THIS INDEMNITY
AGREEMENT (the “Agreement”) is made as of this 31st day
of July 2009, by and between QUIKSILVER, INC., a Delaware
corporation (the “Company”), and Andrew Sweet (the
“Indemnitee”), a director of the Company.
A. The
Indemnitee is currently serving as a director of the Company and in
such capacity renders valuable services to the Company.
B. The
Company has investigated whether additional protective measures are
warranted to protect adequately its directors and officers against
various legal risks and potential liabilities to which such
individuals are subject due to their position with the Company and
has concluded that additional protective measures are
warranted.
C. In order
to induce and encourage highly experienced and capable persons such
as the Indemnitee to continue to serve as officers and directors,
the Board of Directors has determined, after due consideration,
that this Agreement is not only reasonable and prudent, but
necessary to promote and ensure the best interests of the Company
and its stockholders.
NOW, THEREFORE, in
consideration of the continued services of the Indemnitee and as an
inducement to the Indemnitee to continue to serve as a director of
the Company, the Company and the Indemnitee do hereby agree as
follows:
1.
Definitions . As used in this Agreement, the
following terms shall have the meanings set forth below:
(a)
“Proceeding” shall mean any threatened, pending or
completed action, suit or proceeding, whether brought in the name
of the Company or otherwise and whether of a civil, criminal,
administrative or investigative nature, by reason of the fact that
the Indemnitee is or was an officer and/or a director of the
Company, or is or was serving at the request of the Company as
director, officer, employee or agent of another enterprise, whether
or not he is serving in such capacity at the time any liability or
Expense is incurred for which indemnification or advancement of
Expenses is to be provided under this Agreement.
(b)
“Expenses” means, all costs, charges and expenses
incurred in connection with a Proceeding, including, without
limitation, attorneys’ fees, disbursements and retainers,
accounting and witness fees, travel and deposition costs, expenses
of investigations, judicial or administrative proceedings or
appeals, and any expenses of establishing a right to
indemnification pursuant to this Agreement or otherwise, including
reasonable compensation for time spent by the Indemnitee in
connection with the investigation, defense or appeal of a
Proceeding or action for indemnification for which he is not
otherwise compensated by the Company or any third party;
provided , however , that the term
“Expenses” includes only those costs, charges and
expenses incurred with the Company’s consent, which consent
shall not be
unreasonably
withheld; and provided further , that the term
“Expenses” does not include the amount of damages,
judgments, amounts paid in settlement, fines, penalties or excise
taxes under the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), actually levied against the
Indemnitee or paid by or on behalf of the Indemnitee.
2.
Agreement to Serve . The Indemnitee agrees to
continue to serve as a director of the Company so long as the
Indemnitee is duly elected or appointed or until such time as the
Indemnitee tenders a resignation in writing.
3.
Indemnification in Third Party Actions . The Company
shall indemnify the Indemnitee in accordance with the provisions of
this Section 3 if the Indemnitee is a party to or threatened
to be made a party to or otherwise involved in any Proceeding
(other than a Proceeding by or in the right of the Company to
procure a judgment in its favor), by reason of the fact that the
Indemnitee is or was an officer and/or a director of the Company or
is or was serving at the request of the Company as a director,
officer, employee or agent of another enterprise, against all
Expenses, damages, judgments, amounts paid in settlement, fines,
penalties and ERISA excise taxes actually and reasonably incurred
by the Indemnitee in connection with the defense or settlement of
such Proceeding, to the fullest extent permitted by Delaware law;
provided that any settlement shall be approved in writing by
the Company.
4.
Indemnification In Proceedings By or In the Right of the
Company . The Company shall indemnify the Indemnitee in
accordance with the provisions of this Section 4 if the
Indemnitee is a party to or threatened to be made a party to or
otherwise involved in any Proceeding by or in the right of the
Company to procure a judgment in its favor by reason of the fact
that the Indemnitee is or was an officer and/or a director of the
Company, or is or was serving at the request of the Company as a
director, officer, employee or agent of another enterprise, against
all Expenses actually and reasonably incurred by Indemnitee in
connection with the defense or settlement of such Proceeding, to
the fullest extent permitted by Delaware law.
