INDEMNIFICATION AGREEMENT
Indemnification
Agreement, dated as of
, between NCI Building Systems, Inc., a Delaware corporation (the
“ Company ”), and
(“ Indemnitee ”).
WHEREAS, qualified
persons are reluctant to serve corporations as directors or
otherwise unless they are provided with broad indemnification and
insurance against claims arising out of their service to and
activities on behalf of the corporations; and
WHEREAS, the
Company has determined that attracting and retaining such persons
is in the best interests of the Company’s stockholders and
that it is reasonable, prudent and necessary for the Company to
indemnify such persons to the fullest extent permitted by
applicable law and to provide reasonable assurance regarding
insurance;
NOW, THEREFORE,
the Company and Indemnitee hereby agree as follows:
1.
Defined Terms; Construction .
(a)
Defined Terms . As used in this Agreement, the following
terms shall have the following meanings:
“ Change
in Control ” means, and shall be deemed to have occurred
if, on or after the date of this Agreement, ( i ) any
“person” (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended), other
than ( A ) a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or any of its
subsidiaries acting in such capacity, or ( B ) a corporation
owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of stock of
the Company, is or becomes the “beneficial owner” (as
defined in Rule 13d-3 under said Act), directly or indirectly,
of securities of the Company representing more than 20% of the
total voting power represented by the Company’s then
outstanding Voting Securities, ( ii ) during any period of
two consecutive years, individuals who at the beginning of such
period constitute the board of directors of the Company and any new
director whose election by the board of directors of the Company or
nomination for election by the Company’s stockholders was
approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors at the beginning of
the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a
majority thereof, ( iii ) the stockholders of the Company
approve a merger or consolidation of the Company with any other
corporation other than a merger or consolidation that would result
in the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining
outstanding or by being converted into Voting Securities of the
surviving entity) at least 80% of the total voting power
represented by the Voting
Securities of
the Company or such surviving entity outstanding immediately after
such merger or consolidation, ( iv ) the stockholders of the
Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of (in one
transaction or a series of related transactions) all or
substantially all of its assets, or ( v ) the Company shall
file or have filed against it, and such filing shall not be
dismissed, any bankruptcy, insolvency or dissolution proceedings,
or a trustee, administrator or creditors committee shall be
appointed to manage or supervise the affairs of the
Company.
“
Corporate Status ” means the status of a person who is
or was a director (or a member of any committee of a board of
directors), officer, employee or agent (including without
limitation a manager of a limited liability company) of the Company
or any of its subsidiaries, or of any predecessor thereof, or is or
was serving at the request of the Company as a director (or a
member of any committee of a board of directors), officer, employee
or agent (including without limitation a manager of a limited
liability company) of another corporation, limited liability
company, partnership, joint venture, trust or other enterprise, or
of any predecessor thereof, including service with respect to an
employee benefit plan.
“
Determination ” means a determination that either (
x ) there is a reasonable basis for the conclusion that
indemnification of Indemnitee is proper in the circumstances
because Indemnitee met a particular standard of conduct (a “
Favorable Determination ”) or ( y ) there is no
reasonable basis for the conclusion that indemnification of
Indemnitee is proper in the circumstances because Indemnitee met a
particular standard of conduct (an “ Adverse
Determination ”). An Adverse Determination shall include
the decision that a Determination was required in connection with
indemnification and the decision as to the applicable standard of
conduct.
“
DGCL ” means the General Corporation Law of the State
of Delaware, as amended from time to time.
“
Expenses ” means all attorneys’ fees and
expenses, retainers, court, arbitration and mediation costs,
transcript costs, fees of experts, bonds, witness fees, costs of
collecting and producing documents, travel expenses, duplicating
costs, printing and binding costs, telephone charges, postage,
delivery service fees and all other disbursements or expenses of
the types customarily incurred in connection with prosecuting,
defending, preparing to prosecute or defend, investigating, being
or preparing to be a witness in, appealing or otherwise
participating in a Proceeding.
“
Independent Legal Counsel ” means an attorney or firm
of attorneys competent to render an opinion under the applicable
law, selected in accordance with the provisions of
Section 5(e), who has not otherwise performed any services for
the Company or any of its
subsidiaries or
for Indemnitee within the last three years (other than with respect
to matters concerning the rights of indemnitees under indemnity
agreements).
“
Proceeding ” means a threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative
or investigative, including without limitation a claim, demand,
discovery request, formal or informal investigation, inquiry,
administrative hearing, arbitration or other form of alternative
dispute resolution, including an appeal from any of the
foregoing.
