EXHIBIT 10.12
INDEMNIFICATION
AGREEMENT
This Agreement, made and entered
into as of this 7 th day of March, 2006
(“Agreement”), among and between AmTrust Financial
Services, Inc., a Delaware corporation (the “Company”),
and the individual listed on the signature page hereof (the
“Indemnitee”);
WHEREAS, it is reasonable, prudent
and necessary for the Company contractually to obligate itself to
indemnify such persons to the fullest extent permitted by
applicable law so that he will serve or continue to serve the
Company free from undue concern that he will not be so indemnified;
and
WHEREAS, Indemnitee is willing to
serve, for or on behalf of the Company, on the condition that he be
so indemnified;
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. Service by Indemnitee. Indemnitee agrees to continue to serve as a
director and/or officer 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).
SECTION 2. Indemnification - General.
The Company shall indemnify, and
advance Expenses (as hereinafter defined) to Indemnitee as provided
by applicable law in effect on the date hereof and to such greater
extent as applicable law may thereafter from time to time permit.
The rights of Indemnitee provided under the preceding sentence
shall include, but shall not be limited to, the rights set forth in
the other Sections of this Agreement.
The indemnification provided under
this Agreement is in addition to and not in lieu of any other
indemnification provided to Indemnitee by any other agreement or by
operation of law.
SECTION 3. Proceedings Other Than
Proceedings by or in the Right of the Company. Indemnitee shall
be entitled to the rights of indemnification provided in this
Section 3 if, by reason of his Corporate Status (as hereinafter
defined), he is, or is threatened to be made, a party to any
threatened, pending, or completed Proceeding (as hereinafter
defined), other than a Proceeding by or in the right of the
Company. Pursuant to this Section 3, Indemnitee shall be
indemnified against Expenses, judgments, penalties, fines and
amounts paid in settlement actually and reasonably incurred by him
or on his behalf in connection with such Proceeding or any claim,
issue or matter therein, if he 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, with respect to any criminal
Proceeding, had no reasonable cause to believe his conduct was
unlawful.
SECTION 4. Proceedings by or in the Right of the
Company. Indemnitee shall
be entitled to the rights of indemnification provided in this
Section 4 if, by reason of his Corporate Status, he is, or is
threatened to be made, party to any threatened, pending or
completed Proceeding brought by or in the right of the Company to
procure a judgment in its favor. Pursuant to this Section,
Indemnitee shall be indemnified against Expenses actually and
reasonably incurred by him or on his behalf in connection with such
Proceeding if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the
Company. Notwithstanding the foregoing, no indemnification against
such expenses shall be made in respect of any claim, issue or
matter in such Proceeding as to which Indemnitee shall have been
adjudged to be liable to the Company if applicable law prohibits
such indemnification; provided, however, that, if applicable law so
permits, indemnification against Expenses shall nevertheless be
made by the Company in such event if and only to the extent that
the Court in which such Proceeding shall have been brought or is
pending, shall determine.
SECTION 5. Indemnification for Expenses of a Party Who is
Wholly or Partly Successful. Notwithstanding any other provision of this
Agreement, to the extent that Indemnitee is, by reason of his
Corporate Status, a party to and is successful, on the merits or
otherwise, in any Proceeding, he shall be indemnified against all
Expenses actually and reasonably incurred by him or on his behalf
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. For the purposes of this Section and without limitation,
the termination of any claim, issue or matter in such a Proceeding
by settlement or 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 extent that
Indemnitee is, by reason of his Corporate Status, a witness in any
Proceeding, he shall be indemnified against all Expenses actually
and reasonably incurred by him or on his behalf in connection
therewith.
SECTION 7. Advancement of Expenses. The Company shall advance all reasonable
Expenses incurred by or on behalf of Indemnitee in connection with
any Proceeding within twenty (20) days after the receipt by the
Company of a statement or statements from Indemnitee requesting
such advance or advances from time to time, whether prior to or
after final disposition of such Proceeding. Such statement or
statements shall reasonably evidence the Expenses incurred by
Indemnitee and shall include or be preceded or accompanied by an
undertaking by or on behalf of Indemnitee to repay any Expenses
advanced if it shall ultimately be determined that Indemnitee is
not entitled to be indemnified against such Expenses.
