Document:

exv10w15

 

 Execution Copy

OMNIBUS AGREEMENT

     THIS OMNIBUS AGREEMENT (“Agreement”) is entered into on, and effective as of, the
Closing Date, by and among Atlas Pipeline Holdings, L.P. (“Holdings”), a Delaware limited
partnership, Atlas Pipeline Holdings GP, LLC, a Delaware limited liability company (the
“Holdings GP”), and Atlas Pipeline Partners, L.P., a Delaware limited partnership (the
“MLP”).

     In consideration of the premises and the covenants, conditions, and agreements contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Definitions.

     (a) Capitalized terms used herein but not defined herein shall have the meanings given them in
the MLP Agreement.

     (b) As used in this Agreement, the following terms shall have the respective meanings set
forth below:

     “Closing Date” shall mean the closing of the initial public offering of common
units representing limited partner interests in Atlas Pipeline Holdings, L.P.

     “Holdings Conflicts Committee” shall mean the “Conflicts Committee” as defined
in the Amended and Restated Agreement of Limited Partnership of Holdings.

     “Holdings Entities” shall mean Holdings and Holdings GP.

     “MLP Agreement” shall mean the Second Amended and Restated Agreement of Limited
Partnership of the MLP, dated as of March 9, 2004, as the same may be amended.

     “MLP Conflicts Committee” shall mean the “Conflicts Committee” as defined in
the MLP Agreement.

     “MLP Entities” shall mean the MLP and any of its subsidiaries.

     “MLP Group” shall mean the MLP and all of its subsidiaries.

ARTICLE II

BUSINESS OPPORTUNITIES

     Section 2.1 Restricted Businesses. For as long as Holdings or any of its subsidiaries is the general partner of the MLP, if a
Holdings Entity is presented with an

 

 

opportunity to pursue, purchase or invest in any business
opportunity (a “Business Opportunity”) with respect to a business activity in which the MLP
is engaged as of the Closing Date (a “Restricted Business”), the Holdings Entity shall give
prompt written notice to the MLP of the Business Opportunity. Such notice shall set forth all
information available to the Holdings Entity including, but not limited to, the identity of the
Business Opportunity and its seller, the proposed price, all written information about the Business
Opportunity provided to the Holdings Entity by and on behalf of the seller as well as any
information or analyses compiled by the Holdings Entity from other sources (such information
referred to collectively herein as “Business Opportunity Information”). The Holdings
Entity shall continue to provide to the MLP promptly any and all Business Opportunity Information
subsequently received. Within a time period specified by the Holdings Entity’s notice, which shall
be a reasonable time under the circumstances, the MLP shall advise the Holdings Entity in writing
whether MLP wishes to acquire the Business Opportunity. If the MLP advises the Holdings Entity of
its intent to acquire the Business Opportunity, the Holdings Entities shall refrain from making an
offer for the Business Opportunity except as permitted hereunder. If the MLP (i) advises the
Holdings Entity that (with the approval of the MLP Conflicts Committee) it does not intend to
acquire the Business Opportunity, (ii) advises the Holdings Entity of its intent to acquire the
Business Opportunity but does not complete the acquisition within a reasonable time after the MLP’s
notice of its intent to the Holdings Entity or (iii) fails to timely advise the Holdings Entity of
its intent, any of the Holdings Entities shall be free to acquire the Business Opportunity.

     Section 2.2 Scope of Restricted Business Prohibition. Except as provided in this
Article II and the Amended and Restated Agreement of Limited Partnership of Holdings, as
the same may be amended from time to time, each Holdings Entity shall be free to engage in any
business activity whatsoever, including those that may be in direct competition with any MLP
Entity.

     Section 2.3 Enforcement. The Holdings Entities agree and acknowledge that the MLP Group
does not have an adequate remedy at law for the breach by the Holdings Entities of the covenants
and agreements set forth in this Article II, and that any breach by the Holdings Entities
of the covenants and agreements set forth in Article II would result in irreparable injury
to the MLP Group. The Holdings Entities further agree and acknowledge that any member of the MLP
Group may, in addition to the other remedies which may be available to the MLP Group hereunder or
under applicable law, file a suit in equity to enjoin the Holdings Entities from such breach, and
the Holdings Entities consent to the issuance of injunctive relief hereunder.

ARTICLE III

MISCELLANEOUS

     Section 3.1 Choice of Law; Submission to Jurisdiction. This Agreement shall be subject to and governed by the laws of the State of Delaware, excluding
any conflicts-of-law rule or principle that might refer the construction or interpretation of this
Agreement to the laws of another state.

