CLAYTON WILLIAMS ENERGY, INC. INDEMNIFICATION AGREEMENT
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ENERGY, INC.
This
Indemnification Agreement (“Agreement”) is made and entered into as of the _____
day of ___________________, 2008, by and between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Energy, Inc.,
a Delaware corporation (the “Company”), and [NAME]
(“Indemnitee”).
RECITALS
A. Competent
and experienced persons are reluctant to serve or continue to serve corporations
as directors, executive officers or in other capacities unless they are provided
with adequate protection through insurance and indemnification against claims
and actions against them arising out of their service to and activities on
behalf of those corporations.
B. The
Board of Directors of the Company (the “Board”) has determined that the
inability to attract and retain such persons would be detrimental to the best
interests of the Company and its stockholders and that the Company should act to
assure such persons that there will be increased certainty of adequate
protection in the future.
C. The
Board has also determined that it is reasonable, prudent and necessary for the
Company, in addition to purchasing and maintaining directors’ and officers’
liability insurance (or otherwise providing for adequate arrangements of
self-insurance), contractually to obligate itself to indemnify its directors and
executive officers to the fullest extent permitted by applicable law so that
they will serve or continue to serve the Company free from undue concern that
they will not be adequately protected.
D. Indemnitee
is willing to serve and continue to serve the Company on the condition that
Indemnitee be so indemnified to the fullest extent permitted by
law.
E. Article IX
of the Second Restated Certificate of Incorporation of the Company (as amended)
provides for indemnification of directors and officers to the fullest extent
permitted by law.
In
consideration of the foregoing and the mutual covenants contained in this
Agreement, and other good and valuable consideration, the sufficiency and
receipt of which are hereby acknowledged, the parties hereby agree as
follows:
ARTICLE
I
Certain
Definitions
As used
herein, the following words and terms shall have the following respective
meanings (whether singular or plural):
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“Acquiring
Person” means any Person other than (i) the Company, (ii) any of the Company’s
Subsidiaries, (iii) any employee benefit plan of the Company or of a Subsidiary
of the Company or of a Company owned directly or indirectly by the stockholders
of the Company in substantially the same proportions as their ownership of stock
of the Company, or (iv) any trustee or other fiduciary holding securities under
an employee benefit plan of the Company or of a Subsidiary of the Company or of
a Company owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the
Company.
“Affiliate”
of any specified Person means any other Person, directly or indirectly,
controlling or controlled by or under direct or indirect common control with
such specified Person. For purposes of this definition, “control”
when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
“controlling” and “controlled” have meanings correlative to the
foregoing.
“Capital
Stock” of any Person means any and all shares, interests, rights to purchase,
warrants, options, participation or other equivalents of or interests in
(however designated) equity of such Person, including any Preferred Stock, but
excluding any debt securities convertible into such equity.
“Change
in Control” means the occurrence of any of the following events:
(i) (A) Any
Person, other than one or more Permitted Holders, is or becomes the beneficial
owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that
such Person shall be deemed to have “beneficial ownership” of all shares that
any such Person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of more
than 35% of the total voting power of the Voting Stock of the Company (or its
successor by merger, consolidation or purchase of all or substantially all of
its assets) (for the purposes of this clause, such Person shall be deemed to
beneficially own any Voting Stock of the Company held by a parent entity, if
such Person “beneficially owns” (as defined above), directly or indirectly, more
than 35% of the voting power of the Voting Stock of such parent entity); and
(B) the Permitted Holders “beneficially own” (as defined in Rules
13d-3 and 13d-5 of the Exchange Act), directly or indirectly, in the aggregate
less than 25% of the total voting power of the Voting Stock of the Company (or
its successor by merger, consolidation or purchase of all or substantially all
of its assets) or its parent entity and do not have the right or ability by
voting power, contract or otherwise to elect or designate for election a
majority of the board of directors of the Company (or such successor) or its
parent entity; or
(ii) The
members of the Incumbent Board cease for any reason to constitute at least a
majority of the Board;
(iii) The
sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Subsidiaries taken as a
whole to any Person other than a Permitted Holder; or
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(iv) Approval
by the stockholders of the Company of a complete liquidation or dissolution of
the Company.
“Claim”
means an actual or threatened claim or request for relief which was, is or may
be made by reason of anything done or not done by Indemnitee in, or by reason of
any event or occurrence related to, Indemnitee’s Corporate Status.
“Corporate
Status” means the status of a person who is, becomes or was a director, officer,
employee, agent or fiduciary of the Company or is, becomes or was serving at the
request of the Company as a director, officer, partner, member, venturer,
proprietor, trustee, employee, agent, fiduciary or similar functionary of
another foreign or domestic corporation, partnership, limited liability company,
joint venture, sole proprietorship, trust, employee benefit plan or other
enterprise. For purposes of this Agreement, the Company agrees that
Indemnitee’s service on behalf of or with respect to any Subsidiary of the
Company shall be deemed to be at the request of the Company.
“DGCL”
means the Delaware General Corporation Law and any successor statute thereto, as
either of them may from time to time be amended.
“Disinterested
Director” with respect to any request by Indemnitee for indemnification
hereunder, means a director of the Company who at the time of the vote is not a
named defendant or respondent in the Proceeding in respect of which
indemnification is sought by Indemnitee.
“Exchange
Act” means the Securities Exchange Act of 1934.
“Expenses”
means all attorneys’ fees and disbursements, retainers, accountant’s fees and
disbursements, private investigator fees and disbursements, court costs,
transcript costs, fees and expenses of experts, witness fees and expenses,
travel expenses, duplicating costs, printing and binding costs, telephone
charges, postage, delivery service fees and all other disbursements, costs or
expenses of the types customarily incurred in connection with prosecuting,
defending (including affirmative defenses and counterclaims), preparing to
prosecute or defend, investigating, being or preparing to be a witness in, or
participating in or preparing to participate in (including on appeal) a
Proceeding and all interest or finance charges attributable to any
thereof. Should any payments by the Company under this Agreement be
determined to be subject to any federal, state or local income or excise tax,
“Expenses” shall also include such amounts as are necessary to place Indemnitee
in the same after-tax position (after giving effect to all applicable taxes) as
Indemnitee would have been in had no such tax been determined to apply to such
payments.
