Exhibit 10.30.1
Form of
INDEMNIFICATION AGREEMENT
This Indemnification Agreement is made as of the 6th day of December,
2005, by and between Safety Components International, Inc., a Delaware
corporation (the "Corporation"), and ___________________ (the "Indemnitee"), a
director of the Corporation.
RECITALS:
A. It is essential that the Corporation be able to retain and attract as
directors and officers the most capable persons available.
B. The substantial increase in corporate litigation and other
investigative, regulatory and enforcement actions subjects directors and
officers to expensive risks at the same time that the availability of directors'
and officers' liability insurance has been severely limited.
C. It is now and has always been the express policy of the Corporation to
indemnify its directors and officers.
D. The Indemnitee does not regard the protection available under the
respective certificates of incorporation and insurance of the Corporation as
adequate in the present circumstances, and may not be willing to serve or
continue to serve as a director and/or officer without adequate protection.
E. The Corporation desires the Indemnitee to serve, or continue to serve,
as a director and/or officer of the Corporation.
NOW, THEREFORE, the Corporation and the Indemnitee do hereby agree as
follows:
1. Agreement to Serve. The Indemnitee agrees to serve as a director of the
Corporation for so long as the Indemnitee is duly elected or appointed or until
such time as the Indemnitee tenders a resignation in writing.
2. Definitions. As used in this Agreement.
(a) The term "Proceeding" shall include any threatened, pending or
completed action, suit, audit, arbitration, alternative dispute resolution
proceeding, administrative hearing or other proceeding, whether brought by or in
the right of the Corporation or otherwise and whether of a civil, criminal,
administrative, investigative, regulatory or enforcement nature, including,
without limitation, actions involving the U.S. Securities and Exchange
Commission, state securities commissions, the U.S. Department of Justice, the
Federal Transportation Safety Board, the Internal Revenue Service and state and
local taxing authorities, and any appeal therefrom.
(b) The term "Corporate Status" shall mean the status of a person
who is or was a director, officer, partner, employee, agent or trustee of, or in
a similar capacity with, the Corporation, or is or was serving, or has agreed to
serve, at the request of the Corporation, as a
director, officer, partner, employee, agent or trustee of, or in a similar
capacity with, another corporation, partnership, joint venture, trust, limited
liability company or other enterprise.
(c) The term "Expenses" shall include, without limitation,
attorneys' fees, retainers, court costs, transcript costs, fees and expenses of
experts, travel expenses, duplicating costs, printing and binding costs,
telephone charges, postage, delivery service fees and other disbursements and
expenses reasonably incurred by or on behalf of the Indemnitee, 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 "other enterprise" shall include employee benefit
plans; references to "fines" shall include any excise tax assessed with respect
to any employee benefit plan; references to "serving at the request of the
Corporation" shall include any service as a director, officer, partner,
employee, agent or trustee of, or in a similar capacity with, the Corporation
which imposes duties on, or involves services by, such director, officer,
partner, employee, agent or trustee with respect to an employee benefit plan or
its participants or beneficiaries; and a person who acted in good faith and in a
manner such person reasonably believed to be in the interests of the
participants and beneficiaries of an employee benefit plan shall be deemed to
have acted in a manner "not opposed to the best interests of the Corporation" as
referred to in this Agreement.
3. Indemnification in Third-Party Proceedings. The Corporation shall
indemnify the Indemnitee in accordance with the provisions of this Section 3 if
the Indemnitee was or is a party to or is threatened to be made a party to or
otherwise involved in any Proceeding (other than a Proceeding by or in the right
of the Corporation to procure a judgment in its favor) by reason of the
Indemnitee's 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 actually and reasonably incurred
by or on behalf of the Indemnitee in connection with such Proceeding, if the
Indemnitee acted in good faith and in a manner which the Indemnitee reasonably
believed to be in, or not opposed to, the best interests of the Corporation and,
with respect to any criminal Proceeding, had no reasonable cause to believe that
his conduct was unlawful. The termination of any Proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Indemnitee did not act in
good faith and in a manner which the Indemnitee reasonably believed to be in, or
not opposed to, the best interests of the Corporation, and, with respect to any
criminal Proceeding, had reasonable cause to believe that his conduct was
unlawful.