     Section 3.2 Notice. All notices or requests or consents provided for or permitted to be
given pursuant to this Agreement must be in writing and must be given by depositing same in the
United States mail, addressed to the Person to be notified, postpaid, and registered or

2

 

certified
with return receipt requested or by delivering such notice in person or by telecopier or telegram
to such party. Notice given by personal delivery or mail shall be effective upon actual receipt.
Notice given by telegram or telecopier shall be effective upon actual receipt if received during
the recipient’s normal business hours, or at the beginning of the recipient’s next business day
after receipt if not received during the recipient’s normal business hours. All notices to be sent
to a party pursuant to this Agreement shall be sent to or made at the address set forth below such
party’s signature to this Agreement, or at such other address as such party may stipulate to the
other parties in the manner provided in this Section 3.2.

     Section 3.3 Entire Agreement; Supersedure. This Agreement constitutes the entire agreement
of the parties relating to the matters contained herein, superseding all prior contracts or
agreements, whether oral or written, relating to the matters contained herein.

     Section 3.4 Effect of Waiver or Consent. No waiver or consent, express or implied, by any
party to or of any breach or default by any Person in the performance by such Person of its
obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other
breach or default in the performance by such Person of the same or any other obligations of such
Person hereunder. Failure on the part of a party to complain of any act of any Person or to declare
any Person in default, irrespective of how long such failure continues, shall not constitute a
waiver by such party of its rights hereunder until the applicable statute of limitations period has
run.

     Section 3.5 Amendment or Modification. This Agreement may be amended or modified from time
to time only by the written agreement of all the parties hereto; provided, however, that (i) the
MLP may not, without the prior approval of the MLP Conflicts Committee, agree to any amendment or
modification of this Agreement that, in the reasonable discretion of Atlas Pipeline Partners GP,
LLC, will adversely affect the holders of MLP common units; and (ii) Holdings may not, without the
prior approval of the Holdings Conflicts Committee, agree to any amendment or modification of this
Agreement that, in the reasonable discretion of Holdings, will adversely affect the holders of
Holdings common units. Each such instrument shall be reduced to writing and shall be designated on
its face an “Amendment” or an “Addendum” to this Agreement.

     Section 3.6 Assignment. No Party shall have the right to assign its rights or obligations under this Agreement without
the consent of the other parties hereto.

     Section 3.7 Counterparts. This Agreement may be executed in any number of counterparts with
the same effect as if all Parties had signed the same document. All counterparts shall be construed
together and shall constitute one and the same instrument.

     Section 3.8 Severability. If any provision of this agreement or the application thereof to
any person or circumstance shall be held invalid or unenforceable to any extent, the remainder of
this agreement and the application of such provision to other persons or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by law.

3

 

     Section 3.9 Gender, Parts, Articles and Sections. Whenever the context requires, the gender
of all words used in this Agreement shall include the masculine, feminine and neuter, and the
number of all words shall include the singular and plural. All references to Article numbers and
Section numbers refer to Parts, Articles and Sections of this Agreement, unless the context
otherwise requires.

     Section 3.10 Further Assurances. In connection with this Agreement and all transactions
contemplated by this Agreement, each Party hereto agrees to execute and deliver such additional
documents and instruments and to perform such additional acts as may be necessary or appropriate to
effectuate, carry out and perform all of the terms, provisions and conditions of this Agreement and
all such transactions.

     Section 3.11 Laws and Regulations. Notwithstanding any provision of this Agreement to the
contrary, no Party hereto shall be required to take any act, or fail to take any act, under this
Agreement if the effect thereof would be to cause such Party to be in violation of any applicable
law, statute, rule or regulation.

     Section 3.12 Negation of Rights of Limited Partners, Assignees, and Third Parties. The
provisions of this Agreement are enforceable solely by the parties to this Agreement, and no
limited partner, assignee or other Person shall have the right, separate and apart from the MLP or
Holdings, to enforce any provision of this Agreement or to compel any Party to this Agreement to
comply with the terms of this Agreement.

{Signature Page Follows}

4

 

     IN WITNESS WHEREOF, the parties have executed this Agreement on, and effective as of, the
Closing Date.

