DIRECTORS AND OFFICERS INDEMNIFICATION AGREEMENT
Exhibit 10.61
DIRECTORS AND OFFICERS
AGREEMENT, effective as of [Date], between Boston Scientific Corporation, a Delaware
corporation (the “Company”), and the individual whose name appears on the signature page hereof
(the “Indemnitee”).
WHEREAS, it is essential to the Company to retain and attract as directors and officers the
most capable persons available;
WHEREAS, Indemnitee is a director or officer of the Company;
WHEREAS, in recognition of Indemnitee’s need for substantial protection against personal
liability in order to enhance Indemnitee’s continued service to the Company in an effective manner
and in part to provide Indemnitee with specific contractual assurance that the indemnification
protection provided by the Certificate of Incorporation and Bylaws of the Company will be available
to Indemnitee (regardless of, among other things, any amendment to or revocation of such
Certificate of Incorporation and Bylaws or any change in the composition of the Company’s Board of
Directors or acquisition transaction relating to the Company), and in order to induce Indemnitee to
continue to provide services to the Company as an officer and/or director thereof, the Company
wishes to provide in this Agreement for the indemnification of and the advancing of expenses to
Indemnitee to the fullest 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 Company’s directors’ and officers’ liability insurance policies;
NOW, THEREFORE, in consideration of the premises and of Indemnitee continuing to serve the
Company directly or, at its request, another enterprise, and intending to be legally bound hereby,
the parties 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 Company or
corporation owned directly or indirectly by the stockholders 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 twenty percent (20%) or more of the total voting power represented by the Company’s
then outstanding Voting Securities; or (ii) during any period of two (2) consecutive years,
individuals who at the beginning of such period constitute the Board of Directors of the
Company and any new director whose election by the Board of Directors or nomination for election by
the
Company’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 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 eighty percent (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
stockholders of the Company approve a plan of complete liquidation of the company or an agreement
for the sale or disposition by the Company (in one transaction or a series of transactions) of all
or substantially all the Company’s assets.
(b) Claim: any threatened, pending or completed action, suit, proceeding or alternate
dispute resolution mechanism, or any injury, hearing or investigation, whether conducted by the
Company or any other party, that Indemnitee in good faith believes might lead to the institution of
any such action, suit, proceeding or alternate dispute resolution mechanism, whether civil,
criminal, administrative, investigative or other.
(c) Expenses: include attorneys’ fees and all other costs, travel expenses, fees of experts,
transcript costs, filing fees, witness fees, telephone charges, postage, delivery service fees,
expenses and obligations of any nature whatsoever 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 Claim relating to any Indemnifiable
Event.
(d) Indemnifiable Event: any event or occurrence that takes place either prior to or after
the execution of this Agreement related to the fact that Indemnitee is or was an officer, director,
employee, agent or fiduciary of the Company, or is or was serving at the request of the Company as
a director, officer, employee, trustee, agent or fiduciary of another corporation, partnership,
joint venture, employee benefit plan, trust or other enterprise, or by reason of anything done or
not done by Indemnitee in any such capacity.
(e) Potential Change in Control: shall be deemed to have occurred if (i) the Company enters
into an agreement or arrangement, the consummation of which would result in the occurrence of a
Change in Control; (ii) any person (including the Company) publicly announces an intention to take
or to consider taking actions which if consummated would constitute a Change in Control; (iii) any
person, other than a trustee or other fiduciary holding securities under an employee benefit plan
of the Company action in such capacity or a corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as their ownership of stock of
the Company, who is or becomes the beneficial owner, directly or indirectly, of securities of the
Company representing ten percent (10%) or more of the combined voting power of the Company’s then
outstanding Voting Securities, increases his or her beneficial ownership of
such securities by five percent (5%) or more over the percentage so owned by such person on the
date
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hereof; or (iv) the Board adopts a resolution to the effect that, for purpose of this
Agreement, a Potential Change in Control has occurred.
