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EXHIBIT 6
Indemnification Agreement
AGREEMENT, effective as of ____________________, between Roto-Rooter,
Inc., a Delaware corporation (the "Company"), and _____________________________
("Indemnitee"), a director and or officer of the Company.
WHEREAS, in recognition of Indemnitee's need for protection against
personal liability in order to enhance Indemnitee's continued service to the
Company and Indemnitee's reliance on the provisions of the By-Laws of the
Company requiring indemnification under certain circumstances, and in part to
provide Indemnitee with specific contractual assurance that the protection
promised by such By-Laws will be available, the Company wishes to provide in
this Agreement for the indemnification of, and the advancement of, expenses to
Indemnitee to the fullest extent permitted by law.
NOW WHEREAS, in consideration of the premises and intending to be
legally bound hereby, the parties hereto agree as follows:
SECTION 1 Right to Indemnification. The Company shall to the
fullest extent permitted by applicable law as then in effect indemnify the
undersigned person ("Indemnitee") in the event he becomes involved in any
manner (including, without limitation, as a party or a witness) or is
threatened to be made so involved in any threatened, pending or completed
investigation, claim, action, suit or proceeding, whether civil, criminal,
administrative or investigative (including without limitation, any action, suit
or proceeding by or in the right of
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the Company to procure a judgment in its favor) (a "Proceeding") by reason of
the fact that he is or was a director and or officer of the Company, or is or
was serving at the request of the Company as a director and/or officer of
another corporation, partnership, joint venture, trust or other enterprise
(including, without limitation, any employee benefit plan) against all expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such Proceeding.
Such indemnification shall be a contract right and shall include the right to
receive payment in advance of any expenses incurred by the Indemnitee in
connection with such Proceeding, consistent with the provisions of applicable
law as then in effect.
SECTION 2 Indemnification; Not Exclusive Right. The right of
indemnification provided in this Agreement shall not be exclusive of any other
rights to which the Indemnitee may otherwise be entitled, and the provisions of
this Agreement shall inure to the benefit of the heirs and legal
representatives of the Indemnitee and shall be applicable to Proceedings
commenced or continuing after the adoption of this Agreement, whether arising
from acts or omissions occurring before or after its execution.
SECTION 3 Advancement of Expenses; Procedures; Presumptions
and Effect of Certain Proceedings; Remedies. In furtherance, but not in
limitation of the foregoing provisions, the following procedures, presumptions
and remedies shall apply with respect to advancement of expenses and the right
to indemnification under this Agreement:
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(a) Advancement of Expenses. All reasonable expenses
incurred by or on behalf of the Indemnitee in connection with any Proceeding
shall be advanced to the Indemnitee by the Company within 20 days after the
receipt by the Company of a statement or statements from the Indemnitee
requesting such advance or advances from time to time, whether prior to or
after final disposition of such Proceeding. Such statement or statements shall
reasonably evidence the expenses incurred by the Indemnitee and, and if
required by law at the time of such advance, shall include or be accompanied by
an undertaking by or on behalf of the Indemnitee to repay the amounts advanced
if it should ultimately be determined that the Indemnitee is not entitled to
be indemnified against such expenses pursuant to this Agreement.
(b) Procedure for Determination of Entitlement to
Indemnification. (i) To obtain indemnification under this Agreement, the
Indemnitee shall submit to the Secretary of the Company a written request,
including such documentation and information as is reasonably available to the
Indemnitee and reasonably necessary to determine whether and to what extent the
Indemnitee is entitled to indemnification (the "Supporting Documentation").
The determination of the Indemnitee's entitlement to indemnification shall be
made not later than 60 days after receipt by the Company of the written request
for indemnification together with the Supporting Documentation. The Secretary
of the Company shall, promptly upon receipt of such a request for
indemnification, advise the Board of Directors in writing that the Indemnitee
has requested indemnification.
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(ii) The Indemnitee's entitlement to
indemnification under this Agreement shall be determined in one of the
following ways: (a) by a majority vote of the Disinterested Directors (as
hereinafter defined), if they constitute a quorum of the Board of Directors;
(b) by a written opinion of Independent Counsel (as hereinafter defined) if (x)
a Change of Control (as hereinafter defined) shall have occurred and the
Indemnitee so requests or (y) a quorum of the Board of Directors consisting of
Disinterested Directors is not obtainable or, even if obtainable, a majority of
such Disinterested Directors so directs; (c) by the stockholders of the Company
(but only if a majority of the Disinterested Directors, if they constitute a
quorum of the Board of Directors, presents the issue of entitlement to
indemnification to the stockholders for their determination); or (D) as
provided in Section 3(c).
