Exhibit
10.1
FORM OF
INDEMNIFICATION
AGREEMENT
This INDEMNIFICATION AGREEMENT (the "Agreement"), is effective as
of October ___, 2005, between Huttig Building Products, Inc., a
Delaware corporation (the "Company"), and (NAME)
("Indemnitee").
WHEREAS, both the Company and Indemnitee recognize the increased
risk of litigation and other claims being asserted against
directors and officers of public companies at a time when it has
become increasingly difficult to obtain adequate insurance coverage
at reasonable costs; and
WHEREAS, in recognition of Indemnitee's need for substantial
protection against personal liability in order to enhance
Indemnitee's continued service to the Company in an effective
manner, the Company wishes to provide in this Agreement for the
indemnification of and the advancing of expenses to Indemnitee to
the full extent (whether partial or complete) permitted by law and
as set forth in this Agreement, and, to the extent insurance is
maintained, for the continued coverage of Indemnitee under the
Company's directors' and officers' liability insurance policies,
regardless of any future change in the Certificate of
Incorporation, Bylaws, composition of the Board of Directors, or
structure of the Company;
NOW, THEREFORE, in consideration of the premises and of
Indemnitee's service to the Company, directly or indirectly, and
intending to be legally bound hereby, the parties hereto agree as
follows:
1.
In the event Indemnitee was, is, or becomes a party to or a witness
or other participant in, or is threatened to be made a party to or
a witness or other participant in, any threatened, pending or
completed action, suit or proceeding, or any inquiry or
investigation, whether conducted by the Company or any other party,
that Indemnitee in good faith believes might lead to any such
action, suit or proceeding, whether civil, criminal,
administrative, investigative or otherwise ("Claim") by reason of
(or arising in part out of) the fact that Indemnitee is or was a
director, officer, employee, agent or fiduciary of the Company, or
is or was serving at the request of the Company as a director,
officer, employee, trustee, agent or fiduciary of another
corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise, or by reason of anything done or not done
by Indemnitee in any such capacity (an "Indemnifiable Event"), the
Company shall indemnify Indemnitee to the full extent permitted by
law (the determination of which shall be made by the Reviewing
Party referred to below) as soon as practicable but in any event no
later than thirty days after written demand is presented to the
Company, against any and all expenses (including attorneys' fees
and all other costs, expenses and obligations paid or incurred in
connection with investigating, preparing for and defending or
participating in the defense of (including on appeal) any Claim
relating to any Indemnifiable Event) (collectively "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 judgments, fines,
penalties or amounts paid in settlement) of such Claim and, if so
requested by Indemnitee, the Company shall advance (within two
business days of such request) any and all such Expenses to
Indemnitee; provided, however, that (i) the foregoing obligation of
the Company shall not apply to a Claim that was commenced by the
Indemnitee without the prior approval of the Board of Directors of
the Company unless the Claim was commenced after a Change in
Control of the Company (as defined in Section 5 herein); (ii) the
foregoing obligation of the Company shall be subject to the
condition that an appropriate person or body (the "Reviewing
Party") shall not have determined (in a written opinion in any case
in which the special, independent counsel referred to in Section 4
hereof is involved) that Indemnitee would not be permitted to be
indemnified for such Expenses under applicable law; and (iii) if,
when and to the extent that the Reviewing Party determines that
Indemnitee would not be permitted to be indemnified for such
Expenses under applicable law, the Company shall be entitled to be
reimbursed by Indemnitee (who hereby agrees to reimburse the
Company) for all such amounts theretofore paid (unless Indemnitee
has commenced legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, in which event Indemnitee shall
not be required to so reimburse the Company until a final judicial
determination requiring such reimbursement is made with respect
thereto as to which all rights of appeal therefrom have been
exhausted or lapsed) and the Company shall not be obligated to
indemnify or advance any additional amounts to Indemnitee under
this Agreement (unless there has been a determination by a court of
competent jurisdiction that the Indemnitee would be permitted to be
so indemnified or entitled to such expense advances under
applicable law).
2.
If there has not been a Change in Control of the Company (as
hereinafter defined), the Reviewing Party shall be (i) a quorum of
the Board of Directors consisting of directors who are not parties
to the action, suit or proceeding acting by majority vote, or (ii)
if such a quorum is not obtainable, or, even if obtainable, a
quorum of disinterested directors so directs, independent legal
counsel by the use of a written opinion or (iii) the stockholders.
If there has been a Change in Control of the Company, the Reviewing
Party shall be the special, independent counsel referred to in
Section 4 hereof.
3.
If Indemnitee has not been indemnified by the expiration of the
foregoing thirty-day period or received expense advances or if the
Reviewing Party determines that Indemnitee would not be permitted
to be indemnified or be entitled to receive expense advances within
two days of the request therefor in whole or in part under the
applicable law, Indemnitee shall have the right to commence
litigation seeking from the court a finding that Indemnitee is
entitled to indemnification and expense advances or enforcement of
Indemnitee's entitlement to indemnification and expense advances or
challenging any determination by the Reviewing Party or any aspect
thereof that Indemnitee is not entitled to be indemnified or
receive expense advances and the burden of proving that
indemnification or advancement of expenses is not appropriate shall
be on the Company; any determination by the Reviewing Party in
favor of Indemnitee shall be conclusive and binding on the Company,
unless facts supplied by Indemnitee which form the basis for the
determination are subsequently determined to have been materially
incorrect at the time supplied. Indemnitee agrees to bring any such
litigation in any court in the states of New York or Delaware
having subject matter jurisdiction thereof and in which venue is
proper, and the Company hereby consents to service of process and
to appear in any such proceeding.
4.
The Company agrees that if there is a Change in Control of the
Company (as hereinafter defined), then with respect to all matters
thereafter arising concerning the rights of Indemnitee to indemnity
payments and expense advances under this Agreement or any other
agreement or Bylaws now or hereafter in effect relating to Claims
for Indemnifiable Events, the Company shall seek legal advice only
from special, independent counsel selected by Indemnitee who a
majority of the disinterested directors approves (which approval
shall not be unreasonably withheld), and who has not otherwise
performed services for the Company or Indemnitee. Such counsel,
among other things, shall determine whether and to what extent
Indemnitee is permitted to be indemnified or is entitled to expense
advances under applicable law and shall render its written opinion
to the Company and Indemnitee to such effect. The Company agrees to
pay the reasonable fees of the special, independent counsel
referred to above and to fully indemnify such counsel against any
and all expenses (including attorneys' fees), claims, liabilities
and damages arising out of or relating to this Agreement or its
engagement pursuant hereto except for willful misconduct or gross
negligence.
5.
For purposes of this Agreement, (a) "Change in Control of the
Company" shall be deemed to have occurred if (i) any "person" (as
such term is used in Sections 13(d)(3) and 14(d) of the Securities
Exchange Act of 1934, as amended), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the
Company, is or becomes the beneficial owner (as de
