EXHIBIT 10.12
FORM OF
INDEMNITY AGREEMENT
AGREEMENT dated as of June 17, 1997 by and between FBP Acquisition Corp.,
Inc., a Delaware corporation (the "Corporation"), and the undersigned (the
"Indemnitee").
RECITALS
The Indemnitee is a director and/or officer of the Corporation and/or an
Affiliate Indemnitee (as hereafter defined). Both the Corporation and the
Indemnitee recognize the increased risk of litigation and other claims being
asserted against directors and officers in today's environment.
The Restated Certificate of Incorporation of the Corporation requires the
Corporation to indemnify its directors and officers as currently provided
therein, and the Indemnitee has been serving and continues to serve as a
director and/or officer of the Corporation in part in reliance on such
provision. The Restated Certificate of Incorporation of the Corporation permits
the Corporation to purchase and maintain insurance or to furnish similar
protection or make other arrangements (any such insurance, protection or
arrangement, an "Indemnification Arrangement") on behalf of the Indemnitee
against personal liability (including, but not limited to, providing for
Advanced Amounts as hereafter defined), asserted against him or incurred by or
on behalf of him in such capacity as a director or officer of the Corporation or
as an Affiliate Indemnitee, or arising out of his status as such, whether or not
the Corporation would have the power to indemnify him against such liability
under the provisions of this Agreement or under the Delaware General Corporation
Law (the "DGCL"), as it may then be in effect.
In part to provide the Indemnitee with specific contractual assurance of
substantial protection against personal liability (regardless of, among other
things, any amendment to or revocation of the aforementioned provisions of the
Corporation's Restated Certificate of Incorporation or any change in the
composition of the Corporation's Board of Directors or control of the
Corporation), the Corporation desires to enter into this Agreement. DGCL
Section 145(f) expressly recognizes that the indemnification provisions of the
DGCL are not exclusive of any other rights to which a person seeking
indemnification may be entitled under the Certificate of Incorporation or Bylaws
of the Corporation, or an agreement providing for indemnification, or a
resolution of stockholders or directors, or otherwise, and the Restated
Certificate of Incorporation of the Corporation expressly recognizes that the
indemnification provisions of the Restated Certificate of Incorporation of the
Corporation shall be deemed exclusive of, and shall not affect, any other rights
to which a person seeking indemnification may be entitled under any agreement,
and this Agreement is being entered into pursuant to the Restated Certificate of
Incorporation of the Corporation as permitted by the DGCL as authorized by the
stockholders of the Corporation.
In order to induce the Indemnitee to serve as a director and/or officer of
the Corporation and in consideration of the Indemnitee's so serving, the
Corporation desires to hold harmless and indemnify the Indemnitee and to make
arrangements pursuant to which the Indemnitee may be
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advanced or reimbursed expenses incurred by the Indemnitee in certain
proceedings, in every case to the fullest extent authorized or permitted by
the DGCL or any other applicable law, or by any amendment thereof or other
statutory provisions authorizing or permitting such indemnification which are
adopted after the date hereof (but, in the case of any such amendment, only
to the extent that such amendment permits the corporation to provide broader
indemnification rights than the DGCL or other applicable law permitted the
Corporation to provide prior to such amendment).
NOW THEREFORE, in consideration of the foregoing recitals and of the
Indemnitee's continuing to serve the Corporation as a director and/or officer,
the parties agree as follows:
1. INDEMNIFICATION. To the fullest extent allowed by law, the
Corporation shall hold harmless and indemnify the Indemnitee, his executors,
administrators or assigns against any and all expenses, liabilities, and losses
(including, without limitation, investigation expenses and expert witnesses' and
attorneys' fees and expenses, judgment, penalties, fines, and amounts paid or to
be paid in settlement) actually incurred by the Indemnitee (net of any related
insurance proceeds or other amounts received by the Indemnitee or paid by or on
behalf of the Corporation on the Indemnitee's behalf in compensation of such
expenses, liabilities or losses), in connection with any actual or threatened
action, suit or proceeding, whether civil, criminal, administrative or
investigative, to which the Indemnitee is a party or is threatened to be made a
party (a "Proceeding"), as a plaintiff, defendant, respondent or otherwise,
based upon, arising from, relating to or by reason of the fact that the
Indemnitee is, was, shall be or shall have been a director and/or officer of the
Corporation or is or was serving, shall serve or shall have served as a
director, officer, partner, trustee, fiduciary, employee or agent ("Affiliate
Indemnitee") of another foreign or domestic corporation or non-profit
corporation, cooperative, partnership, joint venture, trust, employee benefit
plan, or other incorporated or unincorporated enterprise at the request of the
