Exhibit 10.1
INDEMNIFICATION
AGREEMENT
(Supreme
Industries, Inc.)
THIS AGREEMENT is made this 30th day of September, 2008,
between Supreme Industries, Inc. , a Delaware
corporation (the “Company”), and
(“ Indemnitee”). This Agreement completely
replaces and supersedes the Indemnification Agreement dated
October 15, 1997, between Indemnitee and the
Company.
Competent and experienced persons are becoming
more reluctant to serve as directors and/or officers of
corporations unless they are provided with adequate protection
against claims and actions against them for their activities on
behalf or at the request of such corporations, generally through
insurance and/or indemnification.
Uncertainties in the interpretations of the
statutes and regulations, laws, and public policies relating to
indemnification of corporate directors and officers are such as to
make adequate, reliable assessment of the risks to which directors
and officers of such corporations may be exposed difficult,
particularly in light of the proliferation of lawsuits against
directors and officers generally.
The Board of Directors of the Company, based
upon its business experience, has concluded that the continuation
of present trends in litigation against corporate directors and
officers will inevitably make it more difficult for the Company to
attract and retain directors and officers of the highest degree of
competence committed to the active and effective direction and
supervision of the business and affairs of the Company and its
subsidiaries and affiliates and the operation of its and their
facilities. In fact, the Board deems such consequence to be so
detrimental to the best interests of the Company that it has
concluded that the Company should act to provide its directors and
officers with enhanced protection against inordinate risks
attendant on their positions in order to assure that the most
capable persons otherwise available will be attracted to, or will
remain in, such positions. In such connection, such directors have
further concluded that it is not only reasonable and prudent but
necessary for the Company to obligate itself contractually to
indemnify, to the fullest extent permitted by applicable law,
financial responsibility for expenses and liabilities which might
be incurred by such individuals in connection with claims lodged
against them for their decisions and actions in such
capacities.
The General Corporation Law of the State of
Delaware, under which law the Company is organized, empowers a
corporation organized in Delaware to indemnify persons who serve as
directors and/or officers of the corporation, or persons who serve
at the request of the corporation as directors and/or officers of
an affiliated corporation, further specifies that the
indemnification provided by law “shall not be deemed
exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under
any bylaw, agreement, vote of stockholders or disinterested
directors or otherwise,” and further empowers a
corporation to “purchase and maintain insurance”
on behalf of such persons “against any liability
asserted
against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against any such
liability under this [provision].
The Certificate of Incorporation and Bylaws of
the Company permit indemnification to the fullest extent permitted
by applicable law.
The Company desires to have the Indemnitee serve
or continue to serve as a director and/or officer of the Company,
and/or as a director, officer, employee, partner, trustee, agent,
and/or fiduciary of such other corporations, partnerships, joint
ventures, employee benefit plans, trusts, and/or other enterprises
(herein referred to as “ Company Affiliate ”) of
which he or she has been or is serving, or will serve on behalf of
or at the request of or for the convenience of, or to represent the
interests of the Company, free from undue concern for
unpredictable, inappropriate, or unreasonable claims for damages by
reason of his or her being, or having been, a director and/or
officer of the Company, and/or a director, officer, employee,
partner, trustee, agent, and/or fiduciary of a Company Affiliate,
or by reason of his or her decisions or actions on their
behalf.
The Indemnitee is willing to serve, or to
continue to serve, or to take on additional service for, the
Company and/or the Company Affiliate in such aforesaid capacities
on the condition that he or she be indemnified as provided for
herein.
Accordingly, in consideration of the premises
and the covenants contained herein, the Company and the Indemnitee
do hereby covenant and agree as follows:
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Services to the
Company: The
Indemnitee shall serve or continue to serve as a director and/or
officer of the Company (in the case of a Company officer at the
will of the Company or under separate contract, if any such
contract exists or shall hereafter exist), and/or as a director,
and/or officer, or fiduciary of a Company Affiliate, faithfully and
to the best of his or her ability so long as he or she is duly
elected and qualified in accordance with the provisions of the
Bylaws or other applicable constitutive documents thereof;
provided. however that: (a) the Indemnitee may at any
time and for any reason resign from such position (subject to any
contractual obligations which the Indemnitee has assumed apart from
this Agreement); and (b) neither the Company nor the Company
Affiliate will have any obligation under this Agreement to continue
the Indemnitee in any such position.
