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EXHIBIT 10.6
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is made effective
as of March
11, 2005 by and between Mariner Energy, Inc., a Delaware
corporation (the
"Company"), and the officer or director executing same on the
signature page
hereof ("Indemnitee").
RECITALS
WHEREAS, the bylaws of the Company require indemnification of
the officers
and directors of the Company;
WHEREAS, Indemnitee may also be entitled to indemnification
pursuant to
applicable provisions of the Delaware General Corporation Law
("DGCL");
WHEREAS, the indemnification provisions set forth in the bylaws
and the
DGCL are not exclusive, and the Company may enter into contracts
between the
Company and members of the Board of Directors of the Company
(the "Board") and
officers of the Company with respect to indemnification;
WHEREAS, the Board has determined that it is reasonable, prudent
and
necessary for the Company contractually to obligate itself to
indemnify, and to
advance expenses on behalf of, its officers and directors 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
indemnified;
WHEREAS, this Agreement is intended to replace any existing
indemnification agreements to which Indemnitee is subject, if
any, with respect
to the matters covered herein; and
WHEREAS, this Agreement is a supplement to and in furtherance of
the
bylaws of the Company, which expressly state that the
indemnities afforded under
such bylaws are not exclusive, and any resolutions adopted
pursuant thereto and
shall not be deemed a substitute therefor, nor diminish or
abrogate any rights
of Indemnitee thereunder;
NOW, THEREFORE, in consideration of the premises and the
covenants
contained herein, the Company and Indemnitee do hereby covenant
and agree as
follows:
1. SERVICES TO THE COMPANY. Indemnitee will serve or continue to
serve, at
the will of the Company or under separate contract, if such
exists, as officer
and/or director of the Company for so long as Indemnitee is duly
elected or
appointed and qualified in accordance with the bylaws of the
Company or until
Indemnitee tenders his or her resignation. If Indemnitee is an
employee at will
of the Company, nothing herein shall change such employee's
status as an
employee at will. Nothing in this Section 1
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is intended to modify any provision of any employment agreement
entered into
between the Company and the Indemnitee.
2. DEFINITIONS. As used in this Agreement:
(a) "Beneficial Owner" shall have the meaning set forth in Rule
13d-3
promulgated under the Exchange Act (as defined below).
(b) A "Change of Control" shall be deemed to occur upon the
earliest to
occur after the date of this Agreement of any of the following
events: (i) after
the date hereof, any person or group of affiliates or associated
persons
acquires more than 35% of the voting power of the Company; (ii)
the consummation
of a sale of all or substantially all of the assets of the
Company; (iii) the
dissolution of the Company; or (iv) the consummation of any
merger,
consolidation, or reorganization involving the Company in which,
immediately
after giving effect to such merger, consolidation or
reorganization, less than
51% of the total voting power of outstanding stock of the
surviving or resulting
entity is then "beneficially owned" (within the meaning of Rule
13d-3 under the
Securities Exchange Act of 1934, as amended) in the aggregate by
the
stockholders of the Company immediately prior to such merger,
consolidation or
reorganization. Notwithstanding the foregoing, a Change of
Control shall not
result from any initial acquisitions from the Company or the
placement agent in
the private placement offering of common stock of the Company
made as described
in the confidential Offering Memorandum of the Company dated
March 4, 2005,
including acquisitions of shares upon the exercise of any
related over-allotment
options.
(c) "Corporate Status" describes the status of a person who is
or was a
director, officer, trustee, general partner, managing member,
fiduciary,
employee or agent of the Company or of any other Enterprise (as
defined below)
which such person is or was serving at the request of the
Company.
(d) "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.
(e) "Enterprise" shall mean the Company and any other
corporation, limited
liability company, partnership, joint venture, trust, employee
benefit plan,
organization (whether civil, non-profit or charitable) or other
enterprise of
which Indemnitee is or was serving at the request of the Company
as a director,
officer, trustee, general partner, managing member, fiduciary,
employee or
agent.
(f) "Exchange Act" shall mean the Securities Exchange Act of
1934, as
amended.