Corporation or as a result of the Corporation merging with and into such an
entity, including, without limitation, Falcon Building Products, Inc., a
Delaware corporation (each, a "Company Affiliate"); provided, however, that,
except as provided in Section 8(b) hereof, the Corporation shall indemnify the
Indemnitee in connection with a Proceeding initiated by the Indemnitee only if
such proceeding (or part thereof) was authorized by a majority vote of the Board
of Directors. The Indemnitee shall be presumed to be entitled to such
indemnification under this Agreement upon submission of a written claim pursuant
to Section 3 hereof. Thereafter, the Corporation shall have the burden of proof
to overcome the presumption that the Indemnitee is so entitled. Such
presumption shall only be overcome by a judgment or other final adjudication
after all appeals and all time for appeals has expired ("Final Determination")
adverse to the Indemnitee establishing that his acts were committed in bad
faith, or were the result of active and deliberate dishonesty and were material
to the cause of action so adjudicated, or that the Indemnitee personally gained
in fact a financial profit or other advantage to which he was not legally
entitled. Neither the failure of the Corporation (including its Board of
Directors, legal counsel, or its stockholders) to have made a determination
prior to the commencement of such Proceeding that indemnification of the
Indemnitee is proper in the circumstances because such person has met the
applicable standard of conduct set forth in the DGCL, nor an actual
determination by the Corporation (including its Board of Directors, legal
counsel, or its stockholders) that the Indemnitee has not met the applicable
standard of conduct, shall be a defense to the action or create a presumption
that the Indemnitee has not met the applicable
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standard of conduct. The purchase, establishment, or maintenance of any
Indemnification Arrangement shall not in any way diminish, restrict, limit or
affect the rights and obligations of the Corporation or of the Indemnitee
under this Agreement except as expressly provided herein, and the execution
and delivery of this Agreement by the Corporation and the Indemnitee shall
not in any way diminish, restrict, limit or affect the Indemnitee's right to
indemnification from the Corporation or any other party or parties under any
other Indemnification Arrangement, the Certificate of Incorporation or Bylaws
of the Corporation or the DGCL.
2. INSURANCE. Subject only to the provisions of this Section 2, as long
as the Indemnitee shall continue to serve as a director and/or officer of the
Corporation (or shall continue at the request of the Corporation to serve as an
Affiliate Indemnitee) and thereafter as long as the Indemnitee shall be subject
to any possible Proceeding by reason of the fact that the Indemnitee was a
director and/or officer of the Corporation (or served in any of said other
capacities), the Corporation will, unless no such policies are available in any
market, purchase and maintain in effect for the benefit of the Indemnitee one or
more valid, binding, and enforceable policies (the "Insurance Policies") of
directors' and officers' liability insurance ("D&O Insurance") providing
adequate liability coverage for the Indemnitee's acts as a director and/or
officer of the Corporation or as an Affiliate Indemnitee. The Corporation shall
promptly notify the Indemnitee of any lapse, amendment or failure to renew said
policy or policies or any provision thereof relating to the extent or nature of
coverage provided thereunder. In the event the Corporation does not purchase
and maintain in effect said policy or policies of D&O Insurance pursuant to the
provisions of this Section 2, the Corporation shall, in addition to and not in
limitation of the other rights granted the Indemnitee under this Agreement, hold
harmless and indemnify the Indemnitee to the full extent of coverage which would
otherwise have been provided for the benefit of the Indemnitee pursuant to the
Insurance Policies.
3. CLAIMS FOR PAYMENTS. The Indemnitee shall have the right to receive
from the Corporation on demand, or at his option to have the Corporation pay
promptly on his behalf, in advance of a Final Determination of a Proceeding all
amounts payable by the Corporation pursuant to the terms of this Agreement as
corresponding amounts are expended or incurred by the Indemnitee in connection
with any Proceeding or otherwise expended or incurred by the Indemnitee (such
amounts so expended or incurred being referred to as "Advanced Amounts.") In
making any claim for payment by the Corporation of any amount, including any
Advanced Amount, pursuant to this Agreement, the Indemnitee shall submit to the
Corporation a written request for payment (a "Claim"), which includes a schedule
setting forth in reasonable detail the dollar amount expended (or incurred or
expected to be expended or incurred). Each item on such schedule shall be
supported by the xxxx, agreement, or other documentation relating thereto, a
copy of which shall be appended to the schedule as an exhibit.
Where the Indemnitee is requesting Advanced Amounts, the Indemnitee must
also provide an undertaking to repay such Advanced Amounts if a Final
Determination is made that the Indemnitee is not entitled to indemnification
hereunder.
