EXHIBIT 10.6
INDEMNIFICATION AGREEMENT
-------------------------
This Indemnification Agreement ("Agreement") is made as of this ___ day of
___, 1997 by and between Boston Properties, Inc., a Delaware corporation (the
"Company"), Boston Properties Limited Partnership, a Delaware limited
partnership (the "Operating Partnership"), Boston Properties Management, Inc., a
Delaware corporation (the "Development and Management Company," and, together
with the Company and the Operating Partnership, "Indemnitors") and
-------
("Indemnitee").
WHEREAS, Indemnitors desire to attract and retain the services of highly
qualified individuals, such as Indemnitee, to serve as directors and/or
executive officers of one or more of such Indemnitors; and
WHEREAS, Indemnitors recognize Indemnitee's need for protection against
personal liability, and in order to assure Indemnitee's continued service to one
or more of such Indemnitors, Indemnitors wish to provide in this Agreement for
the indemnification of and the advancing of expenses to Indemnitee.
NOW, THEREFORE, Indemnitors and Indemnitee hereby agree as follows:
1. Indemnification.
---------------
(a) Third-Party Proceedings. Indemnitors shall indemnify Indemnitee
-----------------------
to the full extent permitted now or hereafter by applicable law, as from time to
time amended, subject to the exceptions provided in Section 8 of this Agreement.
Without limiting the foregoing but subject to the provisions of this Agreement,
Indemnitors shall indemnify Indemnitee if Indemnitee is or was a party or is
threatened to be made a party to any threatened, pending or completed action or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of Indemnitors) by reason of Indemnitee's past,
present or future service as a director or executive officer of any Indemnitor,
or, at any such Indemnitor's request, of another enterprise or entity in which
any Indemnitor had, directly or indirectly, an interest at the time of such
service, against expenses (including attorney's fees), judgments, fines and
amounts paid in settlement (if such settlement is approved in advance by
Indemnitors, which approval shall not be unreasonably withheld) actually and
reasonably incurred by Indemnitee in connection with investigating, preparing
for, defending or settling such action or proceeding. Indemnitors hereby agree
to indemnify Indemnitee's spouse (whether by statute or at common law and
without regard to the location of the governing jurisdiction) and children
(including by way of adoption) as express third-party beneficiaries hereunder to
the same extent and subject to the same limitations applicable to Indemnitee
hereunder for claims arising out of the status of such person as a spouse or
child of Indemnitee, including claims seeking damages from marital property
(including community property) or property held by Indemnitee
and such spouse or property transferred to such spouse or child. The
indemnification provided under this Agreement may not be amended, modified or
limited in a manner adverse to the rights of Indemnitee without the consent of
Indemnitee, and Indemnitee shall be deemed to be serving in his capacity as an
officer and/or director of any Indemnitor in reliance on the terms of this
Agreement.
(b) Proceedings By or in the Right of Indemnitors. Subject to the
---------------------------------------------
provisions of this Agreement, Indemnitors shall indemnify Indemnitee if
Indemnitee was or is a party or is threatened to be made a party to any
threatened, pending or completed action or proceeding by or in the right of
Indemnitors or any subsidiary of Indemnitors to procure a judgment in its favor
by reason of Indemnitee's past, present or future service as a director or
officer of any Indemnitor, or, at any such Indemnitor's request, of another
enterprise or entity in which any Indemnitor had, directly or indirectly, an
interest at the time of such service, against expenses (including attorneys'
fees) and, to the fullest extent permitted by law, amounts paid in settlement,
in each case to the extent actually and reasonably incurred by Indemnitee in
connection with investigating, preparing for, defending or settling such action
or proceeding.
2. Expenses; Indemnification Procedure.
-----------------------------------
(a) Advancement of Expenses. Indemnitors shall advance all expenses
-----------------------
incurred by Indemnitee in connection with the investigation, defense, settlement
or appeal of any civil or criminal action or proceeding referenced in Section
1(a) or (b) hereof (but not amounts actually paid in settlement of any such
action or proceeding). Indemnitee hereby undertakes to repay such amounts
advanced only if, and to the extent that, it shall ultimately be determined, in
accordance with Section 2(c), that Indemnitee is not entitled to be indemnified
by Indemnitors as authorized hereby. The advances to be made hereunder shall be
paid by Indemnitors to Indemnitee within twenty (20) days following delivery of
a written request therefor by Indemnitee to Indemnitors.
