Exhibit 10.1
INDEMNIFICATION AGREEMENT
THIS AGREEMENT is effective
May 21, 2008, between Concho Resources Inc., a Delaware
corporation (the “Corporation”), and the undersigned
director or officer of the Corporation
(“Indemnitee”).
WHEREAS, the Restated Certificate of
Incorporation of the Corporation (as the same may be amended from
time to time, the “Certificate of Incorporation”)
provides for indemnification of the Corporation’s directors
and officers; and
WHEREAS, the Corporation has adopted
Amended and Restated Bylaws (as the same may be amended from time
to time, the “Bylaws”) providing for indemnification of
the Corporation’s directors and officers; and
WHEREAS, the Bylaws and the Delaware
General Corporation Law (the “DGCL”) contemplate that
contracts and insurance policies may be entered into with respect
to indemnification of directors and officers; and
WHEREAS, there are questions
concerning the adequacy and reliability of the protection which
might be afforded to directors and officers from acquisition of
policies of Directors and Officers Liability Insurance
(“D&O Insurance”), covering certain liabilities
which might be incurred by directors and officers in the
performance of their services to the Corporation; and
WHEREAS, it is reasonable, prudent
and necessary for the Corporation to obligate itself contractually
to indemnify Indemnitee so that he will serve or continue to serve
the Corporation free from undue concern that he will not be
adequately protected;
NOW, THEREFORE, in consideration of
the premises and the covenants contained herein, the Corporation
and Indemnitee do hereby covenant and agree as follows:
1. Definitions. As used
in this Agreement:
(a) The term
“Proceeding” shall include any threatened, pending or
completed action, suit, claim, inquiry or proceeding, whether
brought by or in the right of the Corporation or otherwise and
whether of a civil, criminal, administrative, arbitrative or
investigative nature, in which Indemnitee is or is reasonably
expected to be involved as a party, as a witness or otherwise, by
reason of the fact that Indemnitee is or was a director or officer
of the Corporation, by reason of any action taken by him or of any
inaction on his part while acting as a director or officer of the
Corporation or by reason of the fact that he is or was serving at
the request of the Corporation as a director, officer, trustee,
employee or agent of another corporation, partnership, joint
venture, trust, limited liability company or other enterprise; in
each case whether or not he is acting or serving in any such
capacity at the time any liability or expense is incurred for which
indemnification or reimbursement can be provided under this
Agreement; provided that any such action, suit, claim, inquiry or
proceeding which is brought by Indemnitee against the Corporation
or directors or officers of the Corporation, other than an action
brought by Indemnitee to enforce his rights under this Agreement,
shall not be deemed a Proceeding without prior approval by a
majority of the Board of Directors of the Corporation.
(b) The term
“Expenses” shall include, without limitation, any
judgments, fines and penalties against Indemnitee in connection
with a Proceeding; amounts paid by Indemnitee in settlement of a
Proceeding pursuant to this Agreement; and all attorneys’
fees and disbursements, accountants’ fees, private
investigation fees and disbursements, retainers, court costs,
transcript costs, fees of experts, fees and expenses of witnesses,
travel expenses, duplicating costs, printing and binding costs,
telephone charges, postage, delivery service fees, and all other
disbursements, or expenses, reasonably incurred by or for
Indemnitee in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, being or preparing to be a
witness in a Proceeding or establishing Indemnitee’s right of
entitlement to indemnification for any of the foregoing.
(c) References to
Indemnitee’s being or acting as “a director or officer
of the Corporation” or “serving at the request of the
Corporation as a director, officer, trustee, employee or agent of
another corporation, partnership, joint venture, trust, limited
liability company or other enterprise” shall include in each
case service to or actions taken while a director, officer,
trustee, employee or agent of any subsidiary of the Corporation or
while serving as a member of a committee of the Board of Directors
of the Corporation.
(d) References 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 Corporation” shall include any service
as a director, officer, employee or agent of the Corporation which
imposes duties on, or involves services by, such director, officer,
trustee, 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 reasonably believed to be in the
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 interest of the Corporation” as referred
to in this Agreement.
