exv10w1






EXHIBIT 10.1




FORM OF INDEMNIFICATION AGREEMENT




     THIS INDEMNIFICATION AGREEMENT (the “Agreement”) is made as of                     ,                    
between ENSTAR GROUP LIMITED (formerly known as Castlewood Holdings Limited), a company organized
under the laws of Bermuda (the “Company”), and                                          (“Indemnitee”).



RECITAL




          The Second Amended and Restated Bye-Laws of the Company, as may be amended from time to time
(the “Bye-Laws”) contain provisions indemnifying the Company’s directors and officers with
respect to certain liabilities and expenses. Indemnitee is currently serving as a director of the
Company’s Board of Directors (the “Board”), and the Board has determined that it is in the
best interests of the shareholders of the Company for the Company to provide Indemnitee with
additional assurance of protection against personal liability pursuant to and in furtherance of the
Bye-Laws, as provided in this Agreement.




AGREEMENT




          NOW, THEREFORE, in consideration of the foregoing recital and of other good and valuable
consideration, the receipt and sufficiency of which is acknowledged, the parties, intending to be
legally bound, agree as follows:




          1. Indemnification.




               (a) The Company shall hold harmless and indemnify and reimburse Indemnitee against all
liabilities, costs, expenses (including without limitation, investigation expenses and expert
witnesses’ and attorneys’ fees), judgments, penalties, fines, excise taxes, interest and amounts
paid or to be paid in settlement in connection with any threatened, pending or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation, administrative hearing,
or proceeding (collectively, a “Proceeding”), in which Indemnitee was or is a party or a
witness, or is threatened to be made a party or a witness, including without limitation, actions by
or in the right of the Company, whether civil, criminal, administrative, regulatory or
investigative, by reason that, either before or after the date hereof, Indemnitee is or was a
director, officer, employee, agent, fiduciary, or other representative of the Company, or is or was
serving while a director, officer, employee, agent, fiduciary, or other representative of the
Company at the request of the Company as a director, officer, employee, agent, fiduciary, or other
representative of another corporation (for profit or not-for-profit), limited liability company,
partnership, joint venture, trust, employee benefit plan or other entity or enterprise
(“Indemnified Position”). Notwithstanding anything to the contrary set forth in this
Agreement, the term “Proceeding” shall not include any action or proceeding commenced by
Indemnitee, other than (i) mandatory counterclaims, (ii) affirmative defenses, (iii) as permitted
by the Company and (iv) actions or proceedings to enforce the terms of this Agreement.



               (b) If Indemnitee is entitled under this Agreement to indemnification by the Company for a
portion of the Indemnified Amounts (defined below) but not for the total



 









 




amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to
which Indemnitee is entitled.




               (c) The Company shall not settle any Proceeding in any manner which would impose any penalty
or limitation of any kind or nature on Indemnitee without Indemnitee’s prior written consent.



          2. Limitations on Indemnification. Notwithstanding any other provision of this
Agreement, Indemnitee shall not be entitled to indemnification under Section 1:




               (a) if the claim, obligation or liability with respect to which indemnity is sought shall have
been determined by a court of competent jurisdiction, by a final, nonappealable judgment or decree,
to have resulted from Indemnitee’s fraud or dishonesty;



               (b) if a court of competent jurisdiction shall determine, by a final, nonappealable judgment
or decree, that such indemnity is prohibited under applicable law;



               (c) on account of any suit in which judgment is rendered for an accounting of profits made
from the purchase or sale by Indemnitee of securities of the Company in violation of the provisions
of Section 16(b) of the Securities Exchange Act of 1934, as amended, and amendments thereto or
similar provisions of any U.S. federal or state statutory law or any Bermuda statutory law; or



               (d) on account of any suit brought against Indemnitee for misuse or misappropriation of
non-public information, or otherwise involving Indemnitee’s status as an “insider” of the Company,
in connection with any purchase or sale by Indemnitee of securities of the Company, and judgment is
rendered against Indemnitee in such suit.



