Exhibit 10.42
INDEMNIFICATION AGREEMENT
Rentech Nitrogen Partners, L.P.
This indemnification agreement (this “Agreement”) is made and entered into
effective as of November 9, 2011 between Rentech Nitrogen Partners, L.P, a
Delaware limited partnership (the “Partnership”), and D. Hunt Ramsbottom, Jr.
(“Indemnitee”).
RECITALS:
A. Indemnitee currently serves as an officer or director of Rentech Nitrogen GP,
LLC, a Delaware limited liability company and the general partner of the
Partnership (the “General Partner”). As such, Indemnitee may be subjected to
claims, suits or proceedings.
B. Indemnitee has indicated that it was and is a condition of Indemnitee’s
acceptance and continuing in such service that, among other things, the
Partnership agrees to indemnify Indemnitee against liabilities, expenses and
costs incurred in connection with any such claims, suits or proceedings, in
accordance with, and to the fullest extent permitted by, the Delaware Revised
Uniform Limited Partnership Act, other applicable law and/or the Second Amended
and Restated Agreement of Limited Partnership of the Partnership (as may be
amended from time to time, the “Partnership Agreement”); and
C. Indemnitee is an “Indemnitee” as such term is defined in the Partnership
Agreement.
D. Section 7.7 of the Partnership Agreement provides for indemnification of
directors and officers of the General Partner, and provides that the Partnership
may enter into additional indemnification agreements with any Indemnitee.
AGREEMENT:
Now, therefore, in consideration of Indemnitee’s acceptance and continuation of
service as an officer or director of the General Partner after the date of this
Agreement, and in consideration of the mutual covenants stated herein, the
parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
following meanings:
(a) Disinterested Director. The term “Disinterested Director” means, with
respect to any request by Indemnitee for indemnification hereunder, a director
of the General Partner who at the time of the vote is not a named defendant or
respondent in the Proceeding in respect of which indemnification is sought by
Indemnitee.

 

 

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(b) DRULPA. The term “DRULPA” means the Delaware Revised Uniform Limited
Partnership Act, as amended.
(c) ERISA. The term “ERISA” means the Employee Retirement Income Security Act of
1974, as amended.
(d) Proceeding. The term “Proceeding” means any threatened, pending or completed
action, suit, claim, counterclaim, cross claim, arbitration, mediation,
alternative dispute resolution mechanism, investigation, inquiry, administrative
hearing or any other actual, threatened or completed proceeding whether civil,
criminal, administrative, regulatory, legislative or investigative, and whether
formal or informal, including appeals.
(e) Representative. As used in reference to Indemnitee, the term
“Representative” means Indemnitee’s serving in the capacity of an officer or
director of the General Partner and, while an officer or director of the General
Partner, Indemnitee’s serving at the General Partner’s request as a director,
officer, agent, associate, employee, fiduciary, manager, member, partner,
promoter, or a trustee of, or holding a similar position with, any corporation,
partnership, joint venture, trust, other enterprise or person or employee
benefit plan.
2. Agreement to Indemnify. The Partnership shall indemnify, and keep
indemnified, Indemnitee in accordance with, and to the fullest extent permitted
and/or required by, the DRULPA and other applicable law, from and against any
losses, claims, damages, liabilities, whether joint or several, judgments,
penalties, fines (including but not limited to ERISA penalties and excise
taxes), interest, amounts paid in settlement and reasonable expenses (including
but not limited to expenses of investigation and preparation and fees and
disbursements of Indemnitee’s counsel, accountants or other experts) actually
incurred by Indemnitee in connection with any Proceeding in which Indemnitee was
or is made a party or was or is involved (for example, as a witness) because
Indemnitee is or was a Representative, which includes any actual or alleged
action or failure to act by Indemnitee in his or her capacity as a
Representative.
3. Insurance.
(a) So long as Indemnitee may be subject to any possible Proceeding by reason of
the fact that Indemnitee is or was a Representative, to the extent the General
Partner or the Partnership maintains an insurance policy or policies providing
directors’ and officers’ liability insurance, the Partnership shall ensure that
Indemnitee shall be covered by such policy or policies, in accordance with its
or their terms, to the maximum extent of the coverage applicable to a
Representative.