(f) Reviewing Party: any appropriate person or body consisting of a member or members of the
Company’s Board of Directors or any other person or body appointed by the Board who is not a party
to the particular Claim for which Indemnitee is seeking indemnification, or Independent Legal
Counsel.
(g) Independent Legal Counsel: Independent Legal Counsel shall refer to an attorney,
selected in accordance with the provisions of Section 3 hereof, who shall not have otherwise
performed services for the Company or Indemnitee within the last five (5) years (other than in
connection with seeking indemnification under this Agreement). Independent Legal Counsel shall not
be any person who, under the applicable standards of professional conduct then prevailing, would
have conflict of interest in representing either the Company or Indemnitee in an action to
determine Indemnitee’s rights under this Agreement, nor shall Independent Legal Counsel be any
person who has been sanctioned or censured for ethical violations of applicable standards of
professional conduct.
(h) Voting Securities: any securities of the Company 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 Claim by reasons of
(or arising in part out of) an Indemnifiable Event, the Company shall indemnify Indemnitee to the
fullest extent permitted by law as soon as practicable but in any event no later than thirty (30)
days after written demand is presented to the Company, against any and all Expenses, judgment,
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) of such Claim and any federal, state, local or foreign
taxes imposed on the Indemnitee as a result of the actual or deemed receipt of any payments under
this Agreement (including the creation of the trust referred to in Section 4 hereof). If so
requested by Indemnitee, the Company shall advance (within five (5) business days of such request)
any and all Expenses to Indemnitee (an “Expense Advance”). Notwithstanding anything in this
Agreement to the contrary and except as provided in Section 5, prior to a Change in Control
Indemnitee shall not be entitled to indemnification pursuant to this Agreement in connection with
any Claim initiated by Indemnitee against the Company or any director or officer of the Company
unless the Company has joined in or consented to the initiation of such claim.
(b) Notwithstanding the foregoing, (i) the obligations of the Company under Section 2(a)
shall be subject to the condition that the Reviewing Party shall not have determined (in
a written opinion, in any case in which the Independent Legal Counsel referred to in Section 3
hereof is
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involved) that Indemnitee would not be permitted to be indemnified under applicable law;
and (ii) the obligation of the Company to make an Expense Advance pursuant to Section 2(a) shall be
subject to the condition that, if, when and to the extent that the Reviewing Party determines that
Indemnitee would not be permitted to be so indemnified under applicable law, the Company shall be
entitled to be reimbursed by Indemnitee (who hereby agrees to reimburse the Company) for all such
amounts theretofore paid; provided, however, that if Indemnitee has commenced legal
proceedings in a court of competent jurisdiction to secure a determination that Indemnitee should
be indemnified under applicable law, any determination made by the Reviewing Party that Indemnitee
shall not be permitted to be indemnified under applicable law shall not be binding and Indemnitee
shall not be required to reimburse the Company for any Expense Advance until a final judicial
determination is made with respect thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). Indemnitee’s obligation to reimburse the Company for Expense Advances shall
be unsecured and no interest shall be charged thereon. If there has not been a Change in Control,
the Reviewing Party shall be selected by the Board of Directors, and if there has been such a
Change in Control (which has been approved by a majority of the Company’s Board of Directors who
were directors immediately prior to such Change in Control), the Reviewing Party shall be selected
by the Board of Directors. If there has been a Change in Control (other than a change in Control
which has been approved by a majority of the Company’s Board of Directors who were directors
immediately prior to such Change in Control), the Reviewing party shall be the Independent Legal
Counsel referred to in Section 3 hereof. If there has been no determination by the Reviewing Party
or if the Reviewing Party determines that Indemnitee substantively would not be 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 or the Commonwealth of Massachusetts having
subject matter jurisdiction thereof and in which venue is proper seeking an initial determination
by the court or challenging any such determination by the Reviewing Party or any aspect thereof, or
the legal or factual bases therefor and the Company hereby consents to service of process and to
appear in any such proceeding. Any determination by the Reviewing Party otherwise shall be
conclusive and binding on the Company and Indemnitee.
