CORNERSTONE ONDEMAND, INC. INDEMNIFICATION AGREEMENT
Exhibit
10.1
CORNERSTONE
ONDEMAND, INC.
This
Amended and Restated Indemnification Agreement (the “Agreement”) is made and
entered into as of ______________ ____, 20[ ] between Cornerstone OnDemand,
Inc., a Delaware corporation (the “Company”), and
____________________ (“Indemnitee”).
RECITALS
WHEREAS, Indemnitee performs a
valuable service for the Company;
WHEREAS, the board of
directors of the Company (the “Board”) has adopted bylaws
(the “Bylaws”) providing
for the indemnification of the officers and directors of the Company to the
maximum extent authorized by Section 145 of the Delaware General
Corporation Law, as amended (the “DGCL”);
WHEREAS, the Bylaws and the
DGCL, by their nonexclusive nature, permit contracts between the Company and the
officers or directors of the Company with respect to indemnification of such
officers or directors;
WHEREAS, in accordance with
the authorization provided by the DGCL, the Company may purchase and maintain a
policy or policies of directors’ and officers’ liability insurance, covering
certain liabilities that may be incurred by its officers or directors in the
performance of their obligations to the Company;
WHEREAS, the Company and
Indemnitee recognize the continued difficulty in obtaining liability insurance
for the Company’s directors, officers, employees, agents and fiduciaries, the
significant and continual increases in the cost of such insurance, and the
general trend of insurance companies to reduce the scope of coverage of such
insurance;
WHEREAS, the Company and
Indemnitee further recognize the substantial increase in corporate litigation in
general, subjecting directors, officers, employees, agents and fiduciaries to
expensive litigation risks at the same time as the availability and scope of
coverage of liability insurance provide increasing challenges for the
Company;
WHEREAS, Indemnitee does not
regard the protection currently provided by applicable law, the Company’s
governing documents and available insurance as adequate under the present
circumstances, and Indemnitee may not be willing to continue to serve in such
capacity without additional protection;
WHEREAS, it is reasonable,
prudent and necessary for the Company contractually to obligate itself to
indemnify, and to advance expenses on behalf of, such persons to the fullest
extent permitted by applicable law, regardless of any amendment or revocation of
the Company’s certificate of incorporation or Bylaws, so that they will serve or
continue to serve the Company free from undue concern that they will not be so
indemnified;
WHEREAS, this Agreement is a
supplement to and in furtherance of the indemnification provided in the Bylaws
and any resolutions adopted pursuant thereto, and shall not be deemed a
substitute therefor, nor to diminish or abrogate any rights of Indemnitee
thereunder; [and]
[WHEREAS, Indemnitee and the
Company previously entered into an agreement for indemnification, dated as of
[ ], 20[ ] (the “Prior Agreement”)[.][;
and]
[WHEREAS, in connection with
the Company’s proposed initial public offering, the Company and Indemnitee have
determined and agreed to amend and restate the Prior Agreement in its entirety
as provided in this Agreement.]
NOW, THEREFORE, in
consideration of Indemnitee’s service as a [director/officer], the parties
hereto agree [to amend and restate the Prior Agreement] as follows:
1. Indemnity of
Indemnitee. The Company hereby agrees to hold harmless and
indemnify Indemnitee to the fullest extent permitted by applicable law, as such
may be amended from time to time. In furtherance of the foregoing
indemnification, and without limiting the generality thereof:
(a) Proceedings Other Than
Proceedings by or in the Right of the Company. Indemnitee
shall be entitled to the rights of indemnification provided in this
Section l(a) if Indemnitee is, or is threatened to be made, a party to or
participant in any Proceeding (as hereinafter defined) other than a Proceeding
by or in the right of the Company. Pursuant to this Section 1(a),
Indemnitee shall be indemnified against all Expenses (as hereinafter defined)
and Liabilities (as hereinafter defined) incurred or paid by Indemnitee or on
Indemnitee’s behalf in connection with such Proceeding or any claim, issue or
matter therein, if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the Company
and, with respect to any criminal Proceeding, the Indemnitee had no reasonable
cause to believe Indemnitee’s conduct was unlawful.