“Incumbent
Board” means the individuals who, as of the date of this Agreement, constitute
the Board and any other individual who becomes a director of the Company after
that date and whose election or appointment by the Board or nomination for
election by the Company’s stockholders was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board, but excluding,
for this purpose, any such individual whose initial assumption of office occurs
as a result of an actual or threatened election contest with
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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
Incumbent Board.
“Independent
Counsel” means a law firm, or a member of a law firm, that is experienced in
matters of corporation law and neither contemporaneously is, nor in the
immediately preceding five years has been, retained to represent: (i)
the Company or Indemnitee in any matter material to either such party (other
than as Independent Counsel under this Agreement or similar agreements), (ii)
any other party to the Proceeding giving rise to a claim for indemnification
hereunder or (iii) the beneficial owner, directly or indirectly, of securities
of the Company representing 5% or more of the combined voting power of the
Company’s then outstanding voting securities (other than, in each such case,
with respect to matters concerning the rights of Indemnitee under this
Agreement, or of other indemnitees under similar indemnification
agreements). 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 Indemnitee in an action to determine
Indemnitee’s rights under this Agreement.
“Independent
Directors” means the directors on the Board that are independent directors as
defined in Rule 4200(a)(15) of the NASDAQ Stock Market or successor provision,
or, if the Company’s common stock is not then quoted on the NASDAQ, that qualify
as independent, disinterested, or a similar term as defined in the rules of the
principal securities exchange or inter-dealer quotation system on which the
Company’s common stock is then listed or quoted.
“Permitted
Holders” means ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇. and any Affiliate or Related Person
thereof.
“Person”
means any individual, group (within the meaning of Sections 13(d)(3) and
14(d)(2) of the Exchange Act) or corporation, partnership, joint venture,
association, join-stock company, trust, unincorporated organization, limited
liability company, government or any agency or political subdivision thereof,
other entity.
“Potential
Change in Control” shall be deemed to have occurred if (i) any Person shall have
announced publicly an intention to effect a Change in Control, or commenced any
action (such as the commencement of a tender offer for the Company’s Common
Stock or the solicitation of proxies for the election of any of the Company’s
directors) that, if successful, could reasonably be expected to result in the
occurrence of a Change in Control; (ii) the Company enters into an agreement,
the consummation of which would constitute a Change in Control; or (iii) any
other event occurs which the Board declares to be a Potential Change of
Control.
“Preferred
Stock”, as applied to the Capital Stock of any corporation, means Capital Stock
of any class or classes (however designated) which is preferred as to the
payment of dividends, or as to the distribution of assets upon any voluntary or
involuntary liquidation or dissolution of such corporation, over shares of
Capital Stock of any other class of such corporation.
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“Proceeding”
means any threatened, pending or completed action, suit, arbitration,
investigation, inquiry, alternate dispute resolution mechanism, administrative
or legislative hearing, or any other proceeding (including, without limitation,
any securities laws action, suit, arbitration, alternative dispute resolution
mechanism, hearing or procedure) whether civil, criminal, administrative,
arbitrative or investigative and whether or not based upon events occurring, or
actions taken, before the date hereof, and any appeal in or related to any such
action, suit, arbitration, investigation, hearing or proceeding and any inquiry
or investigation (including discovery), whether conducted by or in the right of
the Company or any other Person, that Indemnitee in good faith believes could
lead to any such action, suit, arbitration, alternative dispute resolution
mechanism, hearing or other proceeding or appeal thereof.
“Related
Person” with respect to any Permitted Holder means:
(i) any
controlling stockholder or a majority (or more) owned Subsidiary of such
Permitted Holder, or, in the case of an individual, any spouse, family member,
(including adopted children), heir or descendant of such Permitted Holder, any
trust created for the benefit of such individual or such individual’s estate,
executor, administrator, committee or beneficiaries; or
(ii) any
trust, corporation, partnership or other entity, the beneficiaries,
stockholders, partners, owners or Persons beneficially holding a majority (or
more) controlling interest of which consist of such Permitted Holder and/or such
other Persons referred to in clause (i) of this definition.
“Subsidiary”
means, with respect to any Person, any corporation or other entity of which a
majority of the voting power of the voting equity securities or equity interest
is owned, directly or indirectly, by that Person.
“Voting
Stock” of a corporation means all classes of Capital Stock of such corporation
then outstanding and normally entitled to vote in the election of
directors.
ARTICLE
II
Services
by Indemnitee
Indemnitee
is serving as a director of the Company. Indemnitee may from time to
time also agree to serve, as the Company may request from time to time, in
another capacity for the Company or as a director, officer, partner, member,
venturer, proprietor, trustee, employee, agent, fiduciary or similar functionary
of another foreign or domestic corporation, partnership, joint venture, limited
liability company, sole proprietorship, trust, employee benefit plan or other
enterprise. Indemnitee and the Company each acknowledge that they
have entered into this Agreement as a means of inducing Indemnitee to serve, or
continue to serve, the Company in such capacities. Indemnitee may at
any time and for any reason resign from such position or positions (subject to
any other contractual obligation or any obligation imposed by operation of
law). The Company shall have no obligation under this Agreement to
continue Indemnitee in any such position or positions.
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ARTICLE
III
Indemnification
Section
3.1 General. Subject
to the provisions set forth in Article IV, the Company shall indemnify, and
advance Expenses to, Indemnitee to the fullest extent permitted by applicable
law in effect on the date hereof and to such greater extent as applicable law
may hereafter from time to time permit. The other provisions set
forth in this Agreement are provided in addition to and as a means of
furtherance and implementation of, and not in limitation of, the obligations
expressed in this Article III. No requirement, condition to or
limitation of any right to indemnification or to advancement of Expenses under
this Article III shall in any way limit the rights of Indemnitee under Article
VI or Article VII.
Section
3.2 Additional Indemnity of the
Company. Indemnitee shall be entitled to indemnification
pursuant to this Section 3.2 if, by reason of
anything done or not done by Indemnitee in, or by reason of any event or
occurrence related to, Indemnitee’s Corporate Status, Indemnitee is, was or
becomes, or is threatened to be made, a party to, or witness or other
participant in any Proceeding. Pursuant to this Section 3.2, Indemnitee shall be indemnified against
any and all Expenses, judgments, penalties (including excise or similar taxes),
fines and amounts paid in settlement (including all interest, assessments and
other charges paid or payable in connection with or in respect of any such
Expenses, judgments, penalties, fines and amounts paid in settlement) actually
and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection
with such Proceeding or any Claim, issue or matter
therein. Notwithstanding the foregoing, the obligations of the
Company under this Section 3.2 shall be subject to
the condition that no determination (which, in any case in which Independent
Counsel is involved, shall be in a form of a written opinion) shall have been
made pursuant to Article IV that Indemnitee would not be permitted to be
indemnified under applicable law. Nothing in this Section 3.2 shall limit the benefits of Section 3.1, Section 3.3
or any other Section hereunder.
