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EXHIBIT 10.6
JOINT AND SEVERAL INDEMNITY AGREEMENT
AGREEMENT dated as of September , 1998 by and between Xxxxx
Xxxxxx N.V., a corporation formed under the laws of The Netherlands (the
"Corporation"), and Xxxxx Xxxxxx (USA) Inc., a corporation formed under the laws
of the State of Nevada ("Inc" and together with the Corporation, the
"Indemnitors") on the one hand, and ________________ (the "Indemnitee"), on the
other.
RECITALS
The Indemnitee is, or is willing to become, a director and/or
officer of the Corporation, Inc and/or an Affiliate Indemnitee (as hereinafter
defined). Each of the Indemnitors and the Indemnitee recognize the increased
risk of litigation and other claims being asserted against directors and
officers of public companies in today's environment.
The Articles of Association of the Corporation and the Articles
of Incorporation and Bylaws of Inc (collectively, the "Charter Documents")
permit the Indemnitors to indemnify their respective directors and officers as
currently provided therein. The Charter Documents permit the Indemnitors 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 hereinafter defined)
asserted against him or incurred by or on behalf of him in such capacity as a
director or officer of such Indemnitor or as an Affiliate Indemnitee, or arising
out of his status as such, whether or not such Indemnitor would have the power
to indemnify him against such liability under the provisions of this Agreement
or under applicable law, including the Nevada General Corporation Law (the
"NGCL"), 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 any of the Indemnitor's Charter Documents or any change in the
composition of such Indemnitor's Board of Directors or control of such
Indemnitor), each of the Indemnitors desires to enter into this Agreement. The
NGCL expressly recognizes that the indemnification provisions of the NGCL are
not exclusive of any other rights to which a person seeking indemnification may
be entitled under the Charter Documents, or an agreement providing for
indemnification, or a resolution of stockholders or directors, or otherwise, and
the Charter Documents of the Indemnitors expressly recognize that the
indemnification provisions of the Charter Documents shall not 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 Charter Documents, as permitted by applicable law,
and has been authorized by the stockholders of the Indemnitors.
In order to induce the Indemnitee to serve as a director and/or
officer of the Corporation and/or Inc and in consideration of the Indemnitee's
so serving, each of the Indemnitors desires jointly and severally to hold
harmless and indemnify the Indemnitee and to make arrangements pursuant to which
the Indemnitee may be advanced or reimbursed expenses incurred by the Indemnitee
in certain proceedings, in every case to the fullest extent authorized or
permitted by the NGCL, 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 Indemnitor to provide broader
indemnification rights than
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the NGCL, or other applicable law, permitted such Indemnitor to provide prior to
such amendment).
NOW, THEREFORE, in consideration of the foregoing recitals and of
the Indemnitee's willingness to serve the Corporation and/or Inc as a director
and/or officer, the parties agree as follows:
1. Indemnification. (a) To the fullest extent allowed by law,
each of the Indemnitors, jointly and severally, 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, expert witnesses' and attorneys' fees and expenses,
judgments, penalties, fines, amounts paid or to be paid in settlement, any
interest, assessments, or other charges imposed thereon and any federal, state,
local or foreign taxes imposed as a result of actual or deemed receipt of any
payment hereunder) 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 an Indemnitor 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 or in arbitration, to which the Indemnitee is a party or
participant or is threatened to be made a party or participant (a "Proceeding"),
as a plaintiff, defendant, respondent, witness or otherwise, based upon, arising
from, relating to or by reason of the fact that the Indemnitee: (a) is, was,
shall be or shall have been a director and/or officer of an Indemnitor or (b) is
or was serving, shall serve, or shall have served at the request of an
Indemnitor 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 (each, a
"Company Affiliate"); or arising from or relating to any action or omission to
act taken by the Indemnitee in any of the foregoing capacities; provided,
however, that, except as provided in Section 9(b) hereof, an Indemnitor shall
indemnify the Indemnitee in connection with a Proceeding initiated by the
Indemnitee only if such proceeding (or part thereof) was authorized by a
two-thirds vote of the Board of Directors of such Indemnitor.
(b) The Indemnitee shall be presumed to be entitled to such
indemnification under this Agreement upon submission of a written claim pursuant
to Section 4 hereof. Thereafter, the Indemnitors 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"), which is
adverse to the Indemnitee and which establishes (i) that his acts were committed
in bad faith, or were the result of active and deliberate dishonesty or willful
fraud or illegality, and were material to the cause of action so adjudicated or
(ii) that the Indemnitee in fact personally gained a financial profit or other
advantage to which he was not legally entitled. If the Indemnitee is not wholly
successful in any Proceeding but is successful on the merits or otherwise as to
one or more but less than all claims, issues or matters in such Proceeding the
Indemnitors agree, jointly and severally, to indemnify the Indemnitee to the
maximum extent permitted by law against all losses and expenses incurred by the
Indemnitee in connection with each successfully resolved claim, issue or matter.
