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Exhibit 10.1
EXECUTION COPY
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION
AGREEMENT (this " Agreement ") is made as of January
___, 2007 by and between BOWATER INCORPORATED , a Delaware
corporation (the " Corporation "), and
(" Indemnitee ").
RECITALS
WHEREAS , Indemnitee
performs a valuable service for the Corporation;
WHEREAS , the Restated
Certificate of Incorporation of the Corporation, dated
March 23, 1984, as the same has been or may be amended from
time to time (the " Restated Certificate of Incorporation ")
provides that the Corporation shall indemnify the officers and
directors of the Corporation to the fullest extent permitted by
Section 145 of the Delaware General Corporation Law ("
DGCL ");
WHEREAS , the Restated
Certificate of Incorporation and the DGCL expressly provide that
the indemnification provisions set forth therein are not exclusive,
and thereby contemplate that agreements may be entered into between
the Corporation and members of the Board of Directors of the
Corporation (the " Board ") and officers with respect to
indemnification;
WHEREAS , it is reasonable
and prudent for the Corporation contractually to obligate itself to
indemnify, and to advance expenses on behalf of, its officers and
directors to the fullest extent permitted by applicable law so that
they will serve or continue to serve the Corporation free from
undue concern that they will not be indemnified; and
WHEREAS , this Agreement
is separate and independent of the Restated Certificate of
Incorporation and any resolutions adopted pursuant thereto, and
shall not be deemed a substitute therefor, nor to diminish or
abrogate any rights of Indemnitee thereunder, nor shall the
existence of any rights under the Restated Certificate of
Incorporation, the Corporation’s Bylaws, or any other
agreement be deemed a substitute therefor, nor to diminish or
abrogate any rights of Indemnitee under this Agreement.
NOW, THEREFORE , in
consideration of the promises and the covenants contained herein,
the Corporation and Indemnitee do hereby covenant and agree as
follows:
1. Services to the
Corporation . Indemnitee will serve or continue to serve, at
the will of the Corporation or under separate contract, if such
exists, as an officer and/or director of the Corporation for so
long as Indemnitee is duly elected or appointed and qualified in
accordance with the Restated Certificate of Incorporation and
Bylaws of the Corporation or until Indemnitee tenders his or her
resignation. If Indemnitee is an employee at will of the
Corporation, nothing herein shall change such employee’s
status as an employee at will.
2. Definitions . As
used in this Agreement:
(a) The
terms " Beneficial Owner " and " Beneficial Ownership
" shall have the meaning set forth in Rule 13d-3 promulgated
under the Exchange Act as in effect on the date hereof.
(b) A
" Change in Control " shall be deemed to occur upon the
earliest after the date of this Agreement of any of the following
events:
(i)
Acquisition of Stock by Third Party . Any Person is or
becomes the Beneficial Owner, directly or indirectly, of securities
of the Corporation representing twenty percent (20%) or more of the
combined voting power of the Corporation’s then outstanding
securities entitled to vote generally in the election of directors,
unless (1) the change in the relative Beneficial Ownership of
the Corporation’s securities by any Person results solely
from a reduction in the aggregate number of outstanding shares of
securities entitled to vote generally in the election of directors,
or (2) such acquisition was approved in advance by the
Continuing Directors and such acquisition would not constitute a
Change in Control under part (iii) of this definition;
(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 Corporation to effect a Change in Control) whose election
by the Board or nomination for election by the Corporation’s
stockholders was approved by a vote of a majority 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 (collectively, the "Continuing Directors"),
cease for any reason to constitute at least a majority of the
members of the Board;
(iii)
Corporate Transactions . Any reorganization, merger or
consolidation involving the Corporation (a "Business Combination"),
in each case, unless, following such Business Combination:
(1) all or substantially all of the individuals and entities
who were the Beneficial Owners of securities entitled to vote
generally in the election of directors immediately prior to such
Business Combination beneficially own, directly or indirectly, more
than 51% of the combined voting power of the then outstanding
securities of the Corporation entitled to vote generally in the
election of directors resulting from such Business Combination
(including, without limitation, a corporation which as a result of
such transaction owns the Corporation or all or substantially all
of the Corporation’s assets either directly or through one or
more Subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Business Combination, of the
securities entitled to vote generally in the election of directors;
(2) no Person (excluding any corporation resulting from such
Business Combination) is the Beneficial Owner, directly or
indirectly, of twenty percent (20%) or more of the combined voting
power of the then outstanding securities entitled to vote generally
in the election of directors of such corporation except to the
extent that such ownership existed prior to the Business
Combination; and (3) at least a majority of the Board of
Directors of the corporation resulting from such Business
Combination were Continuing Directors at the time of the execution
of the initial agreement, or of the action of the Board of
Directors, providing for such Business Combination;
(iv)
Liquidation . The approval by the stockholders of the
Corporation of a complete liquidation of the Corporation, or an
agreement or series of agreements for the sale or disposition by
the Corporation of all or substantially all of the
Corporation’s assets, other than factoring the
Corporation’s current receivables or escrows due (or, if such
approval is not
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required, the decision by the Board to proceed with such a
liquidation, sale, or disposition in one transaction or a series of
related transactions); or
(c)
" Covered Capacity " means present or former status as a
director, officer, trustee, general partner, managing member, or
fiduciary of the Corporation, any Subsidiary, or any other
corporation, partnership, limited liability company, joint venture,
trust or other enterprise at the request of, for the convenience
of, or to represent the interests of the Corporation or any
Subsidiary.
