not opposed to the best interests of the Company, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his/her conduct was
unlawful.
4. Actions by or in the Right of the Company. The Indemnitee shall be entitled to the
indemnification rights provided in this Section 4 if the Indemnitee was or is a party or is
threatened to be made a party to any threatened, pending or completed action, suit or proceeding
brought by or in the right of the Company to procure a judgment in its favor by reason of the fact
that the Indemnitee is or was a director, officer, employee, agent or fiduciary of the Company, or
is or was serving at the request of the Company as a director, officer, employee, agent or
fiduciary of another entity, including, but not limited to, another corporation, partnership,
limited liability company, employee benefit plan, joint venture, trust or other enterprise, or by
reason of any act or omission by him/her in any such capacity. Pursuant to this Section 4, the
Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by him/her in
connection with the defense or settlement of such action, suit or proceeding (including, but not
limited to the investigation, defense or appeal thereof), if the Indemnitee acted in good faith and
in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the
Company; provided however, that no such indemnification shall be made in respect of any claim,
issue, or matter as to which the Indemnitee shall have been adjudged to be liable to the Company,
unless and only to the extent that the Court of Chancery of the State of Delaware or the court in
which such action, suit or proceeding was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case, the Indemnitee is
fairly and reasonably entitled to be indemnified against such Expenses actually and reasonably
incurred by him/her which such court shall deem proper.
5. Good Faith Definition. For purposes of this Agreement, the Indemnitee shall be deemed to
have acted in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed
to the best interests of the Company, or, with respect to any criminal action or proceeding to have
had no reasonable cause to believe the Indemnitee’s conduct was unlawful, if such action was based
on (i) the records or books of the accounts of the Company or other enterprise, including financial
statements; (ii) information supplied to the Indemnitee by the officers of the Company or other
enterprise in the course of their duties; (iii) the advice of legal counsel for the Company or
other enterprise; or (iv) information or records given in reports made
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to the Company or other enterprise by an independent certified public accountant or by an
appraiser or other expert selected with reasonable care by the Company or other enterprise.
6. Indemnification for Expenses of Successful Party. Notwithstanding the other provisions of
this Agreement, to the extent that the Indemnitee has served on behalf of the Company as a witness
or other participant in any class action or proceeding, or has been successful, on the merits or
otherwise, in defense of any action, suit or proceeding referred to in Section 3 and 4 hereof, or
in defense of any claim, issue or matter therein, including, but not limited to, the dismissal of
any action without prejudice, the Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by the Indemnitee in connection therewith, regardless of whether or not the
Indemnitee has met the applicable standards of Section 3 or 4 and without any determination
pursuant to Section 8.
7. Partial Indemnification. If the Indemnitee is entitled under any provision of this
Agreement to indemnification by the Company for some or a portion of the Expenses, judgments, fines
and amounts paid in settlement actually and reasonably incurred by the Indemnitee in connection
with the investigation, defense, appeal or settlement of such suit, action, investigation or
proceeding described in Section 3 or 4 hereof, but is not entitled to indemnification for the total
amount thereof, the Company shall nevertheless indemnify the Indemnitee for the portion of such
Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably
incurred by the Indemnitee to which the Indemnitee is entitled.
8. Procedure for Determination of Entitlement to Indemnification. (a) To obtain
indemnification under this Agreement, Indemnitee shall submit to the Company a written request,
including documentation and information which is reasonably available to Indemnitee and is
reasonably necessary to determine whether and to what extent Indemnitee is entitled to
indemnification. The Secretary of the Company shall, promptly upon receipt of a request for
indemnification, advise the Board of Directors in writing that Indemnitee has requested
indemnification. Any Expenses incurred by the Indemnitee in connection with the Indemnitee’s
request for indemnification hereunder shall be borne by the Company. The Company hereby
indemnifies and agrees to hold the Indemnitee harmless for any Expenses incurred by Indemnitee
under the immediately preceding sentence irrespective of the outcome of the determination of the
Indemnitee’s entitlement to indemnification.