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Right to
Indemnification:
2.1
The Company shall, except to the
extent prohibited by applicable law as then in effect, indemnify
any Indemnitee who is or was involved in any manner (including,
without limitation, as a party or witness), or is threatened to be
made so involved, in any threatened, pending, or completed
investigation, claim, action, suit, or proceeding whether civil,
criminal, administrative, or investigative (including, without
limitation,
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any action, suit, or proceeding by
or in the right of the Company to procure a judgment in its favor)
(herein referred to as a “ Proceeding ”) by
reason of the fact that such person is or was a director or officer
of the Company, and/or is or was serving at the request of the
Company as a director or officer, of any Company affiliate, against
all expenses (including attorneys’ fees), judgments, fines,
and amounts paid in settlement actually and reasonably incurred by
such person in connection with such Proceeding; provided.
however, that, except as provided in Paragraph 3.4, the
foregoing shall not apply to a director or officer of the Company
with respect to a Proceeding that was commenced by such director or
officer. Such indemnification shall include the right to receive
payment in advance of any expenses incurred by the Indemnitee in
connection with such Proceeding, consistent with the provisions of
applicable law as then in effect.
2.2
Notwithstanding the obligation of
the Company to indemnify attorneys’ fees as above provided in
Paragraph 2.1, as a condition to being so indemnified the following
shall apply. With regard to any “ Proceeding ”
(as above defined), there will be groups the members of which have
totally common interests — i.e., their goals are
identical and there are no conflicts-of-interest among them. At
such time as the determination of these groups has been completed
(such determination to be made by “ Independent
Counsel ” [as hereafter defined] if the parties involved
cannot make such determination among themselves), each group shall,
by majority vote of those comprising such group, select a single
attorney or law firm to serve as (exclusive) legal counsel for all
of the members of such group. In the event that any member of any
such group acts independently by retaining the legal services of
any other attorney or law firm to additionally or separately
represent him, her, or it, all legal fees and expenses of such
independently retained attorney or law firm shall be the (sole)
responsibility of such independently acting member of the
group.
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Advancement of Expenses;
Procedures; Presumptions and Effect of Certain
Proceedings: Remedies: In furtherance, but not in limitation,
of the foregoing provisions, the following procedures,
presumptions, and remedies shall apply with respect to advancement
of expenses and the right to indemnification hereunder:
3.1
Advancement of
Expenses: All
reasonable expenses incurred by or on behalf of the Indemnitee in
connection with any Proceeding shall, after initial approval in
accordance with Paragraph 3.2, be advanced to the Indemnitee by the
Company within twenty (20) calendar days after the receipt by the
Company of a statement or statements from the Indemnitee requesting
such advance or advances from time to time, whether prior to or
after final disposition of such Proceeding. Such statement or
statements shall: (a) be delivered to the Company within
ninety (90) days after the incurrence of the expenses being
reported on such statement or statements;
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and (b) reasonably evidence the
expenses incurred by the Indemnitee (and, if required by law at the
time of such advance, shall include or be accompanied by an
undertaking by or on behalf of the Indemnitee to repay the amounts
advanced if it should ultimately be determined that the Indemnitee
is not entitled to be indemnified against such expenses
hereunder).
3.2
Procurement for Determination
of Entitlement to Indemnification:
3.2.1
To obtain indemnification as herein
provided, an Indemnitee shall submit to the President or Secretary
of the Company a written request, including such documentation and
information as is reasonably available to the Indemnitee and
reasonably necessary to determine whether and to what extent the
Indemnitee is entitled to indemnification (herein referred to as
the “Supporting Documentation”). The determination of
the Indemnitee’s entitlement to indemnification shall be made
not later than 60 calendar days after receipt by the Company of the
written request for Indemnification together with the Supporting
Documentation. The Secretary or President of the Company shall,
promptly upon receipt of such a request for indemnification, advise
the Board of Directors in writing that the Indemnitee has requested
indemnification.
