Exhibit 99.1
INDEMNIFICATION
AGREEMENT
This
Indemnification Agreement, dated as of
, 2007, is made by and between
The Cheesecake Factory Incorporated, a Delaware corporation and
[ ].
RECITALS
A.
The Corporation has previously entered into indemnification
agreements with its directors and certain officers;
B.
The Board of Directors has reviewed the form of indemnification
agreement previously entered into between the Corporation and its
directors and certain officers and considered the adoption of a new
form of indemnification agreement to replace the existing form of
agreement;
C.
The Board of Directors believes that the Corporation’s
ability to continue to attract and retain directors and certain
officers will be adversely affected unless the Corporation
continues or offers to provide indemnification agreements;
D.
The Board of Directors has determined that contractual
indemnification as set forth herein is prudent and fair to the
Corporation and promotes the best interests of the Corporation and
its stockholders;
E.
The Corporation has requested Indemnitee to serve or desires that
Indemnitee continue to serve as a director or officer of the
Corporation free from undue concern for claims for damages arising
out of or related to such services to the Corporation; and
F.
Indemnitee is willing to serve, continue to serve or to provide
additional service for or on behalf of the Corporation on the
condition that he or she is furnished the indemnity provided for
herein.
AGREEMENT
NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth
below, and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
Section 1.
Generally .
To the fullest
extent permitted by the laws of the State of Delaware:
(a)
The Corporation shall indemnify and hold harmless Indemnitee to the
fullest extent authorized by the laws of the State of Delaware, as
the same exist or may hereafter be amended (but, in the case of any
such amendment, only to the extent that such amendment
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permits the Corporation
to provide broader indemnification rights than those laws permitted
the Corporation to provide prior to such amendment).
(b)
The Corporation shall indemnify and hold harmless Indemnitee if
Indemnitee was, is, or is threatened to be made a party to or
witness or other participant in any Action by reason of the fact
that Indemnitee is or was serving or has agreed to serve at the
request of the Corporation as a director, officer, employee or
agent of the Corporation, or while serving as a director or officer
of the Corporation, is or was serving or has agreed to serve at the
request of the Corporation as a director, officer, employee or
agent (which, for purposes hereof, shall include a trustee, partner
or manager or similar capacity) of another corporation, limited
liability company, partnership, joint venture, trust, employee
benefit plan or Other Enterprise by reason of any action alleged to
have been taken or omitted in any such capacity, whether the basis
of the Action is alleged action or failure to act in an official
capacity as a director, officer, employee or agent or in any other
capacity while serving as a director, officer, employee or agent.
For the avoidance of doubt, the foregoing indemnification
obligation includes, without limitation, claims for monetary
damages against Indemnitee in respect of an alleged breach of
fiduciary duties, to the fullest extent permitted under
Section 102(b)(7) of the DGCL as in existence on the date
hereof.
(c)
The indemnification provided by this Section 1 shall be from
and against Expenses as well as any Judgments, Fines and Amounts
Paid in Settlement actually and reasonably incurred or suffered by
Indemnitee or on Indemnitee’s behalf in connection with such
Action and any appeal therefrom, but shall only be provided if
Indemnitee meets the applicable standard of conduct set forth in
the DGCL. The termination of any Action by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that
Indemnitee did not meet that standard of conduct.
(d)
In the case of any Action or suit by or in the right of the
Corporation to procure a judgment in its favor by reason of the
fact that Indemnitee is or was serving or has agreed to serve at
the request of the Corporation as a director, officer, employee or
agent of the Corporation, or while serving as a director or officer
of the Corporation, is or was serving or has agreed to serve at the
request of the Corporation as a director, officer, employee or
agent (which for the purposes hereof, shall include a trustee,
partner, or manager or similar capacity) of another corporation,
limited liability company, partnership, joint venture, trust,
employee benefit plan or Other Enterprise by reason of any action
alleged to have been taken or omitted in any such capacity, whether
the basis of that Action is alleged action or inaction in an
official capacity as a director, officer, employee or agent or in
any other capacity while serving as a director, officer, employee
or agent, Indemnitee shall be entitled to the indemnification
rights provided by this Indemnification Agreement. Provided,
however , no indemnification shall be made in respect of any
claim, issue or matter as to which Indemnitee shall have been
adjudged to be liable to the Corporation unless, and only to the
extent that, the Delaware Court of Chancery or the court in which
such action or suit 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 indemnity for such expenses which the Delaware Court of
Chancery or such other court shall deem proper.