4. Indemnification in Proceedings by or in the Right of the Corporation.
The Corporation shall indemnify the Indemnitee in accordance with the provisions
of this Section 4 if the Indemnitee was or is a party to or is threatened to be
made a party to or otherwise involved in any Proceeding by or in the right of
the Corporation to procure a judgment in its favor by reason of the Indemnitee's
Corporate Status or by reason of any action alleged to have been taken or
omitted in connection therewith, against all Expenses and, to the extent
permitted by law, amounts paid in settlement actually and reasonably incurred by
or on behalf of the Indemnitee in connection with such Proceeding, if the
Indemnitee acted in good faith and in a manner which the Indemnitee reasonably
believed to be in, or not opposed to, the best interests of the
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Corporation, except that no indemnification shall be made under this Section 4
in respect of any claim, issue, or matter as to which the Indemnitee shall have
been adjudged to be liable to the Corporation, unless, and only to the extent,
that the Court of Chancery of the State of Delaware or the court in which such
action or suit was brought shall determine upon application that, despite the
adjudication of such liability but in view of all the circumstances of the case,
the Indemnitee is fairly and reasonably entitled to indemnity for such Expenses
as the Court of Chancery or such other court shall deem proper.
5. Exceptions to Right of Indemnification. Notwithstanding anything to the
contrary in this Agreement: (a) except as set forth in Section 10, 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; (b) 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 for such indemnification payments from the proceeds of insurance, the
Indemnitee shall promptly refund such indemnification payments to the
Corporation to the extent of such insurance reimbursement; and (c) the
Corporation shall not indemnify the Indemnitee hereunder to the extent that such
indemnification is prohibited in the Corporation's certificate of incorporation.
6. Indemnification of Expenses of Successful Party. Notwithstanding any
other provision of this Agreement, to the extent that the Indemnitee has been
successful, on the merits or otherwise, in defense of any Proceeding or in
defense of any claim, issue or matter therein, the Indemnitee shall be
indemnified against all Expenses incurred by or on behalf of the Indemnitee in
connection therewith. Without limiting the foregoing, if any Proceeding or any
claim, issue or matter therein is disposed of, on the merits or otherwise
(including a disposition without prejudice), without (a) an adjudication that
the Indemnitee was liable to the Corporation, (b) a plea of guilty or nolo
contendere by the Indemnitee, (c) an adjudication that the Indemnitee did not
act in good faith and in a manner the Indemnitee reasonably believed to be in or
not opposed to the best interests of the Corporation and (d) with respect to any
criminal proceeding, an adjudication that the Indemnitee had reasonable cause to
believe his or her conduct was unlawful, the Indemnitee shall be considered for
the purposes hereof to have been wholly successful with respect thereto.
7. Notification and Defense of Claim. As a condition precedent to the
Indemnitee's right to be indemnified, the Indemnitee must notify the Corporation
in writing as soon as practicable of any Proceeding for which indemnification
will or could be sought; provided, however, that the failure to provide such
notice to the Corporation shall not relieve the Corporation of any liability
which it may have to the Indemnitee except to the extent the Corporation is
actually prejudiced by such failure. 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 the defense thereof at its own
expense, with legal counsel reasonably acceptable to the Indemnitee. 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
Proceeding, other than as provided below in this Section 7. The Indemnitee shall
have the right to employ his own counsel in connection with such Proceeding, but
the fees and expenses of such counsel
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incurred after notice from the Corporation of its assumption of the defense
thereof shall be at the expense of the Indemnitee unless (a) the employment of
counsel by the Indemnitee has been authorized by the Corporation, (b) counsel to
the Indemnitee shall have reasonably concluded 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 Proceeding or (c) the
Corporation shall not in fact have employed counsel to assume the defense of
such Proceeding, 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 (b)
above. The Corporation shall not be required to indemnify the Indemnitee under
this Agreement for any amounts paid in settlement of any Proceeding effected
without its written consent. The Corporation shall not settle any Proceeding in
any manner which would impose any penalty or limitation on the Indemnitee
without the Indemnitee's written consent. Neither the Corporation nor the
Indemnitee will unreasonably withhold or delay their consent to any proposed
settlement.
