Exhibit 10.1


 


Indemnification Agreement


 


AGREEMENT,
effective as of               ,
2008, between Walter Industries, Inc., a Delaware corporation (the “Corporation”),
and                     (the
“Indemnitee”).


 


WHEREAS,
it is essential to the Corporation to retain and attract as directors and
officers the most capable persons available;


 


WHEREAS,
Indemnitee is a director or officer of the Corporation;


 


WHEREAS,
both the Corporation and Indemnitee recognize the increased risk of litigation
and other claims being asserted against directors and officers of public
companies in today’s environment and that competent and experienced individuals
are increasingly reluctant to serve or to continue to serve as directors or
officers of public corporations unless they are protected by comprehensive
liability insurance or indemnification, or both, due to such increased risk;


 


WHEREAS,
Section 145 of the Delaware General Corporation Law (“Section 145”),
under which the Corporation is organized, empowers the Corporation to indemnify
its directors and officers by agreement and to indemnify persons who serve, at
the request of the Corporation, as directors or officers, and expressly
provides that the indemnification provided by Section 145 is not
exclusive;


 


WHEREAS,
the By-Laws of the Corporation require the Corporation to indemnify and advance
expenses to its directors and officers to the full extent permitted by law and
the Indemnitee has agreed to serve as a director or officer of the Corporation
in part in reliance on such By-Laws;


 


WHEREAS,
the Corporation, after reasonable investigation, has determined that the
liability insurance coverage presently available to the Corporation may be
inadequate in certain circumstances to cover all possible exposure for which
Indemnitee should be protected, in the judgment of the Corporation, and the
Corporation is of the opinion that the best interests of the Corporation and
its stockholders would best be served by a combination of insurance and
indemnification from the Corporation;


 


WHEREAS,
in recognition of Indemnitee’s need for substantial protection against personal
liability in order to enhance Indemnitee’s continued service to the Corporation
in an effective manner and Indemnitee’s reliance on the aforesaid By-Laws, and
in part to provide Indemnitee with specific contractual assurance that the
protection promised by such By-Laws will be available to Indemnitee (regardless
of, among other things, any amendment to or revocation of such By-Laws or any
change in the composition of the Corporation’s Board of Directors or
acquisition transaction relating to the Corporation), the Corporation wishes to
provide in this Agreement for the indemnification of and the advancing of
expenses to Indemnitee to the full extent (whether partial or complete)
permitted by law and as set forth in this Agreement, and, to the extent
insurance is maintained, for the continued coverage of Indemnitee under the
Corporation’s directors’ and officers’ liability insurance policies;


 


NOW,
THEREFORE, in consideration of the premises set forth above, and the mutual
covenants and agreement set forth below, and of Indemnitee continuing to serve
the Corporation as a director or officer, and intending to be legally bound
hereby, the parties hereto agree as follows:


 


1.                                       Certain Definitions:


 


(a)                                  Change in Control: shall be deemed to have occurred if (i) any
“person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the Corporation
or a corporation owned directly or indirectly by the stockholders of the
Corporation in substantially the same proportions as their ownership of stock
of the Corporation, is or becomes the “beneficial owner” (as defined in Rule 13d-3
under said Act), directly or indirectly, of securities of the Corporation
representing 20% or more of the total voting power represented by the
Corporation’s then outstanding Voting Securities, or (ii) during any
period of two consecutive years, individuals who at the 


 

















 


beginning of such period
constitute the Board of Directors of the Corporation and any new director whose
election by the Board of Directors or nomination for election by the
Corporation’s stockholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were directors at
the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority thereof,
or (iii) the stockholders of the Corporation approve a merger or
consolidation of the Corporation with any other entity, other than a merger or
consolidation which would result in the Voting Securities of the Corporation
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities of the
surviving entity) at least 80% of the total voting power represented by the
Voting Securities of the Corporation or such surviving entity outstanding
immediately after such merger or consolidation, or the stockholders of the
Corporation approve a plan of complete liquidation of the Corporation or an
agreement for the sale or disposition by the Corporation (in one transaction or
a series of transactions) of all or substantially all of the Corporation’s
assets.


 


(b)                                 Corporate Capacity: shall mean Indemnitee’s status or
capacity as, or fact that Indemnitee is or was, a director, officer, employee,
agent or fiduciary of the Corporation, or is or was serving at the request of
the Corporation as a director, officer, employee, trustee, agent or fiduciary
of another Entity.


