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EXHIBIT 10.12
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (the "Agreement") is made and entered into
this 29th day of May, 1997 by and between SUN COMMUNITIES, INC., a Maryland
corporation (the "Company"), and __________________________ (the "Indemnitee").
RECITALS:
A. Indemnitee is an executive officer of the Company, and in such capacity
is performing a valuable service for the Company.
B. The Company has adopted Articles of Amendment and Restatement (the
"Articles") and Bylaws (the "Bylaws") authorizing and directing the Company to
indemnify the directors, officers, agents and employees of the Company to the
maximum extent permitted by Maryland law in effect from time to time ("Maryland
Law").
C. The Maryland General Corporation Law ("MGCL") specifically provides
that it is not exclusive, and thereby contemplates that contracts may be
entered into between the Company and its directors, officers, agents and
employees with respect to the indemnification of such persons.
D. Recent developments with respect to the terms and availability of
directors and officers liability insurance ("D&O Insurance") and the
application, amendment and enforcement of statutory and other indemnification
provisions generally have raised questions concerning the adequacy and
reliability of the protection afforded to directors and officers thereby.
E. To resolve such questions and thereby induce Indemnitee to continue to
serve as a member of the Board of Directors of the Company or as an officer, or
both, the Company desires to enter into this Agreement with Indemnitee.
NOW, THEREFORE, in consideration of Indemnitee's continued service with
the Company after the date hereof, the parties agree as follows:
1. D&O Insurance. The Company shall evaluate whether to procure D&O
Insurance, and if it, in its sole and absolute discretion, procures such
insurance, it shall maintain D&O Insurance so long as, in the reasonable
business judgment of the then directors of the Company, both (i) the premium
cost for such insurance is reasonably related to the amount of coverage
provided, and (ii) the coverage provided by such insurance is not so limited by
exclusions that insufficient benefit may be derived therefrom.
2. Indemnity. Subject only to the exclusions set forth in Section 3
hereof, the Company hereby agrees to hold harmless and indemnify Indemnitee
against any and all expenses (including, without limitation, attorneys' fees),
judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by Indemnitee in connection with any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (including an action by or in the right of the Company)
(individually, a "Proceeding" and, collectively, the "Proceedings") to which
Indemnitee is, was or at any time becomes a party, or is threatened to be made
a party, by reason of the fact that Indemnitee is, was or at any time becomes a
director, officer, partner, trustee, employee or agent of the Company, or is or
was serving or at any time serves at the request of the Company as a director,
officer, partner, trustee, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise (including, without
limitation, employee benefit plans) to the fullest extent
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authorized and permitted by the provisions of the MGCL, or by any amendment
thereof or other provisions of Maryland Law authorizing or permitting such
indemnification which is adopted after the date hereof.
3. Limitations on Indemnity. No indemnity pursuant to Section 2 hereof
shall be paid by the Company:
(a) except to the extent the aggregate of losses to be indemnified
hereunder exceed the amount of such losses for which Indemnitee is
indemnified pursuant to any D&O Insurance purchased and maintained by the
Company;
(b) if it is established that the act or omission of Indemnitee was
material to the matter giving rise to the Proceeding and was committed in
bad faith or was the result of active and deliberate dishonesty;
(c) if it is established that Indemnitee actually received an improper
personal benefit in money, property or services in connection with the
matter giving rise to the Proceeding;
(d) if, in the case of any criminal proceeding, Indemnitee had
reasonable cause to believe that the act or omission was unlawful; or
(e) if, in the event of a Proceeding by or in the right of the Company,
Indemnitee shall have been adjudged to be liable to the Company;
provided, however, that (i) the termination of any Proceeding by judgment,
order or settlement does not create a presumption that Indemnitee did not meet
the requisite standard of conduct set forth in this Section 3, and (ii) the
termination of any Proceeding by conviction, or a plea of nolo contendere or
its equivalent, or any entry of an order of probation prior to judgment,
creates a rebuttable presumption that Indemnitee did not meet that requisite
standard of conduct.