8. Advancement of Expenses. Subject to the provisions of Section 9 of this
Agreement, to the extent that the Corporation does not assume the defense
pursuant to Section 7 of this Agreement of any Proceeding of which the
Corporation receives notice under this Agreement or to the extent that the
Corporation is required to pay the expenses of the Indemnitee's own counsel
pursuant to Section 7, any Expenses incurred by or on behalf of the Indemnitee
in defending such Proceeding shall be paid by the Corporation in advance of the
final disposition of such Proceeding; provided, however, that the payment of
such Expenses incurred by or on behalf of the Indemnitee in advance of the final
disposition of such Proceeding 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.
9. Procedure for Indemnification and Advancement of Expenses.
(a) In order to obtain indemnification or advancement of Expenses
pursuant to Sections 3, 4, 6 or 8 of this Agreement, the Indemnitee shall submit
to the Corporation a written request, including in such request such
documentation and information as is reasonably available to the Indemnitee and
is reasonably necessary to determine whether and to what extent the Indemnitee
is entitled to indemnification or advancement of expenses.
(b) Any such indemnification shall be made promptly, and in any
event within 30 days after receipt by the Corporation of the written request of
the Indemnitee, unless with respect to requests for indemnification under
Section 3 or 4 the Corporation determines within such 30-day period that the
Indemnitee did not meet the applicable standard of conduct set forth in Section
3 or 4, as the case may be. Such determination, and any determination that
advanced Expenses must be repaid to the Corporation, shall be made in each
instance (i) by a majority vote of the directors of the Corporation consisting
of persons who are not at that time parties to the Proceeding ("disinterested
directors"), whether or not a quorum, (ii) by a majority vote of a committee of
disinterested directors designated by a majority vote of disinterested
directors,
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whether or not a quorum, (iii) if there are no disinterested directors, or if
the disinterested directors so direct, by independent legal counsel (who may, to
the extent permitted by applicable law, be regular legal counsel to the
Corporation) in a written opinion or (iv) by the stockholders of the
Corporation; provided, however, that following any Change in Control (as defined
below) the Indemnitee shall have the right, by notice to the Corporation, to
require that any such determination, and any determination that advanced
Expenses must be repaid to the Corporation, shall be made only by independent
legal counsel selected by the Indemnitee and approved by the Corporation (which
approval shall not be unreasonably withheld). Such counsel shall render its
written opinion to the Corporation and the Indemnitee as to whether and to what
extent the Indemnitee is permitted to be indemnified or have expenses advanced
hereunder and/or under applicable law and the Corporation agrees to abide by
such opinion. The Corporation agrees to pay the reasonable fees of the
independent legal counsel and to indemnify such counsel against any and all
expenses (including reasonable attorneys fees), claims, liabilities and damages
arising out of or relating to its engagement pursuant hereto.