(b) Upon written request by the Indemnitee for indemnification pursuant to Section 3 or 4
hereof, the entitlement of the Indemnitee to indemnification pursuant to the terms of this
Agreement shall be determined by the following person or persons, who shall be empowered to make
such determination: (i) if a Change in Control (as hereinafter defined) shall have occurred, by
Independent Counsel (as hereinafter defined) (unless the Indemnitee shall request in writing that
such determination be made by the Board of Directors (or a committee thereof) in the manner
provided for in clause (ii) of this Section 8(b)) in a written opinion to the Board of Directors, a
copy of which shall be delivered to the Indemnitee; or (ii) if a Change in Control shall not have
occurred, (A)(1) by the Board of Directors of the Company, by a majority vote of Disinterested
Directors (as hereinafter defined) even though less than a quorum, or (2) by a committee of
Disinterested Directors designated by majority vote of Disinterested Directors, even though less
than a quorum, or (B) if there are no such Disinterested Directors or, even if
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there are such Disinterested Directors, if the Board of Directors, by the majority vote of
Disinterested Directors, so directs, by Independent Counsel in a written opinion to the Board of
Directors, a copy of which shall be delivered to the Indemnitee. Such Independent Counsel shall be
selected by the Board of Directors and approved by the Indemnitee. Upon failure of the Board of
Directors to so select, or upon failure of the Indemnitee to so approve, such Independent Counsel
shall be selected by the Chancellor of the State of Delaware or such other person as the Chancellor
shall designate to make such selection. Such determination of entitlement to indemnification shall
be made not later than 45 days after receipt by the Company of a written request for
indemnification. If the person making such determination shall determine that the Indemnitee is
entitled to indemnification as to part (but not all) of the application for indemnification, such
person shall reasonably prorate such part of indemnification among such claims, issues or matters.
If it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall
be made within ten days after such determination.
9. Presumptions and Effect of Certain Proceedings. (a) In making a determination with
respect to entitlement to indemnification, the Indemnitee shall be presumed to be entitled to
indemnification hereunder and the Company shall have the burden of proof in the making of any
determination contrary to such presumption.
(b) If the Board of Directors, or such other person or persons empowered pursuant to Section 8
to make the determination of whether Indemnitee is entitled to indemnification, shall have failed
to make a determination as to entitlement to indemnification within 45 days after receipt by the
Company of such request, the requisite determination of entitlement to indemnification shall be
deemed to have been made and the Indemnitee shall be absolutely entitled to such indemnification,
absent actual and material fraud in the request for indemnification or a prohibition of
indemnification under applicable law. The termination of any action, suit, investigation or
proceeding described in Section 3 or 4 hereof by judgment, order, settlement or conviction, or upon
a plea of nolo contendere or its equivalent, shall not, of itself: (a) create a presumption that
the Indemnitee did not act in good faith and in a manner which he/she reasonably believed to be in
or not opposed to the best interests of the Company, and, with respect to any criminal action or
proceeding, that the Indemnitee has reasonable cause to believe that the Indemnitee’s conduct was
unlawful; or (b) otherwise adversely affect the rights of the Indemnitee to indemnification, except
as may be provided herein.
10. Advancement of Expenses. All reasonable Expenses actually incurred by the Indemnitee in
connection with any threatened or pending action, suit or proceeding shall be paid by the Company
in advance of the final disposition of such action, suit or proceeding, if so requested by the
Indemnitee, within 20 days after the receipt by the Company of a statement or statements from the
Indemnitee requesting such advance or advances. The Indemnitee may submit such statements from
time to time. The Indemnitee’s entitlement to such Expenses shall include those incurred in
connection with any proceeding by the Indemnitee seeking an adjudication or award in arbitration
pursuant to this Agreement. Such statement or statements shall reasonably evidence the Expenses
incurred by the Indemnitee in connection therewith and shall include or be accompanied by a written
affirmation by Indemnitee of Indemnitee’s good faith belief that Indemnitee has met the standard of
conduct necessary for indemnification under this Agreement and an undertaking by or on behalf of
the Indemnitee to repay such amount if it
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is ultimately determined that the Indemnitee is not entitled to be indemnified against such
Expenses by the Company pursuant to this Agreement or otherwise. Each written undertaking to pay
amounts advanced must be an unlimited general obligation but need not be secured, and shall be
accepted without reference to financial ability to make repayment.