4. SECTION 16(b) LIABILITY. The Corporation shall not be liable under
this Agreement to make any payment in connection with any claim made against the
Indemnitee for an accounting of profits made from the purchase or sale by the
Indemnitee of securities of the Corporation
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within the meaning of Section 16(b) of the Securities Exchange Act of 1934
and amendments thereto or similar provisions of any state statutory law or
common law.
5. CONTINUATION OF INDEMNITY. All agreements and obligations of the
Corporation contained herein shall continue during the period the Indemnitee is
a director and/or officer of the Corporation (or is serving at the request of
the Corporation as an Affiliate Indemnitee) and shall continue thereafter so
long as the Indemnitee shall be subject to any possible Proceeding by reason of
the fact that the Indemnitee was a director or officer of the Corporation or was
serving as such an Affiliate Indemnitee.
6. SUCCESSORS: BINDING AGREEMENT. This Agreement shall be binding on
and shall inure to the benefit of and be enforceable by the Corporation's
successors and assigns and by the Indemnitee's personal or legal
representatives, executors, administrators, successors, heirs, distributee,
divisees, and legatees. The Corporation 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 Corporation, by
written agreement in form and substance reasonably satisfactory to the
Corporation and to the Indemnitee, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Corporation would
be required to perform if no such succession or assignment had taken place.
7. NOTIFICATION AND DEFENSE OF CLAIM. Promptly after receipt by the
Indemnitee of notice of the commencement of any Proceeding, the Indemnitee
shall, if a claim in respect thereof is to be made against the Corporation under
this Agreement, notify the Corporation of the commencement thereof, but the
omission so to notify the Corporation will not relieve the Corporation from any
liability which it may have to the Indemnitee. With respect to any such
Proceeding:
(i) The Corporation shall be entitled to participate therein at its
own expense;
(ii) Except with prior written consent of the Indemnitee, the
Corporation shall not be entitled to assume the defense of any
Proceeding; and
(iii) The Corporation shall not settle any Proceeding in any manner
which would impose any penalty or limitation on the Indemnitee
without the Indemnitee's prior written consent.
The Indemnitee shall not settle any Proceeding with respect to which the
Indemnitee has received indemnified amounts or Advanced Amounts without the
Corporation's prior written consent, nor will the Indemnitee unreasonably
withhold consent to any proposed settlement.
8. ENFORCEMENT. (a) The Corporation has entered into this Agreement
and assumed the obligations imposed on the Corporation hereby in order to
induce the Indemnitee to act as a director and/or officer of the Corporation
or as an Affiliate Indemnitee, and acknowledges that the Indemnitee is
relying upon this Agreement in continuing in such capacity.
(b) In the event the Indemnitee has requested payment of any amount
under this Agreement and has not received payment thereof within thirty (30)
days of such request, the
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Indemnitee may bring any action to enforce rights or collect moneys due
under this Agreement and if the Indemnitee is successful in such action, the
Corporation shall reimburse the Indemnitee for all of the Indemnitee's fees
and expenses in bringing and pursuing such action. The Indemnitee shall be
entitled to the advancement of such amounts to the full extent contemplated
by Section 3 hereof in connection with such Proceeding.
9. SEPARABILITY. 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
this Agreement (including, without limitation, all portions of any sections or
subsections 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 any section or subsections of
this Agreement containing any such provisions 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 of the parties that the
Corporation provide protection to the Indemnitee to the fullest enforceable
extent.
10. MISCELLANEOUS. No provision of this Agreement may be modified,
waived, or discharged unless such modification, waiver, or discharge is agreed
to in writing signed by the Indemnitee and an officer of the Corporation
designated by the Board of Directors. No waiver by either party at any time of
any branch by the other party of, or of compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same time or
at any prior or subsequent time. The validity, interpretation, construction,
and performance of this Agreement shall be governed by the laws of the State of
Delaware, without giving effect to the principles of conflicts of laws thereof.
The Indemnitee may bring an action seeking resolution of disputes or
controversies arising under or in any way related to this Agreement in the state
or federal court jurisdiction in which the Indemnitee resides or in which his
place of business is located, and in any related appellate courts, and the
Corporation consents to the jurisdiction of such courts and to such venue.
11. NOTICES. For the purposes of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, as follows:
If to the Indemnitee: To the address set forth below his
signature
If to the Corporation: Falcon Building Products, Inc.
Two Xxxxx Xxxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: General Counsel
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or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
12. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
13. EFFECTIVENESS. This Agreement shall be effective as of the day and
year first above written.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the day and year first above written.
Falcon Building Products, Inc.
By:
--------------------------------
Name: Xxx X. Xxxxx
Title: Executive Vice-President
INDEMNITEE
--------------------------------
(Name)
Address:
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