 


(c)                                  Entity: shall mean a corporation, partnership, limited
liability company, joint venture, employee benefit plan, trust or other
enterprise.  References herein to a
director of an Entity shall include, in the case of any Entity that is not
managed by a board of directors, such other position, such as manager or
trustee or member of the governing body of such Entity, that entails
responsibility for the management and direction of such Entity’s affairs,
including, without limitation, the general partner of any partnership (general
or limited) and the manager or managing member of any limited liability
company.


 


(d)                                 Expenses: include attorneys’ fees and all other costs,
expenses and obligations reasonably paid or incurred in connection with
investigating, defending, being a witness in or participating in (including on
appeal), or preparing to defend, be a witness in or participate in any
Proceeding for which indemnity is available under Section 2(a) hereof
or in connection with seeking recovery under any directors’ and officers’
liability insurance policies maintained by the Corporation.


 


(e)                                  Indemnifiable Event: any event or occurrence related to the
fact that Indemnitee is or was a director, officer, employee, agent or
fiduciary of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee, trustee, agent or fiduciary of
another Entity, or by reason of anything done or not done by Indemnitee in any
such capacity.


 


(f)                                    Proceeding: is any threatened, pending or completed action,
suit, arbitration, alternative dispute mechanism or proceeding, or any inquiry
or investigation (including an internal investigation), whether conducted by
the Corporation or any other party, that Indemnitee in good faith believes
might lead to the institution of any such action, suit or proceeding, whether
civil, criminal, administrative, investigative or other.


 


(g)                                 Reviewing Party: subject to Section 3 of this
Agreement, a committee or person consisting of a member or members of the
Corporation’s Board of Directors or any other person or body appointed by the
Board who is not a party to or affected by the particular claim for which
Indemnitee is seeking indemnification. 
If there has not been a Change in Control, the Reviewing Party shall be
selected by the Board of Directors (unless the Indemnitee is a director or
officer of the Corporation at the time of the determination of 


 


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entitlement to
indemnification contemplated by Section 3 of this Agreement, in which case
the Reviewing Party shall be determined as provided in Section 3), and if
there has been such a Change in Control, the Reviewing Party shall be special,
independent counsel selected by Indemnitee and approved by the Corporation
(which approval shall not be unreasonably withheld), and who has not otherwise
performed services for the Corporation or Indemnitee within the last 5 years
(other than in connection with such matters). Such counsel, among other things,
shall render its written opinion to the Corporation and Indemnitee as to
whether and to what extent the Indemnitee would be permitted to be indemnified
under applicable law. The Corporation agrees to pay the reasonable fees of such
special, independent counsel and to indemnify fully such counsel against any
and all expenses (including attorney’s fees), claims, liabilities and damages
arising out of or relating to this Agreement or its engagement pursuant hereto.


 


(h)                                 Voting Securities: any securities of the Corporation which
vote generally in the election of directors.


 


2.                                       Basic Indemnification Arrangement.


 


(a)                                  In the event Indemnitee was, is or becomes
a party to or witness or other participant in, or is threatened to be made a
party to or witness or other participant in a Proceeding by reason of (or
arising in part out of) the Indemnitee’s Corporate Capacity or an Indemnifiable
Event, the Corporation shall indemnify Indemnitee to the fullest extent
authorized by applicable law as soon as practicable but in any event no later
than thirty days (60 days if the Reviewing Party is special, independent
counsel) after written demand is presented to the Corporation, against any and
all Expenses, judgments, fines, penalties 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), paid or incurred in connection with such
Proceeding.  To the fullest extent
authorized by applicable law, if so requested by Indemnitee in writing, the
Corporation shall advance (within ten business days of such request) any and
all Expenses to Indemnitee in advance of the final disposition of a Proceeding
to which Indemnitee was, is or becomes a party to or in which Indemnitee was,
is or becomes a witness or other participant in, or to which Indemnitee is
threatened to be made a party to or witness or other participant in, by reason
of (or arising in part out of) the Indemnitee’s Corporate Capacity or an
Indemnifiable Event or in connection with seeking recovery under any directors’
and officers’ liability insurance policies maintained by the Corporation (an “Expense
Advance”).  An Expense Advance shall be
made only upon receipt of (1) an undertaking by or on behalf of the
Indemnitee to repay all amounts so advanced in the event that it shall
ultimately be determined in accordance with this Agreement, including Section 2(c) hereof,
that the Indemnitee is not entitled to be indemnified by the Corporation as
authorized in this Agreement and applicable law; and (2) satisfactory
evidence as to the amount of such Expenses. 
The Indemnitee’s written certification, together with a copy of the
statement paid or to be paid by the Indemnitee, shall constitute satisfactory
evidence of the amount of such Expenses.


