Exhibit 10.1
FORM OF
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT between Prime Group Realty Trust, a
Maryland real estate investment trust (the "Trust"), and ________________, an
officer and/or trustee of the Trust (the "Indemnitee"), dated as of November 17,
1997.
WHEREAS, the Indemnitee has agreed to serve as an officer and
/or trustee of the Trust; and
WHEREAS, the Articles of Amendment and Restatement of the
Declaration of Trust of the Trust (the "Declaration of Trust") and the Amended
and Restated Bylaws of the Trust (the "Bylaws") provide for certain
indemnification of certain of the Trust's officers and each of the Trust's
trustees;
NOW, THEREFORE, in consideration of the Indemnitee's agreement
to serve as an officer and/or trustee of the Trust and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Trust has agreed to the covenants set forth herein for the
purpose of further securing to the Indemnitee the indemnification provided by
the Declaration of Trust and the Bylaws.
Section 1. In the event that the Indemnitee was or is made a
party or is threatened to be made a party to or is involved in any action, suit
or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that the Indemnitee is or
was a trustee, officer or employee of the Trust or a nominee for any such office
or is or was serving at the request of the Trust as a director, officer,
employee or agent of another corporation or of a partnership, joint venture,
trust or other enterprise, including service with respect to employee benefit
plans, whether the basis of such actual or threatened proceeding is alleged
action in an official capacity as a director, officer, employee or agent or a
nominee for any such office or in any other capacity while serving as a
director, officer, employee or agent, the Indemnitee shall be indemnified and
held harmless by the Trust to the fullest extent permitted by the law of the
State of Maryland ("Maryland Law") as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such
amendment permits the Trust to provide broader indemnification rights than said
law permitted the Trust to provide prior to such amendment), against all
expense, liability
and loss (including, without limitation, attorneys' fees, judgments, fines,
ERISA excise taxes or penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by the Indemnitee in connection therewith and
such indemnification shall continue as to the Indemnitee if the Indemnitee
ceases to be a director, officer, employee, agent or a nominee for any such
office and shall inure to the benefit of the Indemnitee's heirs, executors and
administrators; provided, however, that except as provided in Section 2 of this
Indemnification Agreement with respect to proceedings seeking to enforce rights
to indemnification, the Trust shall indemnify the Indemnitee in connection with
a proceeding (or part hereof) initiated by the Indemnitee only if such
proceeding (or part thereof) was authorized by the Board of Trustees of the
Trust.
Section 2. If a claim under Section 1 of this Indemnification
Agreement is not paid in full by the Trust within 30 days after a written claim
has been received by the Trust, the Indemnitee may at any time thereafter bring
suit against the Trust to recover the unpaid amount of the claim and, if
successful in whole or in part, the Indemnitee shall be entitled to be paid also
the expense of prosecuting such claim. It shall be a defense to any such action
(other than an action brought to enforce a claim for expenses incurred in
defending any actual or threatened proceeding in advance of its final
disposition where the required undertaking, if any is required, has been
tendered to the Trust) that the Indemnitee has not met the standards of conduct
which make it permissible under Maryland Law for the Trust to indemnify the
Indemnitee for the amount claimed, but the burden of proving such defense shall
be on the Trust. Neither the failure of the Trust (including its Board of
Trustees, independent legal counsel or shareholders) to have made a
determination prior to the commencement of such action that indemnification of
the Indemnitee is proper in the circumstances because the Indemnitee has met the
applicable standard of conduct set forth in Maryland Law, nor an actual
determination by the Trust (including its Board of Trustees, independent legal
counsel or shareholders) that the Indemnitee has not met such applicable
standard of conduct, shall be a defense to the action or create a presumption
that the Indemnitee has not met the applicable standard of conduct.
Section 3. Following any "change in control" of the Trust of
the type required to be reported under Item 1 of Form 8-K promulgated under the
Securities Exchange Act of 1934, as amended, any determination as to entitlement
to indemnification shall be made by independent legal counsel selected by the
Indemnitee, which independent legal counsel shall be retained by the Board of
Trustees on behalf of the Trust.
Section 4. The right to indemnification and the payment
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of expenses incurred in defending any actual or threatened proceeding in advance
of its final disposition conferred in this Indemnification Agreement shall not
be exclusive of any other right which the Indemnitee may have or hereafter
acquire under any statute, provision of the Declaration of Trust, Bylaws,
agreement, vote of shareholders or disinterested trustees or otherwise.
Section 5. In the event that the Trust maintains insurance to
protect itself and any trustee or officer of the Trust against any expense,
liability or loss, such insurance shall cover the Indemnitee to at least the
same extent as any other trustee or officer of the Trust.
Section 6. The right to indemnification conferred by this
Indemnification Agreement shall include the right to be paid by the Trust the
expenses incurred in defending any actual or threatened proceeding in advance of
its final disposition; provided, however, that if Maryland Law requires, the
payment of such expenses incurred by the Indemnitee in the Indemnitee's capacity
as a trustee or officer (and not in any other capacity in which service was or
is rendered by the Indemnitee while a trustee or officer, including, without
limitation, service to an employee benefit plan) in advance of the final
disposition of any actual or threatened proceeding, shall be made only upon
delivery to the Trust of an undertaking by or on behalf of the Indemnitee to
repay all amounts so advanced if it shall ultimately be determined that the
Indemnitee is not entitled to be indemnified under this Indemnification
Agreement or otherwise.
Section 7. This Indemnification Agreement may not be changed,
modified or amended except in writing signed by the parties hereto.
[signature page follows]
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IN WITNESS WHEREOF, the Trust and the Indemnitee have executed
this Indemnification Agreement in duplicate on the day and year first above
written.
PRIME GROUP REALTY TRUST
By:
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Name:
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Title:
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