4. Continuation of Indemnity. All agreements and obligations of the
Company contained herein shall continue during the period Indemnitee is a
director, officer, employee or agent of the Company (or is or was serving at
the request of the Company as a director, officer, partner, trustee, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise) and shall continue thereafter so long as Indemnitee shall be
subject to any possible claim or threatened, pending or completed action, suit
or proceeding, whether civil, criminal or investigative, by reason of the fact
that Indemnitee was a director of the Company or serving in any other capacity
referred to herein.
5. Notification and Defense of Claim. Promptly after receipt by
Indemnitee of notice of the commencement of any action, suit or proceeding,
Indemnitee shall, 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; provided, however, that the omission so to notify the Company shall
not relieve the Company from any liability or obligation under this Agreement
unless, and only to the extent that, such failure to notify the Company results
in the loss of substantive rights or defenses in the Proceeding. With respect
to any such action, suit or proceeding as to which Indemnitee notifies the
Company of the commencement thereof:
(a) The Company shall be entitled to participate therein at its own
expense.
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(b) Except as otherwise provided below, 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 selected by
the Company and reasonably satisfactory to Indemnitee. After notice from
the Company to Indemnitee of its election so to assume the defense thereof,
the Company shall not be liable to Indemnitee under this Agreement for any
legal or other expenses subsequently incurred by Indemnitee in connection
with the defense thereof other than reasonable costs of investigation or as
otherwise provided below. Notwithstanding the foregoing, Indemnitee shall
have the right to employ separate counsel in such action, suit or
proceeding 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 Indemnitee unless, in the reasonable opinion of the Company's
Indemnification Committee or, if there is no Indemnification Committee,
counsel to such Indemnitee: (i) there may be legal defenses available to
Indemnitee that are different from or in addition to those available to the
Company, or (ii) a conflict or potential conflict otherwise exists between
the Company and Indemnitee that would make such separate representation
advisable.
(c) The Company shall not be liable to indemnify Indemnitee under this
Agreement for any amounts paid in settlement of any action or claim
effected without its prior written consent. The Company shall not settle
any action or claim in any manner which would impose any penalty or
limitation on Indemnitee without Indemnitee's prior written consent.
Neither the Company nor Indemnitee shall unreasonably withhold their
consent to any proposed settlement.
6. Advance Payment of Expenses. Reasonable expenses incurred by Indemnitee
in connection with a Proceeding shall be paid or reimbursed by the Company in
advance of the final disposition of the Proceeding upon receipt by the Company
of: (a) a written affirmation by Indemnitee of his/her good faith belief that
the standard of conduct necessary for indemnification by the Company has been
met; and (b) a written undertaking by or on behalf of Indemnitee to promptly
repay the expenses if it is ultimately determined that Indemnitee is not
entitled to be indemnified by the Company.
7. Non-Exclusivity. The provisions for indemnification and advancement of
expenses set forth in this Agreement shall not be deemed exclusive of any other
rights which Indemnitee may have under any provision of law, the Articles,
Bylaws, other agreements or otherwise. However, the total amount of expenses
advanced or indemnified from all sources combined shall not exceed the amount
of actual expenses incurred by Indemnitee in connection with a Proceeding.
8. Separability. Each of the provisions of this Agreement is a separate
and distinct agreement, independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.
9. Governing Law; Binding Effect; Amendment and Termination.
(a) This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Michigan applicable to contracts made and to be
wholly performed in such state.
(b) This Agreement shall be binding upon Indemnitee and upon the
Company,
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its successors and assigns, and shall inure to the benefit of
Indemnitee, his/her heirs, personal representatives and assigns and to the
benefit of the Company, its successors and assigns.
(c) No amendment, modification, termination or cancellation of this
Agreement shall be effective unless in writing signed by both parties
hereto.
10. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which shall
constitute one instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement on and as of
the day and year first above written.
SUN COMMUNITIES, INC., a Maryland
corporation
By:
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Xxxx X. Xxxxxxxx, President
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[INDEMNITEE]
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