(g) "Expenses" shall include all reasonable 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 of the
type customarily incurred in connection with prosecuting,
defending, preparing
to prosecute or defend, investigating,
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being or preparing to be a witness in, or otherwise
participating in, a
Proceeding. Expenses also shall include 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. Expenses, however, shall
not include
amounts paid in settlement by Indemnitee or the amount of
judgments, fines or
penalties actually levied against Indemnitee.
(h) "Independent Counsel" shall mean 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 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.
(i) The term "Person" shall have the meaning 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.
(j) 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,
officer, employee or
agent of the Company, by reason of any action taken (or failure
to act) by him
or her or of any action (or failure to act) on his or her part
while acting as a
director, officer, employee or agent 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,
trustee, general partner, managing member, fiduciary, employee
or agent of any
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.
(k) 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
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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 a manner "not opposed to the
best interests of
the Company" as referred to in this Agreement.
3. INDEMNIFICATION.
(a) The Company shall indemnify Indemnitee in accordance with
the
provisions of this Section 3(a) when Indemnitee is a party or is
threatened to
be made a party to or is otherwise involved 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(a), Indemnitee shall be
indemnified against
all Expenses, judgments, fines, penalties and amounts paid in
settlement
(including all interest, assessments and other charges paid or
payable in
connection with or in respect of such Expenses, judgments,
fines, penalties and
amounts paid in settlement) actually and reasonably incurred by
Indemnitee or on
his behalf in connection with such Proceeding 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 any criminal
Proceeding, he had no
reasonable cause to believe his conduct was unlawful.
(b) The Company shall indemnify Indemnitee in accordance with
the
provisions of this Section 3(b) when Indemnitee is a party or is
threatened to
be made a party to or is otherwise involved in any Proceeding by
or in the right
of the Company to procure a judgment in its favor. Pursuant to
this Section
3(b), Indemnitee shall be indemnified against all Expenses
actually and
reasonably incurred by Indemnitee or on his behalf in connection
with such
Proceeding 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
3(b) 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 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.
(c) Any indemnification under subsections (a) and (b) of this
Section 3
(unless ordered by a court) shall be made by the Company in
accordance with the
procedures set forth in Sections 5 and 6 hereof.
(d) 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 or
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 or her
or on his or her behalf in connection with each successfully
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resolved claim, issue or matter. If 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 Indemnitee was successful. For
purposes of this
Section 3(d) 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.
(e) Notwithstanding any limitation in subsections (a), (b) and
(c) of this
Section 3, the Company shall indemnify 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,
judgments, fines,
penalties and amounts paid in settlement (including all
interest, assessments
and other charges paid or payable in connection with or in
respect of such
Expenses) actually and reasonably incurred by Indemnitee in
connection with the
Proceeding. No indemnity shall be made under this Section 3(e)
on account of
Indemnitee's conduct which constitutes a breach of Indemnitee's
duty of loyalty
to the Company or its stockholders or is an act or omission not
in good faith or
which involves intentional misconduct or a knowing violation of
the law. For
purposes of this Section 3(e), the meaning of the phrase "to the
fullest extent
permitted by 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.
(f) 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, he shall be
indemnified against
all Expenses actually and reasonably incurred by him or her or
on his or her
behalf in connection therewith.
4. EXCLUSIONS. Notwithstanding any other 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 received by or on behalf
of
Indemnitee under any insurance policy or other indemnity
provision, except
with respect to any excess beyond the amount actually received
under any
insurance policy or other indemnity provision;
(b) for an accounting of profits made from the purchase and sale
(or
sale and purchase) by Indemnitee of securities of the Company
within the
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meaning of Section 16(b) of the Exchange Act or similar
provisions of
state statutory law or common law; or
(c) except as otherwise provided in Sections 8(d) and 8(e)
hereof,
prior to a Change of Control, 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, 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.
5. ADVANCES OF EXPENSES; DEFENSE OF CLAIM.
(a) Notwithstanding any provision of this Agreement to the
contrary, the
Company shall advance the Expenses incurred by Indemnitee or
reasonably expected
by Indemnitee to be incurred by Indemnitee within three months
in connection
with any Proceeding within ten (10) days after the receipt by
the Company of a
statement or statements requesting such advances from time to
time, whether
prior to or after final disposition of any Proceeding. 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. Indemnitee shall qualify for advances solely
upon the
execution and delivery
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