International Coal Group Inc. Contracts
Sample Business Contracts
Indemnification Agreement - ICG Inc.
INDEMNIFICATION AGREEMENT
This Indemnification Agreement, dated as of , (this
"Agreement"), is made by and between ICG, Inc. (formerly known as
International Coal Group, Inc.), a Delaware corporation (the "Company"),
International Coal Group, Inc. (formerly known as ICG Holdco, Inc.), a
Delaware corporation ("Holdco"), and ("Indemnitee").
RECITALS:
A. Section 141 of the General Corporation Law of the State of Delaware
provides that the business and affairs of a corporation shall be managed by or
under the direction of its board of directors.
B. In recognition of the need for corporations to be able to induce
capable and responsible persons to accept positions in corporate management,
Delaware law authorizes (and in some instances requires) corporations to
indemnify their directors and officers, and further authorizes corporations to
purchase and maintain insurance for the benefit of their directors and officers.
C. The Delaware courts have recognized that indemnification by a
corporation serves the dual policies of (1) allowing corporate officials to
resist unjustified lawsuits, secure in the knowledge that, if vindicated, the
corporation will bear the expense of litigation and (2) encouraging capable
women and men to serve as corporate directors and officers, secure in the
knowledge that the corporation will absorb the costs of defending their honesty
and integrity.
D. The number of lawsuits challenging the judgment and actions of
directors of Delaware corporations, the costs of defending those lawsuits, and
the threat to directors' personal assets have all materially increased over the
past several years, chilling the willingness of capable women and men to
undertake the responsibilities imposed on corporate directors.
E. Under Delaware law, a director's right to be reimbursed for the costs
of defense of criminal actions, whether such claims are asserted under state or
federal law, does not depend upon the merits of the claims asserted against the
director and is separate and distinct from any right to indemnification the
director may be able to establish, and indemnification of the director against
criminal fines and penalties is permitted if the director satisfies the
applicable standard of conduct.
F. Indemnitee is a director and officer of the Company and his
willingness to serve in such capacity is predicated, in substantial part, upon
the Company's willingness to indemnify him in accordance with the principles
reflected above, to the fullest extent permitted by the laws of the state of
Delaware, and upon the other undertakings set forth in this Agreement.
G. Therefore, in recognition of the need to provide Indemnitee with
substantial protection against personal liability, in order to procure
Indemnitee's continued service as a director and officer of the Company and to
enhance Indemnitee's ability to serve the Company in an effective manner, and in
order to provide such
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protection pursuant to express contract rights (intended to be enforceable
irrespective of, among other things, any amendment to the Company's certificate
of incorporation or bylaws (collectively, the "Constituent Documents"), any
change in the composition of the Company's Board of Directors (the "Board") or
any change-in-control or business combination transaction relating to the
Company), the Company wishes to provide in this Agreement for the
indemnification of and the advancement of Expenses (as defined in Section 1(f))
to Indemnitee as set forth in this Agreement and for the continued coverage of
Indemnitee under the Company's directors' and officers' liability insurance
policies.
H. In light of the considerations referred to in the preceding recitals,
it is the Company's intention and desire that the provisions of this Agreement
be construed liberally, subject to their express terms, to maximize the
protections to be provided to Indemnitee hereunder.
I. In connection with the Business Combination Agreements with each of
Anker Coal Group, Inc. and CoalQuest Development LLC executed on March 31, 2005
(the "Business Combination Agreements"), the Company agreed to merge with an
indirect subsidiary of Holdco thereby becoming an indirect subsidiary of Holdco
and making Holdco the parent holding company.