Section
3.3 Advancement of
Expenses. The Company shall pay all Expenses reasonably
incurred by, or in the case of retainers, to be incurred by, or on behalf of
Indemnitee (or, if applicable, reimburse Indemnitee for any and all Expenses
reasonably incurred by Indemnitee and previously paid by Indemnitee) in
connection with any Claim or Proceeding, whether brought by the Company or
otherwise, until it shall ultimately be determined (in a final adjudication by a
court from which there is no further right of appeal or in a final adjudication
of an arbitration pursuant to Section 5.1 if
Indemnitee elects to seek such arbitration) that Indemnitee is not entitled to
be indemnified by the Company against such Expenses) within 10 days after the
receipt by the Company of (a) a written request from Indemnitee
requesting such payment or payments from time to time, whether prior to or after
final disposition of such Proceeding, and (b) a written affirmation from
Indemnitee of Indemnitee’s good faith belief that Indemnitee has met the
standard of conduct necessary for Indemnitee to be permitted to be indemnified
under applicable law. Any such payment by the Company is referred to
in this Agreement as an “Expense Advance.” In connection with any
request for an Expense Advance, if requested by the Company, Indemnitee or
Indemnitee’s counsel shall also submit an affidavit stating that the Expenses
incurred were, or in the case of retainers to be incurred are, reasonably
incurred. Any dispute as to the reasonableness of the incurrence of
any Expense shall not delay an Expense Advance by the Company, and the Company
agrees that any such dispute shall be
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resolved
only upon the disposition or conclusion of the underlying Claim against
Indemnitee. Indemnitee hereby undertakes and agrees that Indemnitee
will reimburse and repay the Company without interest for any Expense Advances
to the extent that it shall ultimately be determined (in a final adjudication by
a court from which there is no further right of appeal or in a final
adjudication of an arbitration pursuant to Section
5.1 if Indemnitee elects to seek such arbitration) that Indemnitee is not
entitled to be indemnified by the Company against such
Expenses. Indemnitee shall not be required to provide collateral or
otherwise secure the undertaking and agreement described in the prior
sentence.
Section
3.4 Indemnification for
Additional Expenses. The Company shall indemnify Indemnitee
against any and all costs and expenses (of the types described in the definition
of Expenses in Article I) and, if requested by Indemnitee, shall (within two
business days of that request) advance those costs and expenses to Indemnitee,
that are incurred by Indemnitee in connection with any claim asserted against,
or action brought by, Indemnitee for (i) indemnification or an Expense Advance
by the Company under this Agreement or any other agreement or provision of the
Company’s Certificate of Incorporation or Bylaws now or hereafter in effect
relating to any Claim or Proceeding, (ii) recovery under any directors’ and
officers’ liability insurance policies maintained by the Company, or (iii)
enforcement of, or claims for breaches of, any provision of this Agreement, in
each of the foregoing situations regardless of whether Indemnitee ultimately is
determined to be entitled to that indemnification, advance expense payment,
insurance recovery, enforcement, or damage claim, as the case may be and
regardless of whether the nature of the proceeding with respect to such matters
is judicial, by arbitration, or otherwise.
Section
3.5 Partial
Indemnity. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of the
Expenses, judgments, fines, penalties, and amounts paid in settlement of a Claim
or Proceeding but not, however, for all of the total amount thereof, the Company
shall nevertheless indemnify Indemnitee for the portion thereof to which
Indemnitee is entitled. Moreover, notwithstanding any other provision
of this Agreement, to the extent that Indemnitee has been successful on the
merits or otherwise in defense of any or all Claims or Proceedings, or in
defense of any issue or matter therein, including dismissal without prejudice,
Indemnitee shall be indemnified against all Expenses incurred in connection
therewith.
ARTICLE
IV
Procedure
for Determination of Entitlement
to
Indemnification
Section
4.1 Request by
Indemnitee. To obtain indemnification under this Agreement,
Indemnitee shall submit to the Company a written request, including therein or
therewith such documentation and information as is reasonably available to
Indemnitee and is reasonably necessary to determine whether and to what extent
Indemnitee is entitled to indemnification. The Secretary or an
Assistant Secretary of the Company shall, promptly upon receipt of such a
request for indemnification, advise the Board in writing that Indemnitee has
requested indemnification.
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Section
4.2 Determination of
Request. Upon written request by Indemnitee for
indemnification pursuant to the first sentence of Section 4.1 hereof, a determination, if required by
applicable law, with respect to whether Indemnitee is permitted under applicable
law to be indemnified shall be made in accordance with the terms of Section 4.4, in the specific case as
follows:
(a) If a
Potential Change in Control or a Change in Control shall have occurred, by
Independent Counsel (selected in accordance with Section 4.3) in a written opinion to the Board and
Indemnitee, unless Indemnitee shall request that such determination be made by
the Board, or a committee of the Board, in which case by the person or persons
or in the manner provided for in clause (i) or (ii) of paragraph (b) below;
or
(b) If a
Potential Change in Control or a Change in Control shall not have occurred, (i)
by the Board by a majority vote of the Disinterested Directors even though less
than a quorum of the Board, or (ii) by a majority vote of a committee solely of
two or more Disinterested Directors designated to act in the matter by a
majority vote of all Disinterested Directors even though less than a quorum of
the Board, or (iii) by Independent Counsel selected by the Board or a committee
of the Board by a vote as set forth in clauses (i) or (ii) of this paragraph
(b), or if such vote is not obtainable or such a committee cannot be
established, by a majority vote of all directors, or (iv) if Indemnitee and the
Company agree, by the stockholders of the Company in a vote that excludes the
shares held by directors who are not Disinterested Directors.
