Exhibit 10.18(a)
INDEMNIFICATION
AGREEMENT
This Agreement is made effective as
of the January 1, 2003, by and between Equitable Resources, Inc., a
Pennsylvania corporation (the “Company”) and Randall L.
Crawford (the “Indemnitee”), a director and/or officer
of the Company.
WHEREAS, it is essential that the Company retain and
attract as directors and officers the most capable persons
available; and
WHEREAS, Indemnitee is a director and/or officer of the
Company and in that capacity is performing a valuable service for
the Company; and
WHEREAS, Company Bylaws (the “ Bylaw
”) contain a provision which provides for indemnification of
and advancement of expenses to the directors and officers of the
Company for liabilities and expenses they incur in their capacities
as such, and the Bylaws and the applicable indemnification statutes
of the Commonwealth of Pennsylvania provide that they are not
exclusive; and
WHEREAS, in recognition of Indemnitee’s need for
protection against personal liability in order to enhance
Indemnitee’s continued service to the Company in an effective
manner, the potential difficulty in obtaining satisfactory
Directors and Officers Liability Insurance (“ D & O
Insurance ”) coverage, and Indemnitee’s reliance on
the Bylaws, and in part to provide Indemnitee with specific
contractual assurance that the protection promised by the Bylaws
will be available to Indemnitee (regardless of, among other things,
any amendment to or revocation of the Bylaws or any change in the
composition of the Company’s Board of Directors or
acquisition transaction relating to the Company), the Company
desires to provide in this Agreement for the indemnification of and
the advancing of expenses to Indemnitee to the fullest extent
permitted by law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the continued coverage of
Indemnitee under the Company’s D & O Insurance
policies.
NOW, THEREFORE,
in consideration of the premises and
of Indemnitee continuing to serve the Company directly or, at its
request, another enterprise, and intending to be legally bound
hereby, the parties hereto agree as follows:
1.
Indemnity of Indemnitee.
(a)
The Company shall indemnify and hold harmless the Indemnitee
against any and all reasonable expenses, including fees and
expenses of counsel, and any and all liability and loss, including
judgments, fines, ERISA excise taxes or penalties and amounts paid
or to be paid in settlement, incurred or paid by Indemnitee in
connection with any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or
investigative (hereinafter “a proceeding”) and whether
or not by or in the right of the Company or otherwise, to which the
Indemnitee is, was or at any time becomes a party, or is threatened
to be made a party or is involved (as a witness or otherwise) by
reason of the fact that Indemnitee is or was a
director or officer of the Company or is or was
serving at the request of the Company as director, officer,
employee, trustee or representative of another corporation or of a
partnership, joint venture, trust or other enterprise, including
service with respect to employee benefit plans, whether the basis
of such proceeding is alleged action in an official capacity or in
any other capacity while serving as a director, officer, employee,
trustee or representative, unless the act or failure to act giving
rise to the claim for indemnification is determined by a court to
have constituted willful misconduct or recklessness; provided,
however, that the Company shall indemnify the Indemnitee in
connection with a proceeding (or part thereof) initiated by the
Indemnitee (other than a proceeding to enforce the
Indemnitee’s rights to indemnification under this Agreement
or otherwise) prior to a Change of Control, as defined in Section
2(e), only if such proceeding (or part thereof) was authorized by
the Board of Directors of the Company.
(b)
Subject to the foregoing limitation concerning certain proceedings
initiated by the Indemnitee prior to a Change of Control, the
Company shall pay the expenses (including fees and expenses of
counsel) incurred by Indemnitee in connection with any proceeding
in advance of the final disposition thereof promptly after receipt
by the Company of a request therefor stating in reasonable detail
the expenses incurred or to be incurred.
(c)
If a claim under paragraph (a) or (b) of this section is not paid
in full by the Company within forty-five (45) days after a written
claim has been received by the Company, the Indemnitee may, at any
time thereafter, bring suit against the Company to recover the
unpaid amount of the claim. The burden of proving that
indemnification or advances are not appropriate shall be on the
Company. The Indemnitee shall also be entitled to be paid the
expenses of prosecuting such claim to the extent he or she is
successful in whole or in part on the merits or otherwise in
establishing his or her right to indemnification or to the
advancement of expenses. The Company shall pay such fees and
expenses in advance of the final disposition of such action on the
terms and conditions set forth in Section 1(b).
2.
Maintenance of Insurance and Funding.
(a)
The Company represents that a summary of the terms of the policies
of D&O Insurance in effect as of the date of this Agreement is
attached hereto as Exhibit A (the “ Insurance Policies
”).
