EXHIBIT 10.6
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is made as of the _____ day of
_______________, 1995, by and between Homegate Hospitality, Inc., a Delaware
corporation (the "Company"), and _______________ (the "Indemnitee").
RECITALS
A. The Indemnitee has been requested to serve, or is presently serving, as
a director and/or an officer of the Company and/or, at the request of the
Company, in an Authorized Capacity (as defined below) of or for Another Entity
(as defined below). The Company desires the Indemnitee to serve or to continue
to serve in such capacity. The Company believes that the Indemnitee's
undertaking or continued undertaking of such responsibilities is important to
the Company and that the protection afforded by this Agreement will enhance the
Indemnitee's ability to discharge such responsibilities under existing
circumstances. The Indemnitee is willing, subject to certain conditions
including without limitation the execution and performance of this Agreement by
the Company and the Company's agreement to provide the Indemnitee at all times
the broadest and most favorable (to Indemnitee) indemnification permitted by
applicable law (whether by legislative action or judicial decision), to serve or
to continue to serve in that capacity.
B. In addition to the indemnification to which the Indemnitee is entitled
under the Certificate of Incorporation, as amended, of the Company (the
"Certificate") or the Bylaws, as amended, of the Company (the "Bylaws"), the
Company may obtain insurance protecting its officers and directors and certain
other persons (including the Indemnitee) against certain losses arising out of
actual or threatened actions, suits or proceedings to which such persons may be
made or threatened to be made parties ("D&O Insurance"). The Company, however,
may be unable to obtain such D&O Insurance, and, if obtained, there can be no
assurance as to the continuation or renewal thereof, or that any such D&O
Insurance will provide coverage for losses to which the Indemnitee may be
exposed and for which he or she may be permitted to be indemnified under the
General Corporation Law of the State of Delaware (the "DGCL").
Now, therefore, for and in consideration of the premises, the mutual
promises hereinafter set forth, the reliance of the Indemnitee hereon in
continuing to serve the Company or Another Entity in his or her present capacity
and in undertaking to serve the Company or Another Entity in any additional
capacity or capacities, the Company and the Indemnitee agree as follows:
1. Continued Service. The Indemnitee will serve or continue to serve as a
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director and/or an officer of the Company and/or in each such Authorized
Capacity of or for Another Entity, in each case so long as he or she is duly
elected and qualified to serve in such capacity or until he or she resigns or is
removed.
2. Initial Indemnity. (a) The Company will indemnify the Indemnitee when
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he or she was or is involved in any manner (including without limitation as a
party, a deponent or a witness) or is threatened to be made so involved in any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, formal or informal, and any appeals
therefrom (a "Proceeding") (other than a Proceeding by or in the right of the
Company), by reason of the fact that he or she is or was or had agreed to become
a director, officer, employee or agent of the Company, or is or was serving or
had agreed to serve at the request of the Company as a director, officer,
partner, member,
trustee, employee or agent (each an "Authorized Capacity") of another
corporation, partnership, joint venture, trust or other enterprise (each
"Another Entity"), or by reason of any action alleged to have been taken or
omitted in such capacity, against any and all costs, charges and expenses
(including attorneys' and others' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him or her in connection with
such Proceeding if the Indemnitee acted in good faith and in a manner that he or
she reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal Proceeding, the Indemnitee had no
reasonable cause to believe his or her conduct was unlawful. The termination of
any Proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent will not, of itself, adversely affect the right of
the Indemnitee to indemnification or create a presumption that the Indemnitee
did not meet the foregoing standard of conduct to the extent applicable thereto.
(b) The Company will indemnify the Indemnitee when he or she was or is a
party or is threatened to be made a party to any Proceeding by or in the right
of the Company to procure a judgment in its favor by reason of the fact that he
or she is or was or had agreed to become a director, officer, employee or agent
of the Company, or is or was serving or had agreed to serve at the request of
the Company in an Authorized Capacity of or for Another Entity, against any and
all costs, charges and expenses (including attorneys' and others' fees) actually
and reasonably incurred by him or her in connection with the investigation,
preparation, defense, settlement or appeal of such Proceeding if the Indemnitee
acted in good faith and in a manner that he or she reasonably believed to be in
or not opposed to the best interests of the Company, except that no
indemnification will be made in respect of any claim, issue or matter as to
which the Indemnitee shall have been adjudged to be liable to the Company
unless, and only to the extent, that the Court of Chancery or the court in which
the Proceeding was brought determines upon application that, despite the
adjudication of liability but in view of all circumstances of the case, the
Indemnitee is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court deems proper.