If it is
so determined that Indemnitee is permitted to be indemnified under applicable
law, payment to Indemnitee shall be made within 10 days after such
determination. Nothing contained in this Agreement shall require that
any determination be made under this Section 4.2
prior to the disposition or conclusion of a Claim or Proceeding against
Indemnitee; provided, however, that Expense Advances shall continue to be made
by the Company pursuant to, and to the extent required by, the provisions of
Article III. Indemnitee shall cooperate with the person or persons
making such determination with respect to Indemnitee’s entitlement to
indemnification, including providing to such person upon reasonable advance
request any documentation or information that is not privileged or otherwise
protected from disclosure and that is reasonably available to Indemnitee and
reasonably necessary to such determination. Any costs or expenses
(including attorneys’ fees and disbursements) incurred by Indemnitee in so
cooperating with the person or persons making such determination shall be borne
by the Company (irrespective of the determination as to Indemnitee’s entitlement
to indemnification), and the Company shall indemnify and hold harmless
Indemnitee therefrom.
Section
4.3 Independent
Counsel. If a Potential Change in Control or a Change in
Control shall not have occurred and the determination of entitlement to
indemnification is to be made by Independent Counsel, the Independent Counsel
shall be selected by (a) a majority vote of the Disinterested Directors, even
though less than a quorum of the Board or (b) if there are no Disinterested
Directors, by a majority vote of all directors, and the Company shall give
written notice to Indemnitee, within 10 days after receipt by the Company of
Indemnitee’s request for indemnification, specifying the identity and address of
the Independent Counsel so selected. If a Potential Change in Control
or a Change in Control shall have occurred and the determination of
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entitlement
to indemnification is to be made by Independent Counsel, the Independent Counsel
shall be selected by Indemnitee, and Indemnitee shall give written notice to the
Company, within 10 days after submission of Indemnitee’s request for
indemnification, specifying the identity and address of the Independent Counsel
so selected (unless Indemnitee shall request that such selection be made by the
Disinterested Directors or a committee of the Board, in which event the Company
shall give written notice to Indemnitee within 10 days after receipt of
Indemnitee’s request for the Board or a committee of the Disinterested Directors
to make such selection, specifying the identity and address of the Independent
Counsel so selected). In either event, (i) such notice to Indemnitee
or the Company, as the case may be, shall be accompanied by a written
affirmation of the Independent Counsel so selected that it satisfies the
requirements of the definition of “Independent Counsel” in Article I and that it
agrees to serve in such capacity and (ii) Indemnitee or the Company, as the case
may be, may, within seven days after such written notice of selection shall have
been given, deliver to the Company or to Indemnitee, as the case may be, a
written objection to such selection. Any objection to the selection
of Independent Counsel pursuant to this Section 4.3
may be asserted only on the ground that the Independent Counsel so selected does
not meet the requirements of the definition of “Independent Counsel” in Article
I, and the objection shall set forth with particularity the factual basis of
such assertion. If such written objection is timely made, the
Independent Counsel so selected may not serve as Independent Counsel unless and
until a court of competent jurisdiction (the “Court”) has determined that such
objection is without merit. In the event of a timely written
objection to a choice of Independent Counsel, the party originally selecting the
Independent Counsel shall have seven days to make an alternate selection of
Independent Counsel and to give written notice of such selection to the other
party, after which time such other party shall have five days to make a written
objection to such alternate selection. If, within 30 days after
submission of Indemnitee’s request for indemnification pursuant to Section 4.1, no Independent Counsel shall have been
selected and not objected to, either the Company or Indemnitee may petition the
Court for resolution of any objection that shall have been made by the Company
or Indemnitee to the other’s selection of Independent Counsel and/or for the
appointment as Independent Counsel of a person selected by the Court or by such
other person as the Court shall designate, and the person with respect to whom
an objection is so resolved or the person so appointed shall act as Independent
Counsel under Section 4.2. The Company
shall pay any and all fees and expenses reasonably incurred by such Independent
Counsel in connection with acting pursuant to Section
4.2, and the Company shall pay all fees and expenses reasonably incurred
incident to the procedures of this Section 4.3,
regardless of the manner in which such Independent Counsel was selected or
appointed. Upon the due commencement of any judicial proceeding or
arbitration pursuant to Section 5.1, Independent
Counsel shall be discharged and relieved of any further responsibility in such
capacity (subject to the applicable standards of professional conduct then
prevailing).
Section
4.4 Presumptions and Effect of
Certain Proceedings.
(a) Indemnitee
shall be presumed to be entitled to indemnification under this Agreement upon
submission of a request for indemnification under Section 4.1, and the Company shall have the burden of
proof in overcoming that presumption in reaching a determination contrary to
that presumption. Such presumption shall be used by Independent
Counsel (or other person or persons determining entitlement to indemnification)
as a basis for a determination of entitlement to indemnification unless
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(b) If the
person or persons empowered or selected under Article IV of this Agreement to
determine whether Indemnitee is entitled to indemnification shall not have made
a determination within 60 days after receipt by the Company of the request by
Indemnitee therefor, the determination of entitlement to indemnification shall
be deemed to have been made and Indemnitee shall be entitled to such
indemnification; provided, however, that such 60-day period may be extended
until the disposition or conclusion of a Claim or Proceeding against Indemnitee,
and may be further extended for a reasonable time, not to exceed an additional
30 days, if the person making the determination with respect to entitlement to
indemnification in good faith requires such additional time for the obtaining or
evaluating of documentation and/or information relating to such determination;
and provided, further, that the 60-day limitation set forth in this Section 4.4(b) shall not apply and such period shall
be extended as necessary (i) if within 30 days after receipt by the Company of
the request for indemnification under Section 4.1
Indemnitee and the Company have agreed, and the Board has resolved to submit
such determination to the stockholders of the Company pursuant to Section 4.2(b) for their consideration at an annual
meeting of stockholders to be held within 90 days after such agreement and such
determination is made thereat, or a special meeting of stockholders is called
within 30 days after such receipt for the purpose of making such determination,
such meeting is held for such purpose within 60 days after having been so called
and such determination is made thereat, or (ii) if the determination of
entitlement to indemnification is to be made by Independent Counsel pursuant to
Section 4.2(a) of this Agreement, in which case the
applicable period shall be as set forth in Section 5.1(c).