3.2.2
The Indemnitee’s entitlement
to indemnification hereunder shall (except as provided in
Subparagraph 3.2.3 below) be determined in one of the following
ways (each of which shall give effect to the presumptions set forth
in Paragraph 3.3): (a) by a majority vote of the Disinterested
Directors (as hereinafter defined) if they constitute a quorum of
the Board of Directors; (b) by a written opinion of
Independent Counsel (as hereinafter defined) if a quorum of the
Board of Directors consisting of Disinterested Directors is not
obtainable or, even if obtainable, a majority of such Disinterested
Directors so directs: (c) by the stockholders of the Company
(but only if a majority of the Disinterested Directors, if they
constitute a quorum of the Board of Directors, presents the issue
of entitlement to indemnification to the stockholders for their
determination); or (d) as provided in Paragraph 3.3. In the
event that this Subparagraph 3.2.2 applies, stockholder approval
will be deemed to have been received if the holders of a majority
of the Company’s total common stock outstanding vote in favor
of such approval.
3.2.3
Notwithstanding what is stated
above, in the event of a Change in Control (see definition
contained in Exhibit “A” hereto) the
Indemnitee’s entitlement to indemnification shall be
determined by a written opinion of Independent Counsel in a written
opinion to
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the Board of Directors, a copy of
which shall be delivered to the Indemnitee. The Independent Counsel
shall be selected by the Indemnitee. In the event the Company
objects to the Independent Counsel so selected, within seven days
after written notice of the selection has been given by the
Indemnitee to the Company, the Company may object to such selection
by written notification given to the Indemnitee. Such objection may
be asserted only on the ground that the Independent Counsel so
selected does not meet the requirement of “Independent
Counsel” as hereafter defined, and the objection shall
set forth with particularity the factual basis of such assertion.
If such written objection is made, the Independent Counsel so
selected may not serve as Independent Counsel unless and until a
court has determined that such objection is without merit. The
Company shall pay any and all reasonable fees and expenses of
Independent Counsel incurred by such Independent Counsel in
connection with the performance of his or her responsibilities
hereunder, and the Company shall pay all reasonable fees and
expenses instant to the implementation of the procedures referred
to above. Upon the due commencement of any judicial proceeding or
arbitration pursuant to Subparagraph 3.4.1 hereof, the Independent
Counsel shall be discharged and relieved of any further
responsibility in such capacity (subject to the applicable
standards of professional conduct then prevailing).
3.2.4
In the event of a Potential Change
in Control (as hereinafter defined), the Company, upon written
request by the Indemnitee, shall create a trust (which shall be a
“grantor trust” for federal income tax purposes) for
the benefit of the Indemnitee and from time to time upon written
request of the Indemnitee shall fund such trust in an amount
sufficient to satisfy any and all expenses which at the time of
each such request it is reasonably anticipated will be incurred in
connection with a Proceeding for which the Indemnitee is entitled
to rights of indemnification under Paragraph 2 hereof, and any and
all judgments, fines, penalties, and settlement amounts of any and
all proceedings for which the Indemnitee is entitled to rights of
indemnification under Paragraph 2 from time to time actually paid
or claimed, reasonably anticipated, or proposed to be paid. The
amount or amounts to be deposited in the trust pursuant to the
foregoing funding obligation shall be determined by the Independent
Counsel referred to in Subparagraph 3.2.2 above. The terms of the
trust shall provide that upon a Change in Control:
(i) the trust shall ‘not be revoked or the principal
thereof invaded, without the written consent of the Indemnitee;
(ii) the trustee shall advance, within two (2) business
days of a request by the Indemnitee, any and all expenses to the
Indemnitee; (iii) the trust shall continue to be funded by the
Company in accordance with the funding obligations set forth above;
(iv) the trustee shall promptly
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pay to the Indemnitee all amounts
for which the Indemnitee is entitled to indemnification pursuant to
this Agreement or otherwise; and (v) all unexpended funds in
such trust shall revert to the Company upon a final determination
by such Independent Counsel that the Indemnitee has been fully
indemnified under the terms of this Agreement. The trustee shall be
an institutional trustee with a highly regarded reputation chosen
by the Indemnitee. Nothing in this Subparagraph 3.2.4 shall relieve
the Company of any of
