INDEMNIFICATION
AGREEMENT
This
Indemnification Agreement (the “Agreement” ) is
made and entered into this ___day of
, 2008, by and between Zimmer Holdings, Inc., a Delaware
corporation (the “Company” ), and [Name] (the
“Indemnitee” ).
WHEREAS, it is
essential that the Company be able to retain and attract the most
capable persons available to serve as its directors and
officers;
WHEREAS, Delaware
law permits the Company to enter into indemnification arrangements
and agreements in addition to those provided by statute or in the
Company’s organizational documents;
WHEREAS, the
Company desires to provide the Indemnitee with specific contractual
assurances of the Indemnitee’s rights to full indemnification
against litigation risks and reasonable expenses (regardless, among
other things, of any amendment to the Company’s
organizational documents, or any change in the ownership of the
Company or the composition of its Board of Directors) and, to the
extent insurance is available, the coverage of the Indemnitee under
the Company’s directors’ and officers’ liability
insurance policies; and
WHEREAS, the
Indemnitee is relying upon the rights afforded under this Agreement
in accepting or continuing Indemnitee’s position as a
director or officer of the Company.
NOW, THEREFORE, in
consideration of the mutual promises and covenants contained
herein, the Company and Indemnitee do hereby covenant and agree as
follows:
(a)
“Corporate Status” describes the status of a
person who is serving or has served (i) as a director, officer
or employee of the Company, (ii) in any capacity with respect
to any employee benefit plan of the Company, or (iii) as a
director, partner, member, trustee, officer, employee, or agent of
any other Entity at the request of the Company. For purposes of
subsection (iii) of this Section 1(a), if Indemnitee is
serving or has served as a director, partner, trustee, officer,
employee or agent of a Subsidiary, Indemnitee shall be deemed to be
serving at the request of the Company.
(b)
“Entity” shall mean any corporation,
partnership, limited liability company, joint venture, trust,
foundation, association, organization or other legal entity and any
group or division of the Company or any of its
subsidiaries.
(c)
“Expenses” shall mean all reasonable fees, costs
and expenses actually and reasonably incurred in connection with
any Proceeding (as defined below), including, without limitation,
reasonable attorneys’ fees, disbursements and retainers
(including, without limitation, any such fees, disbursements and
retainers incurred by Indemnitee pursuant to Section 11 of
this Agreement), fees and disbursements of expert witnesses,
private investigators and professional advisors (including, without
limitation, accountants), court costs, transcript costs, fees of
experts, travel expenses, duplicating, printing and binding costs,
telephone and fax transmission charges,
postage,
delivery services, secretarial services, and other disbursements
and expenses, but excluding Liabilities.
(d)
“Indemnifiable Expenses,” “Indemnifiable
Liabilities” and “Indemnifiable
Amounts” shall have the meanings ascribed to those terms
in Section 3(a) below.
(e)
“Liabilities” shall mean judgments, damages,
liabilities, losses, penalties, excise taxes, fines and amounts
paid in settlement.
(f)
“Proceeding” shall mean any threatened, pending
or completed claim, action, suit, arbitration, alternate dispute
resolution process, investigation, administrative hearing, appeal,
or any other proceeding, whether civil, criminal, administrative or
investigative, whether formal or informal, including a proceeding
initiated by Indemnitee pursuant to Section 11 of this
Agreement to enforce Indemnitee’s rights
hereunder.
(g)
“Subsidiary” shall mean any Entity of which the
Company owns (either directly or through or together with another
Subsidiary of the Company) either (i) a general partner,
managing member or other similar interest or (ii) (A) 50% or
more of the voting power of the voting capital equity interests of
such Entity, or (B) 50% or more of the outstanding voting
capital stock or other voting equity interests of such
Entity.
2.
Services of Indemnitee . In consideration of the
Company’s covenants and commitments hereunder, Indemnitee
agrees to serve as a director or officer of the Company;
provided, that this Agreement shall not impose any
obligation on Indemnitee or the Company to continue
Indemnitee’s service to the Company in any particular role or
for any particular period of time, unless otherwise required by law
or by other agreements or commitments of the parties, if
any.
3.
Agreement to Indemnify . The Company agrees to indemnify
Indemnitee as follows:
(a) Subject
to the exceptions contained in this Agreement, if Indemnitee was or
is a party or is threatened to be made a party to any Proceeding
(other than an action by or in the right of the Company) by reason
of Indemnitee’s Corporate Status, Indemnitee shall be
indemnified by the Company against all Expenses and Liabilities
actually incurred by Indemnitee in connection with such Proceeding
(referred to herein as “Indemnifiable Expenses”
and “Indemnifiable Liabilities,” respectively,
and collectively as “Indemnifiable Amounts”
).
