Exhibit 10.1
INDEMNIFICATION
AGREEMENT
This Indemnification Agreement
(“Agreement”) is made as of
, 2006 by and between Superior Essex Inc., a
Delaware corporation (the “Company”), and
(“Indemnitee”).
RECITALS
WHEREAS, highly competent persons
have become more reluctant to serve publicly-held corporations as
directors, officers and in other capacities 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, directors, officers, and other persons 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 Certificate of Incorporation (the
“Charter”) and the Bylaws (the “By-laws”)
of the Company require indemnification of the officers and
directors of the Company. Indemnitee may also be entitled to
indemnification pursuant to the General Corporation Law of the
State of Delaware (“DGCL”). The Charter, the
By-laws 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, officers and other persons
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 and its
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 Charter, the By-laws
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 Charter, the By-laws and
insurance as adequate in the present circumstances, and may not be
willing to serve as an [officer] [director] of the Company [or, at
the request of the Company, as a [director] [officer] [employee]
[agent] of another enterprise] 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] [she] 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 [director] [officer] of the Company [and, at the request of
the Company, as a [director] [officer] [employee] [agent] of
another enterprise]. 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. This Agreement shall
not be deemed an employment contract between the Company (or any of
its subsidiaries or any Enterprise) and Indemnitee.
Indemnitee specifically acknowledges that Indemnitee’s
employment with the Company (or any of its subsidiaries or any
Enterprise), if any, is at will, and the Indemnitee may be
discharged at any time for any reason, with or without cause,
except as may be otherwise provided in any written employment
contract between Indemnitee and the Company (or any of its
subsidiaries or any Enterprise), other applicable formal severance
policies duly adopted by the Board, or, with respect to service as
a director or officer of the Company, by the Charter, By-laws and
the DGCL. The foregoing notwithstanding, this Agreement shall
continue in force after Indemnitee has ceased to serve as an
[officer] [director] of the Company [and, at the request of the
Company, as a [director] [officer] [employee] [agent] of another
enterprise].
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
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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 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.
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(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.
(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 legislative, or
investigative nature, including any appeal therefrom, in which
Indemnitee was, is
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or will be
involved as a party, potential party, non-party witness 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] [her] or of any action on [his] [her] part while acting as
director or officer of the Company, or by reason of the fact that
[he] [she] 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] [her] 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, its participants or beneficiaries; and a
person who acted in good faith and in a manner [he] [she]
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] [her] behalf in connection with such Proceeding or any claim,
issue or matter therein, if Indemnitee acted in good faith and in a
manner [he] [she] 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] [her]
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]
[her] or on [his] [her] behalf in connection with such Proceeding
or any claim, issue or matter therein, if Indemnitee acted in good
faith and in a manner [he] [she] 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.
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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] [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 matters in such
Proceeding, the Company shall indemnify Indemnitee against all
Expenses actually and reasonably incurred by [him] [her] or on
[his] [her] 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 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] [her] Corporate Status, a witness
in any Proceeding to which Indemnitee is not a party, [he] [she]
shall be indemnified against all Expenses actually and reasonably
incurred by [him] [her] or on [his] [her] 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 officers and directors.
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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
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