(b) Proceedings by or in the
Right of the Company. Indemnitee shall be entitled to the
rights of indemnification provided in this Section 1(b) if Indemnitee is, or is
threatened to be made, a party to or participant in any Proceeding brought by or
in the right of the Company. Pursuant to this Section 1(b),
Indemnitee shall be indemnified against all Expenses incurred or paid by
Indemnitee or on Indemnitee’s behalf in connection with such Proceeding if the
Indemnitee acted in good faith and in a manner the Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company; provided, however, that, if applicable
law so provides, no indemnification against such Expenses shall be made in
respect of any claim, issue or matter in such Proceeding as to which Indemnitee
shall have been adjudged to be liable to the Company unless and to the extent
that a court of competent jurisdiction shall determine that such indemnification
may be made.
(c) Indemnification for Expenses
of a Party Who is Wholly or Partly Successful. Notwithstanding
and in addition to any other provision of this Agreement, to the extent that
Indemnitee is a party to, and is successful on the merits or otherwise in, any
Proceeding, Indemnitee shall be indemnified to the maximum extent permitted by
law against all Expenses incurred or paid by Indemnitee or on Indemnitee’s
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 against all Expenses incurred or paid by
Indemnitee or on Indemnitee’s behalf in connection with each successfully
resolved claim, issue or matter. For purposes of this Section 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.
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2. Additional
Indemnity. In addition to, and without regard to any
limitations on, the indemnification provided for in Section 1, the Company shall
and hereby does agree to indemnify and hold harmless Indemnitee against all
Expenses and Liabilities incurred or paid by Indemnitee or on Indemnitee’s
behalf to the fullest extent permitted by applicable law if Indemnitee is, or is
threatened to be made, a party to or participant in any Proceeding (including a
Proceeding by or in the right of the Company), including, without limitation,
all liability arising out of the negligence or active or passive wrongdoing of
Indemnitee. The only limitation that shall exist upon the Company’s
obligations pursuant to this Agreement shall be that the Company shall not be
obligated to make any payment to Indemnitee that is finally determined (under
the procedures, and subject to the presumptions, set forth in Section 6
(Procedures and Presumptions for Determination of Entitlement to
Indemnification), Section 7 (Remedies of Indemnitee) and [Section 21] (Governing
Law and Consent to Jurisdiction) hereof) to be unlawful under applicable law.
3. Contribution. To
the fullest extent permissible under applicable law, if the indemnification
provided for in this Agreement is unavailable to Indemnitee for any reason
whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to
the amount incurred by Indemnitee, whether for Liabilities and/or for Expenses,
in connection with any claim relating to an indemnifiable event under this
Agreement, in such proportion as is deemed fair and reasonable in light of all
of the circumstances of such Proceeding in order to reflect (i) the relative
benefits received by the Company and Indemnitee as a result of the event(s)
and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative
fault of the Company (and its directors, officers, employees and agents) and
Indemnitee in connection with such event(s) and/or transaction(s).
4. Indemnification for Expenses
of a Witness or in Response to a Subpoena. Notwithstanding any
other provision of this Agreement, to the extent that Indemnitee is a witness or
is made (or asked to) respond to discovery requests in any Proceeding involving
the Company, its officers, directors, shareholders or creditors to which
Indemnitee is not a party, Indemnitee shall be indemnified against all Expenses
paid or incurred by Indemnitee in connection therewith and in the manner set
forth in this Agreement.
5. Advancement of
Expenses. Notwithstanding any other provision of this
Agreement, the Company shall advance all Expenses incurred or paid by or on
behalf of Indemnitee in connection with any Proceeding within thirty (30) days
after the receipt by the Company of a statement or statements from Indemnitee
requesting such advance or advances (which may include invoices received by
Indemnitee in connection with such Expenses but, in the case of invoices in
connection with legal services, any references to legal work performed or to
expenditures made that would cause Indemnitee to waive any privilege accorded by
applicable law shall not be included with the invoice) from time to time,
whether prior to or after final disposition of such Proceeding. Such
statement or statements shall reasonably evidence the Expenses incurred or paid
by Indemnitee and shall include or be preceded or accompanied by an undertaking
by or on behalf of Indemnitee to repay any Expenses advanced if it shall
ultimately be determined that Indemnitee is not entitled to be indemnified
against such Expenses. Any advances and undertakings to repay
pursuant to this Section 5 shall be unsecured and interest free and made without
regard to Indemnitee’s financial ability to repay such Expenses and without
regard to Indemnitee’s ultimate entitlement to indemnification under the other
provisions of this Agreement.
