INDEMNIFICATION
AGREEMENT
THIS
INDEMNIFICATION AGREEMENT (the “Agreement”) is made as
of this
day of
, 200 , by and between United
Commercial Bank, a California state-chartered bank, (the
“Bank”) and
, an individual (“Indemnitee”).
A. The Bank
and Indemnitee recognize that unforeseen litigation may subject
directors, officers and agents to costs and expenses.
B. The Bank
desires to attract and retain the services of highly qualified
individuals, such as Indemnitee, to serve as directors, officers
and agents of the Bank and to indemnify its directors, officers and
agents so as to provide them with the maximum protection permitted
by law.
In consideration
of the Recitals set forth above and mutual covenants and agreements
set forth below, the Bank and Indemnitee do hereby agree as
follows:
1.
Indemnification and Expense Advancement .
(a)
Proceedings Other than by Right of the Bank . The Bank shall
indemnify Indemnitee 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 Bank to procure a judgment in its
favor) by reason of the fact that Indemnitee is or was an Agent (as
defined in Section 1(i) below) of the Bank, against costs,
expenses, judgments, fines, settlements and other amounts actually
and reasonably incurred in connection with such proceeding if
Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in the best interests of the Bank and, in
the case of a criminal proceeding, has no reasonable cause to
believe the conduct of Indemnitee was unlawful. The termination of
any proceeding 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 act in good
faith and in a manner which Indemnitee reasonably believed to be in
the best interests of the Bank or that Indemnitee had reasonable
cause to believe that Indemnitee’s conduct was
unlawful.
(b)
Proceedings By or in the Right of the Bank . The Bank shall
indemnify Indemnitee if Indemnitee was or is a party or is
threatened to be made a party to any threatened, pending or
completed action by or in the right of the Bank to procure a
judgment in its favor by reason of the fact that Indemnitee is or
was an Agent of the Bank, against expenses actually and reasonably
incurred by Indemnitee in connection with the defense or settlement
of such action if Indemnitee acted in good faith, in a manner
Indemnitee believed to be in the best interests of the Bank and its
shareholders; except that no indemnification shall be made under
this Section 1(b) for any of the following:
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(i) In
respect of any claim, issue or matter as to which Indemnitee shall
have been adjudged to be liable to the Bank in the performance of
Indemnitee’s duty to the Bank and its shareholders, unless
and only to the extent that the court in which such proceeding is
or was pending shall determine upon application that, in view of
all the circumstances of the case, Indemnitee is fairly and
reasonably entitled to indemnity for the expenses which such court
shall determine;
(ii) Of
amounts paid in settling or otherwise disposing of a pending action
without court approval; or
(iii) Of
expenses incurred in defending a pending action which is settled or
otherwise disposed of without court approval.
(c)
Determination of Right of Indemnification . Any
indemnification under Sections 1(a) and (b) shall be made by
the Bank only if authorized in the specific case, upon a
determination that indemnification of Indemnitee is proper in the
circumstances because Indemnitee has met the applicable standard of
conduct set forth above in Sections 1(a) and (b) by any of the
following:
(i) A
majority vote of a quorum consisting of directors who are not
parties to such proceeding; or
(ii) If
such a quorum of directors is not obtainable, by independent legal
counsel in a written opinion; or
(iii) Approval
of the shareholders by the affirmative vote of a majority of the
shares entitled to vote represented at a duly held meeting at which
a quorum is present or by the written consent of shareholders as
provided in the Bylaws, with the shares owned by the person to be
indemnified not being entitled to vote thereon; or
(iv) By
the court in which such proceeding is or was pending upon
application made by the Bank or its Agent or attorney or other
person rendering services in connection with the defense, whether
or not such application by the Agent, attorney or other person is
opposed by the Bank.
(d)
Advances of Expenses . Expenses (including reasonable
attorneys’ and experts’ fees), costs, and charges
incurred in defending any proceeding shall be advanced promptly by
the Bank prior to the final disposition of such proceeding upon
receipt of a written undertaking by or on behalf of Indemnitee to
repay such amount unless it shall be determined ultimately that
Indemnitee is entitled to be indemnified as authorized in this
Section 1. The form of such undertaking shall be substantially
similar to Exhibit A hereto.
(e)
Indemnification Against Expenses of Successful Party .
Notwithstanding the other provisions of this Section 1, to the
extent that Indemnitee has been successful on the merits in a
defense of any proceeding, claim, issue or matter referred to in
Sections 1(a) and (b), Indemnitee shall be indemnified against all
expenses actually and reasonably incurred by Indemnitee in
connection therewith.
