FORM OF INDEMNIFICATION AGREEMENT
Exhibit 10.6
FORM OF
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (“Agreement”) is made and entered into as of the ___day of
___, 20___, by and between Legacy Healthcare Properties Trust Inc., a Maryland corporation
(the “Company”), and ___(“Indemnitee”).
WHEREAS, at the request of the Company, Indemnitee currently serves as [a director] [and] [an
officer] of the Company and may, therefore, be subjected to claims, suits or proceedings arising as
a result of his service; and
WHEREAS, as an inducement to Indemnitee to continue to serve as [a director] [and] [an
officer], the Company has agreed to indemnify and to advance expenses and costs incurred by
Indemnitee in connection with any such claims, suits or proceedings, to the maximum extent
permitted by law; and
WHEREAS, the parties by this Agreement desire to set forth their agreement regarding
indemnification and advance of expenses.
NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the
Company and Indemnitee do hereby covenant and agree as follows:
Section 1. Definitions. For purposes of this Agreement:
(a) “Affiliate” means any entity, whether now or hereafter existing, which controls, is
controlled by, or is under common control with, the Company (including, but not limited to,
joint ventures, limited liability companies and partnerships). For this purpose, the term
“control” (including the correlative meanings of the terms “controlled by” and “under common
control with”) shall mean ownership, directly or indirectly, of
50% or more of the total
combined voting power of all classes of voting securities issued by such entity, or the
possession, directly or indirectly, of the power to direct the management and policies of
such entity, by contract or otherwise.
(b) “Change in Control” means: (1) a transaction or series of transactions whereby any
“person” or related “group” of “persons,” within the meaning of Sections 13(d) and 14(d)(2)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (other than the
Company or any of its subsidiaries, any trustee or other fiduciary holding the Company’s
securities under an employee benefit plan sponsored or maintained by the Company or any of
its Affiliates, any underwriter temporarily holding the Company’s securities pursuant to an
offering of such securities or any entity owned, directly or indirectly, by the stockholders
of the Company in substantially the same proportions as their ownership of the then
outstanding shares of common stock of the Company), acquires, directly or indirectly,
“beneficial ownership,” within the meaning of Rule 13d-3 under the Exchange Act, of
securities of the Company possessing more than 50% of the combined voting power of the
Company’s securities outstanding immediately after such acquisition; (2) during any period
of two consecutive years, individuals who, at the beginning of such period, constitute the
Board of Directors together with any new
director(s) (other than a director designated by a person who shall have entered into
an agreement with the Company to effect a transaction described in Section 1(b)(1) or
Section 1(b)(3) hereof, or a director whose initial assumption of office is in connection
with an actual or threatened election contest) 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 two year period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof; or (3) the consummation by
the Company (whether directly involving the Company or indirectly involving the Company
through one or more intermediaries) of a merger, consolidation, reorganization, or business
combination, a sale or other disposition of all or substantially all of the Company’s assets
in any single transaction or series of related transactions, or the acquisition of assets or
stock of another entity, in each case other than a transaction (A) which results in the
Company’s voting securities outstanding immediately before the transaction continuing to
represent (either by remaining outstanding or by being converted into voting securities of
the Company or the person that, as a result of the transaction, controls, directly or
indirectly, the Company, or owns, directly or indirectly, all or substantially all of the
Company’s assets or otherwise succeeds to the business of the Company (the Company or such
person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined
voting power of the Successor Entity’s outstanding voting securities immediately after the
transaction, and (B) after which no “person” or related “group” of “persons,” within the
meaning of Sections 13(d) and 14(d)(2) of the Exchange Act, beneficially owns voting
securities representing 50% or more of the combined voting power of the Successor Entity,
provided, however, that no person or group shall be treated for purposes of this Section
1(b)(3)(B) as beneficially owning 50% or more of the combined voting power of the Successor
Entity solely as a result of the voting power held in the Company prior to the consummation
of the transaction.
