DIRECTORS AND OFFICERS
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT, dated as of July ___, 2000 (this
"Agreement"), is made and entered into by and between Omega Healthcare
Investors, Inc., a Maryland corporation (the "Company"), and __________________
("Indemnitee").
RECITALS
A. It is essential to the Company to retain and attract as directors and
officers the most capable persons available;
B. Indemnitee is a director and/or officer of the Company;
C. Both the Company and Indemnitee recognize the increased risk of litigation
and other claims being asserted against directors and officers of companies in
today's environment;
D. The Company's Articles of Restatement, as amended, (the "Articles") and
Amended and Restated Bylaws (the "Bylaws") provide that the Company may
indemnify its directors and officers and may advance expenses in connection
therewith, and Indemnitee's willingness to serve as a director and/or officer of
the Company is based in part on Indemnitee's reliance on such provisions; and
E. 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 Indemnitee's reliance on the aforesaid
provisions of the Articles and Bylaws, and in part to provide Indemnitee with
specific contractual assurance that the protection promised by such provisions
will be available to Indemnitee (regardless of, among other things, any
amendment to or revocation of such provisions or any change in the composition
of the Company's Board of Directors or any acquisition or business combination
transaction relating to the Company), the Company wishes to provide in this
Agreement for the indemnification of and the advancement of expenses to
Indemnitee as set forth in this Agreement, and for the coverage of Indemnitee
under directors' and officers' liability insurance policies.
NOW, THEREFORE, in consideration of the mutual agreements herein set
forth, the parties hereto hereby agree as follows:
1. Certain Definitions.
1.1 "Claim" means any threatened, pending, or completed action, suit, or
proceeding, or any inquiry or investigation, whether instituted, made, or
conducted by the Company 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.
1.2 "Expenses" includes reasonable attorney's fees and all other reasonable
costs, expenses, and obligations 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.
1.3 "Indemnifiable Event" means any actual or asserted event or occurrence
related to the fact that Indemnitee is or was a director, officer, employee, or
agent of the Company, or is or was serving at the request of the Company as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other entity, whether or not for profit (including the heirs,
executors, administrators, or estate of such person) or anything done or not
done by Indemnitee in any such capacity. "Indemnifiable Event" will not include
any event or occurrence to the extent that indemnification is not permitted
under applicable law.
2. Basic Indemnification Arrangement. 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 reason of (or
arising in whole or in part out of) an Indemnifiable Event, the Company will
indemnify Indemnitee to the fullest extent permitted by law as soon as
practicable but in any event no later than 60 calendar days after written demand
is presented to the Company, 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) of such
Claims. The Indemnitee shall give prompt notice to the Company of any actual or
asserted event or occurrence that could reasonably be expected to give rise to a
Claim. The failure by the Indemnitee to notify the Company of such Claim will
not relieve the Company from any liability hereunder unless, and only to the
extent that, the Company did not learn of the Claim and such failure shall
materially prejudice the ability of the Company to defend such Claims or
otherwise perfect rights to any insurance coverage relating thereto.
Notwithstanding anything in this Agreement to the contrary, Indemnitee will not
be entitled to indemnification pursuant to this Agreement in connection with any
Claim initiated by Indemnitee against the Company (other than a claim described
in Section 3 hereof) or any director or officer of the Company unless the
Company has joined in or consented to the initiation of such Claim. If so
requested by Indemnitee, the Company will advance (within two business days of
such request) any and all Expenses to Indemnitee upon receipt of an undertaking
from Indemnitee agreeing to repay any amounts advanced hereunder to the extent
that it is finally determined that Indemnitee is not entitled to indemnification
for such Expenses.
3. Indemnification for Additional Expenses. The Company will indemnify
Indemnitee against, and, if requested by Indemnitee, will (within two business
days of such request) advance to Indemnitee, any and all reasonable attorneys'
fees and other costs, expenses, and obligations paid or incurred by Indemnitee
in connection with any claim, action, suit, or proceeding asserted or brought by
Indemnitee for (i) indemnification or advance payment of Expenses by the Company
under this Agreement or any other agreement or under any provision of the
Articles or Bylaws 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.
