Exhibit 10.5
[Form of]
INDEMNIFICATION
AGREEMENT
(with officers)
This Indemnification Agreement (the “
Agreement ”) is made as of the 1st day of July, 2009
(the “ Effective Date ”), by and between
CenturyTel, Inc., a Louisiana corporation (the “
Corporation ”), and _______________ (“
Indemnitee ”).
In consideration of Indemnitee’s service
as an officer of the Corporation commencing on or before the date
hereof, the Corporation and Indemnitee do hereby agree as
follows:
1.
Agreement to Serve . Indemnitee agrees to serve
or continue to serve as an officer of the Corporation for so long
as Indemnitee is elected or appointed or until such earlier time as
Indemnitee tenders a resignation in writing.
2.
Definitions. As used in this
Agreement:
(a) The
term “ Change of Control ” shall mean (i) an
acquisition by any person (within the meaning of
Section 13(d)(3) or l4(d)(2) of the Securities Exchange Act of
1934, as amended) of beneficial ownership of 20% or more of the
combined voting power of the Corporation'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 Corporation and any new director whose
election by the Board of Directors or nomination for election by
the Corporation's shareholders was approved by a vote of at least
two-thirds 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; or (iii) the consummation
of a merger or consolidation involving the Corporation if the
shareholders of the Corporation, immediately before such merger or
consolidation, do not own, immediately following such merger or
consolidation, more than 50% of the combined voting power of the
outstanding voting securities of the resulting entity in
substantially the same proportion as their ownership of voting
securities immediately before such merger or
consolidation. Notwithstanding the foregoing, a Change
of Control shall not be deemed to occur solely because 20% or more
of the Corporation’s then outstanding voting securities is
acquired by (l) a trustee or other fiduciary holding securities
under one or more employee benefit plans maintained by the
Corporation or any of its subsidiaries or (2) any entity that,
immediately prior to such acquisition, is owned directly or
indirectly by the shareholders of the Corporation in the same
proportion as their ownership of shares in the Corporation
immediately prior to such acquisition.
(b) The
term “ Claim ” shall mean any threatened,
pending or completed claim, action, suit, or proceeding, including
discovery, whether civil, criminal, administrative, arbitrative or
investigative and whether made judicially or extra-judicially, or
any separate issue or matter therein, as the context requires, but
shall not include any action, suit or proceeding initiated by
Indemnitee against the Corporation (other than to
enforce the terms of this Agreement), or initiated by Indemnitee
against any director or officer of the Corporation unless the
Corporation has joined in or consented in writing to the initiation
of such action, suit or proceeding.
(c) The
term “ Determining Body ” shall mean (i) the
Board of Directors by a majority vote of a quorum of the entire
board consisting of directors who are not named as parties to the
Claim for which indemnification is being sought
(“Disinterested Directors”), or (ii) if such a quorum
is not obtainable, independent legal counsel (A) selected by the
Disinterested Directors, or (B) if there are fewer than two
Disinterested Directors, selected by the Board of Directors (in
which selection directors who do not qualify as Disinterested
Directors may participate); provided, however, that following a
Change of Control, with respect to all matters thereafter arising
out of acts, omissions or events occurring prior to or after the
Change of Control concerning the rights of Indemnitee to seek
indemnification, such determination shall be made by independent
legal counsel selected by the Board of Directors in the manner
described above in this Section 2(c) (which selection shall
not be unreasonably delayed or withheld) from a panel of three
counsel nominated by Indemnitee. Such counsel shall not
have otherwise performed services for the Corporation, Indemnitee
or their affiliates (other than services as independent counsel in
connection with similar matters) within the five years preceding
its engagement ("Independent Counsel"). If Indemnitee
fails to nominate Independent Counsel within ten business days
following written request by the Corporation, the Board of
Directors shall select Independent Counsel. Such counsel
shall not be a person who, under the applicable standards of
professional conduct then prevailing, would have a conflict of
interest in representing either the Corporation or Indemnitee in an
action to determine Indemnitee's rights under this Agreement, nor
shall Independent Counsel be any person who has been sanctioned or
censured for ethical violations of applicable standards of
professional conduct. The Corporation agrees to pay the
reasonable fees and costs of the Independent Counsel referred to
above and to fully indemnify such Independent Counsel against any
and all expenses, claims, liabilities and damages arising out of or
relating to this Section 2(c) or its engagement pursuant
hereto. The Determining Body shall determine in
accordance with Section 6 whether and to what extent
Indemnitee is entitled to be indemnified under this Agreement and
shall render a written opinion to the Corporation and to Indemnitee
to such effect.