	 	 	 	 	 	 	 	 	 
	 	 	ATLAS PIPELINE HOLDINGS, L.P.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ATLAS PIPELINE HOLDINGS GP, LLC,

its general partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Address for Notice:	 	311 Rouser Road

Moon Township, PA 15108	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Telecopy Number:	 	(412) 262-4613	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ATLAS PIPELINE HOLDINGS GP, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Address for Notice:	 	311 Rouser Road

Moon Township, PA 15108	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Telecopy Number:	 	(412) 262-4613	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ATLAS PIPELINE PARTNERS, L.P.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ATLAS PIPELINE PARTNERS GP, LLC,

its general partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Address for Notice:	 	311 Rouser Road

Moon Township, PA 15108	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Telecopy Number:	 	(412) 262-4613	 	 

{Signature
Page to Omnibus Agreement}Exhibit 10.1 to MTS Systems Corporation Form 8-K dated August 29, 2006

Exhibit 10.1

 

INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement
is made and executed this ________ day of___________, 2006, by and between MTS Systems Corporation, a Minnesota corporation (the
“Company”), and __________________, an individual resident of the State of ______________ (the
“Indemnitee”).

 

RECITALS

 

WHEREAS, the
Company is aware that, in order to induce highly competent persons to serve the Company as directors or officers or in other
capacities, the Company must provide such persons with adequate protection through insurance and indemnification against
inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the
Company;

 

WHEREAS, the
Company recognizes that the increasing difficulty in obtaining directors’ and officers’ liability insurance, the
increases in the cost of such insurance and the general reductions in the coverage of such insurance have increased the difficulty
of attracting and retaining such persons;

 

WHEREAS, the
Board of Directors of the Company (the “Board of Directors”)has determined that it is essential to the best interests of
the Company’s shareholders that the Company act to assure such persons that there will be increased certainty of such
protection in the future;

 

WHEREAS, it
is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify such persons to the fullest
extent permitted by applicable law so that they will continue to serve the Company free from undue concern that they will not be
so indemnified; and

 

WHEREAS, the
Indemnitee is willing to serve, continue to serve, and take on additional service for or on behalf of the Company on the condition
that the Indemnitee be so indemnified.

 

AGREEMENT

 

NOW, THEREFORE, in
consideration of the premises and the mutual promises and covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Indemnitee do hereby agree as
follows:

 

	
             
 	
            1.
 	
            Definitions.   For purposes of this Agreement:
 

 

 (a)         “Change of 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 Company or a corporation owned directly or indirectly by the shareholders
of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the
“beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company
representing 20% or more of the total voting power represented by the Company’s then outstanding securities of the Company
which vote generally in the election of directors (“Voting Securities”), or (ii) during any period of two consecutive
years, individuals who at the beginning of such period constitute the Board of Directors and any new director whose election by
the Board of Directors or nomination for election by the Company’s shareholders 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
shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or
consolidation which would result in the Voting Securities of the Company 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 Company or such surviving entity outstanding immediately after
such merger or consolidation, or the shareholders of the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of (in one transaction or a series of transactions) all or substantially all
the Company’s assets.

 

 (b)         “Disinterested
Director” shall mean a director of the Company who is not at the time a party to the action, suit, investigation or
proceeding in respect of which indemnification is being sought by the Indemnitee.

 

 (c)         “Expenses”
shall include all attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or
expenses incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating or being or preparing
to be a witness in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or
investigative in nature.

 

 (d)         “Special
Legal Counsel” shall mean a law firm or a member of a law firm that neither is presently nor in the past five years has been
retained to represent (i) the Company or the Indemnitee in any matter material to either such party or (ii) any other party to the
action, suit, investigation or proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the
term “Special Legal 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 the Indemnitee in an action to determine
the Indemnitee’s right to indemnification under this Agreement. “Special Legal Counsel” will be selected either by
(a) a majority of a quorum of the Board of Directors, with only Disinterested Directors counted for determining both a majority
and a quorum or (b) by a majority of a committee of the Board of Directors, consisting solely of two or more Disinterested
Directors, duly designated to act in the matter by a majority of the full Board of Directors including directors who are parties
to such action, suit, investigation or proceeding. If “Special 

2

Legal Counsel” cannot be selected by the
method prescribed in clause (a) or (b), then “Special Legal Counsel” will be selected by a majority of the full board
including directors who are parties.

 

2.           Service
by the Indemnitee.   The Indemnitee agrees to serve and/or continue to serve as a director
and/or officer of the Company faithfully and will discharge the Indemnitee’s duties and responsibilities to the best of the
Indemnitee’s ability so long as the Indemnitee is duly elected or qualified in accordance with the provisions of the Articles
of Incorporation (as may be amended from time to time, the “Articles”), and Bylaws (as may be amended from time to time,
the “Bylaws”) of the Company, the Minnesota Business Corporation Act, as amended (the “MBCA”) and any other
applicable law in effect on the date of this agreement and from time to time, or until the Indemnitee’s earlier death,
resignation or removal. The Indemnitee may at any time and for any reason resign from such position (subject to any other
contractual obligation or other obligation imposed by operation by law), in which event the Company shall have no obligation under
this Agreement to continue the employment or directorship of the Indemnitee. Nothing in this Agreement shall confer upon the
Indemnitee the right to continue in the employ of the Company or as a director of the Company or affect the right of the Company
to terminate the Indemnitee’s employment at any time in the sole discretion of the Company, with or without cause, subject to
any contract rights of the Indemnitee created or existing otherwise than under this Agreement.