 

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(b) If Indemnitee shall cease to be a Representative for any reason, the
Partnership shall procure a run-off directors’ and officers’ liability insurance
policy with respect to claims arising from facts or events that occurred before
the time Indemnitee ceased to be a Representative, which policy, without any
lapse in coverage, will provide coverage for a period of six years after the
time Indemnitee ceased to be a Representative and will provide coverage
(including amount and type of coverage and size of deductibles) that is
substantially comparable to the General Partner’s or the Partnership’s
directors’ and officers’ liability insurance policy that was most protective of
Indemnitee in the 12 months preceding the time Indemnitee ceased to be a
Representative, provided, however, that:
(i) this obligation shall be suspended during the period immediately following
the time Indemnitee ceases to be a Representative if and only so long as the
General Partner or the Partnership has a directors’ and officers’ liability
insurance policy in effect covering Indemnitee for such claims that, if it were
a run-off policy, would meet or exceed the foregoing standards; and
(ii) no later than the end of the suspension period provided in the preceding
clause (i), the Partnership shall procure a run-off directors’ and officers’
liability insurance policy meeting the foregoing standards and lasting the
remainder of the six-year period.
4. Advances. In the event of any Proceeding in which Indemnitee is a party or is
involved and which may give rise to a right of indemnification from the
Partnership pursuant to this Agreement, following written request to the
Partnership by Indemnitee, the Partnership shall pay to Indemnitee, in
accordance with and to the fullest extent permitted and/or required by the
DRULPA and other applicable law, amounts to cover reasonable expenses incurred
by Indemnitee in such Proceeding in advance of its final disposition upon
receipt of (a) a written affirmation by Indemnitee of Indemnitee’s good faith
belief that Indemnitee has met any applicable standard of conduct; (b) a written
undertaking executed by or on behalf of Indemnitee to repay the advance if it
shall ultimately be determined that Indemnitee did not meet such standard of
conduct; and (c) satisfactory evidence as to the amount of such expenses (which
shall include invoices received by Indemnitee in connection with such expenses
but, in the case of invoices in connection with legal services, any references
to legal work performed or to expenditures made that would cause Indemnitee to
waive any privilege accorded by applicable law shall not be so included).
5. Burden of Proof. If under applicable law, the entitlement of Indemnitee to be
indemnified or advanced expenses hereunder depends upon whether a standard of
conduct has been met, the burden of proof of establishing that Indemnitee did
not act in accordance with such standard shall rest with the Partnership.
Indemnitee shall be presumed to have acted in accordance with such standard and
to be entitled to indemnification or the advancement of expenses (as the case
may be) unless, based upon a preponderance of the evidence, it shall be
determined that Indemnitee has not met such standard. Such determination and any
evaluation as to the reasonableness of amounts claimed by Indemnitee shall be
made by either (a) a majority vote of the Disinterested Directors; (b) a
majority vote of a committee consisting of Disinterested Directors designated to
act in the matter by a majority vote of Disinterested Directors; (c) if there
are no Disinterested Directors or if the Disinterested Directors so choose,
independent legal counsel in a written opinion; or (d) by the unitholders of the

 

