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EXHIBIT 10.7
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT (this "Agreement") is made and entered
into as of May ___, 1998, by and between HEALTHCARE FINANCIAL PARTNERS REIT,
INC., a Maryland corporation (the "Corporation"), and the individual signing as
Indemnitee on the signature page hereto ("Indemnitee").
WHEREAS, the Indemnitee is an officer and/or a director of the
Corporation; and
WHEREAS, the Articles of Amendment and Restatement (the "Articles of
Incorporation") of the Corporation provides for indemnification of officers and
directors of the Corporation; and
WHEREAS, the parties believe it appropriate to further memorialize and
reaffirm the Corporation's obligation to indemnify the Indemnitee as set forth
in the Articles of Incorporation;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties agree as follows:
1. AGREEMENT TO INDEMNIFY.
(a) Subject to Section 4 hereof and except as otherwise
provided in this Agreement, the Corporation shall indemnify and hold
harmless the Indemnitee (i) against any reasonable expenses (including
attorneys' fees) in advance of the final disposition of any threatened,
pending, or completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative, and whether civil,
criminal, administrative or investigative ("Proceeding"), without
requiring a determination of the ultimate entitlement to
indemnification, or (ii) against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by the Indemnitee in connection with any Proceeding in which
the Indemnitee was or is or is threatened to be made a party because he
is or was an officer and/or a director of the Corporation or was
serving at the request of the Corporation as a director, officer,
employee, or agent of another corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise unless it is
established that (a) the act or omission of the Indemnitee was material
to the matter giving rise to the Proceeding and (x) was committed in
bad faith or (y) was the result of active or deliberate dishonesty; (b)
the Indemnitee actually received an improper personal benefit in money,
property, or services; or (c) in the case of a criminal proceeding, the
Indemnitee had reasonable cause to believe that the act or omission was
unlawful. If the Proceeding is one by or in the right of the
Corporation, indemnification may not be made in respect of any
Proceeding in which the Indemnitee shall have been adjudged to be
liable to the Corporation.
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(b) The termination of any Proceeding by judgment, order, or
settlement does not create a presumption that the Indemnitee did not
meet the requisite standard of conduct set forth in subsection 1(a)
above. The termination of any Proceeding by conviction, or by plea of
nolo contendre or its equivalent, or an entry of an order of probation
prior to judgment, creates a rebuttable presumption that the Indemnitee
did not meet the requisite standard of conduct.
(c) An Indemnitee may not be indemnified under Section 1(a) in
respect of any Proceeding charging improper personal benefit to the
Indemnitee, whether or not involving action in the Indemnitee's
official capacity, in which the Indemnitee was adjudged to be liable on
the basis that personal benefit was improperly received.
2. INDEMNIFICATION AND ADVANCEMENT OF EXPENSES.
(a) Indemnification may be against judgments, penalties,
fines, settlements, and reasonable expenses (including attorneys' fees)
actually incurred by the Indemnitee in connection with the Proceeding;
(b) Reasonable expenses incurred by the Indemnitee who is a
party to a Proceeding may be paid or reimbursed by the Corporation in
advance of the final disposition of the Proceeding upon receipt by the
Corporation of a written undertaking, substantially in the form of
Annex I attached hereto, by the Indemnitee (i) of the Indemnitee's good
faith belief that the standard of conduct necessary for indemnification
by the Corporation as authorized in this Agreement has been met; and
(ii) to repay the amount if it shall ultimately be determined that the
standard of conduct has not been met.
(c) The undertaking required by 2(b) shall be an unlimited
general obligation of the Indemnitee but need not be secured and may be
accepted without reference to financial ability to make the repayment.
(d) This Agreement does not limit the Corporation's power to
pay or reimburse expenses incurred by the Indemnitee in connection with
an appearance as a witness in a Proceeding at a time when the
Indemnitee has not been made a named defendant or respondent in the
Proceeding.
3. DETERMINATION OF RIGHT OF INDEMNIFICATION.
(a) Indemnification and advancement of expenses under this
Agreement may not be made by the Corporation unless authorized for a
specific Proceeding after a
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determination has been made that indemnification of the Indemnitee is
permissible in the circumstances because the Indemnitee has met the
standard of conduct set forth in Section 1 hereof. Such determination
shall be made:
(i) by the Corporation's Board of Directors (the "Board") by a
majority vote of a quorum consisting of directors not, at the
time, parties to the Proceeding, or, if such a quorum cannot
be obtained, then by a majority vote of a committee of the
Board consisting solely of two or more directors not, at the
time, parties to such Proceeding and who were duly designated
to act in the matter by a majority vote of the full Board in
which the designated directors who are parties may
participate;
(ii) by special legal counsel selected by the Board or a committee
of the Board by vote as set forth in Section 3(a)(i) hereof,
or, if the requisite quorum of the full Board cannot be
obtained therefor and the committee cannot be established, by
a majority vote of the full Board in which director who are
parties may participate; or
(iii) by the stockholders of the Corporation.
(b) Authorization of indemnification and determination as to
reasonableness of expenses shall be made in the same manner as the
determination that indemnification is permissible. However, if the
determination that indemnification is made by special legal counsel,
authorization of indemnification and determination as to reasonableness
of expenses shall be made in the manner specified in Section 3(a)(ii)
hereof for selection of such counsel.