3. Change in Control.
The Company agrees that if there is a Change in Control of the Company (other than a Change in
Control which has been approved by a majority of the Company’s Board of Directors who were
directors immediately prior to such Change in Control) then Independent Legal Counsel shall be
selected by Indemnitee and approved by the Company (which approval shall not be unreasonably
withheld) and such Independent Legal Counsel shall determine whether the Indemnitee is entitled to
indemnity payments and Expense Advances under this Agreement or any other agreement or Certificate
of Incorporation or By-Laws of the Company now or hereinafter in effect relating to Claims for
Indemnifiable Events. Such Independent Legal Counsel, among other things, shall render its written
opinion to the Company and Indemnitee as to whether and to what extent the Indemnitee will be
permitted to be indemnified. The Company agrees to pay the reasonable fees of the Independent
Legal Counsel and to indemnify fully such Independent Legal
Counsel against any
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and all expenses (including attorneys’ fees), claims, liabilities and damages
arising out of or relating to this Agreement or the engagement of Independent Legal Counsel
pursuant hereto.
4. Establishment of Trust.
In the event of a Potential Change in Control, the Company shall, upon written request by
Indemnitee, create a trust for the benefit of Indemnitee and from time to time upon written request
of Indemnitee shall fund such trust in an amount sufficient to satisfy any and all Expenses
reasonably anticipated at the time of each such request to be incurred in connection with
investigating, preparing for and defending any Claim relating to an Indemnifiable Event, and any
and all judgments, fines, penalties and settlement amounts of any and all Claims relating to an
Indemnifiable Event from time to time actually paid or claimed, reasonably anticipated or proposed
to be paid. The amount or amounts to be deposited in the trust pursuant to the foregoing funding
obligation shall be determined by the Reviewing Party, in any case in which the Independent Legal
Counsel referred to above is involved. The terms of the trust shall provide that upon a Change in
Control (i) the trust shall not be revoked or the principal thereof invaded, without the written
consent of Indemnitee; (ii) the trustee shall advance, within five (5) business days of a request
by Indemnitee, any and all Expenses to Indemnitee (and Indemnitee hereby agrees to reimburse the
trust under the circumstances under which Indemnitee would be required to reimburse the Company
under Section 2(b) of this Agreement); (iii) the trust shall continue to be funded by the Company
in accordance with the funding obligation set forth above; (iv) the trustee shall promptly pay to
Indemnitee all amounts for which Indemnitee shall be entitled to indemnification pursuant to this
Agreement or otherwise: and (v) all unexpended funds in such trust shall revert to the Company upon
a final determination by the Reviewing Party or a court of competent jurisdiction, as the case may
be, that Indemnitee has been fully indemnified under the terms of this Agreement. The trustee
shall be chosen by Indemnitee. Nothing in this Section 4 shall relieve the Company of any of its
obligations under this Agreement. All income earned on the assets held in the trust shall be
reported as income by the Company for federal, state, local and foreign tax purposes.
5. Indemnification for Additional Expenses.
The Company shall indemnify Indemnitee against any and all expenses (including attorneys’
fees), if requested by Indemnitee, which are incurred by Indemnitee in connection with any claim
asserted against or in connection with any action brought by Indemnitee for (i) indemnification or
advance payment of Expenses by the Company under this Agreement or any other agreement or
Certificate of Incorporation or By-Laws of the Company now or hereafter in effect relating to
Claims for Indemnifiable Events; and/or (ii) recovery under any directors’ and officers’ liability
insurance policies maintained by the Company, regardless of whether Indemnitee ultimately is
determined to be entitled to such indemnification, advance expense payment or insurance recovery,
as the case may be.
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6. Partial Indemnity, Etc.
If Indemnitee is entitled under any provision of this Agreement to indemnification by the
Company for some or a portion of the Expenses, judgment, fines, penalties and amounts paid in
settlement of a claim but not, however, for all of the total amount thereof, the Company 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 otherwise in defense of any or all Claims relating in whole or in
part to an Indemnifiable Event or in defense of any issue or matter therein, including dismissal
without prejudice, Indemnitee shall be indemnified against all Expenses incurred in connection
therewith.