(c) To the extent that the Indemnitee has been successful on the merits or
otherwise, including without limitation the dismissal of a Proceeding without
prejudice, in the defense of any Proceeding referred to in Section 2(a) or
Section 2(b) or in the defense of any claim, issue or matter in any such
Proceeding, the Company will indemnify him or her against any and all costs,
charges and expenses, including without limitation attorneys' and others' fees,
actually and reasonably incurred by him or her in connection therewith.
(d) Any indemnification under Section 2(a), Section 2(b) or Section 2(c)
(unless ordered by a court) will be made by the Company only as authorized in
the specific case upon a determination, in accordance with Section 4, that such
indemnification is proper in the circumstances because he or she has met the
applicable standards of conduct set forth in Section 2(a) and Section 2(b) (the
"Indemnification Standards"). Such determination will be made in the manner set
forth in Section 4(b).
(e) Any and all costs, charges and expenses, including without limitation
attorneys' and others' fees, actually and reasonably incurred by the Indemnitee
in defending any Proceeding will be paid by the Company as incurred and in
advance of the final disposition of such Proceeding in accordance with the
procedure set forth in Section 4(e).
(f) Notwithstanding anything in this Agreement to the contrary, the
Indemnitee will not be entitled to indemnification or advancement of expenses
pursuant hereto in connection with any Proceeding initiated by the Indemnitee
against the Company (except for any Proceeding initiated by the Indemnitee
pursuant to Section 6) unless the Company has joined in or consented to the
initiation of such Proceeding.
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3. Additional Indemnification. (a) Pursuant to Section 145(f) of the
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DGCL, without limiting any right which the Indemnitee may have under Section 2,
the Certificate, the Bylaws, the DGCL, any policy of insurance or otherwise, but
subject to the limitations set forth in Section 2(f) and to any maximum
permissible indemnity that may exist under applicable law at the time of any
request for indemnity hereunder as contemplated by this Section 3(a), the
Company will indemnify the Indemnitee against any amount which he or she is or
becomes legally obligated to pay relating to or arising out of any claim made
against him or her because of any act, failure to act or neglect or breach of
duty, including any actual or alleged error, omission, misstatement or
misleading statement, which he or she commits, suffers, permits or acquiesces in
while acting in his or her capacity as a director or officer of the Company, or,
at the request of the Company, in an Authorized Capacity of or for Another
Entity. The payments which the Company is obligated to make pursuant to this
Section 3 will include without limitation damages, judgments, fines, amounts
paid in settlement and reasonable charges, costs and expenses, including
attorneys' fees, expenses of investigation, preparation, defense and settlement
of Proceedings and expenses of appeal, attachment or similar bonds; provided,
however, that the Company will not be obligated under this Section 3(a) to make
any payment in connection with any claim against the Indemnitee:
(i) to the extent of any fine or similar governmental imposition which
the Company is prohibited by applicable law from paying and which results
from a final, nonappealable order; or
(ii) to the extent based upon or attributable to the Indemnitee gaining
in fact a personal profit to which he or she was not legally entitled,
including without limitation profits made from the purchase and sale of
equity securities of the Company which are recoverable by the Company
pursuant to Section 16(b) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and profits arising from transactions in
securities which were effected in violation of Section 10(b) or Section
14(e) of the Exchange Act, including Rule 10b-5 or Rule 14e-3 promulgated
thereunder.
The determination of whether the Indemnitee is entitled to indemnification under
this Section 3(a) shall be made in accordance with Section 4(b).
(b) Any and all costs, charges and expenses, including without
limitation attorneys' and others' fees, actually and reasonably incurred by the
Indemnitee in connection with any claim for which the Indemnitee may be entitled
to indemnification pursuant to Section 3(a) will be paid by the Company as
incurred and in advance of the final disposition thereof in accordance with the
procedure set forth in Section 4(e).