(c) The
termination of any Proceeding or of any Claim, issue or matter by judgment,
order, settlement (whether with or without court approval) or conviction, or
upon a plea of nolo contendere or its equivalent, shall not (except as otherwise
expressly provided in this Agreement) by itself adversely affect the rights of
Indemnitee to indemnification or create a presumption that Indemnitee failed to
meet any particular standard of conduct, that Indemnitee had any particular
belief, or that a court has determined that indemnification is not permitted by
applicable law. Indemnitee shall be deemed to have been found liable
in respect of any Claim, issue or matter only after Indemnitee shall have been
so adjudged by the Court after exhaustion of all appeals therefrom.
ARTICLE
V
Certain
Remedies of Indemnitee
Section
5.1 Indemnitee Entitled to
Adjudication in an Appropriate Court. If (a) a determination is made
pursuant to Article IV that Indemnitee is not entitled to indemnification under
this Agreement; (b) there has been any failure by the Company to make timely
payment or advancement of any amounts due hereunder (including, without
limitation, any Expense
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Advances);
or (c) the determination of entitlement to indemnification is to be made by
Independent Counsel pursuant to Section 4.2 and
such determination shall not have been made and delivered in a written opinion
within 90 days after the latest of (i) such Independent Counsel’s being
appointed, (ii) the overruling by the Court of objections to such counsel’s
selection, or (iii) expiration of all periods for the Company or Indemnitee to
object to such counsel’s selection, Indemnitee shall be entitled to commence an
action seeking an adjudication in the Court of Indemnitee’s entitlement to such
indemnification or advancements due hereunder, including, without limitation,
Expense Advances. Alternatively, Indemnitee, at Indemnitee’s option,
may seek an award in arbitration to be conducted by a single arbitrator pursuant
to the commercial arbitration rules of the American Arbitration
Association. Indemnitee shall commence such action seeking an
adjudication or an award in arbitration within 180 days following the date on
which Indemnitee first has the right to commence such action pursuant to this Section 5.1, or such right shall
expire. The Company agrees not to oppose Indemnitee’s right to seek
any such adjudication or award in arbitration and it shall continue to pay
Expense Advances pursuant to Section 3.3 until it
shall ultimately be determined (in a final adjudication by a court from which
there is no further right of appeal or in a final adjudication of an arbitration
pursuant to this Section 5.1 if Indemnitee elects
to seek such arbitration) that Indemnitee is not entitled to be indemnified by
the Company against such Expenses.
Section
5.2 Adverse Determination Not to
Affect any Judicial Proceeding. If a determination shall have
been made pursuant to Article IV that Indemnitee is not entitled to
indemnification under this Agreement, any judicial proceeding or arbitration
commenced pursuant to this Agreement shall be conducted in all respects as a de
novo trial or arbitration on the merits, and Indemnitee shall not be prejudiced
by reason of such initial adverse determination. In any judicial
proceeding or arbitration commenced pursuant to this Agreement, Indemnitee shall
be presumed to be entitled to indemnification or advancement of Expenses, as the
case may be, under this Agreement and the Company shall have the burden of proof
in overcoming such presumption and to show by clear and convincing evidence that
Indemnitee is not entitled to indemnification or advancement of Expenses, as the
case may be.
Section
5.3 Company Bound by
Determination Favorable to Indemnitee in any Judicial Proceeding or
Arbitration. If a determination shall have been made or deemed
to have been made pursuant to Article IV that Indemnitee is entitled to
indemnification, the Company shall be irrevocably bound by such determination in
any judicial proceeding or arbitration commenced pursuant to this Article V, 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.
Section
5.4 Company Bound by the
Agreement. The Company shall be precluded from asserting in
any judicial proceeding or arbitration commenced pursuant to this Article V that
the procedures and presumptions of this Agreement are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator
that the Company is bound by all the provisions of this Agreement.
Section
5.5 Assumption of Defense by
Company. In the event the Company shall be requested by
Indemnitee to pay the Expenses of any Proceeding, the Company, if appropriate,
shall be entitled to assume the defense of such Proceeding, or to participate to
the extent
11
permissible
in such Proceeding, with counsel reasonably acceptable to
Indemnitee. Upon assumption of the defense by the Company and the
retention of such counsel by the Company, the Company shall not be liable to
Indemnitee under this Agreement for any fees of counsel subsequently incurred by
Indemnitee with respect to the same Proceeding, provided that Indemnitee shall
have the right to employ separate counsel in such Proceeding at Indemnitee’s
sole cost and expense. Notwithstanding the foregoing, if Indemnitee’s
counsel delivers a written notice to the Company stating that such counsel has
reasonably concluded that there may be a conflict of interest between the
Company and Indemnitee in the conduct of any such defense or the Company shall
not, in fact, have employed counsel or otherwise actively pursued the defense of
such Proceeding within a reasonable time, then in any such event the fees and
expenses of Indemnitee’s counsel to defend such Proceeding shall be subject to
the indemnification and advancement of expenses provisions of this
Agreement.
ARTICLE
VI
Contribution
Section
6.1 Contribution
Payment. To the extent the indemnification provided for under
any provision of this Agreement is determined (in the manner provided above) not
to be permitted under applicable law, then in the event Indemnitee was, is, or
becomes a party to or witness or other participant in, or is threatened to be
made a party to or witness or other participant in, a Proceeding by reason of
(or arising in part out of) Indemnitee’s Corporate Status, the Company, in lieu
of indemnifying Indemnitee, shall contribute to the amount of any and all
Expenses, judgments, fines, or penalties assessed against or incurred or paid by
Indemnitee on account of such Proceeding and any and all amounts paid in
settlement of that Proceeding (including all interest, assessments, and other
charges paid or payable in connection with or in respect of such Expenses,
judgments, fines, penalties, or amounts paid in settlement) for which such
indemnification is not permitted (“Contribution Amounts”), in such proportion as
is appropriate to reflect the relative fault with respect to the subject matter
of the Proceeding giving rise to the Contribution Amounts of Indemnitee, on the
one hand, and of the Company and any and all other parties (including officers
and directors of the Company other than Indemnitee) who may be at fault with
respect to such matter (collectively, including the Company, the “Third
Parties”) on the other hand.