          3. Other Indemnification Arrangements. The Company’s purchase, establishment and
maintenance of insurance or similar protection or other arrangements, including, but not limited
to, the Bye-Laws, providing a trust fund, letter of credit or surety bond (collectively,
“Indemnification Arrangements”) on behalf of Indemnitee against any liability asserted
against him or her or incurred by or on his or her behalf in his or her Indemnified Position,
whether or not the Company would have the power to indemnify him or her against such liability
under the provisions of this Agreement or under applicable law, shall not in any way limit or
affect the rights and obligations of the Company or of Indemnitee under this Agreement, and the
execution and delivery of this Agreement by the Company and Indemnitee shall not in any way limit
or affect the rights and obligations of the Company or the other party or parties thereto under any
Indemnification Arrangement. All amounts payable by the Company pursuant to this Section 3
or Section 1 are referred to as “Indemnified Amounts.”




          4. Advance Payment of Indemnified Amounts.




               (a) Subject to Section 4(b), Indemnitee hereby is granted the right to receive in
advance of a final, nonappealable judgment or other final, nonappealable adjudication of a
Proceeding the amount of any and all expenses, including, without limitation, attorney’s fees,
expended or incurred by Indemnitee in connection with any Proceeding (such amounts so expended or
incurred, “Advanced Amounts”).



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               (b) In making any request for Advanced Amounts, Indemnitee shall submit to the Company an
undertaking by or on behalf of Indemnitee to repay the Advanced Amounts if it shall ultimately be
determined in a final, nonappealable judgment or decree that he or she is not entitled to be
indemnified by the Company. The undertaking shall be in the form attached hereto as Exhibit
A. The Company shall pay to Indemnitee without the need for action by the Board Advanced
Amounts within five days of its receipt of appropriate documentation and information evidencing the
Advanced Amounts provided that Indemnitee has previously provided the Company with the undertaking
required to be provided by Indemnitee pursuant to this Section 4(b).



          5. Procedure for Payment of Indemnified Amounts.




               (a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a
written request for payment of the appropriate Indemnified Amounts, with such documentation and
information to accompany such request as is reasonably available to Indemnitee and reasonably
necessary for the Company to determine whether and to what extent Indemnitee is entitled to
indemnification.



               (b) The Company shall pay Indemnitee the Indemnified Amounts unless it is established that
Indemnitee has not met any applicable standard of conduct required in this Agreement or applicable
law. For purposes of determining whether Indemnitee is entitled to Indemnified Amounts, in order
to deny indemnification to Indemnitee, the Company shall have the burden of proof in establishing
that Indemnitee did not meet the applicable standard of conduct required to qualify for
indemnification. In this regard, a termination of any Proceeding by judgment, order, plea of
nolo contendere, settlement or conviction shall not create a presumption that
Indemnitee did not meet the applicable standard of conduct required to qualify for indemnification.



               (c) Any determination that Indemnitee has not met the applicable standard of conduct required
to qualify for indemnification shall be made either (i) by the Board by a unanimous vote of all
directors who were not parties to the Proceeding or (ii) by independent legal counsel (who may be
the outside counsel regularly employed by the Company, so long as it has not advised any party in
the subject matter of the Proceeding or the Proceeding itself) approved in advance in writing by
both the highest ranking executive officer of the Company who is not party to the Proceeding and by
Indemnitee. The fees and expenses of counsel in connection with making the determination
contemplated hereunder shall be paid by the Company, and, if requested by such counsel, the Company
shall give such counsel an appropriate written agreement with respect to the payment of their fees
and expenses and such other matters as may be reasonably requested by such counsel.



               (d) The Company shall use its best efforts to conclude as soon as practicable (but in no event
later than 60 days from the date of Indemnitee’s request for indemnification pursuant to Section
5(a)) any requested determination pursuant to Section 5(c) and shall promptly advise
Indemnitee in writing with respect to any determination that Indemnitee is or is not entitled to
indemnification, including a reasonably detailed description of any reason or basis for which
indemnification has been denied. Payment of any applicable



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Indemnified Amounts shall be made to Indemnitee within five days after any determination of
Indemnitee’s entitlement to indemnification.