4. Certain Procedures Relating to Indemnification and Advancement of
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Expenses. (a) Except as otherwise permitted or required by the DGCL, for
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purposes of pursuing his or her rights to indemnification under Section 2(a),
Section 2(b), Section 2(c) or Section 3(a), as the case may be, the Indemnitee
shall submit to the Company (to the attention of the Secretary) a statement of
request for indemnification substantially in the form of Exhibit 1 attached
hereto (the "Indemnification Statement") stating that he or she believes that he
or she is entitled to indemnification pursuant to this Agreement, together with
such documents supporting the request as are reasonably available to the
Indemnitee and are reasonably necessary to determine whether and to what extent
the Indemnitee is entitled to indemnification hereunder (the "Supporting
Documentation"). Upon receipt of any Indemnification Statement, the Company
will promptly advise the Board of Directors of the Company (the "Board") in
writing that the Indemnitee has requested indemnification.
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(b) The Indemnitee's entitlement to indemnification under Section 2(a),
Section 2(b), Section 2(c) or Section 3(a), as the case may be, will be
determined promptly following a claim by the Indemnitee for indemnification
thereunder and in any event not less than 30 calendar days after receipt by the
Company of such Indemnification Statement and Supporting Documentation. The
Indemnitee's entitlement to indemnification under Section 2(a) or Section 2(b)
will, subject to the next sentence, be made in one of the following ways: (i)
by the Board by a majority vote of the directors who are not and were not
parties to such Proceeding or claim ("Disinterested Directors"), even though
less than a quorum, (ii) if there are no Disinterested Directors, or if a
majority of the Disinterested Directors so direct, by written opinion of
independent legal counsel selected by a majority of the Disinterested Directors
(or, if there are no Disinterested Directors or a majority vote thereof is not
obtainable, by a majority of the entire Board), (iii) by the stockholders of the
Company (but only if a majority of Disinterested Directors, if they constitute a
quorum of the Board, presents the issue of entitlement to indemnification to the
stockholders of the Company for their determination) or (iv) as deemed to have
been determined in accordance with Section 4(c). The Indemnitee's entitlement
to indemnification under Section 2(c), Section 3(a) or, in the event of a Change
of Control (as hereinafter defined), under Section 2(a) or Section 2(b) will be
determined by written opinion of independent legal counsel selected by the
Indemnitee. Independent legal counsel selected as described above will be a law
firm or member of a law firm (x) that neither at the time in question nor in the
five years immediately preceding such time has been retained to represent (A)
the Company (or any of its affiliates) or the Indemnitee in any matter material
to either such party or (B) any other party to the Proceeding or claim giving
rise to a claim for indemnification under this Agreement, (y) that, under the
applicable standards of professional conduct then prevailing under the law of
the State of Delaware, would not be precluded from representing either the
Company or the Indemnitee in an action to determine the Indemnitee's rights
under this Agreement and (z) to which the Indemnitee or the Company, acting
therein through a majority of the Disinterested Directors or, if there are no
Disinterested Directors, by a majority of the entire Board, does not reasonably
object. If the Company or the Indemnitee reasonably objects to such independent
legal counsel, the Company, acting therein as hereinbefore provided, or the
Indemnitee shall select another independent legal counsel subject to similar
reasonable objection until there is no further such objection to such
independent legal counsel. The Company will pay the fees and expenses of such
independent legal counsel.
(c) Submission of an Indemnification Statement and Supporting Documentation
to the Company pursuant to Section 4(b) will create a presumption that the
Indemnitee is entitled to indemnification under Section 2(a), Section 2(b),
Section 2(c) or Section 3(a), as the case may be, and thereafter the Company
will have the burden of proof to overcome that presumption in reaching a
contrary determination. In any event, the Indemnitee will be deemed to be
entitled to indemnification under Section 2(a), Section 2(b), Section 2(c) or
Section 3(a) herein unless, within the 30-calendar day period following receipt
by the Company of such Indemnification Statement and Supporting Documentation,
the person or persons empowered under Section 4(b) to determine the Indemnitee's
entitlement to indemnification have been appointed and have made a
determination, based upon clear and convincing evidence (sufficient to rebut the
foregoing presumption), that the Indemnitee is not entitled to such
indemnification and the Indemnitee has received notice within such period in
writing of such determination. The foregoing notice shall (i) disclose with
particularity the evidence in support of such determination and (ii) (A) if made
by Disinterested Directors, be sworn to by all Disinterested Directors who
participated in the determination and voted to deny indemnification, (B) if made
by independent legal counsel, include a signed copy of the related written
opinion of such counsel or (C) if made by the stockholders of the Company,
include a certificate of the Company's Secretary as to the vote of such
stockholders. The provisions of this Section 4(c) are intended to be procedural
only; any determination pursuant to this Section 4(c) that the Indemnitee is not
entitled to indemnification and any related failure to make the payments
requested in the Indemnification Statement will be subject to review as provided
in Section 6.