(iii) In the event the determination of
entitlement to indemnification is to be made by Independent Counsel pursuant to
Section 3(b)(ii), a majority of the Disinterested Directors shall select the
Independent Counsel, but only an Independent Counsel to which the Indemnitee
does not reasonably object; provided, however, that if a Change of Control
shall have occurred, the Indemnitee shall select such Independent Counsel, but
only an Independent Counsel to which the Board of Directors does not reasonably
object.
(c) Presumptions and Effect of Certain Proceedings.
Except as otherwise expressly provided in this Agreement, the Indemnitee shall
be presumed to be entitled to indemnification under this Agreement upon
submission of a request
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for indemnification together with the Supporting Documentation in accordance
with Section 3(b)(i), and thereafter the Company shall have the burden of proof
to overcome that presumption in reaching a contrary determination. In any
event, if the person or persons empowered under Section 3(b) to determine
entitlement to indemnification shall not have been appointed or shall not have
made a determination within 60 days after receipt by the Company of the request
therefor together with the Supporting Documentation, the Indemnitee shall be
deemed to be entitled to indemnification and shall be entitled to such
indemnification unless (A) the Indemnitee misrepresented or failed to disclose
a material fact in making the request for indemnification or in the Supporting
Documentation or (B) such indemnification is prohibited by law. The
termination of any Proceeding described in Section 1, or of any claim, issue or
matter therein, by judgment, order, settlement or conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, adversely affect the
right of the Indemnitee to indemnification or create a presumption that the
Indemnitee did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Company or, with
respect to any criminal Proceeding, that the Indemnitee had reasonable cause to
believe that his conduct was unlawful.
(d) Remedies of Indemnitee.
(i) In the event that a determination is made
pursuant to Section 3(b) that the Indemnitee is not entitled to indemnification
under this Agreement, (a) the Indemnitee shall be
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entitled to seek an adjudication of his entitlement to such indemnification
either, at the Indemnitee's sole option, in (x) an appropriate court of the
State of Delaware or any other court of competent jurisdiction or (y) an
arbitration to be conducted by a single arbitrator pursuant to the rules of the
American Arbitration Association; (b) any such judicial proceeding or
arbitration shall be de novo and the Indemnitee shall not be prejudiced by
reason of such adverse determination; and (c) in any such judicial proceeding
or arbitration the Company shall have the burden of providing that the
Indemnitee is not entitled to indemnification under this Agreement.
(ii) If a determination shall have been made
or deemed to have been made, pursuant to Section 3(b) or (c), that the
Indemnitee is entitled to indemnification, the Company shall be obligated to
pay the amounts constituting such indemnification within five days after such
determination has been made or deemed to have been made and shall be
conclusively bound by such determination unless (a) the Indemnitee
misrepresented or failed to disclose a material fact in making the request for
indemnification or in the Supporting Documentation or (b) such indemnification
is prohibited by law. In the event that (c) advancement of expenses is not
timely made pursuant to Section 3(a) or (d) payment of indemnification is not
made within five days after a determination of entitlement to indemnification
has been made or deemed to have been made pursuant to Section 4(b) or (c), the
Indemnitee shall be entitled to seek judicial enforcement of the Company's
obligation to pay
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to the Indemnitee such advancement of expenses or indemnification.
Notwithstanding the foregoing, the Company may bring an action, in an
appropriate court in the State of Delaware or any other court of competent
jurisdiction, contesting the right of the Indemnitee to receive indemnification
hereunder due to the occurrence of an event described in subclause (a) or (b)
of this clause (ii) (a "Disqualifying Event"); provided, however, that in any
such action the Company shall have the burden of proving the occurrence of such
Disqualifying Event.
(iii) The Company shall be precluded from
asserting in any judicial proceeding or arbitration commenced pursuant to this
Section 3(d) that the procedures and presumptions of this Agreement are not
valid, binding and enforceable and shall stipulate in any such court or before
any such arbitrator that the Company is bound by all the provisions of this
Agreement.
(iv) In the event that the Indemnitee,
pursuant to this Section 3(d), seeks a judicial adjudication of or an award in
arbitration to enforce his rights under, or to recover damages for breach of,
this Agreement, the Indemnitee shall be entitled to recover from the Company,
and shall be indemnified by the Company against, any expenses actually and
reasonably incurred by him if the Indemnitee prevails in such judicial
adjudication or arbitration. If it shall be determined in such judicial
adjudication or arbitration that the Indemnitee is entitled to receive part but
not all of the indemnification or advancement of expenses sought, the expenses
incurred by the
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Indemnitee in connection with such judicial adjudication or arbitration shall
be prorated accordingly.