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Section 2.
Successful Defense; Partial Indemnification .
(a)
To the extent that Indemnitee has been successful on the merits or
otherwise in defense of any Action referred to in Section 1
hereof or in defense of any claim, issue or matter therein,
Indemnitee shall be indemnified against Expenses actually and
reasonably incurred in connection therewith. For purposes of
this Indemnification Agreement and without limiting the foregoing,
if any Action is disposed of, on the merits or otherwise (including
a disposition without prejudice), without (i) the disposition
being adverse to Indemnitee, (ii) an adjudication that
Indemnitee was liable to the Corporation, (iii) a plea of
guilty or nolo contendere by Indemnitee, (iv) an
adjudication that Indemnitee did not act in good faith and in a
manner Indemnitee reasonably believed to be in or not opposed to
the best interests of the Corporation, or (v) with respect to
any criminal Action, an adjudication that Indemnitee had reasonable
cause to believe Indemnitee’s conduct was unlawful,
Indemnitee shall be considered for the purposes hereof to have been
wholly successful with respect thereto.
(b)
If Indemnitee is entitled under any provision of this
Indemnification Agreement to indemnification by the Corporation for
some or a portion of the Expenses and/or any Judgments, Fines or
Amounts Paid in Settlement actually and reasonably incurred by
Indemnitee or on Indemnitee’s behalf in connection with any
Action, or in defense of any claim, issue or matter therein, and
any appeal therefrom but not, however, for the total amount
thereof, the Corporation shall nevertheless indemnify Indemnitee
for the portion of such Expenses and any Judgments, Fines or
Amounts Paid in Settlement to which Indemnitee is entitled.
(c)
Notwithstanding any other provision of this Indemnification
Agreement to the contrary, to the extent that Indemnitee is, by
reason of the fact that Indemnitee’s status with respect to
the Corporation or any corporation, limited liability company,
partnership, joint venture, trust, employee benefit plan or Other
Enterprise which Indemnitee is or was serving or has agreed to
serve at the request of the Corporation, a witness or otherwise
participates in any Action (including, without limitation, any
investigation conducted by the Corporation or by any other person)
at a time when Indemnitee is not a party in the Action, the
Corporation shall indemnify and hold harmless Indemnitee from and
against all Expenses actually and reasonably incurred by Indemnitee
or on Indemnitee’s behalf in connection therewith.
Section 3.
Determination That Indemnification Is Proper . Any
indemnification hereunder shall (unless otherwise ordered by a
court of competent jurisdiction) be made by the Corporation only as
authorized in the specific case upon a determination that
indemnification is proper under the circumstances because the
Indemnitee has met the standard of conduct in the DGCL. Any such
determination shall be made (i) by a majority vote of the
Disinterested Directors, even if less than a quorum, (ii) by a
majority vote of a committee of Disinterested Directors designated
by majority vote of Disinterested Directors, even if less than a
quorum, (iii) by a majority vote of a quorum of the
outstanding shares of stock of all classes entitled to vote on the
matter, voting as a single class, which quorum shall consist of
stockholders who are not at that time parties to the action, suit
or proceeding in question, (iv) if there are no Disinterested
Directors, or if the Disinterested Directors so direct, by
independent legal counsel, or (v) by a court of competent
jurisdiction.
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Section 4.
Advance Payment of Expenses; Notification and Defense of
Claim .
(a)
The Corporation shall pay Expenses incurred by Indemnitee in
connection with any Action, in advance of the final disposition of
such Action as soon as practicable but in no event later than
twenty (20) days after receipt by the Corporation of (i) a
statement or statements from Indemnitee requesting such advance or
advances from time to time, and (ii) if required by the DGCL,
when the Expenses were incurred by Indemnitee in Indemnitee’s
capacity as a current director or officer (and not in any other
capacity in which service was, or is, rendered by Indemnitee) an
undertaking by or on behalf of Indemnitee to repay such amount or
amounts, only if, and to the extent that, it shall ultimately be
determined by final judicial decision from which there is no
further right to appeal or seek review that Indemnitee is not
entitled to be indemnified for such Expense by the Corporation as
authorized by this Indemnification Agreement or otherwise. Such
undertaking is not required to be secured and shall be accepted
without reference to the financial ability of Indemnitee to make
such repayment. The right to advancement of Expenses as granted by
this Indemnification Agreement shall be enforceable by Indemnitee
in any court of competent jurisdiction if the Corporation fails to
pay such Expenses, in whole or in part, or fails to respond, within
such 20-day period.