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(d) If a determination is made or deemed to have been made pursuant to this
Section 4 that the Indemnitee is entitled to indemnification, the Company will
pay to the Indemnitee the amounts to which the Indemnitee is entitled within
five business days after such determination of entitlement to indemnification
has been made or deemed to have been made.
(e) In order to obtain advancement of expenses pursuant to Section 2(e),
the Indemnitee will submit to the Company a written undertaking substantially in
the form of Exhibit 2 attached hereto, executed personally or on his or her
behalf (the "Undertaking"), stating that (i) he or she has incurred or will
incur actual expenses in defending a Proceeding and (ii) if and to the extent
required by law at the time of such advance, he or she undertakes to repay such
amounts advanced as to which it may ultimately be determined that the Indemnitee
is not entitled. In order to obtain advancement of expenses pursuant to Section
3(b), the Indemnitee may submit an Undertaking or, if the Indemnitee chooses not
to submit an Undertaking, shall submit such other form of request as he or she
determines to be appropriate (an "Expense Request"). Upon receipt of an
Undertaking or Expense Request, as the case may be, the Company will within five
calendar days make payment of the costs, charges and expenses stated in the
Undertaking or Expense Request. No security will be required in connection with
any Undertaking or Expense Request, and any Undertaking or Expense Request will
be accepted, and all such payments shall be made, without reference to the
Indemnitee's ability to make repayment.
5. Duplication of Payments. The Company will not be liable under this
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Agreement to make any payment in connection with any claim made against the
Indemnitee to the extent the Indemnitee has actually received payment (under any
insurance policy, the Certificate, the Bylaws, the DGCL or otherwise) of the
amount otherwise payable hereunder.
6. Enforcement. (a) If a claim for indemnification or advancement of
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expenses made to the Company pursuant to Section 4 is not timely paid in full by
the Company as required by Section 4, the Indemnitee will be entitled to seek
judicial enforcement of the Company's obligations to make such payments. If a
determination is made pursuant to Section 4 that the Indemnitee is not entitled
to indemnification or advancement of expenses hereunder, (i) the Indemnitee may
at any time thereafter seek an adjudication of his or her entitlement to such
indemnification or advancement either, at the Indemnitee's sole option, in (A)
an appropriate court of the State of Delaware or any other court of competent
jurisdiction or (B) an arbitration to be conducted by a single arbitrator
pursuant to the rules of the American Arbitration Association, (ii) any such
judicial proceeding or arbitration will be de novo and the Indemnitee will not
be prejudiced by reason of such prior adverse determination and (iii) in any
such judicial proceeding or arbitration the Company will have the burden of
proving that the Indemnitee is not entitled to indemnification or advancement of
expenses under this Agreement.
(b) The Company will be precluded from asserting in any judicial proceeding
or arbitration commenced pursuant to the provisions of Section 6(a) that the
procedures and presumptions of this Agreement are not valid, binding and
enforceable and will stipulate in any such court or before any such arbitrator
that the Company is bound by all the provisions of this Agreement.
(c) In any action brought under Section 6(a), it will be a defense to a
claim for indemnification pursuant to Section 2(a) or Section 2(b) (but not an
action brought to enforce a claim for costs, charges and expenses incurred in
defending any Proceeding in advance of its final disposition where the
Undertaking, if any is required, has been tendered to the Company) that the
Indemnitee has not met the standards of conduct which make it permissible under
the DGCL for the Company to indemnify the Indemnitee for the amount claimed, but
the burden of proving such defense will be on the Company. Neither the failure
of the Company (including any person or persons empowered under Section 4(b) to
determine the Indemnitee's entitlement to indemnification) to have made a
determination as to the propriety
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of indemnification of the Indemnitee hereunder prior to commencement of such
action nor an actual determination by the Company (including any person or
persons empowered under Section 4(b) to determine the Indemnitee's entitlement
to indemnification) that the Indemnitee has not met the applicable standard of
conduct hereunder will be a defense to the action or create a presumption that
the Indemnitee has not met the applicable standard of conduct.