(e) The term
“substantiating documentation” shall mean copies of
bills or invoices for costs incurred by or for Indemnitee, or
copies of court or agency orders or decrees or settlement
agreements, as the case may be, accompanied by a sworn statement
from Indemnitee that such bills, invoices, court or agency orders
or decrees or settlement agreements, represent costs or liabilities
meeting the definition of “Expenses” herein.
(f) The terms “he”
and “his” have been used for convenience and mean
“she” and “her” if Indemnitee is a
female.
2. Indemnity of Director or
Officer. The Corporation hereby agrees to hold harmless and
indemnify Indemnitee against Expenses to the fullest extent
authorized or permitted by law (including the applicable provisions
of the DGCL). The phrase “to the fullest extent permitted by
law” shall include, but not be limited to (a) to the
fullest extent permitted by any provision of the DGCL that
authorizes or permits additional indemnification by agreement, or
the corresponding provision of any amendment to or replacement of
the DGCL and (b) 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. Any
amendment, alteration or repeal of the DGCL that adversely affects
any right of Indemnitee shall be prospective only and shall not
limit or
2
eliminate any such right with respect to any Proceeding involving
any occurrence or alleged occurrence of any action or omission to
act that took place prior to such amendment or repeal.
3. Additional Indemnity.
The Corporation hereby further agrees to hold harmless and
indemnify Indemnitee against Expenses incurred by reason of the
fact that Indemnitee is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of
the Corporation as a director, officer, trustee, employee or agent
of another corporation, partnership, joint venture, trust, limited
liability company or other enterprise, but only if Indemnitee acted
in good faith and, in the case of conduct in his official capacity,
in a manner he reasonably believed to be in the best interests of
the Corporation and, in all other cases, not opposed to the best
interests of the Corporation. Additionally, in the case of a
criminal proceeding, Indemnitee must have had no reasonable cause
to believe that his conduct was unlawful. The termination of any
Proceeding by judgment, order of the court, settlement, conviction
or upon a plea of nolo contendere, or its equivalent, shall not, of
itself, create a presumption that Indemnitee did not act in good
faith and in a manner which he reasonably believed to be in or not
opposed to the best interest of the Corporation, and with respect
to any criminal Proceeding, that Indemnitee had reasonable cause to
believe that his conduct was unlawful.
4. Contribution. If the
indemnification provided under Section 2 or Section 3 is
unavailable by reason of a court decision finding that Indemnitee
is not eligible to receive indemnification for Expenses incurred by
Indemnitee under this Agreement, based on grounds other than any of
those set forth in Section 15, then, in respect of any
Proceeding in which the Corporation is jointly liable with
Indemnitee (or would be if joined in such Proceeding), the
Corporation shall contribute to the amount of Expenses actually and
reasonably incurred and paid or payable by Indemnitee in such
proportion as is appropriate to reflect (i) the relative
benefits received by the Corporation on one hand and Indemnitee on
the other from the transaction from which such Proceeding arose and
(ii) the relative fault of the Corporation on the one hand and of
Indemnitee on the other in connection with the events that resulted
in such Expenses as well as any other relevant equitable
considerations. The relative fault of the Corporation on the one
hand and of Indemnitee on the other shall be determined by
reference to, among other things, the parties’ relative
intent, knowledge, access to information and opportunity to correct
or prevent the circumstances resulting in such Expenses. The
Corporation agrees that it would not be just and equitable if
contribution pursuant to this Section 4 were determined by pro
rata allocation or any other method of allocation that does not
take into account of the foregoing equitable considerations.
5. Choice of Counsel.
Each Indemnitee that is an Outside Director, Chase Director or
Other Indemnitee, together with the other Indemnitees who are
designated in the same group, shall be entitled to employ, and be
reimbursed for the fees and disbursements of, separate counsel to
represent the Outside Directors, the Chase Directors or the Other
Indemnitees, as the case may be, in connection with any Proceeding.
For purposes of this Agreement, an Indemnitee shall be designated
as (i) an “Outside Director” if such Indemnitee is
a director and not an officer of the
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