 

3.          Indemnification.   The
Company shall indemnify the Indemnitee against all Expenses, judgments, penalties (including excise and similar taxes), fines and
amounts paid in settlement actually and reasonably incurred by the Indemnitee as provided in this Agreement to the fullest extent
permitted by the Articles, Bylaws and MBCA or other applicable law in effect on the date of this Agreement and to any greater
extent that applicable law may in the future from time to time permit. Without diminishing the scope of the indemnification
provided by this Section 3, the rights of indemnification of the Indemnitee provided hereunder shall include, but shall not be
limited to, those rights hereinafter set forth. 

 

4.          Actions
or Proceedings in an Official Capacity.   The Indemnitee shall be entitled to the
indemnification rights provided in this Agreement if the Indemnitee was or is a party or is threatened to be a party to any
threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative in nature,
by reason of the fact that the Indemnitee is or was a director, member of a committee of directors, officer, employee, agent or
fiduciary of the Company, or is or was serving at the request of the Company, or whose duties to the Company involve or involved
service, as a director, officer, partner, trustee, governor, manager, employee, agent or fiduciary of any other entity, including,
but not limited to, another corporation, partnership, limited liability company, employee benefit plan, joint venture, trust or
other enterprise, or by reason of any act or omission by the Indemnitee in such capacity. The Indemnitee shall be indemnified
against all Expenses, judgments, penalties (including excise and similar taxes), fines and amounts paid in settlement which were
actually and reasonably incurred by the Indemnitee in connection with such action, suit or proceeding (including, but not limited
to, the investigation, defense or appeal thereof), if the Indemnitee acted in good faith and in a manner the Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company. If the person’s acts or omissions complained of in the
proceeding relate to conduct as 

3

a director, officer, trustee, employee or agent of
an employee benefit plan, the conduct is not considered to be opposed to the best interests of the Company if the person
reasonably believed that the conduct was in the best interests of the participants or beneficiaries of the employee benefit
plan.

 

5.          Good
Faith Definition.   For purposes of this Agreement, the Indemnitee shall be deemed to have
acted in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any action as a director, officer, trustee, employee or agent of an employee benefit plan, the
Indemnitee shall be deemed to have acted in good faith and in a manner that the Indemnitee reasonably believed to be in the best
interests of the participants or beneficiaries of the employee benefit plan, if such action was based on a reasonable reliance
upon (i) the records or books of the accounts of the Company or other enterprise, including financial statements; (ii) information
supplied to the Indemnitee by the officers of the Company or other enterprise in the course of their duties; (iii) the advice of
legal counsel for the Company or other enterprise; (iv) information or records given in reports made to the Company or other
enterprise by an independent registered public accounting firm or by an appraiser or other expert selected with reasonable care by
the Company or other enterprise; or (v) a committee of the Board which Indemnitee is not a member if Indemnitee reasonably
believes such committee merits confidence.

 

6.            Indemnification
for Expenses of a Witness.   Notwithstanding the other provisions of this Agreement, to the
extent that the Indemnitee has served on behalf of the Company as a witness or other participant in any class action or
proceeding, the Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by the Indemnitee in
connection therewith except as provided in Section 3, regardless of whether or not the Indemnitee has met the applicable standards
of Section 4 and without any determination pursuant to Section 8.

 

7.           Partial
Indemnification.   If the Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of the Expenses, judgments, penalties (including excise and similar taxes),
fines and amounts paid in settlement actually and reasonably incurred by the Indemnitee in connection with the investigation,
defense, appeal or settlement of such suit, action, investigation or proceeding described in Section 4 hereof, but is not entitled
to indemnification for the total amount thereof, the Company shall nevertheless indemnify the Indemnitee for the portion of such
Expenses, judgments, penalties (including excise and similar taxes), fines and amounts paid in settlement actually and reasonably
incurred by the Indemnitee to which the Indemnitee is entitled.

 

	
             
 	
            8.
 	
            Procedure for Determination of Entitlement to Indemnification.
 