(c) “Corporate Status” means the status of a person as a present or former director,
officer, employee or agent of the Company or as a director, trustee, officer, partner,
manager, managing member, fiduciary, employee or agent of any other foreign or domestic
corporation, real estate investment trust, partnership, limited liability company, joint
venture, trust, employee benefit plan or other enterprise that such person is or was serving
in such capacity at the request of the Company. As a clarification and without limiting the
circumstances in which Indemnitee may be serving at the request of the Company, service by
Indemnitee shall be deemed to be at the request of the Company if Indemnitee serves or
served as a director, trustee, officer, partner, manager, managing member, fiduciary,
employee or agent of any corporation, real estate investment trust, partnership, limited
liability company, joint venture, trust, employee benefit plan or other enterprise (i) of
which a majority of the voting power or equity interest is owned directly or indirectly by
the Company or (ii) the management of which is controlled directly or indirectly by the
Company.
(d) “Disinterested Director” means a director of the Company who is not and was not a
party to the Proceeding in respect of which indemnification and/or advance of Expenses is
sought by Indemnitee.
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(e) “Effective Date” means the date set forth in the first paragraph of this Agreement.
(f) “Expenses” means any and all reasonable and out-of-pocket attorneys’ fees and
costs, retainers, court costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, federal, state, local or foreign taxes imposed on Indemnitee as a
result of the actual or deemed receipt of any payments under this Agreement, ERISA excise
taxes and penalties and any other disbursements or expenses incurred in connection with
prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing
to be a witness in or otherwise participating in a Proceeding. Expenses shall also include
Expenses incurred in connection with any appeal resulting from any Proceeding including,
without limitation, the premium, security for and other costs relating to any cost bond,
supersedeas bond or other appeal bond or its equivalent.
(g) “Independent Counsel” means a law firm, or a member of a law firm, that is
experienced in matters of corporation law and neither is, nor in the past five years has
been, retained to represent: (i) the Company or Indemnitee in any matter material to either
such party (other than with respect to matters concerning Indemnitee under this Agreement or
of other indemnitees under similar indemnification agreements), or (ii) any other party to
or participant or witness in the Proceeding giving rise to a claim for indemnification or
advance of Expenses hereunder. Notwithstanding the foregoing, the term “Independent
Counsel” shall not include any person who, under the applicable standards of professional
conduct then prevailing, would have a conflict of interest in representing either the
Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.
(h) “Proceeding” means any threatened, pending or completed action, suit, arbitration,
alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or
any other proceeding, whether brought by or in the right of the Company or otherwise and
whether of a civil (including intentional or unintentional tort claims), criminal,
administrative or investigative (formal or informal) nature, including any appeal therefrom,
except one pending or completed on or before the Effective Date, unless otherwise
specifically agreed in writing by the Company and Indemnitee. If Indemnitee reasonably
believes that a given situation may lead to or culminate in the institution of a Proceeding,
such situation shall also be considered a Proceeding.
Section 2. Services by Indemnitee. Indemnitee will serve as [a director] [and] [an
officer] of the Company. However, this Agreement shall not impose any independent obligation on
Indemnitee or the Company to continue Indemnitee’s service to the Company. This Agreement shall
not be deemed an employment contract between the Company (or any other entity) and Indemnitee.
Section 3. General. The Company shall indemnify, and advance Expenses to, Indemnitee
(a) as provided in this Agreement and (b) otherwise to the maximum extent permitted by Maryland law
in effect on the Effective Date and as amended from time to time; provided, however, that no change
in Maryland law shall have the effect of reducing the benefits available
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to Indemnitee hereunder based on Maryland law as in effect on the Effective Date. The rights
of Indemnitee provided in this Section 3 shall include, without limitation, the rights set forth in
the other sections of this Agreement, including any additional indemnification permitted by Section
2-418(g) of the Maryland General Corporation Law (the “MGCL”).
Section 4. Standard for Indemnification. If, by reason of Indemnitee’s Corporate
Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the Company shall
indemnify Indemnitee against all judgments, penalties, fines and amounts paid in settlement and all
Expenses actually and reasonably incurred by him or on his behalf in connection with any such
Proceeding unless it is established that (a) the act or omission of Indemnitee was material to the
matter giving rise to the Proceeding and (i) was committed in bad faith or (ii) was the result of
active and deliberate dishonesty, (b) Indemnitee actually received an improper personal benefit in
money, property or services or (c) in the case of any criminal Proceeding, Indemnitee had
reasonable cause to believe that his conduct was unlawful.