(b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a
--------------------------------
condition precedent to his right to be indemnified under this Agreement, give
Indemnitors notice in writing as soon as practicable of any claim made against
Indemnitee for which indemnification will or could be sought under this
Agreement. Such notice shall contain the written affirmation of Indemnitee that
the standard of conduct necessary for indemnification hereunder has been
satisfied. Notice to any Indemnitor shall be directed to the President and
Chief Operating Officer of the Company in the manner provided in Section 13
hereof. Indemnitee shall give each Indemnitor such information and cooperation
as it may reasonably require and as shall be within Indemnitee's power. A delay
in giving notice under this Section 2(b) shall invalidate the Indemnitee's right
to indemnity under this Agreement only to the extent that such delay prejudices
the defense of the claim or the availability to Indemnitors of insurance
coverage for such claim.
2
(c) Procedure. Any indemnification provided for in Section 1 shall be
---------
made no later than forty-five (45) days after receipt of the written request of
Indemnitee. If a claim under this Agreement, under any statute, or under,
respectively, any provision of the Company's Certificate of Incorporation or
Bylaws, the Operating Partnership's Agreement of Limited Partnership, or the
Development and Management Company's Certificate of Incorporation or Bylaws,
providing for indemnification, is not paid in full by the applicable Indemnitor
within forty-five (45) days after a written request for payment thereof that
complies with the requirements of this Agreement has first been received by such
Indemnitor, Indemnitee may, but need not, at any time thereafter bring an action
against such Indemnitor to recover the unpaid amount of the claim and, subject
to Section 12 of this Agreement, Indemnitee shall also be entitled to be paid
for the expenses (including attorneys' fees) of bringing such action. It shall
be a defense to any such action (other than an action brought to enforce a claim
for expenses incurred in connection with any action or proceeding in advance of
its final disposition) that Indemnitee has not met the standards of conduct that
made it permissible under applicable law for such Indemnitor to indemnify
Indemnitee for the amount claimed, but Indemnitee shall be entitled to receive
interim payments of expenses pursuant to Subsection 2(a) unless and until such
defense may be finally adjudicated by court order or judgment from which no
further right of appeal exists. It is the parties' intention that if such
Indemnitor contests Indemnitee's right to indemnification, the question of
Indemnitee's right to indemnification shall be for the court to decide, and
neither the failure of such Indemnitor (including its Board of Directors or
general partner, as applicable, any committee or subgroup of the Board of
Directors, independent legal counsel or its equity holders) to have made a
determination that indemnification of Indemnitee is proper in the circumstances
because Indemnitee has met the applicable standard of conduct required by
applicable law, nor an actual determination by such Indemnitor (including its
Board of Directors or general partner, as applicable, any committee or subgroup
of the Board of Directors, independent legal counsel or its equity holders) that
Indemnitee has not met such applicable standard of conduct, shall create a
presumption that Indemnitee has or has not met the applicable standard of
conduct.
(d) Notice to Insurers. If, at the time of the receipt of a notice of
------------------
a claim pursuant to Section 2(b) hereof, Indemnitors have directors' and
officers' liability insurance in effect, Indemnitors shall give prompt notice of
the commencement of such proceeding to the insurers in accordance with the
procedures set forth in the respective policies. Indemnitors shall thereafter
take all necessary or desirable action to cause such insurers to pay, on behalf
of the Indemnitee, all amounts payable as a result of such proceeding in
accordance with the terms of such policies.
(e) Selection of Counsel. In the event Indemnitors shall be obligated
--------------------
under Section 2(a) hereof to pay the expenses of any proceeding against
Indemnitee, Indemnitors, unless Indemnitee determines that a conflict of
interest exists between the Indemnitee and Indemnitors with respect to a
particular claim, shall be entitled to assume the defense of such proceeding,
with counsel approved by Indemnitee, which approval shall not be unreasonably
withheld, upon the delivery to Indemnitee of written notice of its election so
to do. After
3
delivery of such notice, approval of such counsel by Indemnitee and the
retention of such counsel by Indemnitors, Indemnitors will not be liable to
Indemnitee under this Agreement for any fees of counsel subsequently incurred by
Indemnitee with respect to the same proceeding; provided that (i) Indemnitee
--------
shall have the right to employ his own separate counsel in any such proceeding
in addition to or in place of any counsel retained by Indemnitors on behalf of
Indemnitee at Indemnitee's expense, and (ii) if (A) the employment of counsel by
Indemnitee has been previously authorized by Indemnitors, (B) Indemnitee shall
have concluded that there may be a conflict of interest between Indemnitors and
Indemnitee in the conduct of any such defense, or (C) Indemnitors shall not, in
fact, have employed counsel to assume the defense of such proceeding, then the
fees and expenses of Indemnitee's counsel shall be at the expense of
Indemnitors.
