AMENDED AND
RESTATED INDEMNITY AGREEMENT
This
Amended and Restated Indemnification Agreement (“
Agreement ”) is made as of December 31, 2008 by
and between Libbey Inc., a Delaware corporation (the “
Company ”), and [Insert Name of Outside Director from
Appendix 1] (“ Indemnitee ”).
A. Highly
competent persons have become more reluctant to serve publicly-held
corporations as directors or in other capacities unless they are
provided with adequate protection through insurance or adequate
indemnification against inordinate risks of claims and actions
against them arising out of their service to and activities on
behalf of the corporation.
B. The
Board of Directors of the Company (the “ Board
”) has determined that, in order to attract and retain
qualified individuals, the Company will attempt to maintain on an
ongoing basis, at its sole expense, liability insurance to protect
persons serving the Company and its subsidiaries from certain
liabilities. Although the furnishing of such insurance has been a
customary and widespread practice among United States-based
corporations and other business enterprises, the Company believes
that, given current market conditions and trends, such insurance
may be available to it in the future only at higher premiums and
with more exclusions. At the same time, directors, officers and
other persons in service to corporations or business enterprises
are being increasingly subjected to expensive and time-consuming
litigation relating to, among other things, matters that
traditionally would have been brought only against the Company or
business enterprise itself. The By-laws of the Company require
indemnification of the officers and directors of the Company.
Indemnitee also may be entitled to indemnification pursuant to the
General Corporation Law of the State of Delaware (“
DGCL ”). The By-laws and the DGCL, expressly provide
that the indemnification provisions set forth therein are not
exclusive, and thereby contemplate that contracts may be entered
into between the Company and members of the board of directors,
officers and other persons with respect to
indemnification.
C. The
uncertainties relating to such insurance and to indemnification
have increased the difficulty of attracting and retaining such
persons.
D. The
Board has determined that the increased difficulty in attracting
and retaining such persons is detrimental to the best interests of
the Company’s stockholders and that the Company should act to
assure such persons that there will be increased certainty of such
protection in the future.
E. It
is reasonable, prudent and necessary for the Company contractually
to obligate itself to indemnify, and to advance expenses on behalf
of, such persons 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 so indemnified.
F. This
Agreement is a supplement to and in furtherance of the By-laws of
the Company and any resolutions adopted pursuant thereto, and shall
not be deemed a substitute therefor, nor to diminish or abrogate
any rights of Indemnitee thereunder.
G. Indemnitee
does not regard the protection available under the Company’s
By-laws and insurance as adequate in the present circumstances, and
may not be willing to serve as an officer or director without
adequate protection, and the Company desires Indemnitee to serve
in
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such
capacity. Indemnitee is willing to serve, continue to serve and to
take on additional service for or on behalf of the Company on the
condition that he or she be so indemnified.
H. The
Company has determined that it is advisable to amend the Indemnity
Agreement dated as of February 1, 2005 between the Company and
Indemnitee (the “Original Indemnity Agreement”) in
order to provide that the Company will maintain directors and
officers liability insurance covering Indemnitee for a period of
six (6) years following Indemnitee’s separation from
service (as defined by Section 409A of the Internal Revenue
Code of 1986, as amended).
NOW,
THEREFORE, in consideration of the premises and the covenants
contained herein, the Company and Indemnitee do hereby agree that
the Original Indemnity Agreement is hereby amended and restated in
its entirety as follows:
Section 1.
Services to the Company . Indemnitee agrees to serve as a
director of the Company. Indemnitee may, at any time and for any
reason, resign from such position (subject to any other contractual
obligation or any obligation imposed by operation of law), in which
event the Company shall have no obligation under this Agreement to
continue Indemnitee in such position. This Agreement shall not be
deemed an employment contract between the Company (or any of its
subsidiaries or any Enterprise) and Indemnitee. The foregoing
notwithstanding, this Agreement shall continue in force after
Indemnitee has ceased to serve as a director of the
Company.
Section 2.
Definitions . As used in this Agreement:
(a) “
Beneficial Owner ” shall have the meaning given to
such term in Rule 13d-3 under the Exchange Act; provided,
however, that Beneficial Owner shall exclude any Person otherwise
becoming a Beneficial Owner by reason of the stockholders of the
Company approving a merger of the Company with another
entity.