Section 5. Certain Limits on Indemnification. Notwithstanding any other provision of
this Agreement (other than Section 6), Indemnitee shall not be entitled to:
(a) indemnification hereunder if the Proceeding was one by or in the right of the
Company and Indemnitee is adjudged to be liable to the Company;
(b) indemnification hereunder if Indemnitee is adjudged to be liable on the basis that
personal benefit was improperly received in any Proceeding charging improper personal
benefit to Indemnitee, whether or not involving action in the Indemnitee’s Corporate Status;
or
(c) indemnification or advance of Expenses hereunder if the Proceeding was brought by
Indemnitee, unless: (i) the Proceeding was brought to enforce indemnification under this
Agreement, and then only to the extent in accordance with and as authorized by Section 12 of
this Agreement, or (ii) the Company’s charter or Bylaws, a resolution of the stockholders
entitled to vote generally in the election of directors or of the Board of Directors or an
agreement approved by the Board of Directors to which the Company is a party expressly
provide otherwise.
Section 6. Court-Ordered Indemnification. Notwithstanding any other provision of this
Agreement, a court of appropriate jurisdiction, upon application of Indemnitee and such notice as
the court shall require, may order indemnification of Indemnitee by the Company in the following
circumstances:
(a) if such court determines that Indemnitee is entitled to reimbursement under Section
2-418(d)(1) of the MGCL, the court shall order indemnification, in which case Indemnitee
shall be entitled to recover the Expenses of securing such reimbursement; or
(b) if such court determines that Indemnitee is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances, whether or not Indemnitee (i) has
met the standards of conduct set forth in Section 2-418(b) of the MGCL or (ii) has been
adjudged liable for receipt of an improper personal benefit under Section 2-418(c) of the
MGCL, the court may order such indemnification as the court shall deem proper.
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However, indemnification with respect to any Proceeding by or in the right of the
Company or in which liability shall have been adjudged in the circumstances described in
Section 2-418(c) of the MGCL shall be limited to Expenses.
Section 7. Indemnification for Expenses of an Indemnitee Who is Wholly or Partially
Successful. Notwithstanding any other provision of this Agreement, and without limiting any
such provision, to the extent that Indemnitee was or is, by reason of his Corporate Status, made a
party to (or otherwise becomes a participant in) any Proceeding and is successful, on the merits or
otherwise, in the defense of such Proceeding, Indemnitee shall be indemnified for all Expenses
actually and reasonably incurred by him or on his behalf in connection therewith. If Indemnitee is
not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one
or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify
Indemnitee under this Section 7 for all Expenses actually and reasonably incurred by him or on his
behalf in connection with each such claim, issue or matter, allocated on a reasonable and
proportionate basis. For purposes of this Section 7 and, without limitation, the termination of
any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be
deemed to be a successful result as to such claim, issue or matter.
Section 8. Advance of Expenses for Indemnitee. If, by reason of Indemnitee’s
Corporate Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the
Company shall, without requiring a preliminary determination of Indemnitee’s ultimate entitlement
to indemnification hereunder, advance all reasonable Expenses incurred by or on behalf of
Indemnitee in connection with such Proceeding within ten days after the receipt by the Company of a
statement or statements requesting such advance or advances from time to time, whether prior to or
after final disposition of such Proceeding. Such statement or statements shall reasonably evidence
the Expenses incurred by Indemnitee and shall include or be preceded or accompanied by a written
affirmation by Indemnitee of Indemnitee’s good faith belief that the standard of conduct necessary
for indemnification by the Company as authorized by law and by this Agreement has been met and a
written undertaking by or on behalf of Indemnitee, in substantially the form attached hereto as
Exhibit A or in such form as may be required under applicable law as in effect at the time
of the execution thereof, to reimburse the portion of any Expenses advanced to Indemnitee relating
to claims, issues or matters in the Proceeding as to which it shall ultimately be established that
the standard of conduct has not been met by Indemnitee and which have not been successfully
resolved as described in Section 7 of this Agreement. To the extent that Expenses advanced to
Indemnitee do not relate to a specific claim, issue or matter in the Proceeding, such Expenses
shall be allocated on a reasonable and proportionate basis. The undertaking required by this
Section 8 shall be an unlimited general obligation by or on behalf of Indemnitee and shall be
accepted without reference to Indemnitee’s financial ability to repay such advanced Expenses and
without any requirement to post security therefor.
