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Exhibit 10.13
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (the "Agreement") is made as of the 30th day of
May, 1997, between THE PEREGRINE REAL ESTATE TRUST, a California business trust
(the "Trust") and ______________________ ("Agent").
RECITALS
1. The Restated Declaration of Trust of the Trust (the "Declaration")
contains provisions indemnifying the Trust's current and former trustees,
officers, employees or agents, and authorizing the Trust to enter into
individual indemnification agreements with any person entitled to be indemnified
by the Trust, without specific approval of the shareholders of the Trust,
subject to certain requirements as set forth in the Declaration;
2. The Bylaws of the Trust (the "Bylaws") contain provisions indemnifying
the Trust's current and former trustees, officers, or agents;
3. The Agent is currently serving as a trustee, officer, employee or
agent of the Trust;
4. The Board of Trustees of the Trust (the "Board") has determined that
it is in the best interests of the shareholders of the Trust for the Trust to
provide Agent with additional assurance of protection against personal
liability; and
5. This Agreement is being entered into pursuant to and in furtherance
of the Declaration and the Bylaws, as authorized by the Board.
NOW, THEREFORE, in consideration of the foregoing recitals and of other
good and valuable consideration, the receipt of which is acknowledged, the
parties agree as follows:
6. Indemnification.
(a) The Trust shall hold harmless and indemnify the Agent against any
and all expenses, liabilities and losses (including, without limitation,
investigation expenses and expert witnesses' and attorneys' fees and expenses,
judgments, penalties, fines, ERISA excise taxes and amounts paid or to be paid
in settlement) actually incurred by the Agent (net of any related insurance
proceeds or other amounts received by Agent or paid by or on behalf of the Trust
on the Agent's behalf), in connection with any action, suit, arbitration or
proceeding (or any inquiry or investigation, whether brought by or in the right
of the Trust, any subsidiary or affiliate of the Trust, or otherwise, that Agent
in good faith believes might lead to the institution of any such action, suit,
arbitration or proceeding), whether civil, criminal, administrative or
investigative, or any appeal therefrom, in which the Agent is a party, is
threatened to be made a party, is a witness or is participating (a "Proceeding")
based upon, arising from, relating to, or by reason of the fact that Agent was a
trustee, officer, employee or agent of the Trust, whether or not arising prior
to the date of this Agreement;
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If Agent is entitled under this Agreement to indemnification by the Trust
for some or a portion of the Indemnified Amounts (defined below) but not,
however, for all of the total amount thereof, the Trust shall nevertheless
indemnify Agent for the portion thereof to which Agent is entitled.
7. Limitations on Indemnification. Notwithstanding any other provision
of this Agreement, Agent shall not be entitled to indemnification under Section
1:
(a) if the claim, obligation or liability with respect to which
indemnity is sought shall have been determined by a court of competent
jurisdiction, by a final judgment or decree, or, in case of settlement, which in
the opinion of counsel for the Trust would, if determined by a court of
competent jurisdiction, likely have been determined to have arisen out of or
been based upon Agent's willful misfeasance, bad faith, gross negligence or
reckless disregard of duty or for Agent's failure to act in good faith in the
reasonable belief that Agent's action was in the best interests of the Trust;
(b) if a court of competent jurisdiction shall determine, by a final
judgment or decree, that such indemnity is not permitted under applicable law;
(c) on account of any suit in which judgment is rendered for an
accounting of profits made from the purchase or sale by Agent of securities of
the Trust in violation of the provisions of Section 16(b) of the Securities
Exchange Act of 1934 and amendments thereto or similar provisions of any
federal, state or local statutory law; or
(d) on account of any suit brought against Agent for misuse or
misappropriation of non-public information, or otherwise involving Agent's
status as an "insider" of the Trust in connection with any purchase or sale by
Agent of securities of the Trust.
(e) Other Indemnification Arrangements. The Trust's purchase,
establishment and maintenance of insurance or similar protection or other
arrangements, including, but not limited to, providing a trust fund, letter of
credit, or surety bond ("Indemnification Arrangements") on behalf of the Agent
against any liability asserted against him or her or incurred by or on behalf of
him or her in such capacity as a trustee, officer, employee or agent of the
Trust, or arising out of his or her status as such, whether or not the Trust
would have the power to indemnify him or her against such liability under the
provisions of this Agreement or under applicable law, shall not in any way limit
or affect the rights and obligations of the Trust or of the Agent under this
Agreement except as expressly provided herein, and the execution and delivery of
this Agreement by the Trust and the Agent shall not in any way limit or affect
the rights and obligations of the Trust or the other party or parties thereto
under any such indemnification Arrangement. All amounts payable by the Trust
pursuant to this Section 3 and to Section 1 of this Agreement are herein
referred to as "Indemnified Amounts."
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9. Advance Payment of Indemnified Amounts.
(a) The Agent hereby is granted the right to receive in advance of a
final, nonappealable judgment or other final adjudication of a Proceeding (a
"Final Determination") the amount of any and all expenses, including, without
limitation, investigation expenses, expert witnesses' and attorney's fees and
other expenses expended or incurred by the Agent in connection with any
Proceeding or otherwise expended or incurred by the Agent (such amounts so
expended or incurred being referred to as "Advanced Amounts").