SECTION 8. Procedure for Determination of Entitlement to
Indemnification.
(a) To obtain
indemnification under this Agreement, Indemnitee shall submit to
the Secretary of the Company a written request, including therein
or therewith such documentation and information as is reasonably
available to Indemnitee and is reasonably necessary to determine
whether and to what extent Indemnitee is entitled to
indemnification. The Secretary of the Company shall, promptly upon
receipt of such a request for indemnification, advise the Board of
Directors in writing that Indemnitee has requested
indemnification.
(b) Upon written
request by Indemnitee for indemnification pursuant to the first
sentence of Section 8(a) hereof, a determination, if required by
applicable law, with respect to Indemnitee’s entitlement
thereto shall be made in the specific case: (i) if a Change in
Control (as hereinafter defined) shall have occurred, by
Independent Counsel (as hereinafter defined) unless Indemnitee
shall request that such determination be made by the Board of
Directors or the stockholders, in which case by the person or
persons or in the manner provided for in clauses (ii) or (iii) of
this Section 8(b) in a written opinion to the Board of Directors, a
copy of which shall be delivered to Indemnitee; (ii) if a Change of
Control shall not have occurred, (A) by the Board of Directors by a
majority vote of a quorum consisting of Disinterested Directors (as
hereinafter defined), or (B) if a quorum of the Board of Directors
consisting of Disinterested Directors is not obtainable or, even if
obtainable, such quorum of Disinterested Directors so directs, by
Independent Counsel in a written opinion to the Board of Directors,
a copy of which shall be delivered to Indemnitee or (C) by the
stockholders of the Company; or (iii) as provided in Section 9(b)
of this Agreement; and, if it is so determined that Indemnitee is
entitled to indemnification, payment to Indemnitee shall be made
within ten (10) days after such determination.
Indemnitee shall cooperate with the
person, persons or entity making such determination with respect to
Indemnitee’s entitlement to indemnification, including
providing to such person, persons or entity 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. Any costs or expenses (including attorney’s
fees and disbursements) incurred by Indemnitee in so cooperating
with the person, persons or entity making such determination shall
be borne by the Company (irrespective of the determination as to
Indemnitee’s entitlement to indemnification) and the Company
hereby indemnifies and agrees to hold Indemnitee harmless
therefrom.
(c) In the event
the determination of entitlement to indemnification is to be made
by Independent Counsel pursuant to Section 8(b) hereof, the
Independent Counsel shall be selected as provided in this Section
8(c). If a Change of Control shall not have occurred, the
Independent Counsel shall be selected by the Board of Directors,
and the
Company shall give written notice to
the Indemnitee advising him of the identity of the Independent
Counsel so selected. If a Change of Control shall have occurred,
the Independent Counsel shall be selected by Indemnitee (unless
Indemnitee shall request that such selection be made by the Board
of Directors, in which event the preceding sentence shall apply),
and Indemnitee shall give written notice to the Company advising it
of the identity of the Independent Counsel so selected. In either
event, Indemnitee or the Company, as the case may be, may within
seven (7) days after such written notice of selection shall have
been given, deliver to the Company or the Indemnitee, as the case
may be, a written objection to such selection. Such objection may
be asserted only on the ground that the Independent Counsel so
selected does not meet the requirements of “Independent
Counsel” as defined in Section 17 of this Agreement, and the
objection shall set forth with particularity the factual basis of
such assertion. If such written objection is made, the Independent
Counsel so selected may not serve as Independent Counsel unless and
until a court has determined that such objection is without merit.
If, within twenty (20) days after submission by Indemnitee of a
written request for indemnification pursuant to Section 8(a)
hereof, no Independent Counsel shall have been selected and not
objected to, either the Company or Indemnitee may petition the
Supreme Court of the State of New York in New York County or other
court of competent jurisdiction for resolution of any objection
which shall have been made by the Company or Indemnitee to the
other’s selection of Independent Counsel and/or for the
appointment as Independent Counsel of a person selected by the
Court or by such other person as the court shall designate, and the
person with respect to whom an objection is so resolved or the
person so appointed shall act as Independent Counsel under Section
8(b) hereof. The Company shall pay any and all reasonable fees and
expenses of Independent Counsel incurred by such Independent
Counsel in connection with acting pursuant to Section 8(b) hereof,
and the Company shall pay