(d) It is the intent of the Company that the Indemnitee shall not be
required to incur the expenses associated with the enforcement of his or her
rights under this Agreement by litigation or other legal action because the cost
and expense thereof would substantially detract from the benefits intended to be
extended to the Indemnitee hereunder. Accordingly, if it should appear to the
Indemnitee that the Company has failed to comply with any of its obligations
under this Agreement or if the Company or any other person takes any action to
declare this Agreement void or unenforceable or institutes any action, suit or
proceeding designed (or having the effect of being designed) to deny, or to
recover from, the Indemnitee the benefits intended to be provided to the
Indemnitee hereunder, the Company irrevocably authorizes the Indemnitee from
time to time to retain counsel of his or her choice, at the expense of the
Company as hereafter provided, to represent the Indemnitee in connection with
the initiation or defense of any litigation or other legal action, whether by or
against the Company or any director, officer, stockholder or other person
affiliated with the Company, in any jurisdiction relating to enforcement of this
Agreement. Notwithstanding any existing or prior attorney-client relationship
between the Company and such counsel, the Company irrevocably consents to the
Indemnitee's entering into an attorney-client relationship with such counsel,
and in that connection the Company and the Indemnitee acknowledge that a
confidential relationship will exist between the Indemnitee and such counsel.
The Company will pay and be solely responsible for any and all costs, charges
and expenses, including without limitation attorneys' and others' fees, incurred
by the Indemnitee (i) as a result of the Company's failure to perform this
Agreement or any provision hereof or (ii) as a result of the Company or any
person unsuccessfully contesting the validity or enforceability of this
Agreement or any provision hereof as aforesaid.
7. Liability Insurance and Funding. If the Company obtains D&O Insurance,
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the Company will use its best efforts, subject to commercial reasonability, to
maintain such D&O Insurance in force at the Company's sole expense. To the
extent that the Company obtains or maintains D&O Insurance, the 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 a director or officer of the
Company or a person serving at the request of the Company in an Authorized
Capacity of or for Another Entity, as the case may be. The Company may, but
shall 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.
8. Change of Control. (a) If the Company sells or otherwise disposes of
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all or substantially all of its assets or is a constituent corporation in a
consolidation, merger or other business combination transaction or if there is a
Change of Control (as defined below) of the Company, (a) the Company will
require (if it is not the surviving, resulting or acquiring corporation therein)
the surviving, resulting or acquiring corporation expressly to assume the
Company's obligations under this Agreement and to agree to indemnify the
Indemnitee to the full extent provided herein and (b), whether or not the
Company is the resulting, surviving or acquiring corporation in any such
transaction (or Change of Control), the Indemnitee will also stand in the same
position under this Agreement with respect to the resulting, surviving or
acquiring corporation as he or she would have with respect to the Company if the
transaction (or Change of Control) had not occurred.
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(b) The Company agrees that, if there is a Change of Control of the Company
(other than a Change of Control which has been approved by a majority of the
Company's Board of Directors who were directors immediately prior to such Change
of Control), then with respect to all matters thereafter arising concerning the
rights of the Indemnitee to indemnity payments and advancement of expenses under
this Agreement or any other agreement or Certificate (as defined below) or Bylaw
provision now or hereafter in effect, the Company shall seek legal advice only
from independent legal counsel selected as provided in Section 4(b). Such
counsel, among other things, shall render its written opinion to the Company and
Indemnitee as to whether and to what extent the Indemnitee would be permitted to
be indemnified under applicable law. The Company agrees to pay the reasonable
fees of such independent legal counsel and to indemnify such counsel fully
against any and all expenses (including attorneys' fees), claims, liabilities
and damages arising out of or relating to this Agreement or its engagement
pursuant hereto.
9. Partial Indemnity. If the Indemnitee is entitled under any provision
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of this Agreement to indemnification by the Company for some or a portion of the
costs, charges, expenses, judgments, fines and amounts paid in settlement of a
Proceeding but not, however, for the total amount thereof, the Company shall
nevertheless indemnify the Indemnitee for the portion thereof to which the
Indemnitee is entitled.