Section 9. Indemnification and Advance of Expenses as a Witness or Proceeding
Participant. Notwithstanding any other provision of this Agreement, to the extent that
Indemnitee is or may be, by reason of his Corporate Status, made a witness or otherwise asked to
participate in any Proceeding, whether instituted by the Company or any other party, and to which
Indemnitee is not a party, he shall be advanced all reasonable Expenses and indemnified against all
Expenses actually and reasonably incurred by him or on his behalf in connection
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therewith within ten days after the receipt by the Company of a statement or statements
requesting such advance or advances from time to time, whether prior to or after final disposition
of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred
by Indemnitee.
Section 10. Procedure for Determination of Entitlement to Indemnification.
(a) To obtain indemnification under this Agreement, Indemnitee shall submit to the
Company a written request, including therein or therewith such documentation and information
as is reasonably available to Indemnitee and is reasonably necessary to determine whether
and to what extent Indemnitee is entitled to indemnification. Indemnitee may submit one or
more such requests from time to time and at such time(s) as Indemnitee deems appropriate in
his sole discretion. The officer of the Company receiving any such request from Indemnitee
shall, promptly upon receipt of such a request for indemnification, advise the Board of
Directors in writing that Indemnitee has requested indemnification.
(b) Upon written request by Indemnitee for indemnification pursuant to Section 10(a)
above, a determination, if required by applicable law, with respect to Indemnitee’s
entitlement thereto shall promptly be made in the specific case: (i) if a Change in Control
shall have occurred, by Independent Counsel, in a written opinion to the Board of Directors,
a copy of which shall be delivered to Indemnitee, which Independent Counsel shall be
selected by the Indemnitee and approved by the Board of Directors in accordance with Section
2-418(e)(2)(ii) of the MGCL, which approval shall not be unreasonably withheld; or (ii) if a
Change in Control shall not have occurred, (A) by the Board of Directors by a majority vote
of a quorum consisting of Disinterested Directors or, if such a quorum cannot be obtained,
then by a majority vote of a duly authorized committee of the Board of Directors consisting
solely of one or more Disinterested Directors, (B) if Independent Counsel has been selected
by the Board of Directors in accordance with Section 2-418(e)(2)(ii) of the MGCL and
approved by the Indemnitee, which approval shall not be unreasonably withheld, by
Independent Counsel, in a written opinion to the Board of Directors, a copy of which shall
be delivered to Indemnitee or (C) if so directed by a majority of the members of the Board
of Directors, by the stockholders of the Company. If it is so determined that Indemnitee is
entitled to indemnification, payment to Indemnitee shall be made within ten days after such
determination. Indemnitee shall cooperate with the person, persons or entity making such
determination with respect to Indemnitee’s entitlement to indemnification, including
providing to such person, persons or entity upon reasonable advance request any
documentation or information which is not privileged or otherwise protected from disclosure
and which is reasonably available to Indemnitee and reasonably necessary to such
determination in the discretion of the Board of Directors or Independent Counsel if retained
pursuant to clause (ii)(B) of this Section 10(b). Any Expenses incurred by Indemnitee in so
cooperating with the person, persons or entity making such determination shall be borne by
the Company (irrespective of the determination as to Indemnitee’s entitlement to
indemnification) and the Company shall indemnify and hold Indemnitee harmless therefrom.
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(c) The Company shall pay the reasonable fees and expenses of Independent Counsel, if
one is appointed.
Section 11. Presumptions and Effect of Certain Proceedings.
(a) In making any determination with respect to entitlement to indemnification
hereunder, the person or persons or entity making such determination shall presume that
Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a
request for indemnification in accordance with Section 10(a) of this Agreement, and the
Company shall have the burden of proof to overcome that presumption in connection with the
making of any determination contrary to that presumption.
(b) The termination of any Proceeding or of any claim, issue or matter therein, by
judgment, order, settlement or conviction, upon a plea of nolo contendere or its equivalent,
or entry of an order of probation prior to judgment, does not create a presumption that
Indemnitee did not meet the requisite standard of conduct described herein for
indemnification.