               (e) Notwithstanding the foregoing, at any time after 30 days after Indemnitee’s request for
indemnification pursuant to Section 5(a) (or upon receipt of written notice that a claim
for Indemnified Amounts has been rejected, if earlier), and before three years after a claim for
Indemnified Amounts has been delivered by Indemnitee to the Company, Indemnitee may petition a
court of competent jurisdiction to determine whether Indemnitee is entitled to indemnification
under the provisions of this Agreement, and such court shall thereupon have the exclusive authority
to make such determination unless and until the court dismisses or otherwise terminates the action
without having made such determination. The court shall, as petitioned, make an independent
determination of whether Indemnitee is entitled to indemnification as provided under this
Agreement, irrespective of any prior determination made by the Board or independent counsel and
without being provided or having evidence or testimony regarding any such prior determination. If
the court determines that Indemnitee is entitled to indemnification as to any claim, issue or
matter involved in the Proceeding with respect to which there has been no prior determination
pursuant to this Agreement or with respect to which there has been a prior determination that
Indemnitee was not entitled to indemnification hereunder, the Company shall pay all expenses,
including attorneys’ fees, actually incurred by Indemnitee in connection with obtaining such
judicial determination, as well as Indemnified Amounts relating thereto.



               (f) Nothing set forth in this Section 5 shall limit or affect the timing or amount, or
the right of Indemnitee to payment, of any Advanced Amounts pursuant to Section 4.



          6. Agreement Not Exclusive: Subrogation Rights, etc.




               (a) This Agreement shall not be deemed exclusive of and shall not diminish any other rights
Indemnitee may have to be indemnified, insured or otherwise protected against any liability, cost,
expense (including, without limitation, investigation expenses and expert witnesses and attorney’s
fees), judgment, penalty, fine, excise tax, interest or amount paid or to be paid in settlement by
the Company, any subsidiary of the Company, or any other person or entity under any memorandum of
association, charter, bylaw, law, agreement, policy of insurance or similar protection, vote of
shareholders or directors, disinterested or not, or otherwise, whether or not now in effect, both
as to actions in Indemnitee’s official capacity with the Company, and as to actions in another
capacity while holding such office, including Indemnitee’s right to contribution as may be
available under applicable law. The Company’s obligations to make payments of Indemnified Amounts
hereunder shall be satisfied to the extent that payments with respect to the same Proceeding (or
part thereof) have been made to or for the benefit of Indemnitee by reason of the indemnification
of Indemnitee pursuant to any other arrangement made by the Company for the benefit of Indemnitee.



               (b) If Indemnitee shall actually receive payment from any insurance carrier or from the
plaintiff in any Proceeding against Indemnitee in respect of Indemnified Amounts after payments on
account of all or part of such Indemnified Amounts have been made by the Company pursuant hereto,
Indemnitee shall promptly reimburse to the Company the amount, if any, by which the sum of such
payment by such insurance carrier or such plaintiff and



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payments by the Company or pursuant to arrangements made by the Company to Indemnitee exceeds
such Indemnified Amounts. Portions, if any, of insurance proceeds that are required to be
reimbursed to the insurance carrier under the terms of its insurance policy, such as deductible or
co-insurance payments, shall not be deemed to be payments to Indemnitee hereunder. In addition,
upon payment of Indemnified Amounts hereunder, the Company shall be subrogated to the rights of
Indemnitee receiving such payments (to the extent thereof) against any insurance carrier (to the
extent permitted under such insurance policies) or plaintiff in respect of such Indemnified Amounts
and Indemnitee shall execute and deliver any and all instruments and documents and perform any and
all other acts or deeds that the Company deems reasonably necessary or advisable to secure such
rights; provided that the Company reimburses Indemnitee for any costs, expenses or
liabilities incurred by it in providing such cooperation. Such right of subrogation shall be
terminated upon receipt by the Company of the amount to be reimbursed by Indemnitee pursuant to the
first sentence of this Section 6(b).