Section
6.2 Relative
Fault. The relative fault of the Third Parties and Indemnitee
shall be determined (i) by reference to the relative fault of Indemnitee as
determined by the court or other governmental agency assessing the Contribution
Amounts or (ii) to the extent such court or other governmental agency does not
apportion relative fault, by the Independent Counsel (or such other party which
makes a determination under Article IV) after giving effect to, among other
things, the relative intent, knowledge, access to information, and opportunity
to prevent or correct the subject matter of the Proceedings and other relevant
equitable considerations of each party. The Company and Indemnitee
agree that it would not be just and equitable if contribution pursuant to this
Section 6.2 were determined by pro rata allocation
or by any other method of allocation which does take account of the equitable
considerations referred to in this Section
6.2.
Austin 1027494v3
12
ARTICLE
VII
Miscellaneous
Section
7.1 Non-Exclusivity. The
rights of Indemnitee to receive indemnification and advancement of Expenses
under this Agreement shall be in addition to, and shall not be deemed exclusive
of, any other rights Indemnitee shall under the DGCL or other applicable law,
the Company’s Certificate of Incorporation or Bylaws, any other agreement, vote
of stockholders or a resolution of directors, or otherwise. No
amendment or alteration of the Company’s Certificate of Incorporation or Bylaws
or any provision thereof shall adversely affect Indemnitee’s rights hereunder
and such rights shall be in addition to any rights Indemnitee may have under the
Company’s Certificate of Incorporation, Bylaws and the DGCL or other applicable
law. To the extent that there is a change in the DGCL or other
applicable law (whether by statute or judicial decision) that allows greater
indemnification by agreement than would be afforded currently under the
Company’s Certificate of Incorporation or Bylaws and this Agreement, it is the
intent of the parties hereto that Indemnitee shall enjoy by virtue of this
Agreement the greater benefit so afforded by such change. Any
amendment, alteration or repeal of the DGCL that adversely affects any right of
Indemnitee shall be prospective only and shall not limit or eliminate any such
right with respect to any Proceeding involving any occurrence or alleged
occurrence of any action or omission to act that took place before such
amendment or repeal.
Section
7.2 I nsurance and
Subrogation.
(a) To the
extent that the Company maintains an insurance policy or policies providing
liability insurance for directors, officers, employees, agents or fiduciaries of
the Company or for individuals serving at the request of the Company as
directors, officers, partners, members, venturers, proprietors, trustees,
employees, agents, fiduciaries or similar functionaries of another foreign or
domestic corporation, partnership, limited liability company, joint venture,
sole proprietorship, trust, employee benefit plan or other enterprise,
Indemnitee shall be covered by such policy or policies in accordance with its or
their terms to the maximum extent of the coverage available for any such
director, officer, employee, agent or fiduciary under such policy or
policies. If, at the time of the receipt of a notice of a Proceeding
pursuant to the terms of this Agreement the Company has such policy or policies
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 policy or policies. The Company shall thereafter use
commercially reasonable efforts to cause such insurers to pay, on behalf of
Indemnitee, all amounts payable as a result of such Proceeding in accordance
with the terms of such policies.
(b) In the
event of any payment by the Company under this Agreement for which reimbursement
is available under any insurance policy or policies obtained by the Company, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery of Indemnitee under such insurance policy or policies, 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 Company to
bring suit to enforce such rights, provided that all Expenses relating to such
action shall be borne by the Company.
Austin 1027494v3
13
(c) The
Company shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable hereunder if and to the extent that Indemnitee has
otherwise actually received such payment under the Company’s charter or bylaws
or any insurance policy, contract, agreement or otherwise.
(d) If
Indemnitee is a director of the Company, the Company will advise the Board of
any proposed material reduction in the coverage for Indemnitee to be provided by
the Company’s directors’ and officers’ liability insurance policy and will not
effect such a reduction with respect to Indemnitee without the prior approval of
at least 80% of the Independent Directors of the Company.
(e) If
Indemnitee is a director of the Company during the term of this Agreement and if
Indemnitee ceases to be a director of the Company for any reason, the Company
shall procure an excess liability insurance policy with respect to claims
arising from facts or events that occurred before the time Indemnitee ceased to
be a director of the Company and covering Indemnitee, which policy, without any
lapse in coverage, will provide coverage for a period of six years after the
time Indemnitee ceased to be a director of the Company and will provide coverage
in the amount of $10 million; provided, however, that:
(i) this
obligation shall be suspended during the period immediately following the time
Indemnitee ceases to be a director of the Company if and only so long as the
Company has a directors’ and officers’ liability insurance policy in effect
covering Indemnitee for such claims that, if it were an excess liability policy,
would meet or exceed the foregoing standards, but in any event this suspension
period shall end when a Change in Control occurs; and
(ii) no later
than the end of the suspension period provided in the preceding clause (i)
(whether because of failure to have a policy meeting the foregoing standards or
because a Change in Control occurs), the Company shall procure an excess
liability insurance policy meeting the foregoing standards and lasting for the
remainder of the six-year period.
(f) Notwithstanding
the preceding clause (e) including the suspension provisions therein, if
Indemnitee ceases to be an officer or a director of the Company in connection
with a Change in Control or at or during the 12-month period following the
occurrence of a Change in Control, the Company shall procure an excess liability
insurance policy covering Indemnitee and meeting the foregoing standards in
clause (e) and lasting for a six-year period upon the Indemnitee’s ceasing to be
an officer or a director of the Company in such circumstances.
Section
7.3 Self Insurance of the
Company; Other Arrangements. The parties hereto recognize that
the Company may, but except as provided in Section
7.2(d), Section 7.2(e), and Section 7.2(f) is not required to, procure or maintain
insurance or other similar arrangements, at its expense, to protect itself and
any person, including Indemnitee, who is or was a director, officer, employee,
14
agent or
fiduciary of the Company or who is or was serving at the request of the Company
as a director, officer, partner, member, venturer, proprietor, trustee,
employee, agent, fiduciary or similar functionary of another foreign or domestic
corporation, partnership, limited liability company, joint venture, sole
proprietorship, trust, employee benefit plan or other enterprise against any
expense, liability or loss asserted against or incurred by such person, in such
a capacity or arising out of the person’s status as such a person, whether or
not the Company would have the power to indemnify such person against such
expense or liability or loss.
