Exhibit 10.73


 


INDEMNITY AGREEMENT


 


Indemnity
Agreement (this “Agreement”), dated as of March 29, 2005 and effective as of November 3,
2004, by and among RESOLUTION PERFORMANCE PRODUCTS INC., a Delaware corporation
(“Holding”), RESOLUTION PERFORMANCE PRODUCTS LLC, a Delaware limited liability
company (“RPP LLC”, and together with Holding, the “Company”), and the
indemnified party named on the signature page hereto (“Indemnitee”).


 


Introduction


 


Indemnitee
is a director and/or officer, as the case may be, of the Company. The parties
desire that the Company provide indemnification (including advancement of
expenses) to Indemnitee against any and all liabilities asserted against
Indemnitee to the fullest extent permitted by the Delaware General Corporation
Law and any other law (including statutory law and law established by judicial
decision) of the State of Delaware (collectively, “Law”), as the Law presently
exists and may be expanded from time to time, in each case on the terms and
subject to the conditions set forth herein. 
Based on such premise, and for certain good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereby agree as follows:


 


1.                                       Continued
Service.  Indemnitee will serve at the
will of the Company or under separate contract, if such exists, as a director
and/or officer, as the case may be, of the Company for so long as Indemnitee is
duly elected, appointed and qualified in accordance with the bylaws of the
Company or until Indemnitee tenders Indemnitee’s resignation to the Company.


 


2.                                       Indemnification.  The Company shall indemnify Indemnitee as
follows:


 


2.1                                 The Company shall
indemnify Indemnitee when Indemnitee was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the Company), by reason of the fact that
Indemnitee is or was a director, officer, employee or agent of the Company or
any of its subsidiaries, or is or was serving at the request of the Company or
any of its subsidiaries as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, or by
reason of any act or omission by Indemnitee in such capacity, against expenses
(including attorneys’ fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by Indemnitee in connection with such action,
suit or proceeding (including punitive and similar damages, to the extent
permitted by Law) if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had no reasonable
cause to believe that Indemnitee’s conduct was unlawful.


 


2.2                                 The Company shall
indemnify Indemnitee when Indemnitee was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding
by or in the right of the Company or any of its subsidiaries to procure a
judgment in its favor by reason of the fact that Indemnitee is or was a
director, officer, employee or agent of the Company or any of its subsidiaries,
or is or was serving at the request of the Company or any of its subsidiaries
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against expenses (including attorneys’
fees) actually and reasonably incurred by Indemnitee in connection with the
defense or settlement of such action or suit if Indemnitee acted in good faith
and in a manner that Indemnitee reasonably believed to be in or not opposed to
the best interests of the Company and except that no indemnification pursuant to
this Agreement shall be made in respect of any claim, issue or matter as to
which Indemnitee shall have been adjudged to be liable to the Company or any of
its subsidiaries unless and only to the extent that the Court of Chancery of
the State of Delaware or the court in which such action, suit or proceeding was
brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, Indemnitee is
fairly and reasonably entitled to indemnity for such expenses which the Court
of Chancery or such other court shall deem proper.


 





















 


2.3                                 Any
indemnification under Sections 2.1 and 2.2 (unless ordered by a court) shall be
made by the Company only as authorized in the specific case upon a
determination, in accordance with the procedures set forth in Section 3,
that indemnification of Indemnitee is proper in the circumstances because
Indemnitee has met the applicable standard of conduct set forth in such
Sections 2.1 and 2.2. Subject to Section 3.3, such determination shall be
made (1) by the board of directors of the Company (the “Board”) by a majority
vote of a quorum consisting of directors who were not parties to such action,
suit or proceeding, or (2) if such a quorum is not obtainable, or, even if obtainable,
if so directed by a majority vote of a quorum of disinterested directors, by
Independent Counsel (selected pursuant to Section 3.3) in a written
opinion, or (3) by the stockholders of the Company.


 


2.4                                 Expenses
(including attorneys’ fees) incurred by Indemnitee in defending any civil,
criminal, administrative, or investigative action, suit or proceeding shall be
paid from time to time by the Company in advance of the final disposition of
such action, suit or proceeding, within 14 days after the receipt by the
Company from Indemnitee of a Statement of Undertaking, in a form reasonably
acceptable to the parties, in which Indemnitee (1) states that Indemnitee has
reasonably incurred actual expenses in defending a civil, criminal,
administrative, or investigative action, suit or proceeding and (2) undertakes
to repay such amount if it shall ultimately be determined that Indemnitee is
not entitled to be indemnified by the Company as authorized in this Section 2.