11. Remedies of the Indemnitee in Cases of Determination not to Indemnify or to Advance
Expenses. In the event that a determination is made that the Indemnitee is not entitled to
indemnification hereunder or if the payment has not been timely made following a determination of
entitlement to indemnification pursuant to Sections 8 and 9, or if Expenses are not advanced
pursuant to Section 10, the Indemnitee shall be entitled to a final adjudication in an appropriate
court of the State of Delaware or any other court of competent jurisdiction of the Indemnitee’s
entitlement to such indemnification or advance. Alternatively, the Indemnitee may, at the
Indemnitee’s option, seek an award in arbitration to be conducted by a single arbitrator pursuant
to the rules of the American Arbitration Association, such award to be made within 60 days
following the filing of the demand for arbitration. The Company shall not oppose the Indemnitee’s
right to seek any such adjudication or award in arbitration or any other claim. Such judicial
proceeding or arbitration shall be made de novo, and the Indemnitee shall not be prejudiced by
reason of a determination (if so made) that the Indemnitee is not entitled to indemnification. If
a determination is made or deemed to have been made pursuant to the terms of Section 8 or Section 9
hereof that the Indemnitee is entitled to indemnification, the Company shall be bound by such
determination and shall be precluded from asserting that such determination has not been made or
that the procedure by which such determination was made is not valid, binding and enforceable. The
Company further agrees to stipulate in any such court or before any such arbitrator that the
Company is bound by all the provisions of this Agreement and is precluded from making any
assertions to the contrary. If the court or arbitrator shall determine that the Indemnitee is
entitled to any indemnification hereunder, the Company shall pay all reasonable Expenses actually
incurred by the Indemnitee in connection with such adjudication or award in arbitration (including,
but not limited to, any appellate proceedings).
12. Notification and Defense of Claim. Promptly after receipt by the Indemnitee of notice of
the commencement of any action, suit or proceeding, the Indemnitee will, if a claim in respect
thereof is to be made against the Company under this Agreement, notify the Company in writing of
the commencement thereof; but the omission to so notify the Company will not relieve the Company
from any liability that it may have to the Indemnitee under this Agreement or otherwise, except to
the extent that the Company may suffer material prejudice by reason of such failure.
Notwithstanding any other provision of this Agreement, with respect to any such action, suit or
proceeding as to which the Indemnitee gives notice to the Company of the commencement thereof:
(a) The Company will be entitled to participate therein at its own expense.
(b) Except as otherwise provided in this Section 12(b), to the extent that it
may wish, the Company, jointly with any other indemnifying party similarly notified,
shall be entitled to assume the defense thereof with counsel reasonably satisfactory
to the Indemnitee. After notice from the Company to the Indemnitee of its election
to so assume the defense thereof, the Company shall not
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be liable to the Indemnitee under this Agreement for any legal or other
Expenses subsequently incurred by the Indemnitee in connection with the defense
thereof other than reasonable costs of investigation or as otherwise provided below.
The Indemnitee shall have the right to employ the Indemnitee’s own counsel in such
action or lawsuit, but the fees and Expenses of such counsel incurred after notice
from the Company 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 Company, (ii) the Indemnitee shall have reasonably concluded that
there may be a conflict of interest between the Company and the Indemnitee in the
conduct of the defense of such action and such determination by the Indemnitee shall
be supported by an opinion of counsel, which opinion shall be reasonably acceptable
to the Company, or (iii) the Company shall not in fact have employed counsel to
assume the defense of the action, in each of which cases the fees and Expenses of
counsel shall be at the expense of the Company. The Company shall not be entitled
to assume the defense of any action, suit or proceeding brought by or on behalf of
the Company or as to which the Indemnitee shall have reached the conclusion provided
for in clause (ii) above.