6. Procedures and Presumptions
for Determination of Entitlement to Indemnification. It is the
intent of this Agreement to secure for Indemnitee rights of indemnity that are
at least as favorable as may be permitted under the law and public policy of the
State of Delaware. Accordingly, the parties agree that the following
procedures and presumptions shall apply in the event of any question as to
whether Indemnitee is entitled to indemnification under this
Agreement:
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(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. The Secretary of the Company shall, promptly upon
receipt of such a request for indemnification, advise the Board in writing that
Indemnitee has requested indemnification. Notwithstanding anything herein to the
contrary, any failure of Indemnitee to provide such a request to the Company, or
to provide such a request in a timely fashion, shall not relieve the Company of
any liability that it may have to Indemnitee unless, and to the extent that,
such failure actually and materially prejudices the interests of the
Company. Notwithstanding anything in this Agreement to the contrary,
no determination (if required by applicable law) as to entitlement to
indemnification under this Agreement shall be required to be made prior to the
final disposition of the Proceeding.
(b) Upon
written request by Indemnitee for indemnification, a determination with respect
to Indemnitee’s entitlement thereto shall be made in the specific case (i) if a
Change in Control shall have occurred, by Independent Counsel in a written
opinion to the Company’s board of directors, a copy of which shall be delivered
to Indemnitee or (ii) if a Change in Control shall not have occurred, if
required by applicable law by one of the following
four (4) methods, which shall be at the election of the Board: (A) by a majority
vote of the Disinterested Directors, even though less than a quorum of the
Board, (B) by a committee of Disinterested Directors designated by a majority
vote of the Disinterested Directors, even though less than a quorum of the
Board, or (C) if there are no such Disinterested Directors or, if such
Disinterested Directors so direct, by Independent Counsel in a written opinion
to the Board, a copy of which shall be delivered to Indemnitee or (D) if so
directed by the Board, by the stockholders of the Company. Indemnitee
shall reasonably cooperate with the person, persons or entity making the
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 that is not privileged or otherwise
protected from disclosure and that is reasonably available to Indemnitee and
reasonably necessary to such determination. Any costs or expenses (including
attorneys’ fees and disbursements) reasonably incurred by Indemnitee in so
cooperating with the person, persons or entity making such determination shall
be borne by the Company, to the extent permitted by applicable law.
(c) In
the event the determination of entitlement to indemnification is to be made by
Independent Counsel pursuant to Section 6(b), the Independent Counsel shall be
selected as provided in this Section 6(c). If a Change in Control shall not have
occurred, the Independent Counsel shall be selected by the Board, and the
Company shall give written notice to Indemnitee advising him or her of the
identity of the Independent Counsel so selected. If a Change in Control shall
have occurred, the Independent Counsel shall be selected by Indemnitee (unless
Indemnitee shall request that such selection be made by the Board, in which
event the preceding sentence shall apply), and Indemnitee shall give written
notice to the Company advising it of the identity of the Independent Counsel so
selected. In either event, Indemnitee or the Company, as the case may be, may,
within ten (10) days after such written notice of selection shall have been
given, deliver to the Company or to Indemnitee, as the case may be, a written
objection to such selection; provided, however, that such objection
may be asserted only on the ground that the Independent Counsel so selected does
not meet the requirements of “Independent Counsel,” as defined in Section [14]
of this Agreement, and the objection shall set forth with particularity the
factual basis of such assertion. Absent a proper and timely objection, the
person so selected shall act as Independent Counsel. If such written objection
is so made and substantiated, the Independent Counsel so selected may not serve
as Independent Counsel unless and until such objection is withdrawn or a court
has determined that such objection is without merit. If, within twenty (20) days
after the later of (i) submission by Indemnitee of a written request for
indemnification pursuant to Section 6(a) hereof and (ii) the final disposition
of the Proceeding, the parties have not agreed upon an Independent Counsel,
either the Company or Indemnitee may petition a court of competent jurisdiction
for resolution of any objection that shall have been made by the Company or
Indemnitee to the other’s selection of Independent Counsel and for the
appointment as Independent Counsel of a person selected by the court or by such
other person as the court shall designate, and the person with respect to whom
all objections are so resolved or the person so appointed shall act as
Independent Counsel under Section 6(b) hereof. The Company agrees to pay the
reasonable fees of the Independent Counsel referred to above and to fully
indemnify such counsel against any and all Expenses, claims, liabilities and
damages arising out of or relating to this Agreement or its engagement pursuant
hereto. Upon the due commencement of any judicial proceeding pursuant to Section
7 of this Agreement, the Independent Counsel shall be discharged and relieved of
any further responsibility in such capacity (subject to the applicable standards
of professional conduct then prevailing)
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(d) In
making a 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 6(a) of this
Agreement. Anyone seeking to overcome this presumption shall have the
burden of proof and the burden of persuasion, by clear and convincing evidence.