For purposes of this Agreement, a "Change in Control" shall mean:
(w) the acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) (a "Person"), of beneficial
ownership of any capital stock of the Corporation if, after such
acquisition, such Person beneficially owns (within the meaning of Rule
13d-3 promulgated under the Exchange Act) 50% or more of either (i) the
then-outstanding shares of common stock of the Corporation (the "Common
Stock") or (ii) the combined voting power of the then-outstanding
securities of the Corporation entitled to vote generally in the election
of directors (the "Voting Securities"); provided, however, that the
following acquisitions shall not constitute a Change in Control: (i) any
acquisition of Common Stock or Voting Securities directly from the
Corporation (excluding an acquisition pursuant to the exercise, conversion
or exchange of any security exercisable for, convertible into or
exchangeable for common stock or voting securities of the Corporation,
unless the Person exercising, converting or exchanging such security
acquired such security directly from the Corporation or an underwriter or
agent of the Corporation), (ii) any acquisition by the Corporation or any
employee benefit plan (or related trust) sponsored or maintained by the
Corporation or any corporation controlled by the Corporation or (iii) any
acquisition by any corporation pursuant to a Merger Combination (as
defined below) that meets the Ownership Requirement (as defined below); or
(x) individuals who, as of the date hereof, constitute the members
of the Corporation's Board of Directors (the "Incumbent Directors") cease
for any reason to constitute at least a majority of the Corporation's
Board of Directors (or, if applicable, the Board of Directors of a
successor corporation to the Corporation); provided, however, that any
individual becoming a director of the Corporation subsequent to the date
hereof who was nominated or elected by at least a majority of the
Incumbent Directors at the time of such nomination or election or whose
election to the Corporation's Board of Directors was recommended or
endorsed by at least a majority of the directors who were the Incumbent
Directors at the time of such nomination or election shall be deemed to be
the Incumbent Directors (except that this proviso shall not apply to any
individual whose
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initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or
other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Corporation's Board of Directors); or
(y) the consummation of a merger, consolidation, reorganization,
recapitalization or share exchange involving the Corporation or a sale or
other disposition of all or substantially all of the assets of the
Corporation (a "Merger Combination"), unless immediately following such
Merger Combination, all or substantially all of the individuals and
entities who were the beneficial owners of Common Stock and Voting
Securities immediately prior to such Merger Combination beneficially own,
directly or indirectly, more than 50% of the shares of common stock and
the combined voting power of the securities entitled to vote generally in
the election of directors, respectively, of the resulting or acquiring
corporation in such Merger Combination (which shall include, without
limitation, a corporation which as a result of such transaction owns the
Corporation or substantially all of the Corporation's assets either
directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Merger
Combination (the "Ownership Requirement"); or
(z) approval by the stockholders of the Corporation of a complete
liquidation or dissolution of the Corporation.
(c) Any such advancement of Expenses shall be made promptly, and in
any event within 30 days after receipt by the Corporation of the written request
of the Indemnitee, unless within such 30-day period (i) the Corporation
determines that the Indemnitee did not meet the applicable standard of conduct
set forth in Section 3 or 4, as the case may be, or (ii) independent legal
counsel (who may, to the extent permitted by applicable law, be regular legal
counsel to the Corporation) determines that the advancement of Expenses would
violate applicable law.
10. 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. Unless otherwise required by law, the burden of
proving that indemnification or advancement of Expenses is not appropriate shall
be on the Corporation. The Indemnitee's expenses (of the type described in the
definition of "Expenses" in Section 2(c)) reasonably incurred in connection with
successfully establishing the Indemnitee's right to indemnification, in whole or
in part, in any such Proceeding shall also be indemnified by the Corporation.
11. Presumption of Entitlement. In making any standard of conduct
determination, the person or persons making such determination shall presume
that the Indemnitee has satisfied the applicable standard of conduct, and that
the Corporation may overcome such presumption only by its adducing clear and
convincing evidence to the contrary. Any standard of conduct determination that
is adverse to the Indemnitee may be challenged by the Indemnitee in the Court of
Chancery of the State of Delaware. No determination by the Corporation
(including by its directors or any independent counsel) that the Indemnitee has
not satisfied any applicable standard of conduct shall be a defense to any claim
by the Indemnitee for indemnification or
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reimbursement or advance payment of Expenses by the Corporation hereunder or
create a presumption that the Indemnitee has not met any applicable standard of
conduct.
12. Partial Indemnification. If the 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 or on behalf of the Indemnitee in
connection with any Proceeding but not, however, for the total amount thereof,
the Corporation shall nevertheless indemnify the Indemnitee for the portion of
such Expenses, judgments, fines, penalties or amounts paid in settlement to
which the Indemnitee is entitled.
13. 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 the Indemnitee, 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.
14. Term of Agreement. This Agreement shall continue in effect
indefinitely regardless of when or if the Indemnitee shall cease to serve as a
director or officer of the Corporation or, at the request of a Corporation, as a
director, officer, partner, employee, agent or trustee of, or in a similar
capacity with, another corporation, partnership, joint venture, trust, limited
liability company or other enterprise.