(c) The Company shall not be liable to indemnify the Indemnitee under this
Agreement for any amounts paid in settlement of any action or claim effected without
its written consent, which consent shall not be unreasonably withheld. The Company
shall not be required to obtain the consent of Indemnitee to settle any action or
claim which the Company has undertaken to defend if the Company assumes full and
sole responsibility for such settlement and such settlement grants Indemnitee a
complete and unqualified release in respect of potential liability.
(d) If, at the time of the receipt of a notice of a claim pursuant to this
Section 12, the Company has director and officer liability 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 the policies.
13. Other Right to Indemnification. The indemnification and advancement of Expenses provided
by this Agreement are cumulative, and not exclusive, and are in addition to any other rights to
which the Indemnitee may now or in the future be entitled under any provision of the By-laws or
Certificate of the Company, any vote of stockholders or Disinterested Directors, any provision of
law or otherwise. Except as required by applicable law, the Company shall not adopt any amendment
to its By-laws or Certificate the effect of which would be to deny, diminish or encumber the
Indemnitee’s right to indemnification under this Agreement.
14. Director and Officer Liability Insurance. The Company shall, from time to time, make the
good faith determination whether or not it is practicable for the Company to obtain and maintain a
policy or policies of insurance with reputable insurance companies
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providing the officers and directors of the Company with coverage for losses from wrongful
acts, or to ensure the Company’s performance of its indemnification obligations under this
Agreement. Among other considerations, the Company will weigh the costs of obtaining such insurance
coverage against the protection afforded by such coverage. In the event the Company maintains
directors’ and officers’ liability insurance, the Indemnitee shall be named as an insured in such
manner as to provide the Indemnitee the same rights and benefits as are accorded to the most
favorably insured of the Company’s officers or directors. However, the Company agrees that the
provisions hereof shall remain in effect regardless of whether liability or other insurance
coverage is at any time obtained or retained by the Company; except that any payments made to, or
on behalf of, the Indemnitee under an insurance policy shall reduce the obligations of the Company
hereunder. Notwithstanding the foregoing, the Company shall have no obligation to obtain or
maintain such insurance if the Company determines in good faith that such insurance is not
reasonably available, if the premium costs for such insurance are disproportionate to the amount of
coverage provided or if the coverage provided by such insurance is limited by exclusions so as to
provide an insufficient benefit.
15. Spousal Indemnification. The Company will indemnify the Indemnitee’s spouse to whom the
Indemnitee is legally married at any time the Indemnitee is covered under the indemnification
provided in this Agreement (even if Indemnitee did not remain married to him or her during the
entire period of coverage) against any pending or threatened action, suit, proceeding or
investigation for the same period, to the same extent and subject to the same standards,
limitations, obligations and conditions under which the Indemnitee is provided indemnification
herein, if the Indemnitee’s spouse (or former spouse) becomes involved in a pending or threatened
action, suit, proceeding or investigation solely by reason of his or her status as Indemnitee’s
spouse, including, without limitation, any pending or threatened action, suit, proceeding or
investigation that seeks damages recoverable from marital community property, jointly-owned
property or property purported to have been transferred from the Indemnitee to his/her spouse (or
former spouse). The Indemnitee’s spouse or former spouse also may be entitled to advancement of
Expenses to the same extent that Indemnitee is entitled to advancement of Expenses herein. The
Company may maintain insurance to cover its obligation hereunder with respect to Indemnitee’s
spouse (or former spouse) or set aside assets in a trust or escrow fund for that purpose.
16. Intent. This Agreement is intended to be broader than any statutory indemnification
rights applicable in the State of Delaware and shall be in addition to any other rights Indemnitee
may have under the Company’s Certificate, By-laws, applicable law or otherwise. To the extent that
a change in applicable law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the Company’s Certificate,
By-laws, applicable law or this Agreement, it is the intent of the parties that Indemnitee enjoy by
this Agreement the greater benefits so afforded by such change.