(b) A
“ Change in Control ” shall be deemed to occur
upon the earliest to occur after the date of this Agreement of any
of the following events:
(i)
Acquisition of Stock by Third Party. Any Person (as defined below)
is or becomes the Beneficial Owner (as defined below), directly or
indirectly, of securities of the Company representing fifteen
percent (15%) or more of the combined voting power of the
Company’s then outstanding securities;
(ii)
Change in Board of Directors. During any period of two
(2) consecutive years (not including any period prior to the
execution of this Agreement), individuals who at the beginning of
such period constitute the Board, and any new director (other than
a director designated by a person who has entered into an agreement
with the Company to effect a transaction described in Sections
2(a)(i), 2(a)(iii) or 2(a)(iv)) whose election by the Board or
nomination for election by the Company’s stockholders was
approved by a vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously
so approved, cease for any reason to constitute a least a majority
of the members of the Board;
(iii)
Corporate Transactions. The effective date of a merger or
consolidation of the Company with any other entity, other than a
merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior to such merger
or
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consolidation
continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity)
more than 51% of the combined voting power of the voting securities
of the surviving entity outstanding immediately after such merger
or consolidation and with the power to elect at least a majority of
the board of directors or other governing body of such surviving
entity;
(iv)
Liquidation. The approval by the stockholders of the Company of a
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the
Company’s assets; and
(v)
Other Events. There occurs any other event of a nature that would
be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A (or a response to any
similar item on any similar schedule or form) promulgated under the
Exchange Act (as defined below), whether or not the Company is then
subject to such reporting requirement.
(c) “
Corporate Status ” describes the status of a person
who is or was a director, officer, employee or agent of the Company
or of any other corporation, limited liability company, partnership
or joint venture, trust, employee benefit plan or other enterprise
which such person is or was serving at the request of the
Company.
(d) “
Disinterested Director ” means a director of the
Company who is not and was not a party to the Proceeding in respect
of which indemnification is sought by Indemnitee.
(e) “
Enterprise ” shall mean the Company and any other
corporation, limited liability company, partnership, joint venture,
trust, employee benefit plan or other enterprise of which
Indemnitee is or was serving at the request of the Company as a
director, officer, employee, agent or fiduciary.
(f) “
Exchange Act ” shall mean the Securities Exchange Act
of 1934, as amended.
(g) “
Expenses ” shall include all reasonable
attorneys’ fees, retainers, court costs, transcript costs,
fees of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery
service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending,
preparing to prosecute or defend, investigating, being or preparing
to be a witness in, or otherwise participating in, a Proceeding.
Expenses also shall include (i) Expenses incurred in
connection with any appeal resulting from any Proceeding, including
without limitation the premium, security for, and other costs
relating to any cost bond, supersedeas bond, or other appeal bond
or its equivalent, and (ii) for purposes of Section 13(d)
only, Expenses incurred by Indemnitee in connection with the
interpretation, enforcement or defense of Indemnitee’s rights
under this Agreement, by litigation or otherwise, Expenses,
however, shall not include amounts paid in settlement by Indemnitee
or the amount of judgments or fines against Indemnitee.
(h) “
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 Indemnitee in any matter
material to either such party (other than with respect to matters
concerning the Indemnitee under this Agreement, or of other
indemnitees under similar indemnification agreements), or
(ii) any other party to the Proceeding 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
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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. The
Company agrees to pay the reasonable fees and expenses of the
Independent Counsel referred to above and to fully indemnify such
counsel against any and all Expenses, claims, liabilities and
damages arising out of or relating to this Agreement or its
engagement pursuant hereto.
(i) “
Person ” shall have the meaning as set forth in
Sections 13(d) and 14(d) of the Exchange Act; provided, however,
that Person shall exclude (i) the Company, (ii) any
trustee or other fiduciary holding securities under an employee
benefit plan of the Company, and (iii) any corporation owned,
directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock of
the Company.
(j) The
term “ Proceeding ” shall include any
threatened, pending or completed action, suit, arbitration,
alternate dispute resolution mechanism, investigation, inquiry,
administrative hearing or any other actual, threatened or completed
proceeding, whether brought in the right of the Company or
otherwise and whether of a civil, criminal, administrative or
investigative nature, in which Indemnitee was, is or will be
involved as a party or otherwise by reason of the fact that
Indemnitee is or was a director or officer of the Company, by
reason of any action taken by him or of any action on his
part while acting as director or officer of the Company, or by
reason of the fact that he is or was serving at the request of the
Company as a director, officer, employee or agent of another
corporation, limited liability company, partnership, joint venture,
trust or other enterprise, in each case whether or not serving in
such capacity at the time any liability or expense is incurred for
which indemnification, reimbursement, or advancement of expenses
can be provided under this Agreement; except one initiated by a
Indemnitee to enforce his rights under this Agreement.
(k) Reference
to “ other enterprise ” shall include employee
benefit plans; references to “fines” shall include any
excise tax assessed with respect to any employee benefit plan;
references to “serving at the request of the Company”
shall include any service as a director, officer, employee or agent
of the Company which imposes duties on, or involves services by,
such director, 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 he reasonably
believed to be in the best interests of the participants and
beneficiaries of an employee benefit plan shall be deemed to have
acted in manner “not opposed to the best interests of the
Company” as referred to in this Agreement.
Section 3.