 


2.5                                 The
indemnification and advancement of expenses provided by, or granted pursuant
to, this Section 2 shall not be deemed exclusive of any other rights to
which Indemnitee may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors, Law or otherwise, both as to action in
Indemnitee’s official capacity and as to action in another capacity while
holding such office, shall continue after Indemnitee has ceased to be a
director, officer, employee or agent of the Company, and shall inure to the
benefit of the heirs, executors and administrators of Indemnitee.


 


2.6                                 The termination
of any action, suit or proceeding by judgment, order, settlement or conviction
or upon a plea of nolo contendere or its equivalent shall not, of itself,
create a presumption that Indemnitee did not act in good faith and in a manner
which Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that Indemnitee’s conduct was unlawful.


 


3.                                       Determination of
Right to Indemnification.  For the
purpose of making the determination of whether to indemnify Indemnitee in a
specific case under Section 2.3, the Board, independent legal counsel or
the stockholders of the Company, as the case may be, shall make the
determination in accordance with the following procedures:


 


3.1                                 Indemnitee shall
submit to the Board a Statement of Request for Indemnification, in a form
reasonably acceptable to the parties, in which Indemnitee states that Indemnitee
has met the applicable standard of conduct set forth in Sections 2.1 and 2.2.


 


3.2                                 Indemnitee’s
submission of a Statement of Request for Indemnification to the Board shall
create a rebuttable presumption that Indemnitee has met the applicable standard
of conduct set forth in Sections 2.1 and 2.2 and, therefore, is entitled to
indemnification under Section 2. The Board, Independent Counsel (as
defined below) or the stockholders, as the case may be, shall determine, within
45 days after submission of the Statement of Request for Indemnification,
specifically that Indemnitee is so entitled, unless it or they shall possess
clear and convincing evidence to rebut the foregoing presumption, which
evidence shall be disclosed to Indemnitee with particularity in a sworn written
statement signed by all persons who participated in the determination and voted
to deny indemnification.


 


3.3                                 If determination
as to indemnification is to be made by Independent Counsel, such Independent
Counsel shall be selected by the Board and approved by Indemnitee (such
approval not to be unreasonably withheld, delayed or conditioned). The Board
shall give written notice to Indemnitee (the “Independent Counsel Notice”)
within 10 days after the delivery of the Statement of Request for Indemnification
advising it of the identity of the Independent Counsel so selected. Indemnitee
may, within seven days after the date of the Independent Counsel Notice,
deliver to the Company a written objection to such selection. Any objection to
selection of


 





















 


Independent Counsel pursuant to this Section 3.3
may be asserted only on the ground that the Independent Counsel so selected
does not meet the requirements of the definition of “Independent Counsel”
below, and the objection shall set forth with particularity the factual basis
of such assertion.  If such written
objection is timely made, the Independent Counsel so selected may not serve as
Independent Counsel unless and until a court has determined that such objection
is without merit. In the event of a timely written objection to a choice of
Independent Counsel, the Company shall have seven days to make an alternate
selection of Independent Counsel and to give written notice of such selection
to Indemnitee, after which time Indemnitee shall have seven days to make a
written objection to such alternate selection. 
Upon failure of the Board to select Independent Counsel, or upon failure
of Indemnitee to so approve, the Independent Counsel shall be selected by the
Chancellor of the State of Delaware or such other person as the Chancellor
shall designate to make such selection. The Company shall pay any and all
reasonable fees and expenses of Independent Counsel incurred by such
Independent Counsel in connection with acting pursuant hereto and provide such person
with appropriate indemnification, and the Company shall pay all reasonable fees
and expenses incident to the procedures of this Section 3.3, regardless of
the manner in which such Independent Counsel was selected or appointed.  The rights and obligations of the parties
under this Section 3.3 shall be subject to, and shall be given effect only
to the extent permitted by, applicable Law.