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(f)
Right of Indemnitee to Indemnification Upon Application;
Procedure Upon Application . Any indemnification provided for
in Sections 1(a), (b) or (e) shall be made no later
than ninety (90) days after the Bank is given notice of
request by Indemnitee, provided that any indemnification under
Sections 1(a) and (b) is authorized pursuant to
Section 1(c). Any such request for indemnification must be
made within ninety (90) days of the final adjudication,
dismissal, or settlement of the matter for which Indemnitee seeks
indemnification, unless an appeal is filed, in which case the
request may be made within ninety (90) days after the appeal
is resolved (hereafter referred to as “Final
Disposition”). Upon such notice, if a quorum of directors who
were not parties to the action, suit, or proceeding giving rise to
indemnification is obtainable, the Bank shall within two
(2) weeks call a Board of Directors meeting to be held within
four (4) weeks of such notice, to make a determination as to
whether Indemnitee has met the applicable standard of conduct.
Otherwise, if a quorum consisting of directors who were not parties
in the relevant action, suit, or proceeding is not obtainable, the
Bank shall retain (at the Bank’s expense) independent legal
counsel chosen by the Bank within two (2) weeks to make such
determination.
If
notice of a request for payment of a claim under any statute, under
this Agreement, or under the Bank’s Articles of Incorporation
or Bylaws providing for indemnification or advance of expenses has
been given to the Bank by Indemnitee, and such claim is not paid in
full by the Bank within ninety (90) days of the later
occurring of the giving of such notice and Final Disposition in
case of indemnification and ten (10) days of the giving of
such notice in case of advance of expenses, Indemnitee may, but
need not, at any time thereafter bring an action against the Bank
to receive the unpaid amount of the claim or the expense advance
and, if successful, Indemnitee shall also be paid for the expenses
(including reasonable attorneys’ and experts’ fees) of
bringing such action. It shall be a defense to any such action
(other than an action brought to enforce a claim for expenses
incurred in connection with any action, suit, or proceeding in
advance of its Final Disposition) that Indemnitee has not met the
standards of conduct which make it permissible under applicable law
for the Bank to indemnify Indemnitee for the amount claimed, and
Indemnitee shall be entitled to receive interim payment of expenses
pursuant to Section 1(d) unless and until such defense may be
finally adjudicated by court order or judgment from which no
further right of appeal exists. Neither the failure of the Bank
(including its Board of Directors, independent legal counsel, or
its shareholders) to have made a determination that indemnification
of Indemnitee is proper in the circumstances because Indemnitee has
met the applicable standard of conduct required by applicable law,
nor an actual determination by the Bank (including its Board of
Directors or its independent legal counsel) that Indemnitee has not
met such applicable standard of conduct, shall create a presumption
that Indemnitee has or has not met the applicable standard of
conduct.
(g)
Insurance . The Bank may purchase and maintain insurance on
behalf of any person who is or was an Agent against any liability
asserted against such person and incurred by him or her in any such
capacity, or arising out of his or her status as such, whether or
not the Bank would have the power to indemnify such person against
such liability under the provisions of this
Section 1.
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(h)
Optional Means of Assuring Payment . Upon request by an
Indemnitee certifying that Indemnitee has reasonable grounds to
believe Indemnitee may be made a party to a proceeding for which
Indemnitee may be entitled to be indemnified under this
Section 1, the Bank may, but is not required to, create a
trust fund, grant a security interest or use other means
(including, without limitation, a letter of credit) to ensure the
payment of such sums as may become necessary to effect
indemnification as provided herein.
(i)
Definition of Agent . For the purposes of this Agreement,
“Agent” means any person who is or was a director,
officer, employee or other agent of the Bank, or is or was serving
at the request of the Bank as a director, officer, employee or
agent of another foreign or domestic Bank, partnership, joint
venture, trust or other enterprise, or was a director, officer,
employee or agent of a foreign or domestic Bank which was a
predecessor Bank of the Bank or of another enterprise at the
request of such predecessor Bank; “proceeding” means
any threatened, pending or completed action or proceeding, whether
civil, criminal, administrative or investigative; and
“expenses” includes without limitation reasonable
attorneys’ and experts’ fees and any expenses of
establishing a right to indemnification.
(j)
Indemnification under Section 204(a)(11) of the California
General Corporation Law . Subject to the provisions of
California General Corporation Law Section 204(a)(11) and any
other applicable law, notwithstanding any other provisions of this
Section 1, the following shall apply to the indemnification of
Indemnitee:
(i) The
Bank shall indemnify Indemnitee pursuant to this Section 1(l) if
the Bank would be required to indemnify Indemnitee pursuant to
Sections 1(a) or (b) if in Section 1(a) or (b) the phrase
“in a manner Indemnitee reasonably believed to be in the best
interests of the Bank” is replaced with the phrase “in
a manner Indemnitee did not believe to be contrary to the best
interests of the Bank.” If pursuant to Sections 1(c) and
(f)
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