(c) The knowledge and/or actions, or failure to act, of any other director, officer,
employee or agent of the Company or any other director, trustee, officer, partner, manager,
managing member, fiduciary, employee or agent of any other foreign or domestic corporation,
real estate investment trust, partnership, limited liability company, joint venture, trust,
employee benefit plan or other enterprise shall not be imputed to Indemnitee for purposes of
determining any other right to indemnification under this Agreement.
Section 12. Remedies of Indemnitee.
(a) If (i) a determination is made pursuant to Section 10(b) of this Agreement that
Indemnitee is not entitled to indemnification under this Agreement, (ii) advance of Expenses
is not timely made pursuant to Section 8 of this Agreement, (iii) no determination of
entitlement to indemnification shall have been made pursuant to Section 10(b) of this
Agreement within 60 days after receipt by the Company of the request for indemnification,
(iv) payment of indemnification is not made pursuant to Section 7 of this Agreement within
ten days after receipt by the Company of a written request therefor, or (v) payment of
indemnification pursuant to any other section of this Agreement or the charter or Bylaws of
the Company is not made within ten days after a determination has been made that Indemnitee
is entitled to indemnification, Indemnitee shall be entitled to an adjudication in an
appropriate court located in the State of Maryland, or in any other court of competent
jurisdiction, of his entitlement to such indemnification or advance of Expenses.
Alternatively, Indemnitee, at his option, may seek an award in arbitration to be conducted
by a single arbitrator pursuant to the Commercial Arbitration Rules of the American
Arbitration Association. Indemnitee shall commence a proceeding seeking an adjudication or
an award in arbitration within 180 days following the date on which Indemnitee first has the
right to commence such proceeding pursuant to this Section 12(a); provided, however, that
the foregoing clause shall not apply to a
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proceeding brought by Indemnitee to enforce his rights under Section 7 of this Agreement. Except
as set forth herein, the provisions of Maryland law (without regard to its conflicts of laws
rules) shall apply to any such arbitration. The Company shall not oppose Indemnitee’s right
to seek any such adjudication or award in arbitration.
(b) In any judicial proceeding or arbitration commenced pursuant to this Section 12,
Indemnitee shall be presumed to be entitled to indemnification or advance of Expenses, as
the case may be, under this Agreement and the Company shall have the burden of proving that
Indemnitee is not entitled to indemnification or advance of Expenses, as the case may be.
If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 12,
Indemnitee shall not be required to reimburse the Company for any advances pursuant to
Section 8 of this Agreement until a final determination is made with respect to Indemnitee’s
entitlement to indemnification (as to which all rights of appeal have been exhausted or
lapsed). The Company shall, to the fullest extent not prohibited by law, be precluded from
asserting in any judicial proceeding or arbitration commenced pursuant to this Section 12
that the procedures and presumptions of this Agreement are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator that the
Company is bound by all of the provisions of this Agreement.
(c) If a determination shall have been made pursuant to Section 10(b) of this Agreement
that Indemnitee is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration commenced pursuant to this Section
12, absent a misstatement by Indemnitee of a material fact, or an omission of a material
fact necessary to make Indemnitee’s statement not materially misleading, in connection with
the request for indemnification.
(d) In the event that Indemnitee, pursuant to this Section 12, seeks a judicial
adjudication of or an award in arbitration to enforce his rights under, or to recover
damages for breach of, this Agreement, Indemnitee shall be entitled to recover from the
Company, and shall be indemnified by the Company for, any and all Expenses actually and
reasonably incurred by him in such judicial adjudication or arbitration. If it shall be
determined in such judicial adjudication or arbitration that Indemnitee is entitled to
receive part but not all of the indemnification or advance of Expenses sought, the Expenses
incurred by Indemnitee in connection with such judicial adjudication or arbitration shall be
appropriately prorated.
(e) Interest shall be paid by the Company to Indemnitee at the maximum rate allowed to
be charged for judgments under the Courts and Judicial Proceedings Article of the Annotated
Code of Maryland for amounts which the Company pays or is obligated to pay for the period
(i) commencing with either the tenth day after the date on which the Company was requested
to advance Expenses in accordance with Section 8 of this Agreement or the 60th
day after the date on which the Company was requested to make the determination of
entitlement to indemnification under Section 12(a) above and (ii) ending on the date such
payment is made to Indemnitee by the Company.