Neither the failure of the Company (including by its directors or Independent
Counsel) to have made a determination, prior to the commencement of any action
pursuant to this Agreement, that indemnification is proper in the circumstances
because Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Company (including by its directors or Independent Counsel)
that Indemnitee has not met such applicable standard of conduct, shall be a
defense to the action or create a presumption that Indemnitee has not met the
applicable standard of conduct.
(e) Indemnitee
shall be deemed to have acted in good faith if Indemnitee’s action is based on
the records or books of account of the Enterprise, including financial
statements, or on information supplied to an Indemnitee by the directors,
officers, agents or employees of the Enterprise in the course of their duties,
or on the advice of legal counsel for the Enterprise or on information or
records given or reports made to the Enterprise by an independent certified
public accountant or by an appraiser or other expert selected by the
Enterprise. In addition, the knowledge and/or actions, or failure to
act, of any director, officer, agent or employee of the Enterprise shall not be
imputed to Indemnitee for purposes of determining the right to indemnification
under this Agreement. Whether or not the foregoing provisions of this
Section 6(e) are satisfied, it shall in any event be presumed that
Indemnitee has at all times acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company. Anyone seeking to overcome this presumption shall have the
burden of proof and the burden of persuasion, by clear and convincing
evidence.
(f) If
the person, persons or entity empowered or selected under Section 6 to determine
whether Indemnitee is entitled to indemnification shall not have made a
determination within sixty (60) days after receipt by the Company of the request
therefor, the requisite determination of entitlement to indemnification shall be
deemed to have been made and Indemnitee shall be entitled to such
indemnification, absent (i) 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, or
(ii) such indemnification is expressly prohibited under applicable law; provided, however, that such sixty (60)
day period may be extended for a reasonable time, not to exceed an additional
fifteen (15) days, if the person, persons or entity making the determination
with respect to entitlement to indemnification in good faith requires such
additional time to obtain or evaluate documentation and/or information relating
thereto; and provided,
further, that the
foregoing provisions of this Section 6(f) shall not apply if the determination
of entitlement to indemnification is to be made by the stockholders pursuant to
Section 6(b) of this Agreement and if (A) within fifteen (15) days after receipt
by the Company of the request for such determination the Board or the
Disinterested Directors, if appropriate, resolve to submit such determination to
the stockholders for their consideration at an annual meeting thereof to be held
within seventy five (75) days after such receipt and such determination is made
thereat, or (B) a special meeting of stockholders is called within fifteen (15)
days after such receipt for the purpose of making such determination, such
meeting is held for such purpose within sixty (60) days after having been so
called and such determination is made thereat.
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(g) Indemnitee
shall reasonably 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. Any Independent Counsel,
member of the Board, or stockholder of the Company shall act reasonably and in
good faith in making a determination of the Indemnitee’s entitlement to
indemnification under this Agreement. Any costs or expenses
(including attorneys’ fees and disbursements) 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 hereby indemnifies and agrees
to hold Indemnitee harmless therefrom.
(h) The
Company acknowledges that a settlement or other disposition short of final
judgment may be successful if it permits a party to avoid expense, delay,
distraction, disruption and uncertainty. In the event that any
action, claim or proceeding to which Indemnitee is a party is resolved in any
manner other than by adverse judgment against Indemnitee (including, without
limitation, settlement of such action, claim or proceeding with or without
payment of money or other consideration), it shall be presumed that Indemnitee
has been successful on the merits or otherwise in such action, suit or
proceeding. Anyone seeking to overcome this presumption shall have
the burden of proof and the burden of persuasion, by clear and convincing
evidence.
(i) The
termination of any Proceeding or of any claim, issue or matter therein, by
judgment, order, settlement or conviction, or upon a plea of nolo contendere or
its equivalent, shall not (except as otherwise expressly provided in this
Agreement) of itself adversely affect the right of Indemnitee to indemnification
or create a presumption that Indemnitee did not act in good faith and in a
manner which Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company or, with respect to any criminal Proceeding, that
Indemnitee had reasonable cause to believe that Indemnitee’s conduct was
unlawful.
7. Remedies of
Indemnitee.