(d)
" Delaware Court " means the Court of Chancery of the State
of Delaware.
(e)
" Disinterested Director " shall mean a director of the
Corporation who is not and was not a party to the Proceeding for
which indemnification is sought by Indemnitee.
(f)
" Exchange Act " shall mean the Securities Exchange Act of
1934, as amended.
(g)
" Expenses " shall include all direct and indirect costs,
fees and expenses of any type or nature whatsoever, including,
without limitation, all attorneys’ fees and costs, retainers,
court costs, transcript costs, fees of experts, witness fees,
travel expenses, fees of private investigators and professional
advisors, duplicating costs, printing and binding costs, telephone
charges, postage, delivery service fees, fax transmission charges,
secretarial services and all other disbursements, obligations or
expenses in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, being or preparing to be a
witness in, settlement or appeal of, or otherwise participating in,
a Proceeding, including reasonable compensation for time spent by
the Indemnitee for which he or she is not otherwise compensated by
the Corporation or any third party. Expenses also shall include
Expenses incurred in connection with any appeal resulting from any
Proceeding, including without limitation the principal, premium,
security for, and other costs relating to any cost bond,
supersedeas bond, or other appeal bond or its equivalent. Expenses,
however, shall not include amounts paid in settlement by Indemnitee
or the amount of judgments or fines against Indemnitee.
(h)
" Independent Counsel " shall mean a law firm, or a member
of a law firm, with significant experienced in matters of
corporation law and neither presently is, nor in the past five
years has been, retained to represent: (i) the Corporation 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 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 professional conduct
then prevailing, would have a conflict of interest in representing
either the Corporation or Indemnitee in an action to determine
Indemnitee’s rights under this Agreement.
(i) The
term " Person " shall have the meaning set forth in Sections
13(d) and 14(d) of the Exchange Act as in effect on the date
hereof; provided , however , that "Person" shall
exclude: (i) the Corporation; (ii) any Subsidiary of the
Corporation; (iii) any employment benefit plan of the
Corporation or of a Subsidiary of the Corporation or of any
corporation owned,
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directly or indirectly, by the stockholders of the Corporation
in substantially the same proportions as their ownership of stock
of the Corporation; and (iv) any trustee or other fiduciary
holding securities under an employee benefit plan of the
Corporation or of a Subsidiary of the Corporation or of a
corporation owned directly or indirectly by the stockholders of the
Corporation in substantially the same proportions as their
ownership of stock of the Corporation.
(j) A
" Potential Change in Control " shall be deemed to have
occurred if: (i) the Corporation enters into an agreement or
arrangement, the consummation of which would result in the
occurrence of a Change in Control; (ii) any Person or the
Corporation publicly announces an intention to take or consider
taking actions which if consummated would constitute a Change in
Control; (iii) any Person who is or becomes the Beneficial
Owner, directly or indirectly, of securities of the Corporation
representing 5% or more of the combined voting power of the
Corporation’s then outstanding securities entitled to vote
generally in the election of directors increases his Beneficial
Ownership of such securities by 5% or more over the percentage so
owned by such Person on the date hereof unless such acquisition was
approved in advance by the Board; or (iv) the Board adopts a
resolution to the effect that, for purposes of this Agreement, a
Potential Change in Control has occurred.
(k) The
term " Proceeding " shall include any threatened, pending or
completed action, suit, arbitration, mediation, alternate dispute
resolution mechanism, investigation, inquiry, administrative
hearing or any other actual, threatened or completed proceeding,
whether brought in the right of the Corporation, another Person, or
otherwise and whether of a civil, criminal, administrative or
investigative nature, in which Indemnitee was, is, will or might be
involved as a party or otherwise by reason of the fact that
Indemnitee is or was serving in a Covered Capacity by reason of any
action taken (or failure to act) by him or her or of any action (or
failure to act) on his or her part while serving in a Covered
Capacity, 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.