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Section 13. Defense of the Underlying Proceeding.
(a) Indemnitee shall notify the Company promptly in writing upon being served with any
summons, citation, subpoena, complaint, indictment, request or other document relating to
any Proceeding which may result in the right to indemnification or the advance of Expenses
hereunder and shall include with such notice a description of the nature of the Proceeding
and a summary of the facts underlying the Proceeding. The failure to give any such notice
shall not disqualify Indemnitee from the right, or otherwise affect in any manner any right
of Indemnitee, to indemnification or the advance of Expenses under this Agreement unless the
Company’s ability to defend in such Proceeding or to obtain proceeds under any insurance
policy is materially and adversely prejudiced thereby, and then only to the extent the
Company is thereby actually so prejudiced.
(b) Subject to the provisions of the last sentence of this Section 13(b) and of Section
13(c) below, the Company shall have the right to defend Indemnitee in any Proceeding which
may give rise to indemnification hereunder; provided, however, that the Company shall notify
Indemnitee of any such decision to defend within 15 calendar days following receipt of
notice of any such Proceeding under Section 13(a) above. The Company shall not, without the
prior written consent of Indemnitee, which shall not be unreasonably withheld or delayed,
consent to the entry of any judgment against Indemnitee or enter into any settlement or
compromise which (i) includes an admission of fault of Indemnitee, (ii) does not include, as
an unconditional term thereof, the full release of Indemnitee from all liability in respect
of such Proceeding, which release shall be in form and substance reasonably satisfactory to
Indemnitee or (iii) would impose any Expense, judgment, fine, penalty or limitation on
Indemnitee. This Section 13(b) shall not apply to a Proceeding brought by Indemnitee under
Section 12 of this Agreement.
(c) Notwithstanding the provisions of Section 13(b) above, if in a Proceeding to which
Indemnitee is a party by reason of Indemnitee’s Corporate Status, (i) Indemnitee reasonably
concludes, based upon an opinion of counsel approved by the Company, which approval shall
not be unreasonably withheld, that he may have separate defenses or counterclaims to assert
with respect to any issue which may not be consistent with other defendants in such
Proceeding, (ii) Indemnitee reasonably concludes, based upon an opinion of counsel approved
by the Company, which approval shall not be unreasonably withheld, that an actual or
apparent conflict of interest or potential conflict of interest exists between Indemnitee
and the Company, or (iii) if the Company fails to assume the defense of such Proceeding in a
timely manner, Indemnitee shall be entitled to be represented by separate legal counsel of
Indemnitee’s choice, subject to the prior approval of the Company, which approval shall not
be unreasonably withheld, at the expense of the Company. In addition, if the Company fails
to comply with any of its obligations under this Agreement or in the event that the Company
or any other person takes any action to declare this Agreement void or unenforceable, or
institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be
provided to Indemnitee hereunder, Indemnitee shall have the right to retain counsel of
Indemnitee’s choice, subject to the prior approval of the Company, which approval shall not
be unreasonably withheld, at the expense of the Company (subject to Section 12(d) of this
Agreement), to represent Indemnitee in connection with any such matter.
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Section 14. Non-Exclusivity; Survival of Rights; Subrogation.
(a) The rights of indemnification and advance of Expenses as provided by this Agreement
shall not be deemed exclusive of any other rights to which Indemnitee may at any time be
entitled under applicable law, the charter or Bylaws of the Company, any agreement or a
resolution of the stockholders entitled to vote generally in the election of directors or of
the Board of Directors, or otherwise. Unless consented to in writing by Indemnitee, no
amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or
restrict any right of Indemnitee under this Agreement in respect of any action taken or
omitted by such Indemnitee in his Corporate Status prior to such amendment, alteration or
repeal, regardless of whether a claim with respect to such action or inaction is raised
prior or subsequent to such amendment, alteration or repeal. No right or remedy herein
conferred is intended to be exclusive of any other right or remedy, and every other right or
remedy shall be cumulative and in addition to every other right or remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion of any right or
remedy hereunder, or otherwise, shall not prohibit the concurrent assertion or employment of
any other right or remedy.