7. Defense to Indemnification, Burden of Proof and Presumptions.
It shall be a defense to any action brought by the Indemnitee against the Company to enforce
this Agreement (other than an action brought to enforce a claim for expenses incurred in defending
a Claim in advance of its final disposition where the required undertaking has been tendered to the
Company) that the Indemnitee has not met the standards of conduct that make it permissible under
the Delaware General Corporation Law for the Company to indemnify the Indemnitee for the amount
claimed. In connection with any determination by the Reviewing Party or otherwise as to whether
the Indemnitee is entitled to be indemnified hereunder, the burden of proof shall be on the Company
to establish that Indemnitee is not so entitled. Neither the failure of the Company (including its
board of Directors, Independent Legal Counsel, or its stockholders) to have made a determination
prior to the commencement of such suit that indemnification of the Indemnitee is proper in the
circumstances because the Indemnitee has met the applicable standard of conduct set forth in the
Delaware General Corporation Law, nor an actual determination by the Corporation (including its
Board of Directors, Independent Legal Counsel, or stockholders) that the Indemnitee had not met
such applicable standard of conduct, shall be a defense to the action or create a presumption that
the Indemnitee has not met the applicable standard of conduct. 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.
8. Non-exclusivity, Etc.
The rights of Indemnitee hereunder shall be in addition to any other rights Indemnitee may
have under the Certificate of Incorporation or By-Laws of the Company or the Delaware General
Corporation Law 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 Certificate of Incorporation and By-Laws of the Company 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.
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9. No Construction as Employment Agreement.
Nothing contained herein shall be construed as giving Indemnitee any right to be retained in
the employ of the Company or any of its subsidiaries.
10. Liability Insurance.
To the extent the Company 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 Company
director or officer.
11. Period of Limitations.
No legal action shall be brought and no cause of action shall be asserted by or in the right
of the Company or any affiliate of the Company against Indemnitee, Indemnitee’s spouse, heirs,
executors, administrators or personal or legal representatives after the expiration of two (2)
years from the date of accrual of such cause of action, and any claim or cause of action, and any
claim or cause of action of the Company 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 period shall govern.
12. Amendments, Etc.
No supplement, modification nor 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.
13. Subrogation.
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 papers required
and shall do everything that may be necessary to secure such rights, including the execution of
such documents necessary to enable the Company effectively to bring suit to enforce such rights.
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14. No Duplication of Payments.
The Company 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, Certificate of Incorporation or By-Laws of the Company or otherwise)
of the amounts otherwise indemnifiable hereunder.
15. 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 and otherwise to all or substantially all of the business and/or
assets of the Company, spouses, heirs, and personal and legal representatives. The Company 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
Company, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume
and agree to perform this Agreement in the same manner and to the same extent that the Company
would be required to perform if no such succession had taken place. This Agreement shall continue
in effect regardless of whether Indemnitee continues to serve as officer of the Company or of any
other enterprise at the Company’s request.
16. Severability.
The provisions of this Agreement shall be severable in the event that any of the provision
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. Furthermore, to the
fullest extent possible, the provisions of this Agreement (including without limitations, each
portion of this Agreement containing any provision held to be invalid, void or otherwise
unenforceable, that is not itself invalid, void or unenforceable) shall be construed so as to give
effect to the intent manifested by the provision held invalid, illegal or unenforceable.
17. Governing Law.
This Agreement shall be governed by and construed and enforced in accordance with the laws of
the State of Delaware applicable to contacts made and to be performed in such state without giving
effect to the principles of conflicts of laws.
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19. Counterparts.
This Agreement may be executed and delivered (including by facsimile transmission) in one or
more counterparts, and by the different parties hereto in separate counterparts, each of which when
executed and delivered shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of
the day first written above.
| BOSTON SCIENTIFIC CORPORATION | ||||
| /s/ J. Xxxxxxx Xxxxxxx
|
||||
| Title: President and Chief Executive Officer | ||||
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