AGREEMENT:
NOW, THEREFORE, the parties hereby agree as follows:
1. Certain Definitions. In addition to terms defined elsewhere herein, the
following terms have the following meanings when used in this Agreement with
initial capital letters:
(a) "Change in Control" means the occurrence after the date of this
Agreement of any of the following events:
(i) the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a "Person") of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of the combined voting power of the
then-outstanding Voting Stock of the Company; provided, however, that:
(A) for purposes of this Section 1(a), the following acquisitions
shall not constitute a Change in Control: (1) any acquisition of Voting Stock of
the Company directly from the Company that is approved by a majority of the
Incumbent Directors, (2) any acquisition of Voting Stock of the Company by the
Company or any Subsidiary, (3) any acquisition of Voting Stock of the Company by
any employee benefit plan (or related trust) sponsored or maintained by the
Company or any Subsidiary, and (4) any acquisition of Voting Stock of the
Company by any Person pursuant to a Business Combination that complies with
clauses (1), (2) and (3) of Section 1(a)(iii) below;
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(B) if any Person acquires beneficial ownership of 20% or more of
combined voting power of the then-outstanding Voting Stock of the Company as a
result of a transaction described in clause (A)(1) of Section 1(a) and such
Person thereafter becomes the beneficial owner of any additional shares of
Voting Stock of the Company representing 1% or more of the then-outstanding
Voting Stock of the Company, other than in an acquisition directly from the
Company that is approved by a majority of the Incumbent Directors or other than
as a result of a stock dividend, stock split or similar transaction effected by
the Company in which all holders of Voting Stock are treated equally, such
subsequent acquisition shall be deemed to constitute a Change in Control;
(C) a Change in Control will not be deemed to have occurred if a
Person acquires beneficial ownership of 20% or more of the Voting Stock of the
Company as a result of a reduction in the number of shares of Voting Stock of
the Company outstanding unless and until such Person thereafter becomes the
beneficial owner of any additional shares of Voting Stock of the Company
representing 1% or more of the then-outstanding Voting Stock of the Company,
other than in an acquisition directly from the Company that is approved by a
majority of the Incumbent Directors or other than as a result of a stock
dividend, stock split or similar transaction effected by the Company in which
all holders of Voting Stock are treated equally; and
(D) if at least a majority of the Incumbent Directors determine
in good faith that a Person has acquired beneficial ownership of 20% or more of
the Voting Stock of the Company inadvertently, and such Person divests as
promptly as practicable a sufficient number of shares so that such Person
beneficially owns less than 20% of the Voting Stock of the Company, then no
Change in Control shall have occurred as a result of such Person's acquisition;
or
(ii) a majority of the Directors are not Incumbent Directors; or
(iii) the consummation of a reorganization, merger or consolidation,
or sale or other disposition of all or substantially all of the assets of the
Company or the acquisition of assets of another corporation, or other
transaction (each, a "Business Combination"), unless, in each case, immediately
following such Business Combination (A) all or substantially all of the
individuals and entities who were the beneficial owners of Voting Stock of the
Company immediately prior to such Business Combination beneficially own,
directly or indirectly, more than 60% of the combined voting power of the then
outstanding shares of Voting Stock of the entity resulting from such Business
Combination (including, without limitation, an entity which as a result of such
transaction owns the Company or all or substantially all of the Company's assets
either directly or through one or more subsidiaries), (B) no Person (other than
the Company, such entity resulting from such Business Combination, or any
employee benefit plan (or related trust) sponsored or maintained by the Company,
any Subsidiary or such entity resulting from such Business Combination)
beneficially owns, directly or indirectly, 20% or more of the combined voting
power of the then outstanding shares of Voting Stock of the entity resulting
from such Business Combination, and (C) at least a majority of the members of
the Board of Directors of the entity resulting from such Business
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Combination were Incumbent Directors at the time of the execution of the initial
agreement or of the action of the Board providing for such Business Combination;
or
(iv) approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company, except pursuant to a Business
Combination that complies with clauses (A), (B) and (C) of Section 1(a)(iii).
(b) "Claim" means (i) any threatened, asserted, pending or completed
claim, demand, action, suit or proceeding, whether civil, criminal,
administrative, arbitrative, investigative or other, and whether made pursuant
to federal, state or other law; and (ii) any threatened, pending or completed
inquiry or investigation, whether made, instituted or conducted by the Company
or any other person, including without limitation any federal, state or other
governmental entity, that Indemnitee determines might lead to the institution of
any such claim, demand, action, suit or proceeding.
(c) "Controlled Affiliate" means any corporation, limited liability
company, partnership, joint venture, trust or other entity or enterprise,
whether or not for profit, that is directly or indirectly controlled by the
Company. For purposes of this definition, "control" means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of an entity or enterprise, whether through the ownership
of voting securities, through other voting rights, by contract or otherwise;
provided that direct or indirect beneficial ownership of capital stock or other
interests in an entity or enterprise entitling the holder to cast 20% or more of
the total number of votes generally entitled to be cast in the election of
directors (or persons performing comparable functions) of such entity or
enterprise shall be deemed to constitute control for purposes of this
definition.
(d) "Disinterested Director" means a director of the Company who is not
and was not a party to the Claim in respect of which indemnification is sought
by Indemnitee.
(e) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(f) "Expenses" means reasonable, documented attorneys' and experts'
fees and expenses and all other reasonable, documented costs and expenses paid
or payable in connection with investigating, defending, being a witness in or
participating in (including on appeal), or preparing to investigate, defend, be
a witness in or participate in (including on appeal), any Claim.