 

 (a)         To
obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request, including documentation and
information that is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent
Indemnitee is entitled to indemnification. The Secretary of the Company shall, promptly upon receipt of a request for
indemnification, advise the Board of Directors in writing that Indemnitee has requested indemnification. Any Expenses incurred by
the Indemnitee in connection with the 

4

Indemnitee’s request for indemnification
hereunder shall be borne by the Company. The Company hereby indemnifies and agrees to hold the Indemnitee harmless for any
Expenses incurred by Indemnitee under the immediately preceding sentence irrespective of the outcome of the determination of the
Indemnitee’s entitlement to indemnification.

 

 (b)         Upon
written request by the Indemnitee for indemnification pursuant to Section 3 hereof, the entitlement of the Indemnitee to
indemnification pursuant to the terms of this Agreement shall be determined by the following person or persons, who shall be
empowered to make such determination: (i) by the Board of Directors by a majority of a quorum, with only Disinterested Directors
(as hereinafter defined) counted for determining both a majority and a quorum; (ii) if a quorum cannot be obtained under clause
(i), by a majority of a committee of the Board of Directors, consisting solely of two or more Disinterested Directors, duly
designated to act in the matter by a majority of the full Board of Directors including the directors who are parties to such
action, suit, investigation or proceeding; (iii) if a determination is not made under clause (i) or (ii) or in the event of a
Change of Control, by Special Legal Counsel; or (iv) if a determination is not made under clause (i), (ii) or (iii), by the
affirmative vote of a majority of the shareholders of the Company, with the shares held by parties to the proceeding not counted
for purposes of determining a quorum and not entitled to vote on the determination. If the person making such determination shall
determine that the Indemnitee is entitled to indemnification as to part (but not all) of the application for indemnification, such
person shall reasonably prorate such part of indemnification among such claims, issues or matters. If it is so determined that
Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten days after such
determination.

 

	
             
 	
            9.
 	
            Presumptions and Effect of Certain Proceedings.
 

 

 (a)         In
making a determination with respect to entitlement to indemnification, the Indemnitee shall be presumed to be entitled to
indemnification hereunder and the Company shall have the burden of proof in the making of any determination contrary to such
presumption.

 

 (b)         If
the Board of Directors, or such other person or persons empowered pursuant to Section 8 to make the determination of whether
Indemnitee is entitled to indemnification, shall have failed to make a determination as to entitlement to indemnification within
60 days after (1) the later of the termination of a proceeding or a written request for indemnification to the Company or (2) a
written request for an advance of expenses, a Minnesota court may make the determination of whether Indemnitee is entitled to
indemnification. In such a case, the Indemnitee would have the burden of establishing the Indemnitee’s entitlement to
indemnification. The termination of any action, suit, investigation or proceeding described in Section 3 hereof by judgment,
order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself: (a) create a
presumption that the Indemnitee did not act in good faith and in a manner which the Indemnitee reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any action as a director, officer, trustee, employee or agent
of an employee benefit plan, that the Indemnitee did not act in good faith and in a manner that the Indemnitee reasonably believed
to be in the best interests of the participants or beneficiaries of the employee benefit plan; or (b) otherwise adversely affect
the rights of the Indemnitee to indemnification, except as may be provided herein.

5

	
             
 	
            10.
 	
            Contribution.   Subject to applicable law:
 

 

 (a)         If
the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason, the Company, in lieu of
indemnifying Indemnitee, shall contribute to the amount of expenses incurred by Indemnitee (including attorneys’ fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred and paid or payable by Indemnitee in connection
with any claim described in Sections 3 through 7, in such proportion as is deemed fair and reasonable in light of all of the
circumstances to reflect the relative benefits received by the Company and all officers, directors or employees of the Company,
other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the
one hand, and Indemnitee, on the other hand, from the transaction from which such action, suit or proceeding arose; provided,
however, that the proportion determined on the basis of relative benefit may, to the extent necessary to conform to law, be
further adjusted by reference to the relative fault of the Company and all officers, directors or employees of the Company other
than Indemnitee who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one
hand, and Indemnitee, on the other hand, in connection with the events that resulted in such expenses, judgments, fines or
settlement amounts, as well as any other equitable considerations which the law may require to be considered. The relative fault
of the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with
Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, shall
be determined by reference to, among other things, the degree to which their actions were motivated by intent to gain personal
profit or advantage, the degree to which their liability is primary or secondary and the degree to which their conduct is active
or passive.

 

 (b)         The
Company hereby agrees to fully indemnify and hold Indemnitee harmless from any claims of contribution which may be brought by
officers, directors or employees of the Company, other than Indemnitee, who may be jointly liable with Indemnitee.