(b) In the event of any 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 take all action necessary to secure such rights, including
execution of such documents as are necessary to enable the Company to bring suit to enforce
such rights.
Section 15. Insurance. The Company will use its reasonable best efforts to acquire
directors and officers liability insurance, on terms and conditions deemed appropriate by the Board
of Directors, with the advice of counsel, covering Indemnitee or any claim made against Indemnitee
by reason of his Corporate Status and covering the Company for any indemnification or advance of
Expenses made by the Company to Indemnitee for any claims made against Indemnitee by reason of his
Corporate Status. Without in any way limiting any other obligation under this Agreement, the
Company shall indemnify Indemnitee for any payment by Indemnitee arising out of the amount of any
deductible or retention and the amount of any excess of the aggregate of all judgments, penalties,
fines, settlements and Expenses incurred by Indemnitee in connection with a Proceeding over the
coverage of any insurance referred to in the previous sentence. The purchase, establishment and
maintenance of any such insurance shall not in any way limit or affect the rights or obligations of
the Company or Indemnitee under this Agreement except as expressly provided herein, and the
execution and delivery of this Agreement by the Company and the Indemnitee shall not in any way
limit or affect the rights or obligations of the Company under any such insurance policies. If, at
the time the Company receives notice from any source of a Proceeding to which Indemnitee is a party
or a participant (as a witness or otherwise) the Company has director and officer liability
insurance in effect, the Company shall give prompt notice of such Proceeding to the insurers in
accordance with the procedures set forth in the respective policies.
Section 16. Coordination of Payments. The Company shall not be liable under this
Agreement to make any payment of amounts otherwise indemnifiable or payable or reimbursable
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as Expenses hereunder if and to the extent that Indemnitee has otherwise actually received
such payment under any insurance policy, contract, agreement or otherwise.
Section 17. Reports to Stockholders. To the extent required by the MGCL, the Company
shall report in writing to its stockholders the payment of any amounts for indemnification of, or
advance of Expenses to, Indemnitee under this Agreement arising out of a Proceeding by or in the
right of the Company with the notice of the meeting of stockholders of the Company next following
the date of the payment of any such indemnification or advance of Expenses or prior to such
meeting.
Section 18. Duration of Agreement; Binding Effect.
(a) This Agreement shall continue until and terminate on the later of (i) the date that
Indemnitee shall have ceased to serve as a director, officer, employee or agent of the
Company or as a director, trustee, officer, partner, manager, managing member, fiduciary,
employee or agent of any other foreign or domestic corporation, real estate investment
trust, partnership, limited liability company, joint venture, trust, employee benefit plan
or other enterprise that such person is or was serving in such capacity at the request of
the Company and (ii) the date that Indemnitee is no longer subject to any actual or possible
Proceeding (including any rights of appeal thereto and any Proceeding commenced by
Indemnitee pursuant to Section 12 of this Agreement).
(b) The indemnification and advance of Expenses provided by, or granted pursuant to,
this Agreement shall be binding upon and be enforceable by the parties hereto and their
respective successors and assigns (including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of the business or assets of
the Company), shall continue as to an Indemnitee who has ceased to be a director, officer,
employee or agent of the Company or a director, trustee, officer, partner, manager, managing
member, fiduciary, employee or agent of any other foreign or domestic corporation, real
estate investment trust, partnership, limited liability company, joint venture, trust,
employee benefit plan or other enterprise that such person is or was serving in such
capacity at the request of the Company, and shall inure to the benefit of Indemnitee and his
spouse, assigns, heirs, devisees, executors and administrators and other legal
representatives.
(c) 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.
(d) The Company and Indemnitee agree hereby that a monetary remedy for breach of this
Agreement, at some later date, may be inadequate, impracticable and difficult of proof, and
further agree that such breach may cause Indemnitee irreparable harm. Accordingly, the
parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief
and/or specific performance hereof, without any necessity of
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showing actual damage or irreparable harm and that by seeking injunctive relief and/or
specific performance, Indemnitee shall not be precluded from seeking or obtaining any other
relief to which he may be entitled. Indemnitee shall further be entitled to such specific
performance and injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions, without the necessity of posting bonds or other
undertakings in connection therewith. The Company acknowledges that, in the absence of a
waiver, a bond or undertaking may be required of Indemnitee by a court, and the Company
hereby waives any such requirement of such a bond or undertaking.