(b)
Promptly after receipt by Indemnitee of notice of the commencement
of any Action, Indemnitee shall, if a claim thereof is to be made
against the Corporation hereunder, notify the Corporation of the
commencement thereof. Provided, however, the failure to
notify the Corporation promptly of the commencement of the Action
or Indemnitee’s request for indemnification, will not relieve
the Corporation from any liability that it may have to Indemnitee
hereunder.
(c)
In the event the Corporation is obligated to pay the Expenses of
Indemnitee with respect to an Action, as provided in this
Indemnification Agreement, the Corporation, if appropriate, will be
entitled to (i) participate therein at its own expense and
(ii) assume the defense of such Action, jointly, with any
other indemnifying person, with counsel reasonably acceptable to
Indemnitee, upon the delivery to Indemnitee of written notice of
its election to do so. After delivery of such notice, approval of
such counsel by Indemnitee and the retention of such counsel by the
Corporation, the Corporation will not be liable to Indemnitee under
this Indemnification Agreement for any fees of counsel subsequently
incurred by Indemnitee with respect to the same Action provided
that (1) Indemnitee will have the right to employ
Indemnitee’s own counsel in such Action at Indemnitee’s
expense and (2) if (i) the employment of counsel by
Indemnitee has been previously authorized in writing by the
Corporation, (ii) counsel to the Corporation or Indemnitee
will have reasonably concluded that there may be a conflict of
interest or position, or reasonably believes that a conflict is
likely to arise, on any significant issue between the Corporation
and Indemnitee in the conduct of any such defense; or
(iii) the Corporation will not have employed counsel within
sixty (60) calendar days of receipt of such notice from Indemnitee
to assume the defense of such Action, then the fees and expenses of
Indemnitee’s counsel shall be at the expense of the
Corporation, except as otherwise expressly provided by this
Indemnification Agreement. The Corporation will not be entitled,
without the consent of Indemnitee, to assume the defense of any
claim brought by or in the right of the Corporation or as to which
counsel for the Corporation or Indemnitee has reasonably made the
conclusion described in clause (c)(2)(ii) above.
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Section 5.
Procedure for Indemnification .
(a)
To obtain indemnification, Indemnitee shall promptly submit to the
Corporation 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
Corporation shall, promptly upon receipt of such a request for
indemnification, advise the Corporation’s Board of Directors
in writing that Indemnitee has requested indemnification.
(b)
The Corporation’s determination whether to grant
Indemnitee’s indemnification request shall be made promptly,
and in any event within thirty (30) days following receipt of a
request for indemnification pursuant to Section 5(a). The
right to indemnification as granted by this Indemnification
Agreement shall be enforceable by Indemnitee in any court of
competent jurisdiction if the Corporation denies such request, in
whole or in part, or fails to respond within such 30-day period.
Alternatively, in seeking to establish or enforce a right to
indemnification or advancement of Expenses under this
Indemnification Agreement, Indemnitee, at Indemnitee’s option
may seek an award in an arbitration to be conducted by a single
arbitrator pursuant to the rules of the American Arbitration
Association, such award to be made within sixty (60) days following
the demand for arbitration. The Corporation shall not oppose
Indemnitee’s right to seek any such adjudication or award in
arbitration or any other claim. It shall be a defense to any such
action by Indemnitee (other than an action brought to enforce a
claim for the advancement of Expenses under Section 4 hereof
when the required undertaking, if any, has been received by the
Corporation) that Indemnitee has not met the standard of conduct
set forth in the DGCL, but the burden of proving such defense by
clear and convincing evidence shall be on the Corporation. Neither
the failure of the Corporation (including its Board of Directors or
one of its committees, its independent legal counsel, and its
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