 

11.        Advancement
of Expenses.   All reasonable Expenses actually incurred by the Indemnitee in connection
with any threatened or pending action, suit or proceeding shall be paid by the Company in advance of the final disposition of such
action, suit or proceeding, if so requested by the Indemnitee, within 10 days after (a) the receipt by the Company of a statement
or statements from the Indemnitee requesting such advance or advances; and (b) a determination that the facts then known to those
making the determination would not preclude indemnification under this Agreement. The Indemnitee may submit such statements from
time to time. The Indemnitee’s entitlement to such Expenses shall include those incurred in connection with any proceeding by
the Indemnitee seeking an adjudication or award in arbitration pursuant to this Agreement. Such statement or statements shall
reasonably evidence the Expenses incurred by the Indemnitee in connection therewith and shall include or be accompanied by a
written affirmation by Indemnitee of Indemnitee’s good faith belief that Indemnitee has met the standard of conduct necessary
for indemnification under this Agreement and an undertaking by or on behalf of the Indemnitee to repay such amount if it is
ultimately determined that the Indemnitee is not entitled to be indemnified against such Expenses by the Company pursuant to this
Agreement or otherwise. Each written undertaking to pay amounts advanced must be an unlimited general 

6

obligation but need not be secured, and shall be
accepted without reference to financial ability to make repayment.

 

12.        Remedies
of the Indemnitee in Cases of Determination not to Indemnify or to Advance Expenses.   In
the event that a determination is made hereunder that the Indemnitee is not entitled to indemnification hereunder or if the
payment has not been timely made following a determination of entitlement to indemnification pursuant to Sections 8 and 9, or if
Expenses are not advanced pursuant to Section 11, the Indemnitee shall be entitled to a final adjudication in an appropriate court
of the State of Minnesota or any other court of competent jurisdiction of the Indemnitee’s entitlement to such
indemnification or advance. The Company shall not unreasonably oppose the Indemnitee’s right to seek any such adjudication or
any other claim. Such judicial proceeding shall be made de novo, and the Indemnitee
shall not be prejudiced by reason of a determination (if so made) that the Indemnitee is not entitled to indemnification. If a
determination is made or deemed to have been made pursuant to the terms of Section 8 or Section 9 hereof that the Indemnitee is
entitled to indemnification, the Company shall be bound by such determination and shall be precluded from asserting that such
determination has not been made or that the procedure by which such determination was made is not valid, binding and enforceable.
The Company further agrees to stipulate in any such court or before any such arbitrator that the Company is bound by all the
provisions of this Agreement and is precluded from making any assertions to the contrary. If the court shall determine that the
Indemnitee is entitled to any indemnification hereunder, the Company shall pay all reasonable Expenses actually incurred by the
Indemnitee in connection with such adjudication (including, but not limited to, any appellate proceedings).

 

13.        Notification
and Defense of Claim.   Promptly after receipt by the Indemnitee of notice of the
commencement of any action, suit or proceeding, the Indemnitee will, if a claim in respect thereof is to be made against the
Company under this Agreement, notify the Company in writing of the commencement thereof; but the omission to so notify the Company
will not relieve the Company from any liability that it may have to the Indemnitee otherwise than under this Agreement or
otherwise, except to the extent that the Company may suffer material prejudice by reason of such failure. Notwithstanding any
other provision of this Agreement, with respect to any such action, suit or proceeding as to which the Indemnitee gives notice to
the Company of the commencement thereof:

 

	
             
 	
            (a)
 	
The Company will be
entitled to participate therein at its own expense.
 

 

 (b)         Except
as otherwise provided in this Section 13(b), to the extent that it may wish, the Company, jointly with any other indemnifying
party similarly notified, shall be entitled to assume the defense thereof with counsel reasonably satisfactory to the Indemnitee.
After notice from the Company to the Indemnitee of its election to so assume the defense thereof, the Company shall not be liable
to the Indemnitee under this Agreement for any legal or other Expenses subsequently incurred by the Indemnitee in connection with
the defense thereof other than reasonable costs of investigation or as otherwise provided below. The Indemnitee shall have the
right to employ the Indemnitee’s own counsel in such action or lawsuit, but the fees and Expenses of such counsel incurred
after notice from the Company of its assumption of the defense thereof shall be at the expense of the Indemnitee unless (i) the
employment of 

7

counsel by the Indemnitee has been authorized in
writing by the Company, (ii) the Indemnitee shall have reasonably concluded that there may be a conflict of interest between the
Company and the Indemnitee in the conduct of the defense of such action and such determination by the Indemnitee shall be
supported by an opinion of counsel, which opinion shall be reasonably acceptable to the Company, or (iii) the Company shall not in
fact have employed counsel to assume the defense of the action, in each of which cases the fees and Expenses of counsel shall be
at the expense of the Company. The Company shall not be entitled to assume the defense of any action, suit or proceeding brought
by or on behalf of the Company or as to which the Indemnitee shall have reached the conclusion provided for in clause (ii)
above.

