EXHIBIT 10.36
INDEMNIFICATION AGREEMENT
CPI INTERNATIONAL, INC.
THIS INDEMNIFICATION AGREEMENT (this "AGREEMENT") is made as of
________,
2006, by and between CPI International, Inc., a Delaware
corporation (the
"COMPANY"), and the individual signatory hereto ("INDEMNITEE").
RECITALS
WHEREAS, the parties hereto recognize that that there has been an
increase
in litigation against corporate directors, officers and agents, and
that highly
competent persons have become more reluctant to serve publicly held
corporations
in such capacities unless they are provided with adequate
protection against
inordinate risks of claims and actions against them arising out of
their service
to and activities on behalf of the corporation;
WHEREAS, the Company desires the benefits of having Indemnitee
serve the
Company as a Fiduciary (as defined below) secure in the knowledge
that expenses,
liabilities and/or losses incurred by him in his good faith service
to and
activities on behalf of the Company will be borne by the Company or
its
successors and assigns;
WHEREAS, Indemnitee is willing to serve in his position(s) with the
Company
only on the condition that he be indemnified for such expenses,
liabilities
and/or losses;
WHEREAS, the Company's Amended and Restated Certificate of
Incorporation
(the "CHARTER") and Amended and Restated Bylaws (the "BYLAWS")
allow and require
the Company to indemnify its directors, officers and agents to the
maximum
extent permitted under applicable law;
WHEREAS, it is reasonable, prudent and necessary for the Company
contractually to obligate itself to indemnify, and to advance
expenses on behalf
of, Indemnitee to the fullest extent permitted by applicable law;
and
WHEREAS, this Agreement is a supplement to and in furtherance of
the
indemnification provided in the Charter and Bylaws and any
resolutions adopted
pursuant thereto, and shall not be deemed a substitute therefor and
shall not
diminish or abrogate any rights of Indemnitee thereunder.
AGREEMENT
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. In his current position(s) with
the
Company or other Enterprises, and if and to the extent that
Indemnitee takes on
additional positions as a Fiduciary within the Company or other
Enterprises,
and/or changes positions or titles within the Company or other
Enterprises, this
Agreement shall protect Indemnitee in all the
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capacities in which he is serving (and/or has served) including,
without
limitation, in any such new positions or under any such new titles.
Indemnitee
may at any time and for any reason resign from any such position
(subject to any
other contractual obligations or any obligations imposed by
operation of law).
This Agreement shall not be deemed an employment contract between
the Company
(or any other Enterprise) and Indemnitee. Notwithstanding the
foregoing, this
Agreement shall continue in force after Indemnitee has ceased to
serve as a
Fiduciary of the Company.
Section 2. Definitions. As used in this Agreement:
(a) "BUSINESS DAY" shall mean any day that is not a Saturday,
Sunday, or a
day on which banks in New York, New York are required or permitted
to be closed.
(b) "CORPORATE STATUS" describes the status of a person who is or
was a
Fiduciary of the Company or of any other Enterprise in which
capacity such
person is or was serving at the request of the Company.
(c) "DISINTERESTED DIRECTOR" shall mean a director of the Company
who is
not and was not a party to the Proceeding (as defined below) in
respect of which
indemnification is sought by Indemnitee.
(d) "ENTERPRISE" shall mean the Company, any subsidiary of the
Company, and
any other corporation, partnership, limited liability company,
joint venture,
trust, employee benefit plan or other enterprise or entity for
which Indemnitee
is or was serving at the request of the Company as a Fiduciary.
(e) "EXPENSES" shall be broadly construed and shall mean all fees,
costs,
expenses, liabilities, judgments, fines, losses, taxes and
penalties incurred,
paid or accrued, including, without limitation, any and all (i)
attorneys' fees
and costs, 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
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; (ii) judgments, fines, losses,
liabilities,
penalties and amounts paid in settlement of any claim in a
Proceeding; (iii)
ERISA excise taxes or penalties assessed or imposed in connection
with any
Proceeding; (iv) federal, state, local or foreign taxes imposed on
Indemnitee as
a result of the actual or deemed receipt of any payments under this
Agreement;
and (v) interest, assessments and other charges paid or payable in
connection
with or in respect of any of the foregoing. Expenses also shall
include any
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.