(g) "Incumbent Directors" means the individuals who, as of the date
hereof, are Directors of the Company and any individual becoming a Director
subsequent to the date hereof whose election, nomination for election by the
Company's stockholders, or appointment, was approved by a vote of at least
two-thirds of the then Incumbent Directors (either by a specific vote or by
approval of the proxy statement of the Company in which such person is named as
a nominee for director, without objection to such nomination); provided,
however, that an individual shall not be an Incumbent Director if such
individual's election or appointment to the Board occurs as a result of an
actual or threatened election contest (as described in Rule 14a-12(c) of
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the Exchange Act) 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 Board.
(h) "Indemnifiable Claim" means any Claim based upon, arising out of or
resulting from (i) any actual, alleged or suspected act or failure to act by
Indemnitee in his capacity as a director, manager, officer, employee or agent of
the Company or as a director, officer, employee, member, manager, trustee or
agent of any other corporation, limited liability company, partnership, joint
venture, trust or other entity or enterprise, whether or not for profit, as to
which Indemnitee is or was serving at the request of the Company as a director,
officer, employee, member, manager, trustee or agent, (ii) any actual, alleged
or suspected act or failure to act by Indemnitee in respect of any business,
transaction, communication, filing, disclosure or other activity of the Company
or any other entity or enterprise referred to in clause (i) of this sentence, or
(iii) Indemnitee's status as a current or former director, manager, officer,
employee or agent of the Company or as a current or former director, officer,
employee, member, manager, trustee or agent of the Company or any other entity
or enterprise referred to in clause (i) of this sentence or any actual, alleged
or suspected act or failure to act by Indemnitee in connection with any
obligation or restriction imposed upon Indemnitee by reason of such status. In
addition to any service at the actual request of the Company, for purposes of
this Agreement, Indemnitee shall be deemed to be serving or to have served at
the request of the Company as a director, officer, employee, member, manager,
trustee or agent of another entity or enterprise if Indemnitee is or was serving
as a director, officer, employee, member, manager, trustee or agent of such
entity or enterprise and (i) such entity or enterprise is or at the time of such
service was a Controlled Affiliate, (ii) such entity or enterprise is or at the
time of such service was an employee benefit plan (or related trust) sponsored
or maintained by the Company or a Controlled Affiliate, or (iii) the Company or
a Controlled Affiliate directly or indirectly caused or authorized Indemnitee to
be nominated, elected, appointed, designated, employed, engaged or selected to
serve in such capacity. Notwithstanding the foregoing, Indemnifiable Claims will
not consist of any Claim to the extent indemnification in respect thereof is
prohibited by the laws of the State of Delaware in effect on the date hereof or
as such laws may from time to time hereafter be amended to increase the scope of
such permitted indemnification.
(i) "Indemnifiable Losses" means any and all Losses relating to,
arising out of or resulting from any Indemnifiable Claim.
(j) "Independent Counsel" means a law firm, or a member of a law firm,
that is experienced in matters of corporation law and neither presently is, nor
in the past five years has been, retained to represent: (i) the Company (or any
Subsidiary) or Indemnitee in any matter material to either such party (other
than with respect to matters concerning Indemnitee under this Agreement, or of
other indemnitees under similar indemnification agreements), or (ii) any other
named (or, as to a threatened matter, reasonably likely to be named) party to
the Indemnifiable Claim giving rise to a claim for indemnification hereunder.
Notwithstanding the foregoing, the term "Independent Counsel" shall not include
any person who, under the applicable standards of professional conduct then
prevailing, would have a conflict of interest in
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representing either the Company or Indemnitee in an action to determine
Indemnitee's rights under this Agreement.
(k) "Losses" means any and all Expenses, damages, losses, liabilities,
judgments, fines, penalties (whether civil, criminal or other) and amounts paid
in settlement, including without limitation all interest, assessments and other
charges paid or payable in connection with or in respect of any of the
foregoing.
(l) "Subsidiary" means an entity in which the Company directly or
indirectly beneficially owns 50% or more of the outstanding Voting Stock.
(m) "Voting Stock" means securities entitled to vote generally in the
election of directors (or similar governing bodies).
2. Indemnification Obligation. Subject to Section 7, the Company shall
indemnify, defend and hold harmless Indemnitee against any and all Indemnifiable
Claims and Indemnifiable Losses; provided, however, that, except as provided in
Sections 4 and 20, Indemnitee shall not be entitled to indemnification pursuant
to this Agreement in connection with any Claim initiated by Indemnitee against
the Company or any director or officer of the Company unless the Company has
joined in or consented to the initiation of such Claim.