(e) Definitions. For the purposes of this Section 3:
(i) "Change in Control" means a change in control of the Company of a nature
that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Securities Exchange Act of 1934 (the
"Act"), whether or not the Company is then subject to such reporting
requirement; provided that, without limitation, such a change in control shall
be deemed to have occurred if (A) any "person" (as such term is used in
Sections 13(d) and 14(d) of the Act) is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Act), directly or indirectly, of securities of
the Company representing 20 percent or more of the combined voting power of the
Company's then outstanding securities without the prior approval of at least
two-thirds of the members of the Board of Directors in office immediately prior
to such acquisition; (B) the Company is a party to a merger, consolidation,
sale of assets or other reorganization, or a proxy contest, as a consequence of
which members of the Board of Directors in office immediately prior to such
transaction or event constitute less than a majority of the Board of Directors
thereafter; or (C) during any period of two consecutive years, individuals who
at the beginning of such period constituted the Board of Directors (including
for this purpose any new director whose election or nomination for election by
the Company's stockholders was approved by a vote of at least a majority of the
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directors then still in office who were directors at the beginning of such
period) cease for any reason to constitute at least a majority of the Board of
Directors.
(ii) "Disinterested Director" means a director of
the Company who is not or was not a party to the Proceeding in respect of which
indemnification is sought by the Indemnitee.
(iii) "Independent Counsel" means a law firm or a
member of a law firm that neither presently is, nor in the past five years has
been, retained to represent: (i) the Company or the Indemnitee in any matter
material to either such party or (ii) any other party to the Proceeding giving
rise to a claim for indemnification under this Agreement. Notwithstanding the
foregoing, the term "Independent Counsel" shall not include any person who,
under the applicable standards of professional conduct then prevailing under
the law of the State of Delaware, would have a conflict of interest in
representing either the Company or the Indemnitee in an action to determine the
Indemnitee's rights under this Agreement.
SECTION 4 Severability. If any provision or provisions of
this Agreement shall be held to be invalid, illegal or unenforceable for any
reason whatsoever: (a) the validity, legality and enforceablity of the
remaining provisions of this Agreement (including, without limitation, all
portions of any paragraph of this Agreement containing any such provision held
to be invalid, illegal or unenforceable, that are not themselves invalid,
illegal or unenforceable) shall not in any way be
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affected or impaired thereby; and (b) to the fullest extent possible, the
provisions of this Agreement (including, without limitation, all portions of
any paragraph of this Agreement containing any such provision held to be
invalid, illegal or unenforceable, that are not themselves invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent manifested
by the provision held invalid, illegal or unenforceable.
SECTION 5 Cancellation. The Company may cancel the
provisions of this Agreement prospectively only upon thirty (30) days' written
notice to Indemnitee, in order to afford Indemnitee an opportunity to resign
as a director rather than continue to serve absent indemnification.
SECTION 6 Amendments and Waiver. No supplement, modification
or amendment of this Agreement shall be binding unless executed in writing by
both of the parties hereto. No waiver of any of the provisions of this
Agreement shall be deemed or shall constitute a waiver of any other provisions
hereof (whether or not similar) nor shall such waiver constitute a continuing
waiver.
SECTION 7 Subrogation. In the event of payment under this
Agreement, the Company shall be subrogated to the extent of such payment to all
of the rights of recovery of Indemnitee, who shall execute all papers required
and shall do everything that may be necessary to secure such rights, including
the execution of such documents necessary to enable the Company effectively to
bring suit to enforce such rights.
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SECTION 8 No Duplication of Payment. The Company shall not
be liable under this Agreement to make any payment in connection with any claim
made against Indemnitee to the extent Indemnitee has otherwise actually
received payment (under any insurance policy, By-Law or otherwise) of the
amounts otherwise indemnifiable hereunder.
SECTION 9. Governing Law. This Agreement shall be governed
by and construed and enforced in accordance with the laws of the State of
Delaware applicable to contracts made and to be performed in such state without
giving effect to the principles of conflicts of laws.
Executed this ____ day of ______.
ROTO-ROOTER, INC.
By:
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Name: William R. Griffin
Title: President and Chief
Executive Officer
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(Indemnitee)
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