(f) "FIDUCIARY" shall mean an officer, director, employee, agent,
fiduciary, trustee, managing member or any similar position.
(g) "INDEPENDENT COUNSEL" means a law firm, or a partner (or, if
applicable, member) of such a law firm, that is experienced in
matters of
corporation law and neither presently is, nor in the five (5) years
prior to the
date on which Indemnitee seeks
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indemnification from the Company in connection with the applicable
Proceeding
has been, retained to represent: (i) the Company, any subsidiary of
the Company,
or Indemnitee in any matter material to any 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.
(h) "PROCEEDING" shall mean any threatened, pending or completed
action,
suit, arbitration, alternate dispute resolution mechanism,
regulatory
proceeding, 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 witness or
otherwise by reason of the fact that Indemnitee is or was a
Fiduciary of the
Company, by reason of any action or omission by him or any action
or omission on
his part while acting as a Fiduciary of the Company, or by reason
of the fact
that he is or was serving at the request of the Company as a
Fiduciary of
another 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.
Section 3. Indemnity in Third-Party Proceedings. The Company shall
indemnify, defend and hold harmless Indemnitee in accordance with
the provisions
of this Section 3 if Indemnitee was, 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 or any other Enterprise to procure a judgment in its
favor.
Pursuant to this Section 3, Indemnitee shall be indemnified against
all Expenses
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 or
Enterprise. The Company shall indemnify, defend and hold harmless
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 or any other Enterprise to procure a
judgment in its
favor. Pursuant to this Section 4, Indemnitee shall be indemnified
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 in a
judgment from which
there is no further right of appeal to be liable to the Company or
such
Enterprise, unless and only to the extent that the court in which
the Proceeding
was brought shall determine upon application that, despite the
adjudication of
liability, and in view of all the circumstances of the case,
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Indemnitee is fairly and reasonably entitled to indemnification for
such
expenses as such court shall deem proper.
Section 5. Indemnification for Expenses of a Party Who is Wholly or
Partly
Successful. 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 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, then the Company
shall indemnify
Indemnitee against (a) all Expenses actually and reasonably
incurred by him or
on his behalf in connection with each successfully resolved claim,
issue or
matter and (b) any claim, issue or matter related to any such
successfully
resolved claim, issue or matter. For purposes of this Section 5 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 extent that Indemnitee
is, by reason
of his Corporate Status, a witness in any Proceeding to which
Indemnitee is not
a party, the Company shall indemnify, defend and hold harmless the
Indemnitee
against all Expenses 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, defend and hold harmless 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
Company to
procure a judgment in its favor) against all Expenses 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 law" shall include, without limitation:
(i) to the fullest extent permitted by the provision of the
Delaware
General Corporation Law ("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.
Section 8. Exclusions. Notwithstanding any provision in this
Agreement to
the contrary, the Company shall not be obligated under this
Agreement to make
any indemnity. in connection with any claim made against
Indemnitee:
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(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, and Indemnitee agrees to reimburse the Company for any
sums he
receives as indemnification from other sources to the extent of any
amount paid
to him in respect thereof by the Company;
(b) for an accounting of profits made from the purchase and sale
(or sale
and purchase) by Indemnitee of securities of the Company pursuant
to the
provisions of Section 16(b) of the Securities Exchange Act of 1934,
as amended,
or similar provisions of federal, state or local statutory law or
common law;
(c) for which it shall be determined by a final judgment or other
final
adjudication that such indemnification or payment was in violation
of law; or
(d) in connection with any Proceeding (or any part of any
Proceeding)
initiated by Indemnitee, including any Proceeding (or any part of
any
Proceeding) initiated by Indemnitee against the Company or its
directors,
officers, employees or other indemnitees, except for (i) any
Proceeding (or part
thereof) brought to establish or enforce a right to indemnification
under this
Agreement, any other statute or law, as permitted under Section
145, or
otherwise (except where it shall be determined by a final judgment
or other
final adjudication that such indemnification or payment was in
violation of
law), (ii) any Proceeding (or part thereof) brought to discharge
the
Indemnitee's fiduciary responsibilities, whether under ERISA or
otherwise, (iii)
any Proceeding (or part thereof) authorized by the Board of
Directors of the
Company prior to its initiation or (iv) any Proceeding (or part
thereof) as to
which the Company elects to provide indemnification, in its sole
discretion,
pursuant to the powers vested in the Company under applicable law.