3. Advancement of Expenses. Indemnitee shall have the right to advancement
by the Company prior to the final disposition of any Indemnifiable Claim of any
and all Expenses relating to, arising out of or resulting from any Indemnifiable
Claim paid or incurred by Indemnitee. Indemnitee's right to such advancement is
not subject to the satisfaction of any standard of conduct. Without limiting the
generality or effect of the foregoing, within five business days after any
request by Indemnitee, the Company shall, in accordance with such request (but
without duplication), (a) pay such Expenses on behalf of Indemnitee, (b) advance
to Indemnitee funds in an amount sufficient to pay such Expenses, or (c)
reimburse Indemnitee for such Expenses; provided that Indemnitee shall repay,
without interest any amounts actually advanced to Indemnitee that, at the final
disposition of the Indemnifiable Claim to which the advance related, were in
excess of amounts paid or payable by Indemnitee in respect of Expenses relating
to, arising out of or resulting from such Indemnifiable Claim. In connection
with any such payment, advancement or reimbursement, Indemnitee shall execute
and deliver to the Company an undertaking, which need not be secured and shall
be accepted without reference to Indemnitee's ability to repay the Expenses, by
or on behalf of Indemnitee, to repay any amounts paid, advanced or reimbursed by
the Company in respect of Expenses relating to, arising out of or resulting from
any Indemnifiable Claim in respect of which it shall have been determined,
following the final disposition of such Indemnifiable Claim and in accordance
with Section 7, that Indemnitee is not entitled to indemnification hereunder.
4. Indemnification for Additional Expenses. Without limiting the
generality or effect of the foregoing, the Company shall indemnify and hold
harmless Indemnitee against and, if requested by Indemnitee, shall reimburse
Indemnitee for, or advance to Indemnitee, within five business days of such
request, any and all Expenses paid or incurred by Indemnitee in connection with
any Claim made, instituted or conducted by
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Indemnitee for (a) indemnification or reimbursement or advance payment of
Expenses by the Company under any provision of this Agreement, or under any
other agreement or provision of the Constituent Documents now or hereafter in
effect relating to Indemnifiable Claims, and/or (b) recovery under any
directors' and officers' liability insurance policies maintained by the Company,
regardless in each case of whether Indemnitee ultimately is determined to be
entitled to such indemnification, reimbursement, advance or insurance recovery,
as the case may be; provided, however, that Indemnitee shall return, without
interest, any such advance of Expenses (or portion thereof) which remains
unspent at the final disposition of the Claim to which the advance related.
5. Partial Indemnity. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of any
Indemnifiable Loss but not for all of the total amount thereof, the Company
shall nevertheless indemnify Indemnitee for the portion thereof to which
Indemnitee is entitled.
6. Procedure for Notification. To obtain indemnification under this
Agreement in respect of an Indemnifiable Claim or Indemnifiable Loss, Indemnitee
shall submit to the Company a written request therefor, including a brief
description (based upon information then available to Indemnitee) of such
Indemnifiable Claim or Indemnifiable Loss. If, at the time of the receipt of
such request, the Company has directors' and officers' liability insurance in
effect under which coverage for such Indemnifiable Claim or Indemnifiable Loss
is potentially available, the Company shall give prompt written notice of such
Indemnifiable Claim or Indemnifiable Loss to the applicable insurers in
accordance with the procedures set forth in the applicable policies. The Company
shall provide to Indemnitee a copy of such notice delivered to the applicable
insurers, and copies of all subsequent correspondence between the Company and
such insurers regarding the Indemnifiable Claim or Indemnifiable Loss, in each
case substantially concurrently with the delivery or receipt thereof by the
Company. The failure by Indemnitee to timely notify the Company of any
Indemnifiable Claim or Indemnifiable Loss shall not relieve the Company from any
liability hereunder unless, and only to the extent that, the Company did not
otherwise learn of such Indemnifiable Claim or Indemnifiable Loss and such
failure results in forfeiture by the Company of substantial defenses, rights or
insurance coverage.
7. Determination of Right to Indemnification. To the extent that
Indemnitee shall have been successful on the merits or otherwise in defense of
any Indemnifiable Claim or any portion thereof or in defense of any issue or
matter therein, including without limitation dismissal without prejudice,
Indemnitee shall be indemnified against all Indemnifiable Losses relating to,
arising out of or resulting from such Indemnifiable Claim in accordance with
Section 2 and no Standard of Conduct Determination (as defined in Section 7(b))
shall be required.