10. Nonexclusivity and Severability. (a) The right to indemnification and
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advancement of expenses provided by this Agreement is not exclusive of any other
right to which the Indemnitee may be entitled under the Certificate, the Bylaws,
the DGCL, any other statute, insurance policy, agreement, vote of stockholders
or of directors or otherwise, both as to actions in his or her official capacity
and as to actions in another capacity while holding such office, and will
continue after the Indemnitee has ceased to serve as a director or officer of
the Company or in an Authorized Capacity in or for Another Entity and will inure
to the benefit of his or her heirs, executors and administrators; provided,
however, that, to the extent the Indemnitee otherwise would have any greater
right to indemnification or advancement of expenses under any provision of the
Certificate or the Bylaws as in effect on the date hereof, the Indemnitee will
be deemed to have such greater right pursuant to this Agreement; and, provided
further, that, inasmuch as it is the intention of the Company to provide the
Indemnitee with the broadest and most favorable (to the Indemnitee) indemnity
permitted by applicable law (whether by legislative action or judicial
decision), to the extent that the DGCL currently permits or in the future
permits (whether by legislative action or judicial decision) any greater right
to indemnification or advancement of expenses than that provided under this
Agreement as of the date hereof, the Indemnitee will automatically, without the
necessity of any further action by the Company or the Indemnitee, be deemed to
have such greater right pursuant to this Agreement. Similarly, the Indemnitee
shall have the benefit of any future changes to the Certificate or the Bylaws
which grant or permit any greater right to indemnification or advancement of
expenses.
(b) The Company will not adopt any amendment to the Certificate or Bylaws
the effect of which would be to deny, diminish or encumber the Indemnitee's
rights to indemnity pursuant to the Certificate, the Bylaws, the DGCL or any
other applicable law as applied to any act or failure to act occurring in whole
or in part prior to the date upon which any such amendment was approved by the
Board or the stockholders, as the case may be. Notwithstanding the foregoing,
if the Company adopts any amendment to the Certificate or Bylaws the purported
effect of which is to so deny, diminish or encumber the Indemnitee's rights to
such indemnity, such amendment will apply only to acts or failures to act
occurring entirely after the effective date thereof.
(c) If any provision or provisions of this Agreement are held to be
invalid, illegal or unenforceable for any reason whatsoever: (i) the validity,
legality and enforceability of the
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remaining provisions of this Agreement (including without limitation 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) will not in any way be affected or impaired thereby
and (ii) to the fullest extent possible, the provisions of this Agreement
(including without limitation 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) will be construed so as to
give effect to the intent manifested by the provision held invalid, illegal or
unenforceable. No claim or right to indemnity or advancement of expenses
pursuant to Section 3 hereof shall in any way affect or limit any right which
the Indemnitee may have under Section 2 hereof, the Certificate, the Bylaws, the
DGCL, any policy of insurance or otherwise.
11. Governing Law. This Agreement will be governed by and construed in
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accordance with the laws of the State of Delaware, without giving effect to the
principles of conflict of laws thereof.
12. Modification; Survival. This Agreement contains the entire agreement
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of the parties relating to the subject matter hereof; provided, however, that
this provision shall not be construed to affect the Company's obligations to the
Indemnitee under the Certificate or Bylaws. This Agreement may be modified only
by an instrument in writing signed by both parties hereto. The provisions of
this Agreement will survive the death, disability, or incapacity of the
Indemnitee or the termination of the Indemnitee's service as a director or an
officer of the Company or in an Authorized Capacity of or for Another Entity and
will inure to the benefit of the Indemnitee's heirs, executors and
administrators.
13. Certain Terms. (a) For purposes of this Agreement, references to a
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person's capacity as a "director" shall include without limitation such person's
capacity as a member of any committee appointed by the board of which such
person is a director; references to "Another Entity" will include employee
benefit plans; references to "fines" will include any excise taxes assessed on
the Indemnitee with respect to any employee benefit plan; and references to
"serving at the request of the Company" will include any service in any capacity
which imposes duties on, or involves services by, the Indemnitee with respect to
an employee benefit plan, its participants or beneficiaries; references to
Sections or Exhibits are to Sections or Exhibits of or to this Agreement;
references to the singular will include the plural and vice versa; and, if the
Indemnitee acted in good faith and in a manner he or she reasonably believed to
be in the interest of the participants and beneficiaries of an employee benefit
plan, he or she will be deemed to have acted in a "manner not opposed to the
best interests of the Company" as referred to herein.