          7. Additional Indemnification Rights. Notwithstanding any other provision of this
Agreement, the Company hereby agrees to indemnify Indemnitee to the fullest extent permitted by
applicable law, notwithstanding that such indemnification may not be specifically authorized by the
other provisions of this Agreement, the Bye-Laws or by statute. If there is any change, after the
date of this Agreement, in any applicable law, statute or rule, whether by case law or otherwise,
that expands the right of a Bermuda company to indemnify a member of its board of directors, such
changes shall be, ipso facto, within the purview of Indemnitee’s rights and Company’s obligations,
under this Agreement. If there is any change in any applicable law, statute or rule that narrows
the right of a Bermuda company to indemnify a member of its board of directors, such changes, to
the extent not otherwise mandatorily required by such law, statute or rule to be applied to this
Agreement, shall have no effect on this Agreement or the parties, rights and obligations hereunder.




          8. Insurance.




               (a) If the Company maintains directors and officers liability insurance to protect itself and
any of its directors or officers against any expense, liability or loss, and such insurance may
cover Indemnitee, such insurance shall cover Indemnitee to at least the same extent as any other
director or officer of the Company. If at any point (i) such insurance ceases to cover acts and
omissions occurring during all or any part of the period of Indemnitee’s Indemnified Position or
(ii) neither the Company nor any of its subsidiaries maintains any such insurance, the Company
shall ensure that Indemnitee is covered, for at least six years (or such shorter period as is
available on commercially reasonable terms) from such point, by other directors and officers
liability insurance, in amounts and on terms (including the period of Indemnitee’s Indemnified
Position) no less favorable (or such other commercially reasonable amounts and terms as are
available) to Indemnitee than the amounts and terms of the liability insurance maintained by the
Company on the date hereof, provided that such insurance is available on commercially reasonable
terms.



               (b) The Company shall give prompt notice of the commencement of a Proceeding to the insurers
in accordance with the procedures set forth in the respective policies. The Company shall
thereafter take reasonable action to cause such insurers to pay, on behalf of



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the Indemnitee, all amounts payable as a result of such Proceeding in accordance with the
terms of such policies.




          9. Severability. Each of the provisions of this Agreement is a separate and distinct
agreement and independent of the others, so that if any provisions hereof shall be held to be
invalid or unenforceable for any reason or under any circumstances, such invalidity or
unenforceability shall not affect the validity or enforceability of the other provisions hereof or
the application of the invalid or unenforceable provision under other circumstances. Furthermore,
to the fullest extent possible, the provisions of this Agreement (including, without limitation,
each portion of this Agreement containing any provision held to be invalid, void or otherwise
unenforceable, that is not itself invalid, void or unenforceable) shall be construed so as to give
effect to the intent manifested by the provision held invalid, illegal or unenforceable.




          10. Further Assurances. The parties shall do, execute and deliver, or shall cause to
be done, executed and delivered, all such further acts, documents and things as may be reasonably
required for the purpose of giving effect to this Agreement and the transactions contemplated
hereby.




          11. Successors; Binding Agreement; No Third Party Beneficiaries. This Agreement shall
be binding on and shall inure to the benefit of and be enforceable by the Company’s successors and
assigns and by Indemnitee’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. Except for the foregoing persons and
entities, nothing in this Agreement, express or implied, is intended to or shall be deemed to
confer upon any person or entity other than the parties hereto any rights or remedies under or by
reason of this Agreement or any provision of this Agreement. The Company shall require any
successor or assignee (whether direct or indirect, by purchase, merger, consolidation or otherwise)
to all or substantially all of the business or assets of the Company, by written agreement in form
and substance reasonably satisfactory to the Company and to Indemnitee, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent that the Company would be
required to perform if no such succession or assignment had taken place.




          12. Counterparts. This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original (including
facsimile signatures), but all such counterparts shall together constitute one and the same
instrument.