 


3.4                                 If the person or
persons empowered or selected under this Agreement to determine whether
Indemnitee is entitled to indemnification shall not have made a determination
within 45 days after receipt by the Company of the Statement of Request for
Indemnification by Indemnitee therefor (or, if the determination of entitlement
to indemnification is to be made by Independent Counsel pursuant to Section 3.3
of this Agreement, and such determination shall not have been made and
delivered in a written opinion within 90 days after (i) such Independent
Counsel’s being appointed, (ii) the overruling by the Court of objections to such
Counsel’s selection or (iii) expiration of all periods for the Company or
Indemnitee to object to such Counsel’s selection), the requisite determination
of entitlement to indemnification shall be deemed to have been made and
Indemnitee shall be entitled to such indemnification, absent a prohibition of
such indemnification under applicable Law; provided, however, that such 45-day
period may be extended for a reasonable time, not to exceed an additional 30
days, if the person making the determination with respect to entitlement to
indemnification in good faith requires such additional time for the obtaining
or evaluating of documentation and/or information relating to such
determination; and provided, further, that the 45-day limitation set forth in
this Section 3.4 shall not apply and such period shall be extended as
necessary if Independent Counsel is not able to make the determination pursuant
to section 3.3 of this Agreement and if within 30 days after receipt by
the Company of the Statement of Request for Indemnification the Board has
resolved to submit such determination to the stockholders for their
consideration at an annual meeting thereof to be held within 90 days after such
receipt and such determination is made thereat, or a special meeting of stockholders
is called within 30 days after such receipt for the purpose of making such
determination, such meeting is held for such purpose within 60 days after
having been so called and such determination is made thereat.


 


4.                                       Merger,
Consolidation or Change in Control.  If
the Company is a constituent corporation in a merger or consolidation, whether
the Company is the resulting or surviving corporation or is absorbed as a
result thereof, or if there is a change in control of the Company, or a sale or
other complete disposition of all or substantially all of the assets of the
Company, Indemnitee shall stand in the same position under this Agreement with
respect to the resulting, surviving, changed or acquiring corporation or other
entity as Indemnitee would have with respect to the Company if its separate
existence had continued or if there had been no change in control of the
Company or a sale or other complete disposition of all or substantially all of
the assets of the Company.


 


5.                                       Certain
Definitions.  For the purposes of this
Agreement, the following terms shall have the indicated meanings and
understandings:


 


5.1                                 The term “other
enterprise” shall include, among others, employee benefit plans and civic,
non-profit and charitable organizations, whether or not incorporated.


 


5.2                                 The term “fines”
shall include any excise taxes assessed on Indemnitee with respect to any
employee benefit plan.


 





















 


5.3                                 The term “serving
at the request of the Company” shall include any service, at the request or
with the express authorization of the Company, as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, which service imposes duties on, or involves services by,
Indemnitee with respect to such corporation, partnership, joint venture, trust
or other enterprise, its participants or beneficiaries.  If Indemnitee acted in good faith and in a
manner Indemnitee reasonably believed to be in or not opposed to the best
interests of such other enterprise, its participants or beneficiaries,
Indemnitee shall be deemed to have acted in a manner not opposed to the best
interests of the Company.


 


5.4                                 The term “change
in control” shall include any change in the ownership of a majority of the
outstanding voting securities of the Company or in the composition of a
majority of the members of the Board of the Company.


 


5.5                                 The term “Independent
Counsel” means a law firm, or a member of a law firm, that is experienced in
matters of corporation law and neither contemporaneously is, nor in the five
years theretofore has been, retained to represent (a) the Company or Indemnitee
in any matter material to either such party, (b) any other party to the
proceeding giving rise to a claim for indemnification hereunder or (c) the
beneficial owner, directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of the Company’s then
outstanding voting securities. Notwithstanding the foregoing, the term “Independent
Counsel” shall not include any person who, under the applicable standards of
professional conduct then prevailing, would have a conflict of interest in
representing either the Company or Indemnitee in an action to determine
Indemnitee’s rights under this Agreement.


 


6.                                       Attorneys’
Fees.  If Indemnitee institutes any legal
action to enforce Indemnitee’s rights under this Agreement, or to recover
damages for breach of this Agreement, Indemnitee, if Indemnitee prevails in
whole or in part, shall be entitled to recover from the Company all fees and expenses
(including attorneys’ fees) incurred by Indemnitee in connection therewith.


 


7.                                       Deposit of Funds
In Trust.  If the Company voluntarily
decides to dissolve or to file a petition for relief under the applicable
bankruptcy, moratorium or similar laws, then not later than 10 days prior to
such dissolution or filing, the Company shall deposit in trust for the sole and
exclusive benefit of Indemnitee a cash amount equal to all amounts previously
authorized to be paid to Indemnitee hereunder, such amounts to be used to
discharge the Company’s obligations to Indemnitee hereunder. Any amounts in
such trust not required for such purpose shall be returned to the Company. This
Section 7 shall not apply to the dissolution of the Company in connection
with a transaction as to which Section 4 applies.