17. Attorney’s Fees and Other Expenses to Enforce Agreement. In the event that the Indemnitee
is subject to or intervenes in any proceeding in which the validity or enforceability of this
Agreement is at issue or seeks an adjudication or award in arbitration to enforce the Indemnitee’s
rights under, or to recover damages for breach of, this Agreement the Indemnitee, if he/she
prevails in whole or in part in such action, shall be entitled to recover from
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the Company and shall be indemnified by the Company against any actual expenses for attorneys’
fees and disbursements reasonably incurred by the Indemnitee.
18. Effective Date. The provisions of this Agreement shall cover claims, actions, suits or
proceedings whether now pending or hereafter commenced and shall be retroactive to cover acts or
omissions or alleged acts or omissions which heretofore have taken place. The Company shall be
liable under this Agreement, pursuant to Sections 3 and 4 hereof, for all acts of the Indemnitee
while serving as a director and/or officer, notwithstanding the termination of the Indemnitee’s
service, if such act was performed or omitted to be performed during the term of the Indemnitee’s
service to the Company.
19. Duration of Agreement. This Agreement shall survive and continue even though the
Indemnitee may have terminated his/her service as a director, officer, employee, agent or fiduciary
of the Company or as a director, officer, employee, agent or fiduciary of any other entity,
including, but not limited to another corporation, partnership, limited liability company, employee
benefit plan, joint venture, trust or other enterprise or by reason of any act or omission by the
Indemnitee in any such capacity. This Agreement shall be binding upon the Company and its
successors and assigns, including, without limitation, any corporation or other entity which may
have acquired all or substantially all of the Company’s assets or business or into which the
Company may be consolidated or merged, and shall inure to the benefit of the Indemnitee and his/her
spouse, successors, assigns, heirs, devisees, executors, administrators or other legal
representations. The Company shall require any successor or assignee (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company, by written agreement in form and substance reasonably satisfactory to the
Company and the Indemnitee, 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
or assignment had taken place.
20. Disclosure of Payments. Except as expressly required by any Federal or state securities
laws or other Federal or state law, neither party shall disclose any payments under this Agreement
unless prior approval of the other party is obtained.
21. Severability. If any provision or provisions of this Agreement shall be held invalid,
illegal or unenforceable for any reason whatsoever, (a) the validity, legality and enforceability
of the remaining provisions of this Agreement (including, but not limited to, all portions of any
Sections of this Agreement containing any such provision held to be invalid, illegal or
unenforceable) shall not in any way be affected or impaired thereby and (b) to the fullest extent
possible, the provisions of this Agreement (including, but not limited to, 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 manifest by the provision held invalid, illegal or unenforceable.
22. Counterparts. This Agreement may be executed by one or more counterparts, each of which
shall for all purposes be deemed to be an original but all of which together shall constitute one
and the same Agreement. Only one such counterpart signed by the party against
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whom enforceability is sought shall be required to be produced to evidence the existence of
this Agreement.
23. Captions. The captions and headings used in this Agreement are inserted for convenience
only and shall not be deemed to constitute part of this Agreement or to affect the construction
thereof.