(b) To the extent that the provisions of Section 7(a) are inapplicable
to an Indemnifiable Claim that shall have been finally disposed of, any
determination of whether Indemnitee has satisfied any applicable standard of
conduct under Delaware law that is a legally required condition precedent to
indemnification of Indemnitee
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hereunder against Indemnifiable Losses relating to, arising out of or resulting
from such Indemnifiable Claim (a "Standard of Conduct Determination") shall be
made as follows: (i) if a Change in Control shall not have occurred, or if a
Change in Control shall have occurred but Indemnitee shall have requested that
the Standard of Conduct Determination be made pursuant to this clause (i), (A)
by a majority vote of the Disinterested Directors, even if less than a quorum of
the Board, (B) if such Disinterested Directors so direct, by a majority vote of
a committee of Disinterested Directors designated by a majority vote of all
Disinterested Directors, or (C) if there are no such Disinterested Directors, by
Independent Counsel in a written opinion addressed to the Board, a copy of which
shall be delivered to Indemnitee; and (ii) if a Change in Control shall have
occurred and Indemnitee shall not have requested that the Standard of Conduct
Determination be made pursuant to clause (i), by Independent Counsel in a
written opinion addressed to the Board, a copy of which shall be delivered to
Indemnitee. Indemnitee will cooperate with the person or persons making such
Standard of Conduct Determination, including providing to such person or
persons, upon reasonable advance request, any documentation or information which
is not privileged or otherwise protected from disclosure and which is reasonably
available to Indemnitee and reasonably necessary to such determination. The
Company shall indemnify and hold harmless Indemnitee against and, if requested
by Indemnitee, shall reimburse Indemnitee for, or advance to Indemnitee, within
five business days of such request, any and all reasonable, documented costs and
expenses (including attorneys' and experts' fees and expenses) incurred by
Indemnitee in so cooperating with the person or persons making such Standard of
Conduct Determination.
(c) The Company shall use its reasonable best efforts to cause any
Standard of Conduct Determination required under Section 7(b) to be made as
promptly as practicable. If (i) the person or persons empowered or selected
under Section 7(b) to make the Standard of Conduct Determination shall not have
made a determination within 30 days after the later of (A) receipt by the
Company of written notice from Indemnitee advising the Company of the final
disposition of the applicable Indemnifiable Claim (the date of such receipt
being the "Notification Date") and (B) the selection of an Independent Counsel,
if such determination is to be made by Independent Counsel, that is permitted
under the provisions of Section 7(e) to make such determination and (ii)
Indemnitee shall have fulfilled his obligations set forth in the second sentence
of Section 7(b), then Indemnitee shall be deemed to have satisfied the
applicable standard of conduct; provided that such 30-day period may be extended
for a reasonable time, not to exceed an additional 30 days, if the person or
persons making such determination in good faith requires such additional time
for the obtaining or evaluation or documentation and/or information relating
thereto.
(d) If (i) Indemnitee shall be entitled to indemnification hereunder against any
Indemnifiable Losses pursuant to Section 7(a), (ii) no determination of whether
Indemnitee has satisfied any applicable standard of conduct under Delaware law
is a legally required condition precedent to indemnification of Indemnitee
hereunder against any Indemnifiable Losses, or (iii) Indemnitee has been
determined or deemed pursuant to Section 7(a) or (c) to have satisfied any
applicable standard of conduct under Delaware law which is a legally required
condition precedent to indemnification of Indemnitee hereunder against any
Indemnifiable Losses, then the Company shall pay to
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Indemnitee, within five business days after the later of (x) the Notification
Date in respect of the Indemnifiable Claim or portion thereof to which such
Indemnifiable Losses are related, out of which such Indemnifiable Losses arose
or from which such Indemnifiable Losses resulted and (y) the earliest date on
which the applicable criterion specified in clause (i), (ii) or (iii) above
shall have been satisfied, an amount equal to the amount of such Indemnifiable
Losses.
(e) If a Standard of Conduct Determination is to be made by Independent
Counsel, the Independent Counsel shall be selected by the Board of Directors,
and the Company shall give written notice to Indemnitee advising him of the
identity of the Independent Counsel so selected. Indemnitee may, within five
business days after receiving written notice of selection from the Company,
deliver to the Company a written objection to such selection; provided, however,
that such objection may be asserted only on the ground that the Independent
Counsel so selected does not satisfy the criteria set forth in the definition of
"Independent Counsel" in Section 1(j), and the objection shall set forth with
particularity the factual basis of such assertion. Absent a proper and timely
objection, the person or firm so selected shall act as Independent Counsel. If
such written objection is properly and timely made and substantiated, (i) the
Independent Counsel so selected may not serve as Independent Counsel unless and
until such objection is withdrawn or a court has determined that such objection
is without merit and (ii) the Company may, at its option, select an alternative
Independent Counsel and give written notice to Indemnitee advising him of the
identity of the alternative Independent Counsel so selected, in which case the
provisions of the two immediately preceding sentences and clause (i) of this
sentence shall apply to such subsequent selection and notice. If applicable, the
provisions of clause (ii) of the immediately preceding sentence shall apply to
successive alternative selections. If no Independent Counsel that is permitted
under the foregoing provisions of this Section 7(e) to make the Standard of
Conduct Determination shall have been selected within 30 days after the Company
gives its initial notice pursuant to the first sentence of this Section 7(e) or
Indemnitee gives its initial notice pursuant to the second sentence of this
Section 7(e), as the case may be, either the Company or Indemnitee may petition
the Court of Chancery of the State of Delaware for resolution of any objection
which shall have been made by Indemnitee to the Company's selection of
Independent Counsel and/or for the appointment as Independent Counsel of a
person or firm selected by the Court or by such other person as the Court shall
designate, and the person or firm with respect to whom all objections are so
resolved or the person or firm so appointed will act as Independent Counsel. In
all events, the Company shall pay all of the reasonable, documented fees and
expenses of the Independent Counsel incurred in connection with the Independent
Counsel's determination pursuant to Section 7.