(b) In making any written request for Advanced Amounts, the Agent
shall submit to the Trust a schedule setting forth in reasonable detail the
dollar amount expended or incurred or an estimate of the current dollar amount
expected to be expended. Each such listing shall be supported by the xxxx,
agreement, or other documentation relating thereto (if reasonably available at
that time). In addition, before the Agent may receive Advanced Amounts from the
Trust, the Agent shall provide to the Trust (i) a written affirmation of the
Agent's good faith belief that the applicable standard of conduct required for
indemnification by the Trust under this Agreement has been satisfied by the
Agent, and (ii) a written undertaking by or on behalf of the Agent to repay the
Advanced Amount if it shall ultimately be determined that the Agent has not
satisfied the applicable standard of conduct. The written undertaking required
from the Agent shall not be secured. The Company shall pay to the Agent all
Advanced Amounts within five (5) days after receipt by the Trust of all
information and documentation required to be provided by the Agent pursuant to
this paragraph.
10. Procedure for Payment of Indemnified Amounts.
(a) To obtain indemnification under this Agreement, the Agent shall
submit to the Trust a written request for payment of the appropriate Indemnified
Amounts, including with such requests such documentation and information as is
reasonably available to the Agent and reasonably necessary to determine whether
and to what extent the Agent is entitled to indemnification.
(b) The Company shall pay the Agent the appropriate Indemnified
Amounts unless it is established that the Agent has not met any applicable
standard of conduct provided in this Agreement or applicable law. For purposes
of determining whether the Agent is entitled to Indemnified Amounts, in order to
deny indemnification to the Agent the Trust has the burden of proof in
establishing that the Agent did not meet the applicable standard of conduct. In
this regard, a termination of any Proceeding by judgment, order or settlement
does not create a presumption that the Agent did not meet the requisite standard
of conduct; provided, however, that the termination of any criminal proceeding
by conviction, or a pleading of nolo contendere or its equivalent, or any entry
of an order of probation prior to judgment, creates a rebuttable presumption
that the Agent did not meet the applicable standard of conduct.
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(c) Any determination that the Agent has not met the applicable
standard of conduct required to qualify for indemnification shall be made either
(i) by the Board of Directors by a majority vote of a quorum consisting of
directors who were not parties of such action, suit or Proceeding; or (ii) by
independent legal counsel (who may be the outside counsel regularly employed by
the Trust); provided that the manner in which (and, if applicable, the counsel
by which) the right to indemnification is to be determined shall be approved in
advance in writing by both the highest ranking executive officer of the Trust
who is not party to the Proceeding (sometimes hereinafter referred to as "Senior
Officer") and by the Agent. In the event that such parties are unable to agree
on the manner in which any such determination is to be made, such determination
shall be made by independent legal counsel retained by the Trust especially for
such purpose, provided that such counsel be approved in advance in writing by
both the said Senior Officer and Agent, and provided further that such counsel
shall not be outside counsel regularly employed by the Trust. The fees and
expenses of counsel in connection with making said determination contemplated
hereunder shall be paid by the Trust, and, if requested by such counsel, the
Trust shall give such counsel an appropriate written agreement with respect to
the payment of their fees and expenses and such other matters as may be
reasonably requested by counsel.
(d) The Company will use its best efforts to conclude as soon as
practicable any requested determination pursuant to subparagraph (c) above and
promptly will advise the Agent in writing with respect to any determination that
the Agent is or is not entitled to indemnification, including a description of
any reason or basis for which indemnification has been denied. Payment of any
applicable Indemnified Amounts will be made to the Agent within ten (10) days
after any determination of the Agent's entitlement to indemnification.
(e) Notwithstanding the foregoing, Agent may, at any time after sixty
(60) days after a claim for Indemnified Amounts has been filed with the Trust
(or upon receipt of written notice that a claim for Indemnified Amounts has been
rejected, if earlier) and before three (3) years after a claim for Indemnified
Amounts has been filed, petition a court of competent jurisdiction to determine
whether the Agent is entitled to indemnification under the provisions of this
Agreement, and such court shall thereupon have the exclusive authority to make
such determination unless and until such court dismisses or otherwise terminates
such action without having made such determination. The court shall, as
petitioned, make an independent determination of whether the Agent is entitled
to indemnification as provided under this Agreement, irrespective of any prior
determination made by the Board or Directors or independent counsel. If the
court shall determine that the Agent is entitled to indemnification as to any
claim, issue or matter involved in the Proceeding with respect to which there
has been no prior determination pursuant to this Agreement or with respect to
which there has been a prior determination that the Agent was not entitled to
indemnification hereunder, the Trust shall pay all expenses (including
attorneys' fees) actually incurred by the Agent in connection with such judicial
determination.
(f) Nothing set forth in this Section 5 shall limit or affect the
timing or amount, or the right of Agent to payment, of any Advanced Amounts
pursuant to Section 4 hereof.