Neither the failure of any of the Indemnitors (including their respective Boards
of Directors, legal counsel or 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, nor an actual determination by such Indemnitor (including its Board
of Directors, its 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 standard of
conduct. The purchase, establishment or maintenance of any Indemnification
Arrangement
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shall not in any way diminish, restrict, limit or adversely affect the rights
and obligations of any of the Indemnitors or of the Indemnitee under this
Agreement, except as expressly provided herein, and the execution and delivery
of this Agreement by the Indemnitors and the Indemnitee shall not in any way
diminish, restrict, limit or adversely affect the Indemnitee's right to
indemnification from the Indemnitors or any other party or parties under any
other Indemnification Arrangement, the Charter Documents of any of the
Indemnitors, or applicable law
2. Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or on behalf of an Indemnitor or any
affiliate of an Indemnitor against the Indemnitee, Indemnitee's spouse, heirs,
executors, or personal or legal representatives after the expiration of two
years from the date of accrual of such cause of action, or such longer period as
may be required by applicable law under the circumstances. Any claim or cause of
action of the Indemnitor or its affiliate shall be extinguished and deemed
released unless asserted by the timely filing of a legal action within such
period; provided, however, that if any shorter period of limitations is
otherwise applicable to any such cause of action the shorter period shall
govern.
3. Insurance. Subject only to the provisions of this Section 3,
as long as the Indemnitee shall continue to serve as a director and/or officer
of an Indemnitor (or shall continue at the request of an Indemnitor 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 an Indemnitor (or served in any of said other
capacities), at least one of the Indemnitors shall use its best efforts to
purchase and maintain in effect for the benefit of the Indemnitee one or more
valid, binding and enforceable policies of directors' and officers' liability
insurance (or maintain an appropriate self-insurance program) providing adequate
liability coverage for the Indemnitee's acts as a director and/or officer of an
Indemnitor or as an Affiliate Indemnitee ("D&O Insurance"). The Indemnitors
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 Indemnitors do not
purchase or maintain in effect said policy or policies of D&O Insurance pursuant
to the provisions of this Section 3, the Indemnitors 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 D&O Insurance.
4. Claims for Payments. The Indemnitee shall have the right to
receive from the Indemnitors on demand or, at his option, to have any of the
Indemnitors pay promptly on his behalf, in advance of a Final Determination of a
Proceeding, all amounts payable by the Indemnitors pursuant to the terms of this
Agreement as corresponding amounts are expended or incurred by the Indemnitee in
connection with any Proceeding or otherwise (such amounts so expended or
incurred being referred to as "Advanced Amounts"). In making any claim for
payment by the Indemnitors of any amount, including any Advanced Amount,
pursuant to this Agreement, the Indemnitee shall submit to the Indemnitors 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.
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5. Section 16(b) Liability. No Indemnitor shall 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 an Indemnitor 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.
6. Continuation of Indemnity. All agreements and obligations of
the Indemnitors contained herein shall continue during the period the Indemnitee
is a director and/or officer of an Indemnitor (or is serving at the request of
an Indemnitor 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 an Indemnitor or served as
such an Affiliate Indemnitee.
7. Successors: Binding Agreement. This Agreement shall be binding
on, and shall inure to the benefit of and be enforceable by, each of the
Indemnitor's successors and assigns and by the Indemnitee's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
divisees and legatees. Each Indemnitor 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 such Indemnitor
expressly to assume and agree in writing to perform this Agreement in the same
manner and to the same extent that such Indemnitor would be required to perform
if no such succession or assignment had taken place.
8. 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 an Indemnitor under
this Agreement, notify such Indemnitor of the commencement thereof, but the
failure to so notify such Indemnitor will not relieve the Indemnitors from any
liability which it may have to the Indemnitee (except to the extent that the
Indemnitors are prejudiced by such failure).
With respect to any such Proceeding:
(i) Each Indemnitor shall be entitled to participate therein at
its own expense;
(ii) Except with prior written consent of the Indemnitee, the
Indemnitors shall not be entitled to assume the defense of any
Proceeding;
(iii) No Indemnitor shall settle any Proceeding in any manner
which would impose any penalty or limitation on the Indemnitee without
the Indemnitee's prior written consent (not to be unreasonably withheld
or delayed); and
(iv) The Indemnitee shall not settle any Proceeding without the
Indemnitors' prior written consent (not to be unreasonably withheld or
delayed).