Except as
provided in Section 7.2(d), Section 7.2(e) and Section
7.2(f), in considering the cost and availability of such insurance, the
Company (through the exercise of the business judgment of its directors and
officers) may, from time to time, purchase insurance which provides for certain
(i) deductibles, (ii) limits on payments required to be made by the insurer, or
(iii) coverage which may not be as comprehensive as that previously included in
insurance purchased by the Company or its predecessors. The purchase
of insurance with deductibles, limits on payments and coverage exclusions, even
if in the best interest of the Company, may not be in the best interest of
Indemnitee. As to the Company, purchasing insurance with deductibles,
limits on payments and coverage exclusions is similar to the Company’s practice
of self-insurance in other areas. In order to protect Indemnitee who
would otherwise be more fully or entirely covered under such policies, the
Company shall, to the maximum extent permitted by applicable law, indemnify and
hold Indemnitee harmless to the extent (i) of such deductibles, (ii) of amounts
exceeding payments required to be made by an insurer, or (iii) of amounts that
prior policies of directors’ and officers’ liability insurance held by the
Company or its predecessors have provided for payment to Indemnitee, if by
reason of Indemnitee’s Corporate Status Indemnitee is or is threatened to be
made a party to any Proceeding. The obligation of the Company in the
preceding sentence shall be without regard to whether the Company would
otherwise be required to indemnify such officer or director under the other
provisions of this Agreement, or under any law, agreement, vote of stockholders
or directors or other arrangement. Without limiting the
generality of any provision of this Agreement, the procedures in Article IV
hereof shall, to the extent applicable, be used for determining entitlement to
indemnification under this Section
7.3.
Section
7.4 Certain Settlement
Provisions. The Company shall have no obligation to indemnify
Indemnitee under this Agreement for amounts paid in settlement of a Proceeding
or Claim without the Company’s prior written consent. The Company
shall not settle any Proceeding or Claim in any manner that would impose any
fine or other obligation on Indemnitee without Indemnitee’s prior written
consent. Neither the Company nor Indemnitee shall unreasonably
withhold their consent to any proposed settlement.
Section
7.5 Duration of
Agreement. This Agreement shall continue for so long as
Indemnitee serves as a director, officer, employee, agent or fiduciary of the
Company or, at the request of the Company, as a director, officer, partner,
member, venturer, proprietor, trustee, employee, agent, fiduciary or similar
functionary of another foreign or domestic corporation, partnership, limited
liability company, joint venture, sole proprietorship, trust, employee benefit
plan or other enterprise, and thereafter shall survive until and terminate upon
the later to occur of: (a) the expiration of 20 years after the
latest date that Indemnitee shall have ceased to serve in any such capacity; (b)
the final termination of all pending Proceedings in respect of which Indemnitee
is granted rights of indemnification or advancement of Expenses hereunder and of
any proceeding commenced by Indemnitee pursuant to Article IV relating thereto;
or (c) the
15
expiration
of all statutes of limitation applicable to possible Claims arising out of
Indemnitee’s Corporate Status.
Section
7.6 Notice by Each
Party. Indemnitee shall promptly notify the Company in writing
upon being served with any summons, citation, subpoena, complaint, indictment,
information or other document or communication relating to any Proceeding or
Claim for which Indemnitee may be entitled to indemnification or advancement of
Expenses hereunder; provided, however, that any failure of Indemnitee to so
notify the Company shall not adversely affect Indemnitee’s rights under this
Agreement except to the extent the Company shall have been materially prejudiced
as a direct result of such failure. The Company shall promptly notify
Indemnitee in writing as to the pendency of any Proceeding or Claim that may
involve a claim against Indemnitee for which Indemnitee may be entitled to
indemnification or advancement of Expenses hereunder.
Section
7.7 Amendment. This
Agreement may not be modified or amended except by a written instrument executed
by or on behalf of each of the parties hereto.
Section
7.8 Waivers. The
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively) by the party
entitled to enforce such term only by a writing signed by the party against
which such waiver is to be asserted. Unless otherwise expressly
provided herein, no delay on the part of any party hereto in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any waiver on the part of any party hereto of any right, power or privilege
hereunder operate as a waiver of any other right, power or privilege hereunder
nor shall any single or partial exercise of any right, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder.
Section
7.9 Entire
Agreement. This Agreement and the documents expressly referred
to herein constitute the entire agreement between the parties hereto with
respect to the matters covered hereby, and any other prior or contemporaneous
oral or written understandings or agreements with respect to the matters covered
hereby, including without limitation any prior indemnification agreements, are
expressly superseded by this Agreement.
Section
7.10 Severability. If
any provision of this Agreement (including any provision within a single
section, paragraph or sentence) or the application of such provision to any
Person or circumstance, shall be judicially declared to be invalid,
unenforceable or void, such decision will not have the effect of invalidating or
voiding the remainder of this Agreement or affect the application of such
provision to other Persons or circumstances, it being the intent and agreement
of the parties that this Agreement shall be deemed amended by modifying such
provision to the extent necessary to render it valid, legal and enforceable
while preserving its intent, or if such modification is not possible, by
substituting therefor another provision that is valid, legal and unenforceable
and that achieves the same objective. Any such finding of invalidity or
unenforceability shall not prevent the enforcement of such provision in any
other jurisdiction to the maximum extent permitted by applicable
law.
Section
7.11 Notices. All notices
and other communications hereunder shall be in writing and shall be deemed given
upon (a) transmitter’s confirmation of a receipt of a facsimile
16
transmission
if during normal business hours of the recipient, otherwise on the next business
day, (b) confirmed delivery of a standard overnight courier or when delivered by
hand or (c) the expiration of five business days after the date mailed by
certified or registered mail (return receipt requested), postage prepaid, to the
parties at the following addresses (or at such other addresses for a party as
shall be specified by like notice):
If to the
Company, to it at:
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▇▇▇▇▇▇▇▇ Energy, Inc.
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▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
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Facsimile: [(___)
-_________]
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If to
Indemnitee, to Indemnitee at:
[INDEMNITEE ADDRESS]
or to
such other address or to such other individuals as any party shall have last
designated by notice to the other parties. All notices and other
communications given to any party in accordance with the provisions of this
Agreement shall be deemed to have been given when delivered or sent to the
intended recipient thereof in accordance with and as provided in the provisions
of this Section 7.11.
Section
7.12 Governing
Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Delaware without regard to the principles
of conflict of laws.
Section
7.13 Certain Construction
Rules.