 


8.                                       Amendments to
Law.  This Agreement is intended to
provide indemnity to Indemnitee to the fullest extent allowed under Law,
including but not limited to statutory law and judicial decisions. Accordingly,
to the extent permitted by Law, if the Law permits greater indemnity than the
indemnity set forth herein, or if any amendment is made to any Law expanding
the indemnity permissible under Law, the indemnity obligations contained herein
automatically shall be expanded, without the necessity of action on the part of
any party, to the extent necessary to provide to Indemnitee the fullest
indemnity permissible under Law.


 


9.                                       Miscellaneous
Provisions.


 


9.1                                 This Agreement
shall continue for so long as Indemnitee serves as a director of the Company or
any of its subsidiaries or as a director, officer, partner, employee, agent or
fiduciary of any other corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise in which the Indemnitee served at the request
of the Company, and thereafter shall survive until and terminate upon the later
to occur of: (a) the final termination of all pending proceedings in respect of
which Indemnitee is granted rights of indemnification or advancement of
expenses hereunder and of any proceeding commenced by Indemnitee relating
thereto; or (b) the expiration of all statutes of limitation applicable to
possible claims arising out of Indemnitee’s services as described above.


 





















 


9.2                                 This Agreement
constitutes the full understanding of the parties and a complete and exclusive
statement of the terms and conditions of this Agreement and supersedes all
prior negotiations, understandings and agreements, whether written or oral,
between the parties, their affiliates, and their respective principals,
shareholders, directors, officers, employees, consultants and agents with
respect thereto; provided, however, that no rights of Indemnitee under any
certificate of incorporation, bylaw, insurance policy, Law or other agreement
shall be limited or terminated by this Agreement.


 


9.3                                 No alteration,
modification, amendment, change or waiver of any provision of this Agreement
shall be effective or binding on any party hereto unless the same is in writing
and is executed by all parties hereto.


 


9.4                                 If a court of
competent jurisdiction declares that any provision of this Agreement is
illegal, invalid or unenforceable, then such provision shall be modified
automatically to the extent necessary to make such provision fully legal, valid
or enforceable. If such court does not modify any such provision as
contemplated herein, but instead declares it to be wholly illegal, invalid or
unenforceable, then such provision shall be severed from this Agreement, this
Agreement and the rights and obligations of the parties hereto shall be
construed as if this Agreement did not contain such severed provision, and this
Agreement otherwise shall remain in full force and effect.


 


9.5                                 This Agreement
shall be enforceable by and against the Company, the Indemnitee and their
respective executors, legal representatives, administrators, heirs, successors
and assignees.


 


9.6                                 The obligations
of Holding and RPP LLC under the Agreement shall be joint and several.


 


9.7                                 This Agreement
shall be governed by, construed under, and enforced in accordance with the laws
of the State of Delaware without reference to the conflict-of-laws provisions
thereof that would require the application of another state’s law.


 


9.8                                 This Agreement
may be executed by the parties hereto in multiple counterparts, each of which
shall be deemed an original for all purposes, and all of which together shall
constitute one and the same instrument.


 


9.9                                 The Company shall
be precluded from asserting in any judicial proceeding commenced under this
Agreement that the procedures and presumptions of this Agreement are not valid,
binding and enforceable and shall stipulate in any such court that the Company
is bound by all the provisions of this Agreement.


 


9.10                           Unless otherwise
expressly provided herein, all notices, requests, demands, consents, waivers,
instructions, approvals and other communications hereunder shall be in writing
and shall be deemed to have been duly given if personally delivered to or
mailed, certified mail return receipt requested, first-class postage paid,
addressed as follows:


 


If to the Company,
to it at:


 


Resolution
Performance Products Inc.

Resolution Performance Products LLC

1600 Smith Street, 24th Floor

Houston, TX 77002

Facsimile: 817-375-2304 

Attention: General Counsel


 


If to Indemnitee,
to Indemnitee at the address under such Indemnitee’s name on the signature page
hereto,


 


or to such other address or to
such other addressees as any party shall have last designated as its address or
addressee


 





















 


by notice to the other party.
All notices and other communications given to any party in accordance with the
provisions of this Agreement shall be deemed to have been given when delivered
or sent to the intended recipient thereof in accordance with the provisions of
this Section 9.10.


 


9.11                           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 documents required and shall do all acts that may be necessary to secure
such rights and to enable the Company effectively to bring suit to enforce such
rights.