(c) Shares held by directors who are parties to the Proceeding
may not be voted on the subject matter under Section 3 hereof.
4. PROCEDURE FOR MAKING DEMANDS. Any indemnification or advancement of
expenses hereunder shall be made promptly, and in any event within sixty (60)
days, upon the written request of the Indemnitee, unless a determination is
reasonably and promptly made by a majority vote of a quorum of disinterested
directors, independent legal counsel or the stockholders, as provided in Section
3 hereof, that the applicable standards of conduct set forth in Section 1 have
been met. The right to indemnification or advancement hereunder shall be
enforceable by the Indemnitee in any court of competent jurisdiction if the
Board or independent legal counsel denies the claim, in whole or in part, or if
no disposition of such claim is made within sixty (60) days after application by
the Indemnitee for indemnification or advancement of expenses. The Indemnitee's
expenses incurred in connection with successfully establishing the Indemnitee's
right to indemnification or advancement of expenses, in whole or in part, in any
such proceeding shall also be indemnified by the Corporation.
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5. SUCCESSORS. This Agreement establishes contract rights which shall
be binding upon, and shall inure to the benefit of, the successors, assigns,
heirs and legal representatives of the parties hereto.
6. CONTRACT RIGHTS NOT EXCLUSIVE. The contract rights conferred by
this Agreement shall be in addition to, but not exclusive of, any other right
which the Indemnitee may have or may hereafter acquire under any statute, the
Articles of Incorporation, any agreement by the vote of stockholders or
disinterested directors of the Corporation, or otherwise.
7. INDEMNITEE'S OBLIGATIONS. The Indemnitee shall promptly advise the
Corporation in writing of the institution of any Proceeding which is or may be
subject to this Agreement and keep the Corporation generally informed of, and
consult with the Corporation with respect to, the status of any such Proceeding.
Notices to the Corporation shall be directed to HealthCare Financial Partners
REIT, Inc., 0 Xxxxxxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxxxx 00000, Attn:
President (or such other address as the Corporation shall designate in writing
to the Indemnitee), and shall be given by personal delivery or by mailing the
same by United States Postal Service, postage prepaid, certified or registered
mail, with return receipt requested. In addition, the Indemnitee shall give the
Corporation such information and cooperation as it may reasonably require and as
shall be within the Indemnitee's power.
8. SEVERABILITY. Should any provision of this Agreement, or any clause
hereof, be held to be invalid, illegal or unenforceable, in whole or in part,
the remaining provisions and clauses of this Agreement shall remain fully
enforceable and binding on the parties.
9. 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.
10. CHOICE OF LAW. The validity, interpretation, performance and
enforcement of this Agreement shall be governed by the laws of the State of
Maryland.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
HEALTHCARE FINANCIAL PARTNERS REIT, INC.
By:
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Name:
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Title:
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INDEMNITEE
By:
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Name:
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ANNEX I
UNDERTAKING AGREEMENT
This UNDERTAKING AGREEMENT (this "Agreement") is made on
_______________, between HEALTHCARE FINANCIAL PARTNERS REIT, INC., a Maryland
corporation (the "Corporation"), and _________________________, an officer
and/or a member of the Board of Directors of the Corporation ("Indemnitee").
WHEREAS, Indemnitee has become involved in investigations, claims,
actions, suits or proceedings which have arisen as a result of Indemnitee's
service to the Corporation; and
WHEREAS, Indemnitee desires that the Corporation pay any and all
expenses (including, but not limited to, attorneys' fees and court costs)
actually and reasonably incurred by Indemnitee or on Indemnitee's behalf in
defending or investigating any such suits or claims and that such payment be
made in advance of the final disposition of such investigations, claims,
actions, suits or proceedings to the extent that Indemnitee has not been
previously reimbursed by insurance; and
WHEREAS, the Corporation is willing to make such payments but, in
accordance with Section 2-418 of the General Corporation Law of the State of
Maryland, the Corporation may make such payments only if it receives an
undertaking to repay from Indemnitee; and
WHEREAS, Indemnitee is willing to give such an undertaking.
NOW, THEREFORE, in consideration of the mutual promises contained
herein, the parties hereto agree as follows:
1. In regard to any payments made by the Corporation to Indemnitee
pursuant to the terms of the Indemnification Agreement dated as of May 6, 1998
(the "Indemnification Agreement"), between the Corporation and Indemnitee,
Indemnitee hereby undertakes and agrees to repay to the Corporation any and all
amounts so paid promptly and in any event within thirty (30) days after the
disposition, including any appeals, of any litigation or threatened litigation
on account of which payments were made; provided, however, that Indemnitee shall
not be required to repay the amount as to which he is determined to be entitled
to be indemnified by the Corporation under Section 2-418 of the General
Corporation Law of the State of Maryland or other applicable law.
2. The Indemnitee in good faith believes that the standard of conduct
necessary for
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indemnification by the Corporation as authorized in the Indemnification
Agreement has been met.
3. This Agreement shall not affect in any manner the rights which
Indemnitee may have against the Corporation, any insurer or any other person to
seek indemnification for or reimbursement of any expenses referred to herein or
any judgment which may be rendered in any litigation or proceeding.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first above written.
HEALTHCARE FINANCIAL PARTNERS REIT, INC.
By:
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Name:
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Title:
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INDEMNITEE
Name:
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