Exhibit 10.38
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (the "Agreement") is executed on and entered
into as of (the "Effective Date") by and between Monitronics
---------
International, Inc., a Texas corporation (the "Company"), and
----------------
("Officer").
The Company is required or permitted under certain circumstances to
indemnify executive officers of the Company against liability incurred by them
in such capacities or by reason of occupying such position. The Company desires
to have Officer serve as an officer of the Company, and Officer desires to
serve, provided that he is indemnified by the Company.
The parties agree as follows:
1. Definitions.
Unless the context requires otherwise, for purposes of this Agreement:
(a) "Act" shall mean the Texas Business Corporation Act, as in effect on
the date of this Agreement and as hereafter amended, and any successor statute;
(b) the terms "proceedings," "expenses" and other terms defined in Article
2.02-1 of the Act are used herein with the meanings as so defined under the Act;
and
(c) the phrase "serving in a representative capacity at the request of the
Company" means serving at the request of the Company as a director, officer,
partner, venturer, proprietor, trustee, employee, agent or similar functionary
of another corporation, partnership, joint venture, sole proprietorship, trust,
employee benefit plan or other enterprise.
2. Indemnity.
(a) The Company agrees to indemnify Officer to the fullest extent permitted
by the Act, as soon as practicable but in any event no later than 30 days after
receipt by the Company of any claim for indemnity hereunder against expenses,
judgments, penalties, fines and amounts paid in settlement (including all
interest, assessments and other charges paid or payable in connection with or in
respect of such expenses, judgments, fines, penalties or amounts paid in
settlement of such proceeding) incurred by or on behalf of Officer in connection
with any proceeding in which Officer was, is or is threatened to be a named a
party to or witness or other participant in such proceeding because he is or was
a director or officer of the Company or because he is or was serving in a
representative capacity at the request of the Company.
(b) The Company agrees to indemnify Officer for reasonable expenses
incurred by Officer in connection with a proceeding referred to in paragraph 2A
in advance of the final disposition of the proceeding and without the
determination specified in Sections F or G of Article 2.02-1 of the Act,
promptly upon receipt by the Company of:
(i) a written affirmation by Officer of his good faith belief that he
has met the standard of conduct necessary for indemnification under the Act; and
(ii) a written undertaking by or on behalf of the Officer to repay the
amount paid or reimbursed pursuant to this paragraph 2(b) if it is ultimately
determined that he has not met the standard of conduct necessary for
indemnification under the Act or if it is ultimately determined that
indemnification of Officer against expenses incurred by him in connection with
that proceeding is prohibited by Section E of Article 2.02-1 of the Act.
(c) This Agreement makes mandatory the indemnification permitted under
Section B of Article 2.02-1 of the Act with respect to expenses incurred in
connection with a proceeding described in such provision and shall be deemed to
constitute authorization of indemnification in the manner required by the Act.
3. Notification and Defense of Claim.
(a) Promptly after receipt by Officer of notice of the commencement of any
proceeding in which Officer was, is or is threatened to be a named a party to or
witness or other participant in such proceeding, if a claim for indemnity in
connection with such proceeding is to be made against the Company under this
Agreement, will promptly notify the Company of the commencement thereof. With
respect to any such proceeding other than a proceeding brought by or on behalf
of the Company or as to which Officer shall have made the determination provided
for in (ii) below, the Company will be entitled to participate therein at its
own expense, and the Company may assume the defense thereof with counsel
satisfactory to Officer. After notice from the Company to Officer of its
election to assume the defense thereof, the Company will not be liable to
indemnify Officer under this Agreement against expenses subsequently incurred by
Officer in connection with the defense thereof other than reasonable costs of
investigation or as otherwise provided below. Officer shall have the right to
select and employ counsel in a proceeding, but the fees and expenses of such
counsel incurred after notice from the Company of its assumption of the defense
thereof shall be borne by Officer unless (i) the employment of such counsel by
Officer has been authorized by the Company, (ii) Officer shall have reasonably
concluded that there may be a conflict of interest between the Company and
Officer in the conduct of the defense of such proceeding, or (iii) the Company
shall not in fact have employed counsel to assume the defense of such action,
and in each case the fees and expenses of counsel shall be subject to the
indemnity provided hereunder by the Company; provided, however, that in the
event any other person indemnified by the Company is also named or threatened to
be named defendant or respondent in a proceeding referred to in (ii) above, the
fees and expenses of only one counsel employed by Officer and all such other
persons shall be subject to indemnity hereunder.