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Partnership. For purposes of this Agreement, unless otherwise expressly stated,
the termination of any Proceeding by judgment, order, settlement (whether with
or without court approval) or conviction, or upon a plea of nolo contendere, or
its equivalent, shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that a court has
determined that indemnification is not permitted by applicable law.
6. Notice to the Partnership. Indemnitee shall notify the Partnership, by
written submission to the Secretary of the General Partner, of any matter for
which Indemnitee intends to seek indemnification hereunder as soon as reasonably
practicable following the receipt by Indemnitee of written notice thereof;
provided, however, that delay in so notifying the Partnership shall not
constitute a waiver or release by Indemnitee of rights hereunder. The written
notification to the Partnership shall include a description of the nature of the
Proceeding and the facts underlying the Proceeding, in each case to the extent
known by Indemnitee. If the Partnership maintains an insurance policy providing
directors’ and officers’ liability insurance that covers Indemnitee, the
Partnership, at the time that any such notice is received from Indemnitee, shall
give prompt notice thereof to the insurers in accordance with the procedures set
forth in the applicable policy.
7. Counsel for Proceeding. In the event of any Proceeding in which Indemnitee is
a party or is involved and which may give rise to a right of indemnification
hereunder, the Partnership shall have the right to retain counsel reasonably
satisfactory to Indemnitee to represent Indemnitee and any others the
Partnership may designate in such Proceeding. In any such Proceeding, Indemnitee
shall have the right to retain Indemnitee’s own counsel, but the fees and
expenses of such counsel shall be at the expense of Indemnitee unless (a) the
retention of such counsel has been specifically authorized by the Partnership;
(b) representation of Indemnitee and another party by the same counsel would be
inappropriate, in the reasonable judgment of Indemnitee, due to actual or
potential differing interests between them (as might be the case for
representation of both the Partnership and Indemnitee in a Proceeding by or in
the right of the Partnership); (c) the counsel retained by the Partnership and
satisfactory to Indemnitee has advised Indemnitee, in writing, that such
counsel’s representation of Indemnitee would be likely to involve such counsel
in representing differing interests which could adversely affect either the
judgment or loyalty of such counsel to Indemnitee, whether it be a conflicting,
inconsistent, diverse or other interest; or (d) the Partnership shall fail to
retain counsel for Indemnitee in such Proceeding. Notwithstanding the foregoing,
if an insurance carrier has supplied directors’ and officers’ liability
insurance covering a Proceeding and is entitled to retain counsel for the
defense of such Proceeding, then the insurance carrier shall retain counsel to
conduct the defense of such Proceeding unless Indemnitee and the Partnership
concur in writing that the insurance carrier’s doing so is undesirable. The
Partnership shall not be liable under this Agreement for any settlement of any
Proceeding effected without its written consent. The Partnership shall not
settle any Proceeding in any manner which would impose any penalty or limitation
on Indemnitee without Indemnitee’s written consent. Consent to a proposed
settlement of any Proceeding shall not be unreasonably withheld by either the
Partnership or Indemnitee.

 

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8. Enforcement. The Partnership acknowledges that Indemnitee is relying upon
this Agreement in serving as a Representative. If a claim for indemnification or
advancement of expenses is not paid in full by the Partnership within ninety
(90) days after a written claim has been received from Indemnitee by the
Partnership, Indemnitee may at any time bring suit against the Partnership to
recover the unpaid amount of the claim. If successful in whole or in part in
such suit, Indemnitee shall also be entitled to be paid all reasonable fees and
expenses (including without limitation fees of counsel) in bringing and
prosecuting such claim. Whether or not Indemnitee has met any applicable
standard of conduct, the Court in such suit may order indemnification or the
advancement of expenses as the Court deems proper (subject to any express
limitation of the Partnership Agreement). Further, the Partnership shall
indemnify Indemnitee from and against any and all expenses (including reasonable
attorneys’ fees) and, if requested by Indemnitee, shall (within ten business
days of such request) advance such expenses to Indemnitee, which are incurred by
Indemnitee in connection with any claim asserted against or suit brought by
Indemnitee for recovery under any directors’ and officers’ liability insurance
policies maintained by the Partnership, regardless of whether Indemnitee is
unsuccessful in whole or in part in such claim or suit.
9. Nonexclusivity. The rights of Indemnitee to receive indemnification and
advancement of expenses under this Agreement shall be in addition to, and shall
not be deemed exclusive of, any other rights Indemnitee shall have under the
DRULPA or other applicable law, the certificate of limited partnership or the
Partnership Agreement of the Partnership, any other agreement, vote of members
or unitholders or a resolution of directors, or otherwise. No amendment or
alteration of the certificate of limited partnership or the Partnership
Agreement of the Partnership shall adversely affect Indemnitee’s rights
hereunder. Any amendment, alteration or repeal of the DRULPA or other applicable
law that adversely affects any right of Indemnitee hereunder shall, to the
fullest extent permitted by law, be prospective only and shall not limit or
eliminate any such right with respect to any Proceeding involving any occurrence
or alleged occurrence of any action or omission to act that took place before
such amendment or repeal.
10. Limitations on Indemnification. Notwithstanding any other provision herein
to the contrary, the Partnership shall not be obligated pursuant to this
Agreement:
(a) To indemnify or advance expenses to Indemnitee with respect to a Proceeding
(or part thereof), however denominated, initiated by Indemnitee, including any
Proceeding (or any part thereof) initiated by Indemnitee against the Partnership
or the Partnership’s directors, officers, employees or other indemnitees, other
than (i) a Proceeding brought to establish or enforce a right to indemnification
or advancement of expenses under this Agreement, (ii) a Proceeding (or part
thereof) authorized or consented to by the General Partner prior to its
initiation, it being understood and agreed that such authorization or consent
shall not be unreasonably withheld in connection with any compulsory
counterclaim or counterclaim or affirmative defense brought or raised by
Indemnitee in response to a Proceeding otherwise indemnifiable under this
Agreement, and (iii) a Proceeding in which the Partnership provides
indemnification, in its sole discretion, pursuant to the powers vested in the
Partnership under the Partnership Agreement or applicable law.