“ Voting
Securities ” means any securities of the Company that
vote generally in the election of directors.
(b)
Construction . For purposes of this Agreement,
(i)
References to the Company and any of its “subsidiaries”
shall include any corporation, limited liability company,
partnership, joint venture, trust or other entity or enterprise
that before or after the date of this Agreement is party to a
merger or consolidation with the Company or any such subsidiary or
that is a successor to the Company as contemplated by Section 8(d)
(whether or not such successor has executed and delivered the
written agreement contemplated by Section 8(d)).
(ii)
References to “fines” shall include any excise taxes
assessed on Indemnitee with respect to an employee benefit
plan.
(iii)
References to a “witness” in connection with a
Proceeding shall include any interviewee or person called upon to
produce documents in connection with such Proceeding.
Indemnitee agrees
to serve as a director of the Company or one or more of its
subsidiaries and in such other capacities as Indemnitee may serve
at the request of the Company from time to time, and by its
execution of this Agreement the Company confirms its request that
Indemnitee serve as a director and in such other capacities.
Indemnitee shall be entitled to resign or otherwise terminate such
service with immediate effect at any time, and neither such
resignation or termination nor the length of such service shall
affect Indemnitee’s rights under this Agreement. This
Agreement shall not constitute an employment agreement, supersede
any employment agreement to which Indemnitee is a party or create
any right of Indemnitee to continued employment or
appointment.
(a)
General Indemnification . The Company shall indemnify
Indemnitee, to the fullest extent permitted by applicable law in
effect on the date hereof or as amended to increase the scope of
permitted indemnification, against Expenses, losses, liabilities,
judgments, fines, penalties and amounts paid in settlement
(including all interest, assessments and other charges in
connection therewith) incurred by Indemnitee or on
Indemnitee’s behalf in connection with any Proceeding in any
way connected with, resulting from or relating to
Indemnitee’s Corporate Status.
(b)
Additional Indemnification Regarding Expenses . Without
limiting the foregoing, in the event any Proceeding is initiated by
Indemnitee or the Company or any of its subsidiaries to enforce or
interpret this Agreement or any rights of Indemnitee to
indemnification or advancement of Expenses (or related obligations
of Indemnitee) under the Company’s or any such
subsidiary’s certificate of incorporation or bylaws, any
other agreement to which Indemnitee and the Company or any of its
subsidiaries are party, any vote of stockholders or directors of
the Company or any of its subsidiaries, the DGCL, any other
applicable law or any liability insurance policy, the Company shall
indemnify Indemnitee against all Expenses incurred by Indemnitee or
on Indemnitee’s behalf in connection with such Proceeding,
whether or not Indemnitee is successful in such Proceeding, except
to the extent that the court presiding over such Proceeding
determines that material assertions made by Indemnitee in such
Proceeding were in bad faith or were frivolous.
(c)
Partial Indemnification . If Indemnitee is entitled under
any provision of this Agreement to indemnification by the Company
for a portion of any Expenses, losses, liabilities, judgments,
fines, penalties and amounts paid in settlement incurred by
Indemnitee, but not for the total amount thereof, the Company shall
nevertheless indemnify Indemnitee for such portion.
(d)
Nonexclusivity . The indemnification provided by this
Agreement shall not be deemed exclusive of any rights to which
Indemnitee may be entitled under the Company’s certificate of
incorporation or bylaws, any agreement, any vote of stockholders or
directors, the DGCL, any other applicable law or any liability
insurance policy , provided that to the extent that
Indemnitee is entitled to be indemnified by the Company under this
Agreement and by any shareholder of the Company or any affiliate of
any such shareholder under any other agreement or instrument, the
obligations of the Company hereunder shall be primary, and the
obligations of such shareholder or affiliate secondary, and the
Company shall not be entitled to contribution or indemnification
from or subrogation against such shareholder or
affiliate.
(e)
Exceptions . Any other provision herein to the contrary
notwithstanding, the Company shall not be obligated under the
Agreement to indemnify Indemnitee:
(i)
For Expenses incurred in connection with Proceedings initiated or
brought voluntarily by the Indemnitee and not by way of defense,
counterclaim or crossclaim, except ( x ) as contemplated by
Section 3(b), ( y ) in specific cases if the board of
directors of the Company has approved the initiation or bringing of
such Proceeding, and ( z ) as may be required by
law.
(ii)
For an accounting of profits arising from the purchase and sale by
the Indemnitee of secur
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