 


(b)                                 Notwithstanding anything in this
Agreement to the contrary, prior to a Change in Control Indemnitee shall not be
entitled to indemnification or Expense Advance pursuant to this Agreement in
connection with any Proceeding, however denominated, initiated by Indemnitee
against the Corporation or any director or officer of the Corporation unless
the Corporation has joined in or consented to the initiation of such
Proceeding.


 


3.                                       Indemnification Determination: Any indemnification under this
agreement (unless ordered by a Court) shall be made by the Corporation only as
authorized in the specific case upon a determination by the Reviewing Party
that indemnification of the Indemnitee is proper in the circumstance because
Indemnitee has satisfied the standards of conduct set forth in Section 145
of the General Corporation Law of the State of Delaware and is otherwise
entitled to be indemnified pursuant to this Agreement and applicable law. The
Corporation agrees that all determinations of the right of Indemnitee to
indemnification under this 


 


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Agreement or any other
agreement, insurance policy, by-law or certificate of incorporation of the
Corporation and its predecessors shall be made by the Reviewing Party in a
writing delivered to the Corporation and the Indemnitee (and if the Reviewing
Party is special, independent counsel, in a written opinion delivered to the
Corporation and the Indemnitee).  If the
Reviewing Party determines that the Indemnitee is not entitled to
indemnification, then such writing (or opinion) shall disclose the bases for
such determination in reasonable detail. 
Notwithstanding anything in this Agreement to the contrary, if
Indemnitee is a director or officer of the Corporation at the time of the
determination contemplated by this Section 3, then to the extent required
by applicable law, the Reviewing Party that makes the determination of
entitlement to indemnification contemplated by this Section 3 shall be one
of the following: (i) if there has been a Change in Control, the Reviewing
Party shall be special, independent counsel selected in the manner provided in Section 1(g);
and (ii) if there has not been a Change in Control, the Reviewing Party
shall be (A) the directors who are not parties to the Proceeding in
connection with which Indemnification is sought, even though less than a quorum
of the Board of Directors, (B) a committee of such directors designated by
a majority vote of such directors, even though less than a quorum of the Board
of Directors, or (C) if there are no such directors, or if a majority of
such directors so direct, special, independent legal counsel who has not
otherwise performed services for the Corporation or Indemnitee within the last
5 years (other than in connection with such matters).  If there has been no determination by the
Reviewing Party within thirty days (60 days if the Reviewing Party is special,
independent counsel) after written demand for indemnification is presented to
the Corporation or if the Reviewing Party determines that Indemnitee is not
permitted to be indemnified in whole or in part under applicable law,
Indemnitee shall have the right to commence litigation in any court in the
State of Delaware having subject matter jurisdiction thereof and in which venue
is proper seeking a determination by the court or challenging any such
determination by the Reviewing Party or any aspect thereof, and the Corporation
hereby consents to service of process and to appear in any such proceeding.


 


4.             Indemnification for Expenses. To the fullest
extent permitted by applicable law, the Corporation shall indemnify Indemnitee
against any and all Expenses.


 


5.             Partial Indemnity, Etc. If Indemnitee is entitled
under any provision of this Agreement to indemnification by the Corporation for
some or a portion of the Expenses, judgments, fines, penalties and amounts paid
in settlement of a Proceeding but not, however, for all of the total amount
thereof, the Corporation shall nevertheless indemnify Indemnitee for the
portion thereof to which Indemnitee is entitled. Moreover, notwithstanding any
other provision of this Agreement, to the extent that Indemnitee has been
successful on the merits or otherwise in defense of any or all Proceedings
relating in whole or in part to an Indemnifiable Event or Indemnitee’s
Corporate Capacity or in defense of any issue or matter therein, including
dismissal without prejudice, Indemnitee shall be indemnified against all
Expenses incurred in connection therewith. In connection with any determination
by the Reviewing Party or otherwise as to whether Indemnitee is entitled to be
indemnified hereunder the burden of proof shall be on the Corporation to
establish that Indemnitee is not so entitled.


 


6.             No Presumption. For purposes of this Agreement,
the termination of any claim, action, suit or 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.


 


7.             Non-exclusivity, Etc. The rights of the
Indemnitee hereunder shall be in addition to any other rights Indemnitee may
have under the Corporation’s Certificate of Incorporation or By-Laws, the
Delaware General Corporation Law, a vote of stockholders, a resolution of
directors, or otherwise. To the extent that a change in the Delaware General
Corporation Law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the
Corporation’s By-Laws and this Agreement, it is the intent of the parties
hereto that Indemnitee shall enjoy by this Agreement the greater benefits so
afforded by such change.   But no
amendment or alteration of the Corporation’s Certificate of Incorporation or
By-Laws or any other agreement shall adversely affect the rights provided to
Indemnitee hereunder.