(a) In
the event that (i) a determination is made pursuant to Section 6 of this
Agreement that Indemnitee is not entitled to indemnification under this
Agreement, (ii) advancement of Expenses is not timely made pursuant to
Section 5 of this Agreement, (iii) no determination of entitlement to
indemnification shall have been made pursuant to Section 6(b) of this Agreement
within seventy-five (75) days after receipt by the Company of the request for
indemnification, (iv) payment of indemnification is not made pursuant to this
Agreement within sixty (60) days after receipt by the Company of a written
request therefor, (v) no contribution has been timely made pursuant to Section 3
hereof or (vi) payment of indemnification is not made within twenty (20)
days after a determination has been made that Indemnitee is entitled to
indemnification or such determination is deemed to have been made pursuant to
Section 6 of this Agreement, Indemnitee shall be entitled to an adjudication in
a court of competent jurisdiction of Indemnitee’s entitlement to such
indemnification. The Company shall not oppose Indemnitee’s right to
seek any such adjudication.
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(b) In
the event that a determination shall have been made pursuant to Section 6(b) of
this Agreement that Indemnitee is not entitled to indemnification, any judicial
proceeding commenced pursuant to this Section 7 shall be conducted in all
respects as a de novo
trial on the merits, and Indemnitee shall not be prejudiced by reason of
that adverse determination under Section 6(b).
(c) If
a determination shall have been made pursuant to Section 6(b) of this Agreement
that Indemnitee is entitled to indemnification, the Company shall be bound by
such determination in any judicial proceeding commenced pursuant to this Section
7, absent a prohibition of such indemnification under applicable
law.
(d) In
the event that Indemnitee, pursuant to this Section 7, seeks a judicial
adjudication of Indemnitee’s rights under, or to recover damages for
breach of, this Agreement, the Company shall pay on
Indemnitee’s behalf, in advance, any and all expenses (of the types
described in the definition of Expenses in [Section 14] of this Agreement)
incurred or paid by Indemnitee in such judicial adjudication, regardless of
whether Indemnitee ultimately is determined to be entitled to such
indemnification, advancement of expenses or insurance recovery. The
Company shall, within twenty (20) days after receipt by the Company of a written
request therefor from Indemnitee, advance such Expenses to Indemnitee pursuant
to comparable procedures as those set forth in Section 5 with respect to
advancement of Expenses therein. The Company irrevocably authorizes the
Indemnitee from time to time to retain counsel of Indemnitee’s choice, at the
expense of the Company to the extent provided hereunder or under applicable law,
to advise and represent Indemnitee in connection with any such judicial
adjudication or recovery, including without limitation the initiation or defense
of any litigation or other legal action, whether by or against the Company or
any director, officer, stockholder or other person affiliated with the
Company.
(e) The
Company shall be precluded from asserting in any judicial proceeding commenced
pursuant to this Section 7 that the procedures and presumptions of this
Agreement are not valid, binding and enforceable and shall stipulate in any such
court that the Company is bound by all the provisions of this
Agreement.
8. Non-Exclusivity; Survival of
Rights; Insurance; Subrogation; Primacy of Indemnification.
(a) The
rights of indemnification 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 certificate of incorporation of the Company, the
Bylaws, any agreement, a vote of stockholders or a resolution of directors, or
otherwise. 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 the Indemnitee prior to
such amendment, alteration or repeal. To the extent that a change in
the DGCL, whether by statute or judicial decision, permits greater
indemnification than would be afforded currently under the certificate of
incorporation of the Company, the Bylaws and this Agreement, the Indemnitee
shall enjoy by this Agreement the greater benefits so afforded by such
change. No right or remedy herein conferred is intended to be
exclusive of any other right or remedy, and every other right and remedy shall
be cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other right or
remedy.
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(b) To
the extent that the Company maintains an insurance policy or policies providing
liability insurance for directors, trustees, general partners, managing members,
officers, employees, agents or fiduciaries of the Company or any other
Enterprise, Indemnitee shall be covered by such policy or policies to the same
extent as the most favorably-insured persons under such policy or policies in a
comparable position. At the time of the receipt of a notice of a
claim pursuant to the terms hereof, the Company shall give prompt notice of the
commencement of such proceeding to the insurers in accordance with the
procedures set forth in the respective policies. The Company shall
thereafter take all reasonably 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.
(c) [Subject
to Section 9 below], [i][I]n 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.
(d) The Company shall not be liable under
this Agreement to make any payment of amounts otherwise indemnifiable hereunder
(or for which advancement is provided hereunder) if and to the extent that
Indemnitee has otherwise actually received such payment under any insurance
policy, contract, agreement or otherwise[.] [,subject to any subrogation rights
set forth in Section 9.]
