Exhibit 10.2
INDEMNIFICATION AGREEMENT
This
Indemnification Agreement (this “Agreement”) is made as
of the day of
2005 by and between BRUSH
ENGINEERED MATERIALS INC., an Ohio corporation (the
“Company”), and
(the “Indemnitee”), an officer of the Company or one of
its wholly owned subsidiaries.
RECITALS
A. The Indemnitee is presently serving as
an officer of the Company or one of its wholly owned subsidiaries,
and the Company desires the Indemnitee to continue in that
capacity. The Indemnitee is willing, subject to certain conditions
(including, without limitation, the execution and performance of
this Agreement by the Company), to continue in that
capacity.
B. In addition to the indemnification to
which the Indemnitee is entitled under the Code of Regulations of
the Company (the “Regulations”) or otherwise, the
Company has obtained, at its sole expense, insurance protecting the
Company and its Directors and officers including the Indemnitee
against certain losses arising out of actual or threatened actions,
suits, or proceedings to which such persons may be made or
threatened to be made parties. However, as a result of
circumstances having no relation to, and beyond the control of, the
Company and the Indemnitee, there can be no assurance of the
continuation or renewal of that insurance.
Accordingly, and in order to induce the
Indemnitee to continue to serve in his present capacity, the
Company and the Indemnitee agree as follows:
1. Continued Service . The
Indemnitee shall continue to serve at the will of the Company as an
officer of the Company or one of its wholly owned subsidiaries so
long as he is duly elected and qualified in accordance with the
Regulations or until he resigns in writing in accordance with
applicable law.
2. Initial Indemnity . (a) The
Company shall indemnify the Indemnitee, if or when he is a party or
is threatened to be made a party to any threatened, pending, or
completed action, suit or proceeding, whether civil, criminal,
administrative, or investigative (other than an action by or in the
right of the Company), by reason of the fact that he is or was a
Director or an officer of the Company or is or was serving at the
request of the Company as a director, trustee, officer, employee,
or agent of another corporation, domestic or foreign, nonprofit or
for profit, partnership, joint venture, trust, or other enterprise,
or by reason of any action alleged to have been taken or omitted in
any such capacity, against any and all costs, charges, expenses
(including, without limitation, fees and expenses of attorneys
and/or others; all such costs, charges and expenses being herein
jointly referred to as “Expenses”), judgments, fines
and amounts paid in settlement, actually and reasonably incurred by
the Indemnitee in connection therewith including any appeal of or
from any judgment or decision, if the Indemnitee acted in good
faith and in a manner which he believed to be in or not opposed to
the best interests of the Company. In addition, with respect to any
criminal action or proceeding, indemnification hereunder shall be
made only if the Indemnitee had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, or conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the Indemnitee did not satisfy the
foregoing standard of conduct to the extent applicable
thereto.
(b) The Company shall indemnify the
Indemnitee, if or when he is a party or is threatened to be made a
party to any threatened, pending, or completed action, suit, or
proceeding by or in the right of the Company to procure a judgment
in its favor, by reason of the fact that the Indemnitee is or was a
Director or an officer of the Company or is or was serving at the
request of the Company as a director, trustee, officer, employee,
or agent of another corporation, domestic or foreign, nonprofit or
for profit, partnership, joint venture, trust, or other enterprise,
against any and all Expenses actually and reasonably incurred by
the Indemnitee in connection with the defense or settlement thereof
or any appeal of or from any judgment or decision, if the
Indemnitee acted in good faith and in a manner which he believed to
be in or not opposed to the best interests of the Company, except
that no indemnification pursuant to this Section 2(b) shall be made
in respect of any action or suit in which the only liability
asserted against the Indemnitee is pursuant to Section 1701.95
of the Ohio Revised Code (the “ORC”).
(c) Any indemnification under Section 2(a)
or 2(b) (unless ordered by a court) shall be made by the Company
only as authorized in the specific case upon a determination that
indemnification of the Indemnitee is proper in the circumstances
because he has met the applicable standard of conduct set forth in
Section 2(a) or 2(b). Such authorization shall be made (i) by
the Directors of the Company (the “Board”) by a
majority vote of a quorum consisting of Directors who were not and
are not parties to or threatened with such action, suit, or
proceeding, or (ii) if such a quorum of disinterested
Directors is not obtainable or if a majority of such quorum so
directs, in a written opinion by independent legal counsel
(designated for such purpose by the Board) which shall not be an
attorney, or a firm having associated with it an attorney, who has
been retained by or who has performed services for the Company, or
any person to be indemnified, within the five years preceding such
determination, or (iii) by the shareholders of the Company
(the “Shareholders”), or (iv) by the court in
which such action, suit, or proceeding was brought.
(d) To the extent that the Indemnitee has
been successful on the merits or otherwise, including, without
limitation, the dismissal of an action without prejudice, in
defense of any action, suit, or proceeding referred to in Section
2(a) or 2(b), or in defense of any claim, issue, or matter therein,
he shall be indemnified against Expenses actually and reasonably
incurred by him in connection therewith.