(d) The
term " Disbursing Officer " shall mean, with respect to a
Claim, the Chief Executive Officer of the Corporation or, if the
Chief Executive Officer is a party to the Claim as to which
advancement or indemnification is being sought, any officer who is
not a party to the Claim and who is designated by the Chief
Executive Officer, which designation shall be made promptly after
the Corporation's receipt of Indemnitee's initial request for
advancement or indemnification and communicated to
Indemnitee.
(e) The
term “ Expenses ” shall mean any reasonable
expenses or costs (including, without limitation, attorney’s
fees, fees of experts retained by attorneys, judgments, punitive or
exemplary damages, fines and amounts paid in settlement) actually
and reasonably incurred by Indemnitee with respect to a Claim,
except that Expenses shall not include any amount paid in
settlement of a Claim against Indemnitee (i) by or in the right of
the Corporation, or (ii) that the Corporation has not approved,
which approval will not be unreasonably delayed or
withheld.
(f) The
term “ Standard of Conduct ” shall mean conduct
by an Indemnitee with respect to which a Claim is asserted that was
in good faith and that Indemnitee reasonably believed to be in, or
not opposed to, the best interest of the Corporation, and, in the
case of a Claim that is a criminal action or proceeding, conduct
that the Indemnitee had no reasonable cause to believe was
unlawful. The termination of any Claim 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 meet the Standard of Conduct.
3. Limitation
of Liability.
To the fullest extent permitted by
Article VII of the Articles of Incorporation of the
Corporation in effect on the Effective Date and, if and to the
extent the Articles of Incorporation are amended to permit further
limitations, in effect at any time prior to the determination of
liability, Indemnitee shall not be personally liable in damages for
breach of Indemnitee’s fiduciary duty as a director or
officer. The Board of Directors of the Corporation will
not take any action to effect any amendment to the Articles of
Incorporation the effect of which would be to deny, diminish or
encumber Indemnitee’s right to exculpation under this
Section 3.
4. Maintenance
of Insurance.
(a) The
Corporation represents that it presently maintains in force and
effect directors and officers liability insurance (“
D&O Insurance ”) policies that provide primary and
excess coverage on behalf of the Corporation’s directors and
officers on the terms and conditions specified therein (the “
Insurance Policies ”). Subject only to the
provisions of Section 4(b) hereof, the Corporation hereby
agrees that, so long as Indemnitee shall continue to serve as a
director or officer (or shall continue at the request of the
Corporation to serve in any capacity referred to in
Section 6(a) hereof) and thereafter so long as Indemnitee
shall be subject to any possible Claim, the Corporation shall
purchase and maintain in effect for the benefit of Indemnitee one
or more valid and enforceable policy or policies of D&O
Insurance providing, in all respects, coverage reasonably
comparable (including Side A) to that currently provided
pursuant to the Insurance Policies, provided that the Corporation
shall have no obligation to provide primary coverage or excess
coverage in excess of the amount of coverage provided on the
Effective Date.
(b) The
Corporation shall not be required to purchase and maintain the
Insurance Policies in effect if D&O Insurance is not reasonably
available or if, in the reasonable business judgment of a majority
of the directors of the Corporation, either (i) the premium cost
for such insurance is excessive in light of the amount of coverage
or (ii) the coverage provided by such insurance is so limited by
exclusions, retentions, deductibles or otherwise that there is
insufficient benefit from such insurance.
5. Advancement
of Expenses.
(a) Subject
to Indemnitee’s furnishing the Corporation with a written
undertaking, in a form reasonably satisfactory to the Corporation,
to repay such amount if it is ultimately determined that Indemnitee
is not entitled under this Agreement to indemnification therefor,
the Corporation shall advance Expenses to Indemnitee in advance of
the final disposition of any Claim involving Indemnitee; provided,
however, that Indemnitee will return, without interest, any such
advance that remains unspent at the disposition of the Claim to
which the advance related, and provided further, that advances of
such Expenses by the Corporation's D&O Insurance carrier shall
be treated, for purposes of this Section 5(a), as advances by
the Corporation. The written undertaking by Indemnitee
must be an unlimited general obligation of Indemnitee but need not
be secured and will be accepted by the Corporation without
reference to the financial ability of Indemnitee to make
repayment.
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