(a) The
article and section headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. As used in this Agreement, unless otherwise provided
to the contrary, (1) all references to days shall be deemed references to
calendar days and (2) any reference to a “Section” or “Article” shall be deemed
to refer to a section or article of this Agreement. The words
“hereof,” “herein” and “hereunder” and words of similar import referring to this
Agreement refer to this Agreement as a whole and not to any particular provision
of this Agreement. Whenever the words “include,” “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by
the words “without limitation.” Unless otherwise specifically
provided for herein, the term “or” shall not be deemed to be
exclusive. Whenever the context may require, any pronoun used in this
Agreement shall include the corresponding masculine, feminine or neuter forms,
and the singular form of nouns, pronouns and verbs shall include the plural and
vice versa.
(b) For
purposes of this Agreement, references to “other enterprises” shall include
employee benefit plans; references to “fines” shall include any excise taxes
assessed on a person with respect to any employee benefit plan; references to
“serving at the request of the Company” shall include any service as a director,
officer, employee or
17
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agent
of the Company which imposes duties on, or involves services by,
such director, nominee, officer, employee or agent with respect to an
employee benefit plan, its participants or beneficiaries; and a person who
acted in good faith and in a manner the 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 interest of the Company” for purposes of this Agreement and the
DGCL.
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Section
7.14 Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed to be an original and all of which together shall be deemed to be one and
the same instrument, notwithstanding that both parties are not signatories to
the original or same counterpart.
Section
7.15 Certain Persons Not Entitled
to Indemnification. The Company shall not be obligated
pursuant to the terms of this Agreement:
(a) To
indemnify Indemnitee if a final decision by a court or arbitration body having
jurisdiction in the matter shall determine that such indemnification is not
lawful;
(b) To
indemnify Indemnitee for the payment to the Company of profits pursuant to
Section 16(b) of the Exchange Act, or Expenses incurred by Indemnitee for
Proceedings in connection with such payment under Section 16(b) of the Exchange
Act;
(c) To
indemnify Indemnitee in connection with any Proceeding (or any part of any
Proceeding) initiated by Indemnitee other than as contemplated by Section 7.18, but including any Proceeding (or any
part of any Proceeding) initiated by Indemnitee against the Company or its
directors, officers, employees or other indemnitees, unless (i) the Board
of Directors of the Company authorized the Proceeding (or any part of any
Proceeding) prior to its initiation or (ii) the Company provides the
indemnification, in its sole discretion, pursuant to the powers vested in the
Company under applicable law; or
(d) To
indemnify Indemnitee in connection with Proceedings (or any part of any
Proceeding) or Claim involving the enforcement of non-compete and/or
non-disclosure agreements or the non-compete and/or non-disclosure provisions of
employment, consulting or similar agreements the Indemnitee may be a party to
with the Company, or any Subsidiary of the Company or any other applicable
foreign or domestic corporation, partnership, joint venture, trust or other
enterprise, if any.
Section7.16 Indemnification for
Negligence, Gross Negligence, etc. Without limiting the
generality of any other provision hereunder, it is the express intent of this
Agreement that Indemnitee be indemnified and Expenses be advanced regardless of
Indemnitee’s acts of negligence, gross negligence, intentional or willful
misconduct to the extent that indemnification and advancement of Expenses is
allowed pursuant to the terms of this Agreement and under applicable
law.
Section
7.17 Mutual
Acknowledgments. Both the Company and Indemnitee acknowledge
that in certain instances, applicable law (including applicable federal law that
may preempt or override applicable state law) or public policy may prohibit the
Company from indemnifying the directors, officers, employees, agents or
fiduciaries of the Company under this
18
Agreement
or otherwise. For example, the Company and Indemnitee acknowledge
that the U.S. Securities and Exchange Commission has taken the position that
indemnification of directors, officers and controlling Persons of the Company
for liabilities arising under federal securities laws is against public policy
and, therefore, unenforceable. Indemnitee understands and
acknowledges that the Company has undertaken or may be required in the future to
undertake with the Securities and Exchange Commission to submit the question of
indemnification to a court in certain circumstances for a determination of the
Company’s right under public policy to indemnify Indemnitee. In
addition, the Company and Indemnitee acknowledge that federal law prohibits
indemnifications for certain violations of the Employee Retirement Income
Security Act of 1974, as amended.
Section
7.18 Enforcement. The
Company agrees that its execution of this Agreement shall constitute a
stipulation by which it shall be irrevocably bound in any court or arbitration
in which a proceeding by Indemnitee for enforcement of Indemnitee’s rights
hereunder shall have been commenced, continued or appealed, that its obligations
set forth in this Agreement are unique and special, and that failure of the
Company to comply with the provisions of this Agreement will cause irreparable
and irremediable injury to Indemnitee, for which a remedy at law will be
inadequate. As a result, in addition to any other right or remedy
Indemnitee may have at law or in equity with respect to breach of this
Agreement, Indemnitee shall be entitled to injunctive or mandatory relief
directing specific performance by the Company of its obligations under this
Agreement. The Company agrees not to seek, and agrees to waive any
requirement for the securing or posting of, a bond in connection with
Indemnitee’s seeking or obtaining such relief.
Section
7.19 Successors and
Assigns. All of the terms and provisions of this Agreement shall be
binding upon, shall inure to the benefit of and shall be enforceable by the
parties hereto and their respective successors, assigns, heirs, executors,
administrators, legal representatives.
Section
7.20 Period of
Limitations. No legal action shall be brought and no cause of
action shall be asserted by or on behalf of the Company or any Affiliate of the
Company against Indemnitee or Indemnitee’s spouse, heirs, executors, or personal
or legal representatives after the expiration of one year from the date of
accrual of that cause of action, and any claim or cause of action of the Company
or its Affiliate shall be extinguished and deemed released unless asserted by
the timely filing of a legal action within that one-year period; provided,
however, that for any claim based on Indemnitee’s breach of fiduciary duties to
the Company or its stockholders, the period set forth in the preceding sentence
shall be three years instead of one year; and provided, further, that, if any
shorter period of limitations is otherwise applicable to any such cause of
action, the shorter period shall govern.
[Signature
Page Follows]
Austin 1027494v3
19
IN
WITNESS WHEREOF, this Agreement has been duly executed and delivered to be
effective as of the date first above written.
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▇▇▇▇▇▇▇▇ ENERGY, INC.
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By:
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Name:
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Title:
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INDEMNITEE:
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[NAME]
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Signature
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