 

 (c)         The
Company shall not be liable to indemnify the Indemnitee under this Agreement for any amounts paid in settlement of any action or
claim effected without its written consent, which consent shall not be unreasonably withheld. The Company shall not be required to
obtain the consent of Indemnitee to settle any action or claim which the Company has undertaken to defend if the Company assumes
full and sole responsibility for such settlement and such settlement grants Indemnitee a complete and unqualified release in
respect of potential liability.

 

 (d)         If,
at the time of the receipt of a notice of a claim pursuant to this Section 13, the Company has director and officer liability
insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance
with the procedures set forth in the respective policies. The Company 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 the policies.

 

14.        Other
Right to Indemnification.   The indemnification and advancement of Expenses provided by
this Agreement are cumulative, and not exclusive, and are in addition to any other rights to which the Indemnitee may now or in
the future be entitled under any provision of the Bylaws or Articles of the Company, any vote of shareholders or the Board of
Directors, any provision of law or otherwise. Except as required by applicable law, the Company shall not adopt any amendment to
its Bylaws or Articles the effect of which would be to deny, diminish or encumber the Indemnitee’s right to indemnification
under this Agreement.

 

15.        Director
and Officer Liability Insurance.   The Company shall maintain directors’ and
officers’ liability insurance for so long as Indemnitees’ services are covered hereunder, provided and to the extent
that such insurance is available on a commercially reasonable basis. In the event the Company maintains directors’ and
officers’ liability insurance, the Indemnitee shall be named as an insured in such manner as to provide the Indemnitee the
same rights and benefits as are accorded to the most favorably insured of the Company’s officers or directors. However, the
Company agrees that the provisions hereof shall remain in effect regardless of whether liability or other insurance coverage is at
any time obtained or retained by the Company; except that any payments made to, or on behalf of, the Indemnitee under an insurance
policy shall reduce the obligations of the Company hereunder.

 

16.        Spousal
Indemnification.   The Company will indemnify the Indemnitee’s spouse to whom the
Indemnitee is legally married at any time the Indemnitee is covered under the 

8

indemnification provided in this Agreement (even if
Indemnitee did not remain married during the entire period of coverage) against any pending or threatened action, suit, proceeding
or investigation for the same period, to the same extent and subject to the same standards, limitations, obligations and
conditions under which the Indemnitee is provided indemnification herein, if the Indemnitee’s spouse (or former spouse)
becomes involved in a pending or threatened action, suit, proceeding or investigation solely by reason of status as
Indemnitee’s spouse, including, without limitation, any pending or threatened action, suit, proceeding or investigation that
seeks damages recoverable from marital community property, jointly-owned property or property purported to have been transferred
from the Indemnitee to the Indemnitee’s spouse (or former spouse). The Indemnitee’s spouse or former spouse also may be
entitled to advancement of Expenses to the same extent that Indemnitee is entitled to advancement of Expenses herein. The Company
may maintain insurance to cover its obligation hereunder with respect to Indemnitee’s spouse (or former spouse) or set aside
assets in a trust or escrow fund for that purpose.

 

17.        Intent.   This
Agreement shall be in addition to any other rights Indemnitee may have under the Company’s Articles, Bylaws, applicable law
or otherwise. To the extent that a change in applicable law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the Company’s Articles, Bylaws, applicable law or this
Agreement, it is the intent of the parties that Indemnitee enjoy by this Agreement the greater benefits so afforded by such
change.

 

18.        Attorney’s
Fees and Other Expenses to Enforce Agreement.   In the event that the Indemnitee is subject
to or intervenes in any proceeding in which the validity or enforceability of this Agreement is at issue or seeks an adjudication
or award in arbitration to enforce the Indemnitee’s rights under, or to recover damages for breach of, this Agreement the
Indemnitee, if the Indemnitee prevails in whole or in part in such action, shall be entitled to recover from the Company and shall
be indemnified by the Company against any actual expenses for attorneys’ fees and disbursements reasonably incurred by the
Indemnitee.

 

19.        Effective
Date.   The provisions of this Agreement shall cover claims, actions, suits or proceedings
whether now pending or hereafter commenced and shall be retroactive to cover acts or omissions or alleged acts or omissions which
heretofore have taken place. The Company shall be liable under this Agreement, pursuant to Section 4 hereof, for all acts of the
Indemnitee while serving as a director and/or officer, notwithstanding the termination of the Indemnitee’s service, if such
act was performed or omitted to be performed during the term of the Indemnitee’s service to the Company.