(l) References
to " fines " shall include any excise tax assessed with
respect to any employee benefit plan; references to " serving at
the request of the Corporation " shall include any service as a
director, officer, employee, agent or fiduciary of the Corporation
which imposes duties on, or involves services by, such director,
officer, employee, agent or fiduciary 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 a manner "
not opposed to the best interests of the Corporation " as
referred to in this Agreement.
(m) In
connection with any merger or consolidation, references to " the
Corporation " shall include not only the resulting or surviving
corporation but also any constituent corporation or any constituent
of a constituent corporation, which, if its separate existence had
continued, would have had power and authority to indemnify its
directors or officers and employees or agents. The intent of this
provision is that a person who is or was a director of such
constituent corporation after the date hereof or is or was serving
at the request of such constituent corporation as a director,
officer, employee, trustee or agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other
enterprise after the
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date hereof, shall stand in the same position under this
Agreement with respect to the resulting or surviving corporation as
the person would have under this Agreement with respect to such
constituent corporation if its separate existence had
continued.
(n) The
term " Subsidiary " shall mean 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 corporation or entity.
3. Indemnification
.
(a) The
Corporation shall indemnify Indemnitee in accordance with the
provisions of this Section 3(a) when Indemnitee was, is, or is
threatened to be made, a party to or is otherwise involved in any
Proceeding (other than a Proceeding by or in the right of the
Corporation to procure a judgment in its favor). Pursuant to this
Section 3(a), Indemnitee shall be indemnified against all
Expenses, judgments, liabilities, fines, penalties and amounts paid
in settlement (including all interest, assessments and other
charges paid or payable in connection with or in respect of such
Expenses, judgments, fines, penalties and amounts paid in
settlement) actually and reasonably incurred by Indemnitee or on
his or her behalf in connection with such Proceeding or any claim,
issue or matter therein, if, and only 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 Corporation, and, in the case
of any criminal Proceeding, he had no reasonable cause to believe
his or her conduct was unlawful.
(b) The
Corporation shall indemnify Indemnitee in accordance with the
provisions of this Section 3(b) when Indemnitee was, is, or is
threatened to be made, a party to or is otherwise involved in any
Proceeding by or in the right of the Corporation to procure a
judgment in its favor. Pursuant to this Section 3(b),
Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by Indemnitee or on his or her behalf in
connection with such Proceeding or any claim, issue or matter
therein, if, and only if, Indemnitee acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to the
best interests of the Corporation. No indemnification for Expenses
shall be made under this Section 3(b) 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 Corporation, unless and
only to the extent that the court in which the Proceeding was
brought or the Delaware Court 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.
(c) Any
indemnification under subsections (a) and (b) of this
Section 3 (unless otherwise ordered by a court) shall be made
by the Corporation in accordance with the procedures set forth in
Sections 7, 8 and 9 hereof.
(d) Notwithstanding
any other provisions of this Agreement, 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 with respect to
any claim, issue or matter therein, in whole or in part, the
Corporation shall indemnify Indemnitee against all Expenses
actually and reasonably incurred by him or her 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
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matters in such Proceeding, the Corporation shall indemnify
Indemnitee against all Expenses actually and reasonably incurred by
him or her or on his or her behalf in connection with each
successfully resolved claim, issue or matter. For purposes of this
Section 3(d) and without limitation, the termination of any claim,
issue or matter in such a Proceeding by dismissal, with or without
prejudice, or the settlement of any claim, issue or matter in such
a Proceeding without admission of liability, shall be deemed to be
a successful result as to such claim, issue or matter. If the
Indemnitee is not wholly successful in such Proceeding but is
partially successful, the Corporation 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 unsuccessful.
(e) Notwithstanding
any other provision of this Agreement, to the extent that
Indemnitee is, by reason of his 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 on his behalf in connection therewith.
4. Additional
Indemnification Rights .