9. [Note: include the
following provision if director is affiliated with a venture capital
fund: Primacy of Company’s
Indemnification Obligations. The Company acknowledges that Indemnitee has
certain rights to indemnification and advancement of expenses provided by [insert name of fund] and
certain affiliates thereof] (collectively, the “Fund Indemnitors”). The
Company agrees that, as between the Company and the Fund Indemnitors, the
Company is the indemnitor of first resort and primarily responsible for amounts
required to be indemnified or advanced under the Company’s certificate of
incorporation or Bylaws or this Agreement (or any other agreement between the
Company and Indemnitee) without regard to any rights Indemnitee may have against
the Fund Indemnitors, and any obligation of the Fund Indemnitors to provide
indemnification or advancement for the same amounts is secondary to those
Company obligations. To the extent not in contravention of any insurance policy
or policies providing liability or other insurance for the Company or any
director, trustee, general partner, managing member, officer, employee, agent or
fiduciary of the Company or any other Enterprise, the Company irrevocably
waives, relinquishes and releases any right of contribution or subrogation or
any other recovery of any kind against the Fund Indemnitors with respect to the
liabilities for which the Company is primarily responsible under this
Section 9. In the event of any payment by the Fund Indemnitors of amounts
otherwise required to be indemnified or advanced by the Company under the
Company’s certificate of incorporation or Bylaws or this Agreement, the Fund
Indemnitors shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee for indemnification or advancement of expenses
under the Company’s certificate of incorporation or Bylaws or this Agreement or,
to the extent such subrogation is unavailable and contribution is found to be
the applicable remedy, shall have a right of contribution with respect to the
amounts paid. The Fund Indemnitors are express third-party beneficiaries of the
terms of this Section 9.]
10. Exception to Right of
Indemnification. Notwithstanding any other provision of this
Agreement, Indemnitee shall not be entitled to indemnification under this
Agreement with respect to any Proceeding (or any part of any
Proceeding):
(a) brought
by Indemnitee, including any Proceeding (or any part of any Proceeding)
initiated by Indemnitee against the Company or its directors, officers,
employees, agents or other indemnitees, or any claim therein, unless (i) the
bringing of such Proceeding or making of such claim shall have been approved by
the Board, (ii) such Proceeding is being brought by the Indemnitee to assert,
interpret or enforce Indemnitee’s rights under this Agreement, or (iii) the
Company provides the indemnification, in its sole discretion, pursuant to the
powers vested in the Company under applicable law. For the avoidance of doubt,
Indemnitee shall not be deemed, for purposes of this subsection, to have
initiated or brought any claim by reason of (a) having asserted any affirmative
defenses in connection with a claim not initiated by Indemnitee or (b) having
made any mandatory counterclaim in connection with any claim not initiated by
Indemnitee;
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(b) for
an accounting or disgorgement of profits pursuant to Section 16(b) of the
Securities Exchange Act of 1934, as amended, or similar provisions of federal,
state or local statutory law or common law, if Indemnitee is held liable
therefor (including pursuant to any settlement arrangements);
(c) for
any reimbursement of the Company by Indemnitee of any bonus or other
incentive-based or equity-based compensation or of any profits realized by
Indemnitee from the sale of securities of the Company, as required in each case
under the Securities Exchange Act of 1934, as amended (including any such
reimbursements that arise from an accounting restatement of the Company pursuant
to Section 304 of the Xxxxxxxx-Xxxxx Act of 2002 (the “Xxxxxxxx-Xxxxx Act”), or the
payment to the Company of profits arising from the purchase and sale by
Indemnitee of securities in violation of Section 306 of the Xxxxxxxx-Xxxxx Act),
if Indemnitee is held liable therefor (including pursuant to any settlement
arrangements); or
(d) if
prohibited by applicable law.
11. Duration of
Agreement. All agreements and obligations of the Company
contained herein shall continue during the period Indemnitee is an officer or
director of the Company or any other Enterprise at the Company’s request and
shall continue thereafter so long as Indemnitee shall be subject to any
Proceeding (or any proceeding commenced under Section 7 hereof), whether or not
Indemnitee is acting or serving in any such capacity at the time any liability
or expense is incurred for which indemnification can be provided under this
Agreement. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors (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), assigns, spouses, heirs, executors and personal and legal
representatives. This Agreement shall continue in effect regardless
of whether Indemnitee continues to serve as an officer or director of the
Company or any other Enterprise at the Company’s request.
12. Security. To
the extent requested by the Indemnitee and approved by the Board, the Company
may at any time and from time to time provide security to the Indemnitee for the
Company’s obligations hereunder through an irrevocable bank line of credit,
funded trust or other collateral. Any such security, once provided to
the Indemnitee, may not be revoked or released without the prior written consent
of the Indemnitee.