3. Nonexclusivity of Indemnification Rights. The indemnification
----------------------------------------
provided by this Agreement shall not be deemed exclusive of any rights to which
Indemnitee may be entitled under the Company's Certificate of Incorporation or
Bylaws, the Operating Partnership's Agreement of Limited Partnership, the
Development and Management Company's Certificate of Incorporation or Bylaws, any
agreement, any vote of equity holders or disinterested Directors, applicable
law, or otherwise, both as to action in Indemnitee's official capacity and as to
action in another capacity while holding such office.
4. Partial Indemnification. If Indemnitee is entitled under any
-----------------------
provision of this Agreement to indemnification by Indemnitors for some or a
portion of the expenses, judgments, fines or penalties actually or reasonably
incurred by him in the investigation, defense, appeal or settlement of any civil
or criminal action or proceeding, but not, however, for the total amount
thereof, Indemnitors shall nevertheless indemnify Indemnitee for the portion of
such expenses, judgments, fines or penalties to which Indemnitee is entitled.
5. Mutual Acknowledgment. Both Indemnitors and Indemnitee acknowledge
---------------------
that in certain instances, federal law or applicable public policy may prohibit
Indemnitors from indemnifying their respective directors and officers under this
Agreement or otherwise. Indemnitee understands and acknowledges that Indemnitors
have undertaken and may be required in the future to undertake with the
Securities and Exchange Commission to submit the question of indemnification to
a court in certain circumstances for a determination of Indemnitors' right under
public policy to indemnify Indemnitee.
6. Directors' and Officers' Liability Insurance. The Company currently
--------------------------------------------
intends to obtain and maintain a policy or policies of insurance with reputable
insurance companies providing the directors and officers of the Company with
coverage for losses from wrongful acts, or to ensure the Company's performance
of its indemnification obligations under this Agreement, subject to its good
faith determination from time to time whether or not it is practicable for the
Company to obtain or maintain such insurance. Among other considerations, the
Company will weigh the costs of obtaining such insurance coverage against the
protection afforded by such coverage. In all policies of directors' and
officers' liability
4
insurance, Indemnitee shall be named as an insured in such a manner as to
provide Indemnitee the same rights and benefits as are accorded to the most
favorably insured of the Company's directors. Notwithstanding the foregoing, the
Company shall have no obligation to obtain or maintain such insurance if the
Company determines in good faith that such insurance is not reasonably
available, if the premium costs for such insurance are disproportionate to the
amount of coverage provided, if the coverage provided by such insurance is
limited by exclusions so as to provide an insufficient benefit, or if Indemnitee
is covered by similar insurance maintained by a subsidiary or parent of the
Company.
7. Severability. Nothing in this Agreement is intended to require or
------------
shall be construed as requiring Indemnitors to do or fail to do any act in
violation of applicable law. Indemnitors' inability, pursuant to court order, to
perform its obligations under this Agreement shall not constitute a breach of
this Agreement. The provisions of this Agreement shall be severable as provided
in this Section 7. If this Agreement or any portion hereof shall be invalidated
on any ground by any court of competent jurisdiction, then Indemnitors shall
nevertheless indemnify Indemnitee to the full extent permitted by any applicable
portion of this Agreement that shall not have been invalidated, and the balance
of this Agreement not so invalidated shall be enforceable in accordance with its
terms.