15. 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 the Indemnitee may be entitled under the
certificate of incorporation or by-laws of the Corporation, any other agreement,
any vote of stockholders or disinterested directors, the General Corporation Law
of Delaware, any other law (common or statutory), or otherwise, both as to
action in the Indemnitee's official capacity and as to action in another
capacity while holding office for the Corporation. Nothing contained in this
Agreement shall be deemed to prohibit the Corporation from purchasing and
maintaining insurance, at its expense, to protect itself or the Indemnitee
against any expense, liability or loss incurred by it or the Indemnitee in any
such capacity, or arising out of the Indemnitee's status as such, whether or not
the Indemnitee would be indemnified against such expense, liability or loss
under this Agreement; provided that the Corporation shall not be liable under
this Agreement to make any payment of amounts otherwise indemnifiable hereunder
if and to the extent that the Indemnitee has otherwise actually received such
payment under any insurance policy, contract, agreement or otherwise.
16. No Special Rights. Nothing herein shall confer upon the Indemnitee any
right to continue to serve as a 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 the 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
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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 be deemed an original and all of it shall
together constitute one and the same instrument.
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 the
Indemnitee.
20. Headings. The headings of the paragraphs or sections 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. This Agreement may be amended from time to
time to reflect changes in Delaware law or for other reasons. No supplement,
modification or amendment of this Agreement shall be binding unless executed in
writing by each 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 (a) when
delivered by hand, (b) if mailed by certified or registered mail with postage
prepaid (return receipt requested), on the third day after the date on which it
is so mailed, (c) one business day after delivery to a nationally recognized
overnight courier service for next day delivery or (d) the date when sent by
facsimile (with confirmation of receipt):
(a) if to the Indemnitee, to:
______________________________
______________________________
______________________________
______________________________
(b) if to the Corporation, to:
Safety Components International, Inc.
00 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile: 864) 240-2728
or to such other address or facsimile number as may have been furnished to the
Indemnitee by the Corporation or to the Corporation by the Indemnitee, as the
case may be.
23. Applicable Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware. The Indemnitee
may elect to have the right to indemnification or reimbursement or advancement
of Expenses interpreted on
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the basis of the applicable law in effect at the time of the occurrence of the
event or events giving rise to the applicable Proceeding, to the extent
permitted by law, or on the basis of the applicable law in effect at the time
such indemnification or reimbursement or advancement of Expenses is sought. Such
election shall be made, by a notice in writing to the Corporation, at the time
indemnification or reimbursement or advancement of Expenses is sought; provided,
however, that if no such notice is given, and if the General Corporation Law of
Delaware is amended, or other Delaware law is enacted, to permit further
indemnification of the directors and officers, then the Indemnitee shall be
indemnified to the fullest extent permitted under the General Corporation Law of
Delaware, as so amended, or by such other Delaware law, as so enacted.
24. Enforcement. The Corporation expressly confirms and agrees that it has
entered into this Agreement in order to induce the Indemnitee to continue to
serve as a director of the Corporation and acknowledges that the Indemnitee is
relying upon this Agreement in continuing in such capacity.
25. Entire Agreement. This Agreement sets forth the entire agreement of
the parties hereto in respect of the subject matter contained herein and
supercedes all prior agreements, whether oral or written, by any officer,
employee or representative of any party hereto in respect of the subject matter
contained herein; and any prior agreement of the parties hereto in respect of
the subject matter contained herein is hereby terminated and cancelled. For
avoidance of doubt, the parties confirm that the foregoing does not apply to or
limit the Indemnitee's rights under Delaware law or the certificate of
incorporation or by-laws of the Corporation.
26. Consent to Suit. In the case of any dispute under or in connection
with this Agreement, the Indemnitee may only bring suit against the Corporation
in the Court of Chancery of the State of Delaware. The Indemnitee hereby
consents to the exclusive jurisdiction and venue of the courts of the State of
Delaware, and the Indemnitee hereby waives any claim the Indemnitee may have at
any time as to forum non conveniens with respect to such venue. The Corporation
shall have the right to institute any legal action arising out of or relating to
this Agreement in any court of competent jurisdiction. Any judgment entered
against either of the parties in any proceeding hereunder may be entered and
enforced by any court of competent jurisdiction.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
SAFETY COMPONENTS INTERNATIONAL, INC.
By: __________________________________
Name: ________________________________
INDEMNITEE:
______________________________________
[name]