 

20.        Duration
of Agreement.   This Agreement shall survive and continue even though the Indemnitee may
have terminated the Indemnitee’s service as a director, officer, employee, agent or fiduciary of the Company or as a
director, officer, partner, trustee, governor, manager, employee, agent or fiduciary of any other entity, including, but not
limited to another corporation, partnership, limited liability company, employee benefit plan, joint venture, trust or other
enterprise or by reason of any act or omission by the Indemnitee in any such capacity. This Agreement shall be binding upon the
Company and its successors and assigns, including, without limitation, any corporation or other entity which may have acquired all
or substantially all of the 

9

Company’s assets or business or into which the
Company may be consolidated or merged, and shall inure to the benefit of the Indemnitee and the Indemnitee’s spouse,
successors, assigns, heirs, devisees, executors, administrators or other legal representations. 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 and/or assets of the Company, by written agreement in form and substance reasonably satisfactory to the Company and
the 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.

 

21.        Disclosure
of Payments.   If the Company indemnifies or advances expenses under this Agreement, the
Company shall report to the shareholders in writing the amount of the indemnification or advance and to whom and on whose behalf
it was paid not later than the next meeting of shareholders. Other than this disclosure, except as expressly required by any
Federal or state securities laws or other Federal or state law, neither party shall disclose any payments under this Agreement
unless prior approval of the other party is obtained.

 

22.        Severability.   If
any provision or provisions of this Agreement shall be held invalid, illegal or unenforceable for any reason whatsoever, (a) the
validity, legality and enforceability of the remaining provisions of this Agreement (including, but not limited to, all portions
of any Sections of this Agreement containing any such provision held to be invalid, illegal or unenforceable) shall not in any way
be affected or impaired thereby and (b) to the fullest extent possible, the provisions of this Agreement (including, but not
limited to, all portions of any paragraph of this Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent
manifest by the provision held invalid, illegal or unenforceable.

 

23.        Specific
Performance.   The parties recognize that if any provision of this Agreement is violated by
the Company, the Indemnitee may be without an adequate remedy at law. Accordingly, in the event of any such violation, the
Indemnitee shall be entitled, if the Indemnitee so elects, to institute proceedings, either in law or at equity, to obtain
damages, to enforce specific performance, to enjoin such violation, or to obtain any relief or any combination of the foregoing as
the Indemnitee may elect to pursue.

 

24.        Counterparts.   This
Agreement may be executed by one or more counterparts, each of which shall for all purposes be deemed to be an original but all of
which together shall constitute one and the same Agreement.

 

25.        Captions.   The
captions and headings used in this Agreement are inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.

 

26.        Entire
Agreement, Modification and Waiver.   This Agreement constitutes the entire agreement and
understanding of the parties hereto regarding the subject matter hereof, and no supplement, modification or amendment of this
Agreement shall be binding unless executed 

10

in writing by both parties hereto. No waiver of any
of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall such waiver constitute a continuing waiver. No supplement, modification or amendment of this Agreement shall
limit or restrict any right of the Indemnitee under this Agreement in respect of any act or omission of the Indemnitee prior to
the effective date of such supplement, modification or amendment unless expressly provided therein.

 

27.        Notices.   All
notices, requests, demands or other communications hereunder shall be in writing and shall be deemed to have been duly given if
(i) delivered by hand with receipt acknowledged by the party to whom said notice or other communication shall have been directed
or (ii) mailed by certified or registered mail, return receipt requested with postage prepaid, on the date shown on the return
receipt:

 

	
             
 	
            (a)
 	
            If to the Indemnitee to:
 

 

	
             
 	
            _____________________________
 

	
             
 	
            _____________________________
 

	
             
 	
            _____________________________
 

 

	
             
 	
            (b)
 	
            If to the Company, to:
 

 

	
             
 	
            _____________________________
 

	
             
 	
            _____________________________
 

	
             
 	
            _____________________________
 

 

or to such other address as may be furnished to the
Indemnitee by the Company or to the Company by the Indemnitee, as the case may be.

 

28.        Governing
Law.   The parties hereto agree that this Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Minnesota, applied without giving effect to any conflicts of law principles.

 

[Signature page follows.]

11

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

 

	
             
 	
            MTS SYSTEMS CORPORATION
 
	 
	
             
 	
            By ____________________________
 
	
             
 	
            Name: _________________________
 
	
             
 	
            Title: __________________________
 
	 
	
             
 	
            INDEMNITEE:
 
	 
	
             
 	
            By ____________________________
 
	
             
 	
            Name: _________________________
 

[SIGNATURE PAGE TO INDEMNIFICATION AGREEMENT]

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