(e) Expenses actually and reasonably
incurred by the Indemnitee in defending any such action, suit, or
proceeding shall be paid by the Company as they are incurred in
advance of the final disposition of such action, suit, or
proceeding under the procedure set forth in
Section 4(b).
(f) For purposes of this Agreement,
references to “other enterprises” shall include
employee benefit plans; references to “fines” shall
include any excise taxes assessed on the Indemnitee with respect to
any employee benefit plan; references to “serving at the
request of the Company” shall include any service which
imposes duties on, or involves services by, the Indemnitee with
respect to an employee benefit plan, its participants or
beneficiaries; references to the masculine shall include the
feminine; and references to the singular shall include the plural
and vice versa.
(g) No amendment to the Amended Articles of
Incorporation of the Company (the “Articles”) or the
Regulations shall deny, diminish, or encumber the
Indemnitee’s rights to indemnity pursuant to this Agreement,
except to the extent that such amendment is required by law to be
given effect. No amendment to the Articles or the Regulations shall
deny, diminish, or encumber the Indemnitee’s rights to
indemnity pursuant to the Articles, the Regulations, the ORC, or
any other applicable law as applied to any act or failure to act
occurring in whole or in part prior to the date (the
“Effective Date”) upon which the amendment was approved
by the Shareholders, except to the extent that such amendment is
required by law to be given effect. In the event that the Company
shall purport to adopt any amendment to its Articles or Regulations
or take any other action the effect of which is to deny, diminish,
or encumber the Indemnitee’s rights to indemnity pursuant to
the Articles, the Regulations, the ORC, or any such other law, such
amendment shall apply only to acts or failures to act occurring
entirely after the Effective Date thereof.
3. Additional Indemnification .
Pursuant to ORC Section 1701.13(E)(6), without limiting any
right which the Indemnitee may have pursuant to Section 2
hereof or any other provision of this Agreement or the Articles,
the Regulations, the ORC, any policy of insurance, or otherwise,
but subject to any limitation on the maximum permissible indemnity
which may exist under applicable law at the time of any request for
indemnity hereunder and subject to the following provisions of this
Section 3, the Company shall indemnify the Indemnitee against
any amount which he is or becomes obligated to pay relating to or
arising out of any claim (including any pending, threatened or
completed action, suit or proceeding to which he is or is
threatened to be made a party) made against him because of any
action alleged to have been taken or omitted to be taken, including
any actual or alleged error, misstatement, or misleading statement,
which he commits, suffers, permits, or acquiesces in while acting
in his capacity as a Director or an officer of the Company. The
payments which the Company is obligated to make pursuant to this
Section 3 shall include, without limitation, judgments, fines,
and amounts paid in settlement and any and all Expenses actually
and reasonably incurred by the Indemnitee in connection therewith
including any appeal of or from any judgment or decision; provided,
however, that the Company shall not be obligated under this
Section 3 to make any payment in connection with any claim
against the Indemnitee:
(i) to the extent of any fine or similar
governmental imposition which the Company is prohibited by
applicable law from paying which results from a final,
nonappealable order; or
(ii) to the extent based upon or
attributable to the Indemnitee having actually realized a personal
gain or profit to which he was not legally entitled, including,
without limitation, profit from the purchase and sale by the
Indemnitee of equity securities of the Company which is recoverable
by the Company pursuant to Section 16(b) of the Securities Exchange
Act of 1934, or profit arising from transactions in publicly traded
securities of the Company which were effected by the Indemnitee in
violation of Section 10(b) of the Securities Exchange Act of 1934,
or Rule 10b-5 promulgated thereunder.
(b) A determination as to whether the
Indemnitee shall be entitled to indemnification under this
Section 3 shall be made in accordance with
Section 4(a).
(c) Expenses incurred by the Indemnitee in
defending any claim to which this Section 3 applies shall be
paid by the Company as they are actually and reasonably incurred in
advance of the final disposition of such claim under the procedure
set forth in Section 4(b).
4. Certain Procedures Relating to
Indemnification . (a) For purposes of pursuing his rights
to indemnification under Section 3, the Indemnitee shall
(i) submit to the Board a sworn statement of request for
indemnification substantially in the form of Exhibit 1
attached hereto and made a part hereof (the “Indemnification
Statement”) stating that he is entitled to indemnification
hereunder; and (ii) present to the Board reasonable evidence
of all amounts for which indemnification is requested. Submission
of an Indemnification Statement to the Board shall create a
presumption that the Indemnitee is entitled to indemnification
hereunder, and the Company shall, within 60 calendar days after
submission of the Indemnification Statement, make the payments
requested in the Indemnification Statement to or for the benefit of
the Indemnitee, unless (i) within such 60-calendar-day period the
Board shall resolve by vote of a majority of the Directors at a
meeting at which a quorum is present that the Indemnitee is not
entitled to indemnification under Section 3, (ii) such
vote shall be based upon clear and convincing evidence (sufficient
to rebut the foregoing presumption), and (iii) the Indemnitee
shall have received within such period notice in writing of such
vote, which