(a) Notwithstanding
any limitation in Section 3 of this Agreement, the Corporation
shall indemnify Indemnitee to the fullest extent permitted by law
if Indemnitee is a party to or threatened to be made a party to any
Proceeding (including a Proceeding by or in the right of the
Corporation to procure a judgment in its favor) against all
Expenses, judgments, fines, penalties and amounts paid in
settlement (including all interest, assessments and other charges
paid or payable in connection with or in respect of such Expenses,
judgments, fines, penalties and amounts paid in settlement)
actually and reasonably incurred by Indemnitee in connection with
the Proceeding. No indemnification shall be made under this Section
4(a) on account of Indemnitee’s conduct which constitutes a
breach of Indemnitee’s duty of loyalty to the Corporation or
its stockholders or is an act or omission not in good faith or
which involves intentional misconduct or a knowing violation of the
law.
(b) For
purposes of this Section 4, the meaning of the phrase " to
the fullest extent permitted by 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 or provisions 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, directors and/or key employees.
5. Contribution In The
Event Of Joint Liability .
(a) To
the fullest extent permissible under applicable law, if the
indemnification rights provided for in this Agreement are
unavailable to Indemnitee in whole or in part for any reason
whatsoever, then in any Proceeding in which the Corporation is
jointly liable with Indemnitee (or would be if joined in such
Proceeding) the Corporation shall pay, in the first instance, the
entire amount incurred by Indemnitee, whether for judgments,
liabilities,
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fines, penalties, excise taxes, amounts paid or to be paid in
settlement and/or for Expenses, in connection with any Proceeding
without requiring Indemnitee to contribute to such payment, and the
Corporation hereby waives and relinquishes any right of
contribution it may have at any time against Indemnitee.
(b) The
Corporation shall not enter into any settlement unless such
settlement provides for a full and final release of all claims
asserted against Indemnitee. The Corporation shall not be liable to
Indemnitee under this Agreement for amounts paid in settlement of
any Proceeding effected without the Corporation’s prior
written consent. Neither the Corporation nor Indemnitee shall
unreasonably withhold consent to any proposed settlement;
provided , however , that Indemnitee may withhold
consent to any settlement that does not provide the full, final,
complete and unconditional release.
(c) The
Corporation hereby agrees to fully indemnify Indemnitee from any
claims for contribution which may be brought by officers, directors
or employees of the Corporation other than Indemnitee who may be
jointly liable with Indemnitee.
6. Exclusions .
Notwithstanding any other provision in this Agreement, the
Corporation shall not be obligated under this Agreement to make any
indemnification in connection with any claim made against
Indemnitee:
(a) for
which payment has actually been received by or on behalf of
Indemnitee under any insurance policy or other indemnity provision
or agreement (other than this Agreement), either by the Corporation
or otherwise, except with respect to any excess beyond the amount
actually received under any insurance policy, contract, agreement,
other indemnity provision or otherwise;
(b) for
an accounting of profits made from the purchase and sale (or sale
and purchase) by Indemnitee of securities of the Corporation within
the meaning of Section 16(b) of the Exchange Act or similar
provisions of state statutory law or common law; or
(c) except
as otherwise provided in Sections 11(e) and (f) hereof, prior
to a Change in Control, in connection with any Proceeding (or any
part of any Proceeding) initiated by Indemnitee, and not brought by
way of defense, including any Proceeding (or any part of any
Proceeding) initiated by Indemnitee against the Corporation or its
directors, officers, employees or other indemnitees, unless
(i) the Board of Directors of the Corporation authorized the
Proceeding (or any part of any Proceeding) prior to its initiation;
or (ii) the Corporation otherwise provides such
indemnification in its sole discretion, pursuant to the powers
vested in the Corporation under applicable law.
7. Advances of Expenses;
Defense of Claim .
(a) Notwithstanding
any provision of this Agreement to the contrary, and to the fullest
extent permitted by applicable law, the Corporation shall advance
to Indemnitee the Expenses incurred by Indemnitee (or reasonably
expected by Indemnitee to be incurred by Indemnitee within the next
three months) in connection with any Proceeding. The Corporation
will advance such Expenses within ten (10) days after the
receipt by the Corporation from Indemnitee of a statement or
statements requesting such advances from time to time, whether
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prior to or after final disposition of any Proceeding. The
statement(s) shall be in a form reasonably acceptable to the
Corporation and shall set forth in reasonable detail the Expenses
to be advanced. All advances shall be unsecured and interest free.
Advances shall be made without regard to Indemnitee’s ability
to repay the Expenses and without regard to Indemnitee’s
ultimate entitlement to be indemnified under the other provisions
of this Agreement. Advances shall include any and all reasonable
Expenses incurred pursuing a Proceeding to enforce this right of
advancement, including Expenses incurred preparing and forwarding
statement(s) to the Corporation to support the advances claimed.
The Indemnitee shall qualify for advances, to the fullest extent
permitted by applicable law, solely upon the execut
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