13. Enforcement.
(a) The
Company expressly confirms and agrees that it has entered into this Agreement
and assumed the obligations imposed on it hereby in order to induce Indemnitee
to serve as an officer or director of the Company, and the Company acknowledges
that Indemnitee is relying upon this Agreement in serving as an officer or
director of the Company; provided, however, that this Agreement
is a supplement to and in furtherance of the Company’s certificate of
incorporation and Bylaws and applicable law.
9
(b) This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements and
understandings, oral, written and implied, between the parties hereto with
respect to the subject matter hereof.
14. Definitions. For
purposes of this Agreement:
(a) A
“Change in Control”
shall be deemed to occur upon the earliest to occur after the date of this
Agreement of any of the following events:
(i) Acquisition of Stock by
Third Party. Any Person (as defined below) is or becomes the Beneficial
Owner (as defined below), directly or indirectly, of securities of the Company
representing fifteen percent (15%) or more of the combined voting power of the
Company’s then outstanding securities;
(ii) Change in Board
Composition. During any period of two consecutive years (not including
any period prior to the execution of this Agreement), individuals who at the
beginning of such period constitute the Board, and any new directors (other than
a director designated by a person who has entered into an agreement with the
Company to effect a transaction described in Sections 13(a)(i), 13(a)(iii) or
13(a)(iv)) whose election by the Board or nomination for election by the
Company’s stockholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute at least a majority of the members of the
Board;
(iii) Corporate
Transactions. The effective date of a merger or consolidation of the
Company with any other entity, other than a merger or consolidation which would
result in the voting securities of the Company outstanding immediately prior to
such merger or consolidation continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the combined voting power of the voting securities of
the surviving entity outstanding immediately after such merger or consolidation
and with the power to elect at least a majority of the Board or other governing
body of such surviving entity;
(iv) Liquidation. The
approval by the stockholders of the Company of a complete liquidation of the
Company or an agreement for the sale, lease, transfer or other disposition by
the Company of all or substantially all of the Company’s assets, in each case,
in one or a series of related transactions; and
(v) Other Events. Any
other event of a nature that would be required to be reported in response to
Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item
on any similar schedule or form) promulgated under the Securities Exchange Act
of 1934, as amended, whether or not the Company is then subject to such
reporting requirement.
For
purposes of this [Section 14(a)], the following terms shall have the following
meanings:
10
(1) “Person” shall have the meaning
as set forth in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended; provided,
however, that “Person”
shall exclude (i) the Company, (ii) any trustee or other fiduciary holding
securities under an employee benefit plan of the Company, and (iii) any
corporation owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the
Company.
(2) “Beneficial Owner” shall have
the meaning given to such term in Rule 13d-3 under the Securities Exchange Act
of 1934, as amended; provided, however, that “Beneficial
Owner” shall exclude any Person otherwise becoming a Beneficial Owner by reason
of (i) the stockholders of the Company approving a merger of the Company with
another entity or (ii) the Board approving a sale of securities by the Company
to such Person.
(b)
“Disinterested Director”
means a director of the Company who is not and was not a party to the Proceeding
in respect of which indemnification is sought by Indemnitee.
(c) “Enterprise” shall mean the
Company and any other corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise of which Indemnitee is or was serving at the
request of the Company as a director, officer, employee, agent or
fiduciary.
(d) “Expenses” shall include all
reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of
experts, witness fees, travel expenses, duplicating costs, printing and binding
costs, telephone charges, postage, delivery service fees, and all other
disbursements or expenses of the types customarily incurred in connection with
prosecuting, defending, preparing to prosecute or defend, investigating,
participating, or being or preparing to be a witness in a Proceeding, or
responding to, or objecting to, a request to provide discovery in any
Proceeding. Expenses also shall 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, supersede as bond, or
other appeal bond or its equivalent. Expenses, however, shall not
include amounts paid in settlement by Indemnitee or the amount of judgments or
fines against Indemnitee.
(e)
“Independent Counsel”
means a law firm, or a member of a law firm, that is experienced in matters of
corporation law and neither presently is, nor in the past five (5) 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 the Indemnitee under this Agreement, or of other indemnitees under
similar indemnification agreements), or (ii) any other party to the Proceeding
giving rise to a claim for indemnification 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.
(f) “Liabilities” includes
judgments, penalties, fines, interest, assessments, charges and amounts paid in
settlement.