4. 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, judgments, fines, penalties, and amounts paid in settlement of a Claim
but not, however, for all of the total amount thereof, the Company will
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 all Claims relating to an Indemnifiable Event or in defense of any
issue or matter therein, including dismissal without prejudice, Indemnitee will
be indemnified against all Expenses incurred in connection therewith. In
connection with any determination as to whether Indemnitee is entitled to be
indemnified hereunder, the burden of proof will be on the Company to establish
that Indemnitee is not so entitled.
5. Action by Company. The Company will use its best efforts to take, or cause to
be taken, all action necessary to fulfill any requirements to providing
indemnification as contemplated by this Agreement including, but not limited to,
any actions required by Maryland General Corporation Law. Promptly after the
date hereof, the Company will use its commercially reasonable best efforts to
increase the aggregate liability limits under its directors' and officers'
insurance policy to not less than $15 million on terms acceptable to the Company
and Indemnitee.
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, will not in and of itself 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 Indemnitee hereunder will be in addition
to any other rights Indemnitee may have under the Articles, the Bylaws, or the
Maryland General Corporation Law or otherwise; provided, however, that to the
extent that Indemnitee otherwise would have any greater right to indemnification
under any provision of the Articles or Bylaws as in effect on the date hereof,
Indemnitee will be deemed to have such greater right hereunder; and, provided
further, that to the extent that any change is made to the Maryland General
Corporation Law (whether by legislative action or judicial decision), the
Articles, and/or the Bylaws which permits any greater right to indemnification
than that provided under this Agreement as of the date hereof, Indemnitee will
be deemed to have such greater right hereunder. The Company will not adopt any
amendment to the Articles or the Bylaws the effect of which would be to deny,
diminish, or encumber Indemnitee's right to indemnification under the Articles,
the Bylaws, the Maryland General Corporation Law, or otherwise as applied to any
act or failure to act occurring in whole or in part prior to the date upon which
the amendment was approved by the Company's Board of Directors and/or its
stockholders, as the case may be.
8. Liability Insurance and Funding. The Company will maintain an insurance
policy or policies providing directors' and officers' liability insurance to the
extent, in the judgment of the Board of Directors, such insurance is available
on reasonable terms and at reasonable premiums and Indemnitee will 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. Copies of
all correspondence between the Company and the company or companies providing
such insurance shall be promptly delivered to Indemnitee by the Company upon
request of Indemnitee. The Company may, but will not be required to, create a
trust fund, grant a security interest or use other means (including without
limitation a letter of credit) to ensure the payment of such amounts as may be
necessary to satisfy its obligations to indemnify and advance expenses pursuant
to this Agreement.
9. Subrogation. In the event of payment under this Agreement, the Company will
be subrogated to the extent of such payment to all of the related rights of
recovery of Indemnitee against other persons or entities. The Indemnitee will
execute all papers reasonably required and will do everything that may be
reasonably necessary to secure such rights and enable the Company effectively to
bring suit to enforce such rights (all of Indemnitee's reasonable costs and
expenses, including attorneys' fees and disbursements, to be reimbursed by or,
at the option of Indemnitee, advanced by the Company).
10. No Duplication of Payments. The Company will 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, the Articles, or the Bylaws or otherwise) of the
amounts otherwise indemnifiable hereunder.
11. Joint Defense. Notwithstanding anything to the contrary herein contained, if
(a) Indemnitee elects to retain counsel in connection with any Claim in respect
of which indemnification may be sought by Indemnitee against the Company
pursuant to this Agreement and (b) any other director or officer of the Company
may also be subject to liability arising out of such Claim and in connection
with such Claim may seek indemnification against the Company pursuant to an
agreement similar to this Agreement, Indemnitee, together with such other
persons, will employ counsel reasonably acceptable to all indemnities and all
such other persons to represent jointly Indemnitee and such other persons unless
the Board, upon the written request of Indemnitee delivered to the Company (to
the attention of the Secretary) setting forth in reasonable detail the basis for
such request, determines that such joint representation would be precluded under
the applicable standards of professional conduct then prevailing under the law
of the State of Maryland, in which case Indemnitee will be entitled to be
represented by separate counsel. In the event that the Board fails to act on
such request within 30 calendar days after receipt thereof by the Company,
Indemnitee will be deemed to be entitled to be represented by separate counsel
in connection with such Claim and the reasonable fees and expenses of such
counsel shall be Expenses subject to this Agreement.