 


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8.             Liability Insurance. To the extent the Corporation
maintains an insurance policy or policies providing directors’ and officers’
liability insurance, Indemnitee shall be covered by such policy or policies, in
accordance with its or their terms, to the maximum extent of the coverage
available for any Corporation director or officer.  If, at the time of the receipt of a notice of
a claim pursuant to the terms hereof, the Corporation has director and officer
liability insurance in effect, the Corporation shall give prompt notice of such
claim or of the commencement of a proceeding, as the case may be, to the
insurers in accordance with the procedures set forth in the respective
policies.  The Corporation shall
thereafter take all necessary or desirable action to cause such insurers to
pay, on behalf of the Indemnitee, all amounts payable as a result of such
proceeding in accordance with the terms of such policies.  This Agreement shall not limit the Indemnitee’s
rights under any direct of so-called “Side A” coverages available to the
Indemnitee.


 


9.             Period of Limitations. No legal action shall be
brought and no cause of action shall be asserted by or on behalf of the
Corporation or any affiliate of the Corporation against Indemnitee, Indemnitee’s
spouse, heirs, executors or personal or legal representatives after the
expiration of two years from the date of accrual of such cause of action, and
any claim or cause of action of the Corporation or its affiliate shall be
extinguished and deemed released unless asserted by the timely filing of a
legal action within such two-year period; provided, however, that if any
shorter period of limitations is otherwise applicable to any such cause of
action such shorter period shall govern.


 


10.           No Modification. This
Agreement supersedes any prior indemnification agreement between Indemnitee and
the Corporation or its predecessors (but not any indemnification provision
contained in any by-law or certificate of incorporation of any of the
foregoing).  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.


 


11.           Subrogation. In the event of
payment under this Agreement, the Corporation 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 reasonably necessary to
secure such rights, including the execution of such documents necessary to
enable the Corporation effectively to bring suit to enforce such rights.


 


12.           No Duplication of Payments.
The Corporation 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,
certificate of incorporation, other indemnity provision, or otherwise) of the
amounts otherwise indemnifiable hereunder.


 


13.           Binding Effect, Etc. This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors, assigns, including any
direct or indirect successor by purchase, merger, consolidation or otherwise to
all or substantially all of the business and/or assets of the Corporation,
spouses, heirs, and personal and legal representatives. The Corporation shall
require and cause any successor (whether direct or indirect by purchase,
merger, consolidation or otherwise) to all, substantially all, or a substantial
part, of the business and/or assets of the Corporation, by written agreement in
form and substance satisfactory to the Indemnitee, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent that
the Corporation would be required to perform if no such succession had taken
place. This Agreement shall continue in effect regardless of whether Indemnitee
continues to serve as a director or officer of the Corporation or of any other
enterprise at the Corporation’s request.


 


14.           Severability. The provisions
of this Agreement shall be severable in the event that any of the provisions
hereof (including any provision within a single section, paragraph or sentence)
are held by a court of competent jurisdiction to be invalid, void or otherwise
unenforceable, and the remaining provisions shall remain enforceable to the
fullest extent permitted by law.


 


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15.           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.  Indemnitee is specifically authorized to
bring suit in the event of any determination by any person that indemnification
is not available to the Indemnitee hereunder or that Indemnitee will not be
entitled to an Expense Advance, if a payment owed to Indemnitee has not been
made in a timely manner, or if there is any other breach of the Agreement.  For purposes of any action or proceeding
arising out of or in connection with this Agreement, the Indemnitee agrees to (i) the
exclusive jurisdiction of the Chancery Court of the State of Delaware (the “Delaware
Court”), and not in any other state or federal court in the United States of
America or any court in any other country, (ii) waive any objection to the
laying of venue of any such action or proceeding in the Delaware Court and (iii) waive
any claim that any such action or proceeding brought in the Delaware Court has
been brought in an improper or inconvenient forum.


 


IN
WITNESS WHEREOF, the Corporation has duly executed and delivered this Agreement
as of the date first above written.


 


	
   

  	
   

  	
  Walter
  Industries, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Accepted
  and agreed

  	
   

  	
   

  
	
  as
  of the date first written above:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  [Name
  of Director or Officer]

  	
   

  	
   

  



 


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