9. Enforcement. (a) Each Indemnitor has entered into this
Agreement and assumed the obligations imposed on such Indemnitor hereby in order
to induce the Indemnitee to act as a director and/or officer of the Corporation
and/or Inc or as an Affiliate Indemnitee and acknowledges that the Indemnitee is
relying upon this Agreement in agreeing to serve or continuing in such capacity.
(b) All expenses incurred by the Indemnitee in connection with
the preparation and submission of the Indemnitee's request for indemnification
hereunder shall be borne, jointly and severally, by the Indemnitors. In the
event the Indemnitee has requested payment of any amount under this Agreement or
under the D&O Insurance and has
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not received payment thereof within thirty (30) days of such request, the
Indemnitee may bring any action to enforce his rights or such collect moneys
due, and, if the Indemnitee is successful in such action, the Indemnitors shall
reimburse the Indemnitee for all of the Indemnitee's fees and expenses in
bringing and pursuing such action. If it is determined that the Indemnitee is
entitled to indemnification for part (but not all) of the indemnification so
requested, or is entitled to part (but not all) of the amounts claimed under the
D&O Insurance, such fees and expenses shall be reasonably prorated. The
Indemnitee shall be entitled to the advancement of such amounts to the full
extent contemplated by Section 4 hereof in connection with such Proceeding.
10. Contribution. If the indemnification provided for herein in
respect of any expense, liability or loss incurred by Indemnitee in connection
with any Proceeding is finally determined by a court of competent jurisdiction
to be prohibited by applicable law, then the Indemnitors, in lieu of
indemnifying Indemnitee, shall contribute to the amount paid or payable by
Indemnitee as a result of such expense, liability or loss in such proportion as
is appropriate to reflect (i) the relative benefits received by the Indemnitors
on the one hand and Indemnitee on the other hand from the events, circumstances,
conditions, happenings, actions or transactions from which such Proceeding
arose, (ii) the relative fault of the Indemnitors (including their affiliates)
on the one hand and of Indemnitee on the other hand in connection with the
events, circumstances and happenings which resulted in such expense, liability
or loss (such relative fault to be determined by reference to, among other
things, the parties relative intent, knowledge, access to information and
opportunity to correct or prevent the events, circumstances and/or happenings
resulting in such expense, liability or loss), and (iii) any other relevant
equitable considerations, it being agreed that it would not be just and
equitable if such contribution were determined by pro rata or other method of
allocation which does not take into account the foregoing equitable
considerations.
11. 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 by 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 shall be construed so as to give effect to the intent
of the parties that the Indemnitors (or any of them) provide protection to the
Indemnitee to the fullest extent enforceable.
12. Subrogation. In the event of payment under this Agreement,
the Indemnitors shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee, who shall execute all papers required and
shall do everything that may be necessary to secure such rights.
13. Miscellaneous. No provision of this Agreement may be
modified, waived or discharged unless such modification, waiver or discharge is
agreed to in a writing signed by the Indemnitee and an officer of each of the
Indemnitors designated by the Board of Directors of such Indemnitor. No waiver
by either party at any time of any breach 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 Nevada, without giving effect to the principles of
conflicts of laws thereof.
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14. 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 by hand against a receipt
therefor, received by facsimile, or five days after being mailed by United
States registered mail, return receipt requested, postage prepaid, as follows:
If to the Indemnitee:
Attn:
If to the Corporation: Xxxxx Xxxxxx N.V.
c/o De Brauw Blackstone Westbroek
Tripolis 300
Burgerweeshuispad 301
X.X. Xxx 00000
0000 XX Xxxxxxxxx
Xxx Xxxxxxxxxxx
Facsimile No.: 00-00-000-0000
Attn: Xxxxxx van Olffen
With a copy to: Xxxxxx, Xxxx & Xxxxxxxx
Jamboree Center
0 Xxxx Xxxxx
Xxxxxx, XX 00000-0000
Facsimile No.: 949-451-4220
Attn: Xxxx X. Xxxxxxxxx
If to Inc: Xxxxx Xxxxxx (USA) Inc.
00000 Xx Xxxxxxx
Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Facsimile No.: 000-000-0000
Attn: Xxxxx Xxxxxxxxx
With a copy to: Xxxxxx, Xxxx & Xxxxxxxx
Jamboree Center
0 Xxxx Xxxxx
Xxxxxx, XX 00000-0000
Facsimile No.: 949-451-4220
Attn: Xxxx X. Xxxxxxxxx
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.
15. 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.
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16. Effectiveness. This Agreement shall be effective as of the
day and year first above written, and shall apply to any Proceedings relating to
matters which occurred prior to such date.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to
be executed as of the day and year first above written.
XXXXX XXXXXX N.V.
By:
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Name:
Title:
XXXXX XXXXXX (USA) INC.
By:
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Name:
Title:
INDEMNITEE
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