12. Successors and Binding Agreement.
(a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation, reorganization, or otherwise)
to all or substantially all of the business or assets of the Company, by
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 the Company would be required to perform if no such succession
had taken place. This Agreement will be binding upon and inure to the
benefit of the Company and any successor to the Company, including without
limitation any person acquiring directly or indirectly all or substantially
all of the business or assets of the Company whether by purchase, merger,
consolidation, reorganization, or otherwise (and such successor will
thereafter be deemed the "Company" for purposes of this Agreement), but
will not otherwise be assignable, transferable, or delegatable by the
Company.
(b) This Agreement will inure to the benefit of and be enforceable by
the Indemnitee's personal or legal representatives, executors,
administrators, successors, heirs, distributees, and legatees.
(c) This Agreement is personal in nature and neither of the parties
hereto will, without the consent of the other, assign, transfer, or
delegate this Agreement or any rights or obligations hereunder except as
expressly provided in Sections 12(a) and 12(b). Without limiting the
generality or effect of the foregoing, Indemnitee's right to receive
payments hereunder will not be assignable, transferable, or delegatable,
whether by pledge, creation of a security interest, or otherwise, other
than by a transfer by the Indemnitee's will or by the laws of descent and
distribution and, in the event of any attempted assignment or transfer
contrary to this Section 12(c), the Company will have no liability to pay
any amount so attempted to be assigned, transferred, or delegated.
13. Notices. For all purposes of this Agreement, all communications, including
without limitation notices, consents, requests, or approvals, required or
permitted to be given hereunder will be in writing and will be deemed to have
been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof orally confirmed), or five calendar days
after having been mailed by United States registered or certified mail, return
receipt requested, postage prepaid, or one business day after having been sent
for next-day delivery by a nationally recognized overnight courier service,
addressed to the Company (to the attention of the Secretary of the Company) at
its principal executive office and to the Indemnitee at the Indemnitee's
principal residence as shown in the Company's most current records, or to such
other address as any party may have furnished to the other in writing and in
accordance herewith, except that notices of changes of address will be effective
only upon receipt.
14. Governing Law. The validity, interpretation, construction, and performance
of this Agreement will be governed by and construed in accordance with the
substantive laws of the State of Maryland, without giving effect to the
principles of conflict of laws of such State.
15. Validity. If any provision of this Agreement or the application of any
provision hereof to any person or circumstance is held invalid, unenforceable,
or otherwise illegal, the remainder of this Agreement and the application of
such provision to any other person or circumstance will not be affected, and the
provision so held to be invalid, unenforceable, or otherwise illegal will be
reformed to the extent (and only to the extent) necessary to make it
enforceable, valid, or legal.
16. Miscellaneous. No provision of this Agreement may be waived, modified, or
discharged unless such waiver, modification, or discharge is agreed to in
writing signed by Indemnitee and the Company. No waiver by either party hereto
at any time of any breach by the other party hereto or compliance with any
condition or provision of this Agreement to be performed by such other party
will be deemed a waiver of similar or dissimilar provisions or conditions at the
same or at any prior or subsequent time. No agreements or representations, oral
or otherwise, expressed or implied with respect to the subject matter hereof
have been made by either party which are not set forth expressly in this
Agreement. References to Sections are to references to Sections of this
Agreement.
17. Counterparts. This Agreement may be executed in one or more counterparts,
each of which will be deemed to be an original but all of which together will
constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties to this Agreement have executed this
Agreement as of the date first above written.
OMEGA HEALTHCARE INVESTORS, INC.
By: _____________________________________
Name: ___________________________________
Title: ___________________________________
Name: ___________________________