(b) Subject
to the exceptions contained in this Agreement, including
Section 4(b) below, if Indemnitee was or is a party or is
threatened to be made a party to any Proceeding by or in the right
of the Company to procure a judgment in its favor by reason of
Indemnitee’s Corporate Status, Indemnitee shall be
indemnified by the Company against all Indemnifiable
Expenses.
4.
Exceptions to Indemnification . Indemnitee shall be entitled
to indemnification under Sections 3(a) and 3(b) above in all
circumstances other than the following:
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(a) If
indemnification is requested under Section 3(a) and it has
been adjudicated finally by a court of competent jurisdiction that,
in connection with the subject of the Proceeding out of which the
claim for indemnification has arisen, Indemnitee failed to act in
good faith and in a manner Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company or, with
respect to any criminal action or Proceeding, Indemnitee had
reasonable cause to believe that Indemnitee’s conduct was
unlawful, Indemnitee shall not be entitled to payment of
Indemnifiable Amounts hereunder.
(b) If
indemnification is requested under Section 3(b) and it has
been adjudicated finally by a court of competent jurisdiction
that
(i) in
connection with the subject of the Proceeding out of which the
claim for indemnification has arisen, Indemnitee failed to act in
good faith and in a manner Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company and/or
indemnification is against public policy, Indemnitee shall not be
entitled to payment of Indemnifiable Expenses hereunder;
(ii) Indemnitee
is liable to the Company with respect to any claim, issue or matter
involved in the Proceeding out of which the claim for
indemnification has arisen, including, without limitation, a claim
that Indemnitee received an improper personal benefit or improperly
took advantage of a corporate opportunity, Indemnitee shall not be
entitled to payment of Indemnifiable Expenses hereunder with
respect to such claim, issue or matter unless the court in which
such 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 indemnity for such Indemnifiable Expenses which such
court shall deem proper; or
(iii) Indemnitee
is liable to the Company for an accounting of profits made from the
purchase or sale by the Indemnitee of securities of the Company
pursuant to the provisions of Section 16(b) of the Securities
Exchange Act of 1934, as amended, the rules and regulations
promulgated thereunder and amendments thereto or similar provisions
of any federal, state or local statutory law, Indemnitee shall not
be entitled to payment of Indemnifiable Expenses
hereunder.
5.
Notification and Defense of Claim . As a condition precedent
to the right of indemnification, Indemnitee agrees to notify the
Company in writing as soon as practicable of any Proceeding for
which indemnification will or could be sought by Indemnitee and
provide the Company with a copy of any summons, citation, subpoena,
complaint, indictment, information or other document relating to
such Proceeding with which Indemnitee is served; provided that the
failure of Indemnitee to give notice as provided herein shall not
relieve the Company of its obligations under this Agreement, except
to the extent that the Company is adversely affected by such
failure. With respect to any Proceeding of which the Company is so
notified, the Company will be entitled to participate therein at
its own expense and/or to assume the defense thereof at its own
expense, with legal counsel reasonably acceptable to Indemnitee.
After notice from the Company to Indemnitee of its election so to
assume such defense, the Company shall not be liable to Indemnitee
for any legal or other expenses subsequently incurred by Indemnitee
in connection with such claim, other than as provided below in this
Section 5. Indemnitee shall
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have the right
to employ Indemnitee’s own counsel in connection with such
claim, but the fees and expenses of such counsel incurred after
notice from the Company of its assumption of the defense thereof
shall be at the expense of Indemnitee unless (i) the
employment of counsel by Indemnitee has been authorized by the
Company, (ii) counsel to Indemnitee shall have reasonably
concluded that there may be a conflict of interest or position on
any significant issue between the Company and Indemnitee in the
conduct of the defense of such action, (iii) counsel to
Indemnitee reasonably concludes that Indemnitee may have separate
defenses or counterclaims to assert with respect to any issue which
may not be consistent with the position of other defendants in such
Proceeding or (iv) the Company shall not in fact have employed
counsel to assume the defense of such action, in each of which
cases the fees and expenses of counsel for Indemnitee shall be at
the expense of the Company, except as otherwise expressly provided
by this Agreement. The Company shall not be entitled, without the
consent of Indemnitee, to assume the defense of any claim brought
by or in the right of the Company or as to which counsel for
Indemnitee shall have reasonably made the conclusion provided for
in clauses (ii) or (iii) above. The Company shall not
settle any Proceeding in any manner, without Indemnitee’s
written consent, which (i) would impose any penalty or
limitation on Indemnitee, (ii) includes an admission of fault
of Indemnitee, or (iii) does not include, as an unconditional
term thereof, the full release of Indemnitee from all liability in
respect of such Proceeding, which release shall be in form and
substance reasonably satisfactory to Indemnitee. The Indemnitee
will not unreasonably withhold his consent to any proposed
settlement. In making the determination required to be made under
Delaware law with respect to
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