(b) For purposes of this Agreement, a "Change of Control" shall be deemed
to have occurred if (1) any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) other than Xxxxxx X. Faith, Xxxxxx X. Xxxx, one of
their affiliates, a trustee or other fiduciary holding securities under an
employee benefit plan of the Company 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, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing a majority of the total
voting power represented by the Company's then outstanding Voting Securities,
(2) during any period of two 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 a majority 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 (3) 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
-8-
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 merger of Extended Stay Limited
Partnership, a Delaware limited partnership, with and into the Company), 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 of (in one
transaction or a series of transactions) all or substantially all the Company's
assets.
(c) For purposes of this Agreement, the term "Voting
Securities"shall mean any securities of the Company which vote generally in the
election of directors.
14. Joint Defense. Notwithstanding anything to the contrary contained
-------------
herein, if (a) the Indemnitee elects to retain counsel in connection with any
Proceeding or claim in respect of which indemnification may be sought by the
Indemnitee against the Company pursuant to this Agreement and (b) any other
director or officer of the Company or person serving at the request of the
Company in an Authorized Capacity of or for Another Entity may also be subject
to liability arising out of such Proceeding or claim and in connection with such
Proceeding or claim seeks indemnification against the Company pursuant to an
agreement similar to this Agreement, the Indemnitee, together with such other
persons, will employ counsel to represent jointly the Indemnitee and such other
persons unless the Indemnitee determines that such joint representation would be
precluded under the applicable standards of professional conduct then prevailing
under the law of the State of Delaware, in which case the Indemnitee will notify
the Company (to the attention of the Secretary) thereof and will be entitled to
be represented by separate counsel.
15. Express Negligence Acknowledgment. Without limiting or enlarging the
---------------------------------
scope of the indemnification obligations set forth in this Agreement, the
Indemnitee will be entitled to indemnification hereunder in accordance with the
terms hereof, regardless of whether the claim giving rise to such
indemnification obligation is the result of the sole, concurrent or comparative
negligence, or strict liability, of the Indemnitee.
-9-
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the date first above written.
HOMEGATE HOSPITALITY, INC.
By:______________________________________
Name: _______________________________
Title:_______________________________
INDEMNITEE
_________________________________________
Name: ___________________________________
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Exhibit 1
---------
INDEMNIFICATION STATEMENT
-------------------------
1. This Indemnification Statement is submitted pursuant to the
Indemnification Agreement, dated as of _____________ _____, 1995 (the
"Indemnification Agreement"), between Homegate Hospitality, Inc., a Delaware
corporation (the Company"), and the undersigned.
2. I am requesting indemnification in connection with a Proceeding (as
defined in the Indemnification Agreement) or claim in which I was or am involved
or am threatened to be made involved.
3. With respect to all matters related to any such Proceeding or claim, I
believe that I am entitled to be indemnified pursuant to the provisions of the
Indemnification Agreement.
4. Without limiting any other rights which I have or may have, I am
requesting indemnification against liabilities which have or may arise out of
________________________________________________________________________________
________________________________________________________________________________
__________.
5. I have attached such documents supporting this request as are
reasonably available to me and are reasonably necessary to determine whether and
to what extent I am entitled to indemnification under the Indemnification
Agreement.
_____________________________________
Name: _______________________________
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Exhibit 2
---------
UNDERTAKING
-----------
1. This Undertaking is submitted pursuant to the Indemnification
Agreement, dated as of _______________ ___, 1995 (the "Indemnification
Agreement"), between Homegate Hospitality, Inc., a Delaware corporation (the
"Company"), and the undersigned.
2. I am requesting advancement of certain costs, charges and expenses
(including attorneys' and others' fees) which I have incurred or will incur in
defending a Proceeding (as defined in the Indemnification Agreement) or in
connection with a claim for which I may be entitled to indemnification pursuant
to the Indemnification Agreement.
3. I hereby undertake to repay this advancement of expenses if it is
ultimately determined that I am not entitled to be indemnified by the Company
under the Indemnification Agreement.
4. The costs, charges and expenses for which advancement is requested
are, in general, all expenses related to
________________________________________________________________________________
________________________________________________________________________________
__________________________________________________.
_____________________________________
Name: _______________________________
-12-