          13. Corporate Power and Authority; Due Authorization; Valid and Binding Obligation.
The Company represents and warrants that (a) it has the corporate power and authority to execute,
deliver and perform its obligations under this Agreement, (b) this Agreement has been duly
authorized, executed and delivered by the Company, (c) upon the execution and delivery of this
Agreement by the Indemnitee, this Agreement will constitute a valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, (d) the execution, delivery
and performance of its obligations under this Agreement by the Company does not and will not
breach, violate or cause a termination, default or acceleration under its Memorandum of Association
or Bye-Laws or any agreement, document,




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instrument, policy (insurance or otherwise), or arrangement to which it is a party or is bound
and (e) Indemnitee is relying upon this Agreement in serving in an Indemnified Position.




          14. Specific Performance. It is specifically understood and agreed that any breach or
threatened breach of this Agreement by the Company will result in irreparable injury to Indemnitee,
that the remedy at law alone will be an inadequate remedy for such breach or threatened breach and
that, in addition to any other remedy for such breach or threatened breach, the Indemnitee shall be
entitled to enforce the provisions of this Agreement through both temporary and permanent
injunctive relief, without the necessity of (a) proving actual damages, but without limitation of
the rights to recover such damages and (b) posting a bond or other security.




          15. Miscellaneous. No provision of this Agreement may be modified, waived, or
discharged unless the modification, waiver or discharge is agreed to in writing signed by
Indemnitee and either the Chairman of the Board or the President of the Company or another officer
of the Company specifically designated by the Board. No waiver by either party at any time of any
breach by the other party of, or of compliance with, any condition or provision of this Agreement
to be performed by the other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same time or at any prior or subsequent time. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment
of any other right or remedy. No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either party that are not set
forth expressly in this Agreement. The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of Bermuda, without giving effect to the principles of
conflict of laws of that or any other jurisdiction. The headings in this Agreement are for
convenience only and shall not affect the interpretation of any provision of this Agreement. All
communications under this Agreement shall be in writing and shall be deemed effectively given: (a)
upon personal delivery to the party to be notified; (b) when sent by confirmed facsimile if sent
during normal business hours of the recipient; (c) seven days after having been sent by registered
or certified mail, return receipt requested, postage prepaid; or (d) two days after deposit with an
internationally recognized overnight courier, specifying two day or prior delivery, with written
verification of receipt. All communications under this Agreement to the (i) Company shall be sent
to its principal place of business to the attention of the Secretary and (ii) Indemnitee shall be
sent to his residential mailing address on file with the Company.




(The remainder of this page is intentionally left blank.)




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          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.



	 	 	 	 	 
	 

	 	INDEMNITEE	 	 
	 
	 	 	 	 
	 

	 	 

Name:
	 	 






	 	 	 	 	 
	 	ENSTAR GROUP LIMITED

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



[Signature Page to Indemnification Agreement]




 









 








Exhibit A




[Date]




[Company name and Address]




Ladies and Gentlemen:





     I
have entered into an Indemnification Agreement, made as of
                     ,                      (the
“Indemnification Agreement”), with Enstar Group Limited (formerly known as Castlewood Holdings
Limited) (the “Company”) pursuant to which I am entitled to advancement of expenses. I understand
that the entry into of this undertaking is a condition to the Company’s obligations to advance
expenses under the Indemnification Agreement.



     Please accept this letter as my undertaking to repay Advanced Amounts (as defined in the
Indemnification Agreement) if it shall ultimately be determined in a final, nonappealable judgment
or decree that I am not entitled to be indemnified by the Company. I agree to repay any amounts to
the Company within fifteen business days of any demand therefore pursuant to this undertaking.



     This undertaking shall survive any termination or rescission of the Indemnification Agreement,
unless agreed otherwise by the Company.



     The validity, interpretation, construction and performance of this undertaking shall be
governed by the laws of Bermuda, without giving effect to the principles of conflict of laws of
that or any other jurisdiction.



Sincerely,