8. Presumption of Entitlement. In making any Standard of Conduct
Determination, the person or persons making such determination shall presume
that Indemnitee has satisfied the applicable standard of conduct, and the
Company may overcome such presumption only by its adducing clear and convincing
evidence to the contrary. Any Standard of Conduct Determination that is adverse
to Indemnitee may be challenged by Indemnitee in the Court of Chancery of the
State of Delaware. No determination by the Company (including by its directors
or any Independent Counsel) that Indemnitee has not satisfied any applicable
standard of conduct shall be a defense
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to any Claim by Indemnitee for indemnification or reimbursement or advance
payment of Expenses by the Company hereunder or create a presumption that
Indemnitee has not met any applicable standard of conduct.
9. No Other Presumption. For purposes of this Agreement, the termination
of any Claim by judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere or its equivalent,
will not create a presumption that Indemnitee did not meet any applicable
standard of conduct or that indemnification hereunder is otherwise not
permitted.
10. Non-Exclusivity. The rights of Indemnitee hereunder will be in
addition to any other rights Indemnitee may have under the Constituent
Documents, or the substantive laws of the Company's jurisdiction of formation,
any other contract or otherwise (collectively, "Other Indemnity Provisions");
provided, however, that (a) to the extent that Indemnitee otherwise would have
any greater right to indemnification under any Other Indemnity Provision,
Indemnitee will be deemed to have such greater right hereunder and (b) to the
extent that any change is made to any Other Indemnity Provision which permits
any greater right to indemnification than that provided under this Agreement as
of the date hereof, Indemnitee will be deemed to have such greater right
hereunder. The Company will not adopt any amendment to any of the Constituent
Documents the effect of which would be to deny, diminish or encumber
Indemnitee's right to indemnification under this Agreement or any Other
Indemnity Provision.
11. Liability Insurance and Funding. For the duration of Indemnitee's
service as a director of the Company, and thereafter for so long as Indemnitee
shall be subject to any pending or possible Indemnifiable Claim, the Company
shall use commercially reasonable efforts (taking into account the scope and
amount of coverage available relative to the cost thereof) to cause to be
maintained in effect policies of directors' and officers' liability insurance
providing coverage for directors and/or officers of the Company that is at least
substantially comparable in scope and amount to that provided by the Company's
current policies of directors' and officers' liability insurance. The Company
shall provide Indemnitee with a copy of all directors' and officers' liability
insurance applications, binders, policies, declarations, endorsements and other
related materials, and shall provide Indemnitee with a reasonable opportunity to
review and comment on the same. Without limiting the generality or effect of the
two immediately preceding sentences, the Company shall not discontinue or
significantly reduce the scope or amount of coverage from one policy period to
the next (i) without the prior approval thereof by a majority vote of the
Incumbent Directors, even if less than a quorum, or (ii) if at the time that any
such discontinuation or significant reduction in the scope or amount of coverage
is proposed there are no Incumbent Directors, without the prior written consent
of Indemnitee (which consent shall not be unreasonably withheld or delayed). In
all policies of directors' and officers' liability insurance obtained by the
Company, Indemnitee shall be named as an insured in such a manner as to provide
Indemnitee the same rights and benefits, subject to the same limitations, as are
accorded to the Company's directors and officers most favorably insured by such
policy. The Company may, but shall not be required to, create a trust fund,
grant a security interest or use other means, including without limitation a
letter of credit, to ensure the
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payment of such amounts as may be necessary to satisfy its obligations to
indemnify and advance expenses pursuant to this Agreement.
12. Subrogation. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the related rights
of recovery of Indemnitee against other persons or entities (other than
Indemnitee's successors), including any entity or enterprise referred to in
clause (i) of the definition of "Indemnifiable Claim" in Section 1(g).