Section 9. Payment and Advances of Expenses. The Company shall
advance, to
the extent not prohibited by law, the Expenses incurred by
Indemnitee in
connection with any Proceeding (an "ADVANCE") as promptly as
reasonably
possible, and in any event within 20 Business Days after the
receipt by the
Company of a statement or statements requesting such payments
(which shall, if
available, include invoices received by Indemnitee in connection
with such
Expenses but, in the case of invoices in connection with legal
services, any
references to legal work performed or to expenditures made that
would cause
Indemnitee to waive any privilege accorded by applicable law shall
not be
included with the invoice) from time to time, whether prior to or
after final
disposition of any Proceeding. Indemnitee shall be entitled to
advancement of
Expenses (including, without limitation, the retainer or other
advance payment
of legal counsel and experts) prior to the time Indemnitee is
required to pay or
advance such Expenses to third parties. 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
indemnification under the other provisions of this Agreement.
Advances shall
include any and all reasonable Expenses incurred pursuing an action
to enforce
this right of advancement, including Expenses incurred preparing
and forwarding
statements to the Company to support the Advances claimed. The
Indemnitee shall
qualify for Advances upon the execution and delivery to the Company
of this
Agreement, which shall constitute an undertaking providing that the
Indemnitee
undertakes to the fullest extent permitted by law to repay the
Advance if and to
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the extent that it is ultimately determined by final judicial
decision from
which there is no further right to appeal that Indemnitee is not
entitled to be
indemnified by the Company. The rights of indemnification and to
receive
advancement of Expenses as provided by this Agreement shall in all
events
continue until final disposition of any Proceeding, including any
appeal
thereof. This Section 9 shall not apply to any claim made by
Indemnitee for
which indemnity is excluded pursuant to Section 8.
Section 10. Procedure for Notification and Defense of Claim.
(a) To obtain indemnification under this Agreement, Indemnitee
shall submit
to the Company a written request therefor.
(b) The Company will be entitled to participate in the Proceeding
at its
own expense.
(c) The Company shall not enter into any settlement of any
Proceeding to
which Indemnitee is a party without Indemnitee's prior written
consent, which
shall not be unreasonably withheld. The Company acknowledges that
Indemnitee may
reasonably withhold his consent to any settlement that imposes any
penalty,
limitation, charge, administrative action or other claim or
detriment (including
any reputational detriment) on him, other than any settlement
solely for money
damages that is paid in full by the Company pursuant to this
Agreement and which
settlement does not otherwise adversely affect Indemnitee.
Section 11. Procedure upon Application for Indemnification;
Selection of
Independent Counsel.
(a) Upon written request by Indemnitee for indemnification pursuant
to
Section 10(a), a determination, if required by applicable law, with
respect to
Indemnitee's entitlement thereto shall be made in the specific case
by one of
the following methods, which shall be at the election of
Indemnitee: (i) by a
majority vote of the Disinterested Directors, even though less than
a quorum of
the board of directors or (ii) by Independent Counsel chosen in
accordance with
Section 11(b) below. If it is so determined that Indemnitee is
entitled to
indemnification, then payment to Indemnitee shall be made within
ten (10) days
after such determination. Indemnitee shall cooperate with the
party(ies) making
such determination with respect to Indemnitee's entitlement to
indemnification,
including providing to such party(ies) upon reasonable advance
request any
documentation or information that is not privileged or otherwise
protected from
disclosure and that is reasonably available to Indemnitee and
reasonably
necessary to such determination. Any costs or expenses (including
attorneys'
fees and disbursements) incurred by Indemnitee in so cooperating
with the
party(ies) 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.
(b) In the event the determination of entitlement to
indemnification is to
be made by Independent Counsel pursuant to Section 11(a) hereof,
the Independent
Counsel shall be selected as provided in this Section 11(b). The
Independent
Counsel shall be selected by Indemnitee (unless Indemnitee shall
request that
such selection be made by the board of
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directors), and Indemnitee shall give written notice to the Company
advising it
of the identity of the Independent Counsel so selected and
certifying that the
Independent Counsel so selecte