 

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(b) To indemnify Indemnitee for any expenses incurred by Indemnitee with respect
to any Proceeding initiated by Indemnitee to enforce or interpret this
Agreement, unless Indemnitee is successful in such Proceeding in establishing
Indemnitee’s right, in whole or in part, to indemnification or advancement of
expenses hereunder, or unless and to the extent that the court in such action,
suit or proceeding shall determine that, despite Indemnitee’s failure to
establish its right to indemnification, Indemnitee is entitled to indemnity for
such expenses; provided, however, that nothing in this Section 10(b) is intended
to limit the Partnership’s obligations with respect to the advancement of
expenses to Indemnitee in connection with any such action, suit or proceeding
instituted by Indemnitee to enforce or interpret this Agreement, as provided in
Section 8 hereof.
(c) To indemnify Indemnitee on account of conduct by Indemnitee where such
conduct has been determined by a final (not interlocutory) judgment or other
adjudication of a court or arbitrator or administrative body of competent
jurisdiction to have been knowingly fraudulent or constitute willful misconduct
as to which there is no further right or option of appeal or the time within
which an appeal must be filed has expired without such filing.
(d) To indemnify Indemnitee in any circumstance where such indemnification has
been determined to be prohibited by law by a final (not interlocutory) judgment
or other adjudication of a court or arbitrator or administrative body of
competent jurisdiction as to which there is no further right or option of appeal
or the time within which an appeal must be filed has expired without such
filing.
11. Miscellaneous.
(a) Effectiveness. This Agreement shall be effective for and shall be applied to
acts or omissions prior to, on or after the date of this Agreement.
(b) Mutual Acknowledgments. Both the Partnership and Indemnitee acknowledge that
in certain instances, applicable law (including applicable federal law that may
preempt or override applicable state law) or public policy may prohibit the
Partnership from indemnifying the directors, officers, employees, agents or
fiduciaries of the Partnership under this Agreement or otherwise. For example,
the Partnership and Indemnitee acknowledge that the U.S. Securities and Exchange
Commission has taken the position that indemnification of directors, officers
and controlling persons of the Partnership for liabilities arising under federal
securities laws is against public policy and, therefore, unenforceable.
Indemnitee understands and acknowledges that the Partnership has undertaken or
may be required in the future to undertake with the Securities and Exchange
Commission to submit the question of indemnification to a court in certain
circumstances for a determination of the Partnership’s right under public policy
to indemnify Indemnitee. In addition, the Partnership and Indemnitee acknowledge
that federal law prohibits indemnifications for certain violations of ERISA.

