Exhibit 10.14
FORM OF
OFFICER INDEMNIFICATION AGREEMENT
This Indemnification Agreement
(“Agreement”) is made as of __________, 2006 by and
between DynCorp International Inc., a Delaware corporation (the
“Company”), and .
(“Indemnitee”).
RECITALS
WHEREAS, highly competent persons
have become more reluctant to serve publicly-held corporations as
officers 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;
WHEREAS, 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,
officers 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 Amended and Restated Certificate of
Incorporation of the Company (the “Certificate of
Incorporation”) requires indemnification of the officers of
the Company. Indemnitee may also be entitled to indemnification
pursuant to the General Corporation Law of the State of Delaware
(“DGCL”). The Certificate of Incorporation 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 with respect to indemnification;
WHEREAS, the uncertainties relating
to such insurance and to indemnification have increased the
difficulty of attracting and retaining such persons;
WHEREAS, 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;
WHEREAS, 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;
WHEREAS, this Agreement is a
supplement to and in furtherance of the Certificate of
Incorporation 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;
WHEREAS, Indemnitee does not regard
the protection available under the Company’s Certificate of
Incorporation of the Company and insurance as adequate in the
present circumstances, and may not be willing to serve as a officer
without adequate protection, and the Company desires Indemnitee to
serve in 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 be so indemnified; and
NOW, THEREFORE, in consideration of
the premises and the covenants contained herein, the Company and
Indemnitee do hereby covenant and agree as follows:
Section 1.
Services to the Company. Indemnitee
agrees to serve as a officer of the Company, at the request 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. The foregoing notwithstanding, this
Agreement shall continue in force after Indemnitee has ceased to
serve as an officer of the Company.
Section 2.
Definitions. As used in this
Agreement:
(a) 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 at 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
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
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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.
For purposes of this
Section 2(a), the following terms shall have the following
meanings:
(A) “Exchange Act” shall
mean the Securities Exchange Act of 1934, as amended.
(B) “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.
(C) “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)
“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.
(c)
“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.
(d)
“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.
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(e)
“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.
(f)
“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
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.
(g) 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 an Indemnitee to enforce his rights under this
Agreement.
(h)
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,
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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
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
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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 Corporate Status, a
witness in any Proceeding to which Indemnitee is not a party, he
shall be indemnified against all Expenses actually and reasonably
incurred by him or on his behalf in connection
therewith.
Section 7.
Additional Indemnification.
(a)
Notwithstanding any limitation in Sections
3, 4, or 5, the Company shall indemnify Indemnitee to the fullest
extent permitted by applicable 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 Company to procure a judgment
in its favor) 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
directors and officers.
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 13(d) of this Agreement, in connection
with any Proceeding (or any part of any Proceeding) initiated by
Indemnitee, including any
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Proceeding (or any part of any Proceeding)
initiated by Indemnitee against the Company or its directors,
officers, employees or other indemnitees, unless (i) the Board
of Directors of the Company authorized the Proceeding (or any part
of any Proceeding) prior to its initiation or (ii) the Company
provides the indemnification, in its sole discretion, pursuant to
the powers vested in the Company under applicable law.
Section 9.
Advances of Expenses. &nbs