24. Definitions. For purposes of this Agreement:
(a) “Change in Control” shall mean:
| (i) | a “change in control” of the Company of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A for a proxy statement filed under Section 14(a) of the Act as in effect on the date of this Agreement; | ||
| (ii) | a “person” (as that term is used in Section 14(d)(2) of the Act) who becomes the beneficial owner (as defined in Rule 13d-3 under the Act) directly or indirectly of securities representing 45% or more of the combined voting power for election of directors of the then outstanding securities of the Company; | ||
| (iii) | the individuals who at the beginning of any period of two consecutive years or less (starting on or after the date of this Agreement) constitute the Company’s Board of Directors cease for any reason during such period to constitute at least a majority of the Company’s Board of Directors, unless the election or nomination for election of each new member of the Board of Directors was approved in advance by vote of at least two-thirds of the members of such Board of Directors then still in office who were members of such Board of Directors at the beginning of such period; | ||
| (iv) | the stockholders of the Company approve any reorganization, merger, consolidation or share exchange as a result of which the common stock of the Company shall be changed, converted or exchanged into or for securities of another organization or any dissolution or liquidation of the Company or any sale or the disposition of 50% or more of the assets or business of the Company; or | ||
| (v) | the stockholders of the Company approve any reorganization, merger, consolidation or share exchange with another corporation unless (1) the persons who were the beneficial owners of the outstanding shares of the common stock of the Company immediately before the consummation of such transaction beneficially own more than 60% of the outstanding shares of the |
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common stock of the successor or survivor corporation in such
transaction immediately following the consummation of such
transaction and (2) the number of shares of the common stock of such
successor or survivor corporation beneficially owned by the persons
described in Section 24(a)(v)(1) immediately following the
consummation of such transaction is beneficially owned by each such
person in substantially the same proportion that each such person had
beneficially owned shares of the Company common stock immediately
before the consummation of such transaction, provided (3) the
percentage described in Section 24(a)(v)(1) of the beneficially
owned shares of the successor or survivor corporation and the number
described in Section 24(a)(v)(2) of the beneficially owned shares of
the successor or survivor corporation shall be determined exclusively
by reference to the shares of the successor or survivor corporation
which result from the beneficial ownership of shares of common stock
of the Company by the persons described in Section 24(a)(v)(1)
immediately before the consummation of such transaction.
(b) “Disinterested Director” shall mean a director of the Company who is not or
was not a party to the action, suit, investigation or proceeding in respect of which
indemnification is being sought by the Indemnitee.
(c) “Expenses” shall include all attorneys’ fees, retainers, court costs,
transcript costs, fees of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery service fees, and
all other disbursements or expenses incurred in connection with prosecuting,
defending, preparing to prosecute or defend, investigating or being or preparing to
be a witness in any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative in nature.
(d) “Independent Counsel” shall mean a law firm or a member of a law firm that
neither is presently nor in the past five years has been retained to represent (i)
the Company or the Indemnitee in any matter material to either such party or (ii)
any other party to the action, suit, investigation or 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 the Indemnitee in an action to determine the
Indemnitee’s right to indemnification under this Agreement.
25. Entire Agreement, Modification and Waiver. This Agreement constitutes the entire
agreement and understanding of the parties hereto regarding the subject matter hereof, and no
supplement, modification or amendment of this Agreement shall be binding unless executed in writing
by both 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
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shall such waiver constitute a continuing waiver. No supplement, modification or amendment of
this Agreement shall limit or restrict any right of the Indemnitee under this Agreement in respect
of any act or omission of the Indemnitee prior to the effective date of such supplement,
modification or amendment unless expressly provided therein.
26. Notices. All notices, requests, demands or other communications hereunder shall be in
writing and shall be deemed to have been duly given if (i) delivered by hand with receipt
acknowledged by the party to whom said notice or other communication shall have been directed or if
(ii) mailed by certified or registered mail, return receipt requested with postage prepaid, on the
date shown on the return receipt:
(a) If to the Indemnitee to:
Xxxxx X. Xxxxxx
c/o Watershed Asset Management, L.L.C.
Xxx Xxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
c/o Watershed Asset Management, L.L.C.
Xxx Xxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
(b) If to the Company, to:
Carmike Cinemas, Inc.
0000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxxxxxx
0000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxxxxxx
with a copy to:
King & Spalding LLP
Attn: Xxxx X. Xxxxxx
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxx X. Xxxxxx
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
or to such other address as may be furnished to the Indemnitee by the Company or to the Company by
the Indemnitee, as the case may be.
27. Governing Law. The parties hereto agree that this Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of Delaware, applied without
giving effect to any conflicts-of-law principles.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first
above written.
| CARMIKE CINEMAS, INC. |
||||
| By /s/ Xxx Xxxxxxxx | ||||
| Name: | Xxx Xxxxxxxx | |||
| Title: | Senior Vice President, General Counsel and Secretary |
|||
| INDEMNITEE |
||||
| By /s/ Xxxxx X. Xxxxxx | ||||
| Name: | Xxxxx X. Xxxxxx | |||
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