Indemnitee shall execute all papers reasonably required to evidence such rights
(all of Indemnitee's reasonable Expenses, including attorneys' fees and charges,
related thereto to be reimbursed by or, at the option of Indemnitee, advanced by
the Company).
13. No Duplication of Payments. The Company shall not be liable under this
Agreement to make any payment to Indemnitee in respect of any Indemnifiable
Losses to the extent Indemnitee has otherwise actually received payment (net of
Expenses incurred in connection therewith) under any insurance policy, the
Constituent Documents and Other Indemnity Provisions or otherwise (including
from any entity or enterprise referred to in clause (i) of the definition of
"Indemnifiable Claim" in Section 1(g)) in respect of such Indemnifiable Losses
otherwise indemnifiable hereunder.
14. Defense of Claims. The Company shall be entitled to participate in the
defense of any Indemnifiable Claim or to assume the defense thereof, with
counsel reasonably satisfactory to Indemnitee; provided that if Indemnitee
believes, after consultation with counsel selected by Indemnitee, that (a) the
use of counsel chosen by the Company to represent Indemnitee would present such
counsel with an actual or potential conflict, (b) the named parties in any such
Indemnifiable Claim (including any impleaded parties) include both the Company
and Indemnitee and Indemnitee shall conclude that there may be one or more legal
defenses available to him that are different from or in addition to those
available to the Company, or (c) any such representation by such counsel would
be precluded under the applicable standards of professional conduct then
prevailing, then Indemnitee shall be entitled to retain separate counsel (but
not more than one law firm plus, if applicable, local counsel in respect of any
particular Indemnifiable Claim) at the Company's expense. The Company shall not
be liable to Indemnitee under this Agreement for any amounts paid in settlement
of any threatened or pending Indemnifiable Claim effected without the Company's
prior written consent. The Company shall not, without the prior written consent
of Indemnitee, effect any settlement of any threatened or pending Indemnifiable
Claim which Indemnitee is or could have been a party unless such settlement
solely involves the payment of money and includes a complete and unconditional
release of Indemnitee from all liability on any claims that are the subject
matter of such Indemnifiable Claim. Neither the Company nor Indemnitee shall
unreasonably withhold its consent to any proposed settlement; provided that
Indemnitee may withhold consent to any settlement that does not provide a
complete and unconditional release of Indemnitee.
15. Successors and Binding Agreement. The Company shall require any
successor (whether direct or indirect, by purchase, merger, consolidation,
reorganization or otherwise) to all or substantially all of the business or
assets of the
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Company, by agreement in form and substance satisfactory to Indemnitee and his
counsel, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent the Company would be required to perform if no
such succession had taken place. This Agreement shall be binding upon and inure
to the benefit of the Company and any successor to the Company, including
without limitation any person acquiring directly or indirectly all or
substantially all of the business or assets of the Company whether by purchase,
merger, consolidation, reorganization or otherwise (and such successor will
thereafter be deemed the "Company" for purposes of this Agreement), but shall
not otherwise be assignable or delegatable by the Company.
(b) This Agreement shall inure to the benefit of and be enforceable by
Indemnitee's personal or legal representatives, executors, administrators,
heirs, distributees, legatees and other successors.
(c) This Agreement is personal in nature and neither of the parties
hereto shall, without the consent of the other, assign or delegate this
Agreement or any rights or obligations hereunder except as expressly provided in
Sections 15(a) and (b). Without limiting the generality or effect of the
foregoing, Indemnitee's right to receive payments hereunder shall not be
assignable, whether by pledge, creation of a security interest or otherwise,
other than by a transfer by Indemnitee's will or by the laws of descent and
distribution, and, in the event of any attempted assignment or transfer contrary
to this Section 15(c), the Company shall have no liability to pay any amount so
attempted to be assigned or transferred.
16. Notices. For all purposes of this Agreement, all communications,
including without limitation notices, consents, requests or approvals, required
or permitted to be given hereunder shall be in writing and shall be deemed to
have been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof orally confirmed), or five business days
after having been mailed by United States registered or certified mail, return
receipt requested, postage prepaid or one business day after having been sent
for next-day delivery by a nationally recognized overnight courier service,
addressed to the Company (to the attention of the Secretary of the Company) and
to Indemnitee at the applicable address shown on the signature page hereto, or
to such other address as any party may have furnished to the other in writing
and in accordance herewith, except that notices of changes of address will be
effective only upon receipt.
17. Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by and construed in accordance
with the substantive laws of the State of Delaware, without giving effect to the
principles of conflict of laws of such State. The Company and Indemnitee each
hereby irrevocably consent to the jurisdiction of the Chancery Court of the
State of Delaware for all purposes in connection with any action or proceeding
which arises out of or relates to this Agreement and agree that any action
instituted under this Agreement shall be brought only in the Chancery Court of
the State of Delaware.