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11. Agreement Not Exclusive: Subrogation Rights, etc.
(a) This Agreement shall not be deemed exclusive of and shall not
diminish any other rights the Agent may have to be indemnified or insured or
otherwise protected against any liability, loss, or expense by the Trust, any
subsidiary of the Trust, or any other person or entity under any charter,
bylaws, law, agreement, policy of insurance or similar protection, vote of
stockholders or directors, disinterested or not, or otherwise, whether or not
now in effect, both as to actions in the Agent's official capacity with the
Trust, and as to actions in another capacity while holding such office,
including Agent's right to contribution as may be available under applicable
law. The Company's obligations to make payments of Indemnified Amounts hereunder
shall be satisfied to the extent that payments with respect to the same
Proceeding (or part thereof) have been made to or for the benefit of the Agent
by reason of the indemnification of the Agent pursuant to any other arrangement
made by the Trust for the benefit of the Agent.
(b) In the event the Agent shall receive payment from any insurance
carrier or from the plaintiff in any Proceeding against such Agent in respect of
Indemnified Amounts after payments on account of all or part of such Indemnified
Amounts have been made by the Trust pursuant hereto, such Agent shall promptly
reimburse to the Trust the amount, if any, by which the sum of such payment by
such insurance carrier or such plaintiff and payments by the Trust or pursuant
to arrangements made by the Trust to Agent exceeds such indemnified Amounts;
provided, however, that such portions, if any, of such insurance proceeds that
are required to be reimbursed to the insurance carrier under the terms of its
insurance policy, such as deductible or co-insurance payments, shall not be
deemed to be payments to the Agent hereunder. In addition, upon payment of
indemnified Amounts hereunder, the Trust shall be subrogated to the rights of
Agent receiving such payments (to the extent thereof) against any insurance
carrier (to the extent permitted under such insurance policies) or plaintiff in
respect of such Indemnified Amounts and the Agent shall execute and deliver any
and all instruments and documents and perform any and all other acts or deeds
which the Trust deems necessary or advisable to secure such rights. Such right
of subrogation shall be terminated upon receipt by the Trust of the amount to be
reimbursed by the Agent pursuant to the first sentence of this paragraph.
12. Additional Indemnification Rights. Notwithstanding any other
provision of this Agreement, the Trust hereby agrees to indemnify Agent to the
fullest extent permitted by law, notwithstanding that such indemnification is
not specifically authorized by the other provisions of this Agreement, the
Declaration, the Bylaws or by statute. In the event of any change, after the
date of this Agreement, in any applicable law, statute or rule which expands the
right of a California business trust to indemnify a member of its board of
directors or an officer, such changes shall be, ipso facto, within the purview
of Agent's rights and Trust's obligations, under this Agreement. In the event of
any change in any applicable law, statute or rule which narrows the right of a
California business trust to indemnify a member of its Board of Trustees or an
officer, such changes, to the extent not otherwise required by such law, statute
or rule to be applied to this Agreement shall have no effect on this Agreement
or the parties, rights and obligations hereunder.
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13. Insurance. In the event that the Trust maintains directors, and
officers, liability insurance to protect itself and any of its directors or
officers against any expense, liability or loss, such insurance shall cover the
Agent to at least the same extent as any other director or officer of the Trust,
provided that nothing in this Agreement shall require the Trust to obtain
coverage relating to any acts occurring prior to the date hereof.
14. Severability. Each of the provisions of this Agreement is a separate
and distinct agreement and independent of the others, so that if any provisions
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.
15. Further Assurances. The parties will do, execute and deliver, or will
cause to be done, executed and delivered, all such further acts, documents and
things as may be reasonably required for the purpose of giving effect to this
Agreement and the transactions contemplated hereby.
16. Successors; Binding Agreement. This Agreement shall be binding on and
shall inure to the benefit of and be enforceable by the Trust's successors and
assigns and by the Agent's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees, and legatees. The
Company shall require any successor or assignee (whether direct or indirect, by
purchase, merger, consolidation, or otherwise) to all or substantially all of
the business or assets of the Trust, by written agreement in form and substance
reasonably satisfactory to the Trust and to the Agent, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent that
the Trust would be required to perform if no such succession or assignment had
taken place.
17. Counterparts. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute one and the same
instrument.
18. Miscellaneous. No provision of this Agreement may be modified,
waived, or discharged unless such modification, waiver, or discharge is agreed
to in writing signed by Agent and either the Chairman of the Board or the
President of the Trust or another officer of the Trust specifically designated
by the Board. No waiver by either party at any time of any breach by the other
party of, or of compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same time or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. The validity,
interpretation, construction, and performance of this Agreement shall be
governed by the laws of the State of California, without giving effect to the
principles of conflict of laws thereof. The Agent may bring an action seeking
resolution of disputes or controversies arising under or in any way related to
this Agreement in the state or federal court jurisdiction in which Agent resides
or in which his or her place of business is located, and in any related
appellate courts, and the Trust consents to the jurisdiction of such courts and
to such venue.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
AGENT: THE PEREGRINE REAL ESTATE TRUST
By:
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Name:
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Title:
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