11
(g) “Proceeding” includes any
threatened, pending or completed action, suit, arbitration, alternate dispute
resolution mechanism, investigation, inquiry, administrative hearing or any
other actual, threatened or completed proceeding, whether brought by or in the
right of the Company or otherwise and whether civil, criminal, administrative or
investigative, in which Indemnitee was, is or will be involved as a party or
otherwise, by reason of the fact that Indemnitee is or was a director or officer
of the Company, by reason of any action taken by Indemnitee or of any inaction
on Indemnitee’s part while acting as an officer or director of the Company, or
by reason of the fact that Indemnitee is or was serving at the request of the
Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other Enterprise; in each case whether or
not Indemnitee is acting or serving in any such capacity at the time any
liability or expense is incurred for which indemnification can be provided under
this Agreement; including one pending on or before the date of this Agreement;
and excluding one initiated by an Indemnitee pursuant to Section 7 of this
Agreement to enforce Indemnitee’s rights under this
Agreement.
15. Severability. If
any provision or provisions of this Agreement shall be held by a court of
competent jurisdiction to be invalid, void, illegal or otherwise 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 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; and
(b) to the fullest extent possible, the provisions of this Agreement (including,
without limitation, each portion of any section 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. Without limiting the generality of the foregoing,
this Agreement is intended to confer upon Indemnitee indemnification rights to
the fullest extent permitted by applicable laws.
16. Modification and
Waiver. No supplement, modification, termination 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.
17. Notice By
Indemnitee. Indemnitee agrees promptly to notify the Company
in writing upon being served with any summons, citation, subpoena, complaint,
indictment, information or other document relating to any Proceeding or matter
which may be subject to indemnification covered hereunder. The
failure to so notify the Company shall not relieve the Company of any obligation
which it may have to the Indemnitee under this Agreement or otherwise unless and
only to the extent that such failure or delay materially prejudices the
Company.
18. 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, 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 below Indemnitee’s signature
hereto.
(b) If
to the Company, to:
Cornerstone
OnDemand, Inc.
0000
Xxxxxxxxxxx Xxxx., Xxxxx 000 Xxxxx
Xxxxx Xxxxxx, XX 00000
Attn:
Chief Executive Officer
12
or to
such other address as may have been furnished to Indemnitee by the Company or to
the Company by Indemnitee, as the case may be.
19. 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. This Agreement may also be executed and delivered by
facsimile signature and in 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. Only one such counterpart signed by the party against
whom enforceability is sought needs to be produced to evidence the existence of
this Agreement.
20. 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.
21. Governing Law and Consent to
Jurisdiction. The parties agree that this Agreement shall be
governed by, and construed and enforced in accordance with, the laws of the
State of Delaware without application of the conflict of laws principles
thereof. Any reference made in this Agreement to a judicial
determination, decision or action of the Court of Chancery of the State of
Delaware or another court of competent jurisdiction shall mean a final,
non-appealable order. The Company and Indemnitee hereby irrevocably and
unconditionally (i) agree that any action or proceeding arising out of or in
connection with this Agreement shall be brought only in the Delaware Court of
Chancery, and not in any other state or federal court in the United States of
America or any court in any other country, (ii) consent to submit to the
exclusive jurisdiction of the Delaware Court of Chancery for purposes of any
action or proceeding arising out of or in connection with this Agreement, (iii)
appoint, to the extent such party is not otherwise subject to service of process
in the State of Delaware, The Corporation Trust Company, Wilmington, Delaware as
its agent in the State of Delaware as such party’s agent for acceptance of legal
process in connection with any such action or proceeding against such party with
the same legal force and validity as if served upon such party personally within
the State of Delaware, (iv) waive any objection to the laying of venue of any
such action or proceeding in the Delaware Court of Chancery, and (v) waive, and
agree not to plead or to make, any claim that any such action or proceeding
brought in the Delaware Court of Chancery has been brought in an improper or
inconvenient forum.
22. Miscellaneous. 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.
[Signature Page
Follows]
13
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of
the day and year first above written.
| COMPANY: | |||
|
CORNERSTONE
ONDEMAND, INC.
|
|||
|
|
By:
|
||
| Name: |
Xxxx
Xxxxxx
|
||
| Title: | President and Chief Executive Officer | ||
| Address: | 0000 Xxxxxxxxxxx Xxxx. Xxxxx 000 Xxxxx | ||
| Xxxxx Xxxxxx, XX 00000 |
|
INDEMNITEE:
|
||
|
|
||
| Name: | ||
| Address: | ||
[Signature Page to Indemnification
Agreement]
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