(b) Promptly following receipt by the Company from Officer of any claim for
indemnity hereunder, the Company shall in good faith make or cause to be made
any determination as to reasonableness of expenses and determination that
indemnification is permissible as may be required pursuant to the Act and, as
soon as practicable, but in any event no later than 30 days after receipt by the
Company of any claim for indemnity hereunder, following such determination, the
Company shall pay or cause to be paid to Officer in cash the amount of the
expenses indemnified
hereunder and so determined to be reasonable and permissible. Such payment shall
be made out of the assets of the Company.
4. Miscellaneous.
(a) The Company expressly confirms and agrees that it has entered into this
Agreement in order to induce Officer to serve or continue to serve as a director
or in a representative capacity at the request of the Company, and acknowledges
that Officer is relying upon this Agreement in continuing in such capacity and
in serving as a director of the Company or in a representative capacity at the
request of the Company hereafter, whether or not Officer serves in any such
capacity on the date of this Agreement. All agreements and obligations of the
Company contained herein shall continue during the period that Officer serves as
a director of the Company or in a representative capacity at the request of the
Company and thereafter so long as Officer shall be subject to any possible claim
or pending, threatened or completed proceeding by reason of the fact that
Officer was an officer or served in any other representative capacity.
(b) In the event Officer is required to bring any action to enforce his
rights or to collect any amount due him under this Agreement and is successful
in such action, the Company shall reimburse Officer for all of Officer's fees
and expenses (including, without limitation, reasonable attorney's fees) in
bringing and pursuing such action.
(c) Each of the provisions (including any provision within a single
paragraph or sentence) of this Agreement is a separate and distinct agreement
and independent of the others, so that if any provision hereof shall be held to
be invalid, illegal or unenforceable for any reason whatsoever, such invalidity
or unenforceability shall not affect the validity or enforceability of the other
provisions hereof and such remaining provisions shall remain enforceable to the
fullest extent permitted by law.
(d) This Agreement shall be interpreted and enforced in accordance with the
internal laws but not the law of conflicts of the State of Texas.
(e) This Agreement and the terms hereof shall be binding upon and inure to
the benefit of the Company and Officer, and their respective successors and
assigns.
(f) No amendment, modification, termination or cancellation of this
Agreement shall be effective unless in writing signed by both 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.
(g) The indemnification provided by this Agreement shall not be deemed
exclusive of any other rights to which Officer may be entitled under any
provision of the Act, the Articles of Incorporation or bylaws of the Company or
of any other corporation, or any other agreement or otherwise. To the extent
that a change in the Act (whether by statute or judicial decision) permits
greater indemnification by agreement than would be affording currently under the
Company's bylaws and this Agreement, it is the intent of parties hereto that
Officer shall enjoy by this
Agreement the greater benefits so afforded by such change.
(h) All notices, demands or other communications to be given or delivered
under or by reason of the provisions of this Agreement will be in writing and
will be deemed to have been given when delivered personally or by telex,
facsimile transmission, telegram or overnight delivery service, or 72 hours
after having been mailed by certified or registered mail, return receipt
requested and postage prepaid, to the recipient. Such notices, demands and other
communications will be sent to each party at the address indicated below:
If to the Officer:
-------------------------------
-------------------------------
Attn:
Facsimile:
If to the Company:
Monitronics International, Inc.
12801 Stemmons Freeway
Suite 821
Dallas, Texas 75234
Attention: President
Facsimile: (972) 243-7443
or to such other address or to the attention of such other Person as the
recipient party has specified by prior written notice to the sending party.
* * *
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the Effective Date.
The Company:
Monitronics International, Inc.
By:
---------------------------
James R. Hull, President
Officer:
----------------------