Section 19. Severability. If any provision or provisions of this Agreement shall be
held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality
and enforceability of the remaining provisions of this Agreement (including, without limitation,
each portion of any Section, paragraph or sentence of this Agreement containing any such provision
held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest
extent permitted by law; (b) such provision or provisions shall be deemed reformed to the extent
necessary to conform to applicable law and to give the maximum effect to the intent of the parties
hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including,
without limitation, each portion of any Section, paragraph or sentence of this Agreement containing
any such provision held to be invalid, illegal or unenforceable, that is not itself invalid,
illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.
Section 20. Identical Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original but all of which
together shall constitute one and the same Agreement. One such counterpart signed by the party
against whom enforceability is sought shall be sufficient to evidence the existence of this
Agreement.
Section 21. Headings. The headings of the paragraphs of this Agreement are inserted
for convenience only and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.
Section 22. Modification and Waiver. No supplement, modification or 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.
Section 23. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if (i) delivered by hand
and receipted for by the party to whom said notice or other communication shall have been directed,
on the day of such delivery, or (ii) mailed by certified or registered mail with postage prepaid,
on the third business day after the date on which it is so mailed:
(a) If to Indemnitee, to the address set forth on the signature page hereto.
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(b) If to the Company, to:
or to such other address as may have been furnished in writing to Indemnitee by the Company or to
the Company by Indemnitee, as the case may be.
Section 24. Governing Law. The parties agree that this Agreement shall be governed
by, and construed and enforced in accordance with, the laws of the State of Maryland, without
regard to its conflicts of laws rules.
Section 25. Miscellaneous. Use of the masculine pronoun shall be deemed to include
usage of the feminine pronoun where appropriate.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.
| COMPANY: LEGACY HEALTHCARE PROPERTIES TRUST INC. |
||||
| By: | ||||
| Name: Title: |
||||
INDEMNITEE:
Name:
Address:
Address:
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EXHIBIT A
FORM OF AFFIRMATION AND UNDERTAKING TO REPAY EXPENSES ADVANCED
To: The Board of Directors of Legacy Healthcare Properties Trust Inc.
Re: Undertaking to Repay Expenses Advanced
Ladies and Gentlemen:
This affirmation and undertaking is being provided pursuant to that certain Indemnification
Agreement dated the ___day of ___, 20___, by and between Legacy Healthcare
Properties Trust Inc., a Maryland corporation (the “Company”), and the undersigned Indemnitee (the
“Indemnification Agreement”), pursuant to which I am entitled to advance of Expenses in connection
with [Description of Proceeding] (the “Proceeding”).
Terms used herein and not otherwise defined shall have the meanings specified in the
Indemnification Agreement.
I am subject to the Proceeding by reason of my Corporate Status or by reason of alleged
actions or omissions by me in such capacity. I hereby affirm my good faith belief that at all
times, insofar as I was involved as [a director] [an officer] of the Company, in any of the facts
or events giving rise to the Proceeding, I (1) did not act with bad faith or active or deliberate
dishonesty, (2) did not receive any improper personal benefit in money, property or services and
(3) in the case of any criminal proceeding, had no reasonable cause to believe that any act or
omission by me was unlawful.
In consideration of the advance of Expenses by the Company for reasonable attorneys’ fees and
related Expenses incurred by me in connection with the Proceeding (the “Advanced Expenses”), I
hereby agree that if, in connection with the Proceeding, it is established that (1) an act or
omission by me was material to the matter giving rise to the Proceeding and (a) was committed in
bad faith or (b) was the result of active and deliberate dishonesty or (2) I actually received an
improper personal benefit in money, property or services or (3) in the case of any criminal
proceeding, I had reasonable cause to believe that the act or omission was unlawful, then I shall
promptly reimburse the portion of the Advanced Expenses relating to the claims, issues or matters
in the Proceeding as to which the foregoing findings have been established.
IN WITNESS WHEREOF, I have executed this Affirmation and Undertaking on this ___day of
___, 20___.
| Name: | ||||