5.
Conclusive Presumption Regarding Standard of Conduct
. The Indemnitee shall be conclusively presumed to have met the
relevant standards of conduct required by Delaware law for
indemnification pursuant to this Agreement, unless a determination
is made that the Indemnitee has not met such standards by
(i) the Board of Directors of the Company by a majority vote
of a quorum thereof consisting of directors who were not parties to
such Proceeding, (ii) the stockholders of the Company by
majority vote, or (iii) in a written opinion of independent
legal counsel, the selection of whom has been approved by the
Indemnitee in writing.
6.
Indemnification of Expenses of Successful Party .
Notwithstanding any other provision of this Agreement, to the
extent that the Indemnitee has been successful on the merits or
otherwise in defense of any Proceeding or in defense of any claim,
issue or matter therein, including the dismissal of a Proceeding
without prejudice, the Indemnitee shall be indemnified against all
Expenses incurred in connection therewith to the fullest extent
permitted by Delaware law.
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7.
Advances of Expenses . The Expenses incurred by the
Indemnitee in any Proceeding shall be paid promptly by the Company
in advance of the final disposition of the Proceeding at the
written request of the Indemnitee to the fullest extent permitted
by Delaware law; provided that the Indemnitee shall
undertake in writing to repay such amount to the extent that it is
ultimately determined that the Indemnitee is not entitled to
indemnification by the Company.
8.
Partial Indemnification . If the Indemnitee is
entitled under any provision of this Agreement to indemnification
by the Company for some or a portion of the Expenses, damages,
judgments, amounts paid in settlement, fines, penalties or ERISA
excise taxes actually and reasonably incurred by Indemnitee in the
investigation, defense, appeal or settlement of any Proceeding but
not, however, for the total amount thereof, the Company shall
nevertheless indemnify the Indemnitee for the portion of such
Expenses, damages, judgments, amounts paid in settlement, fines,
penalties or ERISA excise taxes to which the Indemnitee is
entitled.
9.
Indemnification Procedure; Determination of Right to
Indemnification .
(a) Promptly
after receipt by the Indemnitee of notice of the commencement of
any Proceeding with respect to which the Indemnitee intends to
claim indemnification pursuant to this Agreement, the Indemnitee
will notify the Company of the commencement thereof. The omission
to so notify the Company will not relieve the Company from any
liability which it may have to the Indemnitee under this Agreement
or otherwise.
(b) If
a claim under this Agreement is not paid by or on behalf of the
Company within 30 days of receipt of written notice thereof,
Indemnitee may at any time thereafter bring suit in any court of
competent jurisdiction against the Company to enforce the right to
indemnification provided by this Agreement. It shall be a defense
to any such action (other than an action brought to enforce a claim
for Expenses incurred in defending any Proceeding in advance of its
final disposition where the required undertaking, if any is
required, has been tendered to the Company) that the Indemnitee has
failed to meet the standard of conduct that makes it permissible
under Delaware law for the Company to indemnify the Indemnitee for
the amount claimed. The burden of proving by clear and convincing
evidence that indemnification or advancement of Expenses are not
appropriate shall be on the Company. The failure of the directors
or stockholders of the Company or independent legal counsel to have
made a determination prior to the commencement of such Proceeding
that indemnification or advancement of Expenses are proper in the
circumstances because the Indemnitee has met the applicable
standard of conduct shall not be a defense to the action or create
a presumption that the Indemnitee has not met the applicable
standard of conduct.
(c) The
Indemnitee’s Expenses incurred in connection with any action
concerning Indemnitee’s right to indemnification or
advancement of Expenses in whole or in part pursuant to this
Agreement shall also be indemnified by the Co
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