Subject only to the provisions of
Section 2(b) hereof, the Company agrees that, so long as Indemnitee
shall continue to serve as an officer or director of the Company
(or shall continue at the request of the Company to serve as a
director, officer, employee, trustee or representative of another
corporation, partnership, joint venture, trust or other enterprise,
including service with respect to an employee benefit plan) and
thereafter so long as Indemnitee shall be subject to any possible
claim or threatened, pending or completed action, suit or
proceeding, whether civil, criminal or investigative, by reason of
the fact that Indemnitee was a director or officer of the Company
(or served in any of said other capacities), the Company shall
purchase and maintain in effect for the benefit of Indemnitee one
or more valid, binding and enforceable policy or policies of D
& O Insurance providing coverage at least comparable to that
provided pursuant to the Insurance Policies.
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(b)
The Company shall not be required to maintain said policy or
policies of D & O Insurance in effect if, in the reasonable,
good faith business judgment of the then Board of Directors of the
Company (i) the premium cost for such insurance is substantially
disproportionate to the amount of coverage, (ii) the coverage
provided by such insurance is so limited by exclusions that there
is insufficient benefit from such insurance or (iii) said insurance
is not otherwise reasonably available; provided, however, that in
the event the then Board of Directors makes such a judgment, the
Company shall purchase and maintain in force a policy or policies
of D & O Insurance in the amount and with such coverage as the
then Board of Directors determines to be reasonably
available. Notwithstanding the general provisions of this
Section 2(b), following a Change of Control, any decision not to
maintain any policy or policies of D & O Insurance or to reduce
the amount or coverage under any such policy or policies shall be
effective only if there are Disinterested Directors (as defined in
Section 2(e) hereof) and shall require the concurrence of a
majority of the Disinterested Directors.
(c)
If and to the extent the Company, acting under Section 2(b), does
not purchase and maintain in effect the policy or policies of D
& O Insurance described in Section 2(a), the Company shall
indemnify and hold harmless the Indemnitee to the full extent of
the coverage which would otherwise have been provided by such
policies. The rights of the Indemnitee hereunder shall be in
addition to all other rights of Indemnitee under the
remaining
provisions of this Agreement.
(d)
In the event of a Potential Change of Control or if and to the
extent the Company is not required to maintain in effect the policy
or policies of D & O Insurance described in Section 2(a)
pursuant to the provisions of Section 2(b), the Company shall, upon
written request by Indemnitee, create a “Trust” for the
benefit of Indemnitee and from time to time, upon written request
by Indemnitee, shall fund such Trust in an amount sufficient to pay
any and all expenses, including attorneys’ fees, and any and
all liability and loss, including judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement
actually and reasonably incurred by him or on his behalf for which
the Indemnitee is entitled to indemnification or with respect to
which indemnification is claimed, reasonably anticipated or
proposed to be paid in accordance with the terms of this Agreement
or otherwise; provided that in no event shall more than $100,000 be
required to be deposited in any Trust created hereunder in excess
of the amounts deposited in respect of reasonably anticipated
expenses, including attorneys’ fees. The amounts to be
deposited in the Trust pursuant to the foregoing funding obligation
shall be determined by a majority of the Disinterested Directors
whose determination shall be final and conclusive.
The terms of the Trust shall provide
that upon a Change of Control (i) the Trust shall not be revoked or
the principal thereof invaded, without the written consent of the
Indemnitee, (ii) the Trust shall advance, within two business days
of a request by the Indemnitee, any and all expenses, including
attorneys’ fees, to the Indemnitee (and the Indemnitee hereby
agrees to reimburse the Trust under the circumstances under which
the Indemnitee would be required to reimburse the Company under
Section 5 of this Agreement), (iii) the Trust shall continue to be
funded by the Company in accordance with the funding obligation set
forth above, (iv) the Trustee shall promptly pay to the Indemnitee
all amounts for which the Indemnitee shall be entitled to
indemnification pursuant to this Agreement or otherwise, and (v)
all unexpended
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funds in such Trust shall revert to the Company
upon a final determination by a majority of the Disinterested
Directors or a court of competent jurisdiction, as the case may be,
that the Indemnitee has been fully indemnified under the terms of
this Agreement. The Trustee shall be a bank or trust company
or other individual or entity chosen by the Indemnitee and
reasonably acceptable and approved of by the Company.
(e)
For the purposes of this Agreement:
(i)
a “ Change of Control
” shall mean any of the following events (each of such events
being herein referred to as a “Change of
Control”):
A.
The sale or other disposition by the
Company of all or substantially all of its assets to a single
purchaser or to a group of purchasers, other than to a corporation
with respect to which, following such sale or disposition, more
than eighty percent (80%) of, respectively, the then outstanding
shares of Company common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in
the election of the Board of Directors is then owned beneficially,
directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the outstanding Company common stock and the
combined voting power of the then outstanding voting securities
immediately prior to such sale or disposition in substantially the
same proportion as their ownership of the outstandin