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18. Validity. If any provision of this Agreement or the application of any
provision hereof to any person or circumstance is held invalid, unenforceable or
otherwise illegal, the remainder of this Agreement and the application of such
provision to any other person or circumstance shall not be affected, and the
provision so held to be invalid, unenforceable or otherwise illegal shall be
reformed to the extent, and only to the extent, necessary to make it
enforceable, valid or legal. In the event that any court or other adjudicative
body shall decline to reform any provision of this Agreement held to be invalid,
unenforceable or otherwise illegal as contemplated by the immediately preceding
sentence, the parties thereto shall take all such action as may be necessary or
appropriate to replace the provision so held to be invalid, unenforceable or
otherwise illegal with one or more alternative provisions that effectuate the
purpose and intent of the original provisions of this Agreement as fully as
possible without being invalid, unenforceable or otherwise illegal.
19. Miscellaneous. No provision of this Agreement may be waived, modified
or discharged unless such waiver, modification or discharge is agreed to in
writing signed by Indemnitee and the Company. No waiver by either party hereto
at any time of any breach by the other party hereto or compliance with any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations,
oral or otherwise, expressed or implied with respect to the subject matter
hereof have been made by either party that are not set forth expressly in this
Agreement. References to Sections are to references to Sections of this
Agreement.
20. Legal Fees and Expenses. It is the intent of the Company that
Indemnitee not be required to incur legal fees and or other Expenses associated
with the interpretation, enforcement or defense of Indemnitee's rights under
this Agreement by litigation or otherwise because the cost and expense thereof
would substantially detract from the benefits intended to be extended to
Indemnitee hereunder. Accordingly, without limiting the generality or effect of
any other provision hereof, if it should appear to Indemnitee that the Company
has failed to comply with any of its obligations under this Agreement or in the
event that the Company or any other person takes or threatens to take any action
to declare this Agreement void or unenforceable, or institutes any litigation or
other action or proceeding designed to deny, or to recover from, Indemnitee the
benefits provided or intended to be provided to Indemnitee hereunder, the
Company irrevocably authorizes Indemnitee from time to time to retain counsel of
Indemnitee's choice, at the expense of the Company as hereafter provided, to
advise and represent Indemnitee in connection with any such interpretation,
enforcement or defense, including without limitation the initiation or defense
of any litigation or other legal action, whether by or against the Company or
any director, officer, stockholder or other person affiliated with the Company,
in any jurisdiction. Notwithstanding any existing or prior attorney-client
relationship between the Company and such counsel, the Company irrevocably
consents to Indemnitee's entering into an attorney-client relationship with such
counsel, and in that connection the Company and Indemnitee agree that a
confidential relationship shall exist between Indemnitee and such counsel.
Without respect to whether Indemnitee prevails, in whole or in part, in
connection with any of the foregoing, the Company will pay and be solely
financially responsible for any and all
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reasonable, documented attorneys' and related fees and expenses incurred by
Indemnitee in connection with any of the foregoing.
21. Certain Interpretive Matters. Unless the context of this Agreement
otherwise requires, (a) "it" or "its" or words of any gender include each other
gender, (b) words using the singular or plural number also include the plural or
singular number, respectively, (c) the terms "hereof," "herein," "hereby" and
derivative or similar words refer to this entire Agreement, (d) "Section" refers
to the specified Section of this Agreement, (e) the terms "include," "includes"
and "including" will be deemed to be followed by the words "without limitation"
(whether or not so expressed), and (f) the word "or" is disjunctive but not
exclusive. Whenever this Agreement refers to a number of days, such number will
refer to calendar days unless business days are specified and whenever action
must be taken (including the giving of notice or the delivery of documents)
under this Agreement during a certain period of time or by a particular date
that ends or occurs on a non-business day, then such period or date will be
extended until the immediately following business day. As used herein, "business
day" means any day other than Saturday, Sunday or a United States federal
holiday.
22. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original but all of which
together shall constitute one and the same agreement.
23. Consummation of Mergers. Upon the consummation of the transactions
contemplated by the Business Combination Agreements, the provisions hereof will
apply to Holdco, mutatis mutandis, as they originally applied to the Company,
and Holdco will thereafter be deemed the "Company" for purposes of this
Agreement.
[Signatures Appear On Following Page]
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IN WITNESS WHEREOF, Indemnitee has executed and the Company has caused its
duly authorized representative to execute this Agreement as of the date first
above written.
ICG, INC.
By:
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Name:
Title:
INTERNATIONAL COAL GROUP, INC.
By:
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Name:
Title: