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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:
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(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 Act (including any such reimbursements that arise from
an accounting restatement of the Company pursuant to Section
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