 

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(c) Survival; Continuation. The rights of Indemnitee hereunder shall inure to
the benefit of Indemnitee (even after Indemnitee ceases to be a Representative),
Indemnitee’s personal representative, heirs, executors, administrators and
beneficiaries; and this Agreement shall be binding upon the Partnership, its
successors and assigns. The rights of Indemnitee under this Agreement shall
continue so long as Indemnitee may be subject to any possible Proceeding because
of the fact that Indemnitee was an Indemnitee of the Partnership. If the
Partnership sells, leases, exchanges or otherwise disposes of, in a single
transaction or series of related transactions, all or substantially all of its
property and assets, the Partnership shall, as a condition precedent to such
transaction, cause effective provision to be made so that the person or entity
acquiring such property and assets shall become bound by and replace the
Partnership under this Agreement.
(d) Governing Law. This Agreement shall be governed by the laws of the State of
Delaware. Any Proceeding arising out of or based upon this Agreement may be
instituted in the United States District Court for the District of Delaware or
the courts of the State of Delaware, in each case located in the County of New
Castle, and Indemnitee and the Partnership each irrevocably submits to the
exclusive jurisdiction (except for proceedings instituted in regard to the
enforcement of a judgment of any such court, as to which such jurisdiction is
non-exclusive) of such courts in any such Proceeding.
(e) Severability. If any provision of this Agreement shall be held to be
prohibited by or invalid under applicable law, such provision shall be deemed
amended to accomplish the objectives of the provision as originally written to
the fullest extent permitted by law and all other provisions shall remain in
full force and effect.
(f) Amendment. No amendment, termination or cancellation of this Agreement shall
be effective unless in writing signed by the Partnership and Indemnitee.
(g) Other Payments. The Partnership shall not be liable under this Agreement to
make any payment in connection with any Proceeding against or involving
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under the Partnership Agreement, any insurance policy or otherwise) of the
amounts otherwise indemnifiable hereunder. Indemnitee shall repay to the
Partnership the amount of any payment the Partnership makes to Indemnitee under
this Agreement in connection with any Proceeding against or involving
Indemnitee, to the extent Indemnitee has otherwise actually received payment
(under the Partnership Agreement, any insurance policy or otherwise) of such
amount.
(h) Subrogation. In the event of payment under this Agreement, the Partnership
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 reasonably necessary to secure such rights, including the
execution of such documents necessary to enable the Partnership effectively to
bring suit to enforce such rights.

 

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(i) Headings. The headings in this Agreement are for convenience only and are
not to be considered in construing this Agreement.
(j) Counterparts. This Agreement may be executed in counterparts, both of which
shall be deemed an original, and together shall constitute one document.
The parties have executed this Agreement as of the day and year first above
stated.

              RENTECH NITROGEN PARTNERS, L.P.   INDEMNITEE    
 
           
By:
  /s/ RENTECH NITROGEN PARTNERS, L.P.   /s/ D. Hunt Ramsbottom, Jr.    
 
 
 
 
 
D. Hunt Ramsbottom, Jr.    

 

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Schedule to Exhibit 10.42
The following directors and executive officers of Rentech Nitrogen GP, LLC are
parties to Indemnification Agreements with Rentech Nitrogen Partners, L.P. which
are substantially identical in all material respects to the representative
Indemnification Agreement to which this schedule is attached and which is filed
as an exhibit to the Company’s Annual Report on Form 10-K, except as to the
parties thereto set forth below. These other Indemnification Agreements are not
being filed with the Annual Report, pursuant to Instruction 2 to Item 601 of
Regulation S-K promulgated under the Securities Exchange Act of 1934, as
amended.

      Name of Signatory     Dan J. Cohrs     Colin M. Morris     John H. Diesch
    John A. Ambrose     Wilfred R. Bahl, Jr.     Julie Dawoodjee     Michael S.
Burke     Keith B. Forman     Michael F. Ray     Halbert S. Washburn    

 

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