Indemnity in Third-Party Proceedings. The Company shall
indemnify Indemnitee in accordance with the provisions of this
Section 3 if Indemnitee is, or is threatened to be made, a
party to or a participant in any Proceeding, other than a
Proceeding by or in the right of the Company to procure a judgment
in its favor. Pursuant to this Section 3, Indemnitee shall be
indemnified to the fullest extent permitted by applicable law
against all Expenses, judgments, fines and amounts paid in
settlement actually and reasonably incurred by Indemnitee or on his
behalf in connection with such Proceeding or any claim, issue or
matter therein, if Indemnitee acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best
interests of the Company and, in the case of a criminal proceeding
had no reasonable cause to believe that his conduct was
unlawful.
Section 4.
Indemnity in Proceedings by or in the Right of the Company.
The Company shall indemnify Indemnitee in accordance with the
provisions of this Section 4 if Indemnitee is, or is
threatened to be made, a party to or a participant in any
Proceeding by or in the right of the Company to procure a judgment
in its favor. Pursuant to this Section 4, Indemnitee shall
be
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indemnified
to the fullest extent permitted by applicable law against all
Expenses actually and reasonably incurred by him or on his behalf
in connection with such Proceeding or any claim, issue or matter
therein, if Indemnitee acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests
of the Company. No indemnification for Expenses shall be made under
this Section 4 in respect of any claim, issue or matter as to
which Indemnitee shall have been finally adjudged by a court to be
liable to the Company, unless and only to the extent that the
Delaware Court of Chancery or any court in which the Proceeding was
brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of
the case, Indemnitee is fairly and reasonably entitled to
indemnification.
Section 5.
Indemnification for Expenses of a Party Who is Wholly or Partly
Successful. Notwithstanding any other provisions of this
Agreement, to the fullest extent permitted by applicable law and to
the extent that Indemnitee is a party to (or a participant in) and
is successful, on the merits or otherwise, in any Proceeding or in
defense of any claim, issue or matter therein, in whole or in part,
the Company shall indemnify Indemnitee against all Expenses
actually and reasonably incurred by him in connection therewith. If
Indemnitee is not wholly successful in such Proceeding but is
successful, on the merits or otherwise, as to one or more but less
than all claims, issues or matters in such Proceeding, the Company
shall indemnify Indemnitee against all Expenses actually and
reasonably incurred by him or on his behalf in connection with each
successfully resolved claim, issue or matter. If the Indemnitee is
not wholly successful in such Proceeding, the Company also shall
indemnify Indemnitee against all Expenses reasonably incurred in
connection with a claim, issue or matter related to any claim,
issue, or matter on which the Indemnitee was successful. For
purposes of this Section and without limitation, the termination of
any claim, issue or matter in such a Proceeding by dismissal, with
or without prejudice, shall be deemed to be a successful result as
to such claim, issue or matter.
Section 6.
Indemnification For Expenses of a Witness. Notwithstanding
any other provision of this Agreement, to the fullest extent
permitted by applicable law and to the extent that Indemnitee is,
by reason of his or her Corporate Status, a witness in any
Proceeding to which Indemnitee is not a party, he or she shall be
indemnified against all Expenses actually and reasonably incurred
by him or her or on his or her behalf in connection
therewith.
Section 7.
Additional Indemnification .
(a) Notwithstanding
any limitation in Sections 3, 4, or 5, if Indemnitee is a
party to or is threatened to be made a party to any Proceeding
(including a Proceeding by or in the right of the Company to
procure a judgment in its favor), the Company shall indemnify
Indemnitee, to the fullest extent permitted by applicable law,
against all Expenses, judgments, fines and amounts paid in
settlement actually and reasonably incurred by Indemnitee in
connection with the Proceeding.
(b) For
purposes of Section 7(a), the meaning of the phrase “to
the fullest extent permitted by applicable law” shall
include, but not be limited to:
(i)
to the fullest extent permitted by the provision of the DGCL that
authorizes or contemplates additional indemnification by agreement,
or the corresponding provision of any amendment to or replacement
of the DGCL, and
(ii)
to the fullest extent authorized or permitted by any amendments to
or replacements of the DGCL adopted after the date of this
Agreement that increase the extent to which a corporation may
indemnify its officers and directors.
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Section 8.
Exclusions. Notwithstanding any provision in this Agreement,
the Company shall not be obligated under this Agreement to make any
indemnity in connection with any claim made against
Indemnitee:
(a) for
which payment has actually been made to or on behalf of Indemnitee
under any insurance policy or other indemnity provision, except
with respect to any excess beyond the amount paid under any
insurance policy or other indemnity provision; or
(b) for
(i) an accounting of profits made from the purchase and sale
(or sale and purchase) by Indemnitee of securities of the Company
within the meaning of Section 16(b) of the Exchange Act (as defined
in Section 2(a) hereof), or similar provisions of state statutory
law or common law, or (ii) any reimbursement of the Company by
the Indemnitee of any bonus or other incentive-based or
equity-based compensation or of any profits realized by the
Indemnitee from the sale of securities of the Company, as required
in each case under the Exchange Act; or
(c) except
as provided in Section 1.3(d) of th
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