8. Exceptions. Any other provision herein to the contrary
----------
notwithstanding, Indemnitors shall not be obligated pursuant to the terms of
this Agreement to indemnify Indemnitee in the following circumstances:
(a) Excluded Acts. Each Indemnitor shall not be obligated to
-------------
indemnify Indemnitee for any acts or omissions or transactions from which a
person serving in Indemnitee's capacity with respect to such Indemnitor may not
be relieved of liability under the jurisdiction of such Indemnitor's
organization;
(b) Claims Initiated by Indemnitee. Indemnitors shall not be
------------------------------
obligated to indemnify or advance expenses to Indemnitee with respect to
proceedings or claims initiated or brought voluntarily by Indemnitee and not by
way of defense, except with respect to proceedings brought to establish or
enforce a right to indemnification under this Agreement or any other statute or
law in accordance with Section 1(b) hereof, but such indemnification or
advancement of expenses may be provided by any Indemnitor in specific cases if
such Indemnitor's Board of Directors or general partner, as applicable, has
approved the initiation or bringing of such suit;
(c) Insured Claims. Indemnitors shall not be obligated to indemnify
--------------
Indemnitee for expenses or liabilities of any type whatsoever (including, but
not limited to, judgments, fines, ERISA excise taxes or penalties and amounts
paid in settlement) to the extent that Indemnitee has otherwise actually
received payment, or payments have been made on behalf of Indemnitee, with
respect to such expense or liability (under any insurance policy, provision of
the Company's Certificate of Incorporation or Bylaws, the Operating
5
Partnership's Agreement of Limited Partnership, the Development and Management
Company's Certificate of Incorporation or Bylaws, or otherwise) of amounts
otherwise indemnifiable hereunder; or
(d) Claims Under Section 16(b). Indemnitors shall not be obligated to
--------------------------
indemnify Indemnitee for expenses and the payment of profits arising from the
purchase and sale by Indemnitee of securities in violation of Section 16(b) of
the Securities Exchange Act of 1934, as amended, or any similar successor
statute.
9. Construction of Certain Phrases.
-------------------------------
(a) For purposes of this Agreement, references to "Indemnitors" shall
-----------
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, employees, or agents, so that if
Indemnitee is or was a director, officer, employee or agent of such constituent
corporation, or is or was serving at the request of such constituent corporation
as a director, officer, employee, or agent of another corporation, partnership,
joint venture, trust, or other enterprise, Indemnitee shall stand in the same
position under the provisions of this Agreement with respect to the resulting or
surviving corporation as Indemnitee would have with respect to such constituent
corporation if its separate existence had continued.
(b) For purposes of this Agreement, references to "another enterprise"
------------------
or "other enterprises" shall include employee benefit plans; references to
-----------------
"fines" shall include any excise taxes assessed on Indemnitee with respect to an
------
employee benefit plan; and references to "serving at the request of Indemnitors"
-------------------------------------
shall include any service as a director, officer, employee or agent of
Indemnitors which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to an employee benefit plan, its
participants or beneficiaries.
10. Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall constitute an original and all of which
together shall constitute a single agreement.
11. Successors and Assigns. This Agreement shall be binding upon
----------------------
Indemnitors and their respective successors and assigns, and shall inure to the
benefit of Indemnitee and Indemnitee's estate, heirs, legal representatives and
assigns.
12. Attorneys' Fees. In the event that any action is instituted by
---------------
Indemnitee under this Agreement to enforce or interpret any of the terms hereof,
Indemnitee shall be entitled to be paid all court costs and expenses, including
reasonable attorneys' fees, incurred by Indemnitee with respect to such action,
unless as a part of such action, the court of competent
6
jurisdiction determines that each of the material assertions made by Indemnitee
as a basis for such action were not made in good faith or were frivolous. In the
event of an action instituted by or in the name of Indemnitors under this
Agreement or to enforce or interpret any of the terms of this Agreement,
Indemnitee shall be entitled to be paid all court costs and expenses, including
reasonable attorneys' fees, incurred by Indemnitee in defense of such action
(including with respect to Indemnitee's counterclaims and cross-claims made in
such action), unless as a part of such action the court determines that each of
Indemnitee's material defenses to such action were made in bad faith or were
frivolous.
13. Notice. All notices, requests, demands and other communications
------
under this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Addresses for
notice to any party are as shown on the signature page of this Agreement, or as
subsequently modified by written notice.
14. Choice of Law. This Agreement shall be governed by and its
-------------
provisions construed in accordance with the laws of the State of Delaware as
applied to contracts between Delaware residents entered into and to be performed
entirely within the State of Delaware.
7
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
BOSTON PROPERTIES, INC.
By:__________________________________
Name:
Title:
Address:
0 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
BOSTON PROPERTIES LIMITED
PARTNERSHIP
By: Boston Properties, Inc.,
as General Partner
By:________________________________
Name:
Title:
Address:
0 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
BOSTON PROPERTIES MANAGEMENT, INC.
By:________________________________
Name:
Title:
Address:
0 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
8
AGREED TO AND ACCEPTED:
INDEMNITEE:
---------------------------------------------
________
Address:
9
