INDEMNIFICATION AGREEMENT
Exhibit 10.3
THIS INDEMNIFICATION AGREEMENT (the “Agreement”) is made and entered into as of the
___ day of ____________, 2011 by and between Carbonite, Inc., a Delaware corporation (the
“Company”), and _____________ (“Indemnitee”).
WHEREAS, highly competent persons have become more reluctant to serve publicly-held
corporations as directors, officer, or in other capacities unless they are provided with adequate
protection through insurance or adequate indemnification against risks of claims and actions
against them arising out of their service to and activities on behalf of the corporation;
WHEREAS, the Board of Directors of the Company (the “Board”) has determined that, in
order to attract and retain qualified individuals, the Company will attempt to maintain on an
ongoing basis, at its sole expense, liability insurance to protect persons serving the Company and
its subsidiaries from certain liabilities. Although the furnishing of such insurance has been a
customary and widespread practice among United States-based corporations and other business
enterprises, the Company believes that, given current market conditions and trends, such insurance
may be available to it in the future only at higher premiums and with more exclusions. At the same
time, directors, officers, and other persons in service to corporations or business enterprises are
being increasingly subjected to expensive and time-consuming litigation relating to, among other
things, matters that traditionally would have been brought only against the Company or business
enterprise itself. The Certificate of Incorporation of the Company provides that the Company shall
indemnify and advance expenses to all directors and officers of the Company in the manner set forth
therein and to the fullest extent permitted by applicable law. The Certificate of Incorporation of
the Company further provides that for the limitation of liability for directors. In addition,
Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the
State of Delaware (“DGCL”). The Certificate of Incorporation and the DGCL expressly
provide that the indemnification provisions set forth therein are not exclusive, and thereby
contemplate that contracts may be entered into between the Company and members of the Board,
officers and other persons with respect to indemnification;
WHEREAS, the uncertainties relating to such insurance and to indemnification have increased
the difficulty of attracting and retaining such persons;
WHEREAS, the Board has determined that the increased difficulty in attracting and retaining
such persons is detrimental to the best interests of the Company’s stockholders and that the
Company should act to assure such persons that there will be increased certainty of such protection
in the future;
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 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 Certificate of
Incorporation of the Company and any resolutions adopted pursuant thereto, and shall not be deemed
a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder;
WHEREAS, Indemnitee does not regard the protection available under the Company’s Certificate
of Incorporation and insurance as adequate in the present circumstances, and may not be willing to
serve as an officer, director, or in other capacities without adequate protection, and the Company
desires Indemnitee to serve in such capacity. Indemnitee is willing to serve, continue to serve,
and to take on additional service for or on behalf of the Company on the condition that he or she
be so indemnified; and
NOW, THEREFORE, in consideration of the premises and covenants contained herein, the Company
and Indemnitee covenant and agree as follows:
1. Service by Indemnitee. Indemnitee shall serve or continue to serve as a director
or officer of the Company faithfully and to the best of Indemnitee’s ability so long as Indemnitee
is duly elected or appointed or until Indemnitee tenders his or her resignation or is removed.
2. Indemnity of Indemnitee. The Company hereby agrees to hold harmless and indemnify
Indemnitee to the fullest extent permitted by 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 2(a) if, by
reason of his or her Corporate Status (as hereinafter defined), 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 2(a), Indemnitee
shall be indemnified against all Expenses (as hereinafter defined) and Liabilities (as hereinafter
defined) actually and reasonably incurred 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, 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 2(b) if, by reason of his or her
Corporate Status, 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 2(b),
Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by
Indemnitee, or on Indemnitee’s behalf, in connection with such Proceeding 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; provided, however, 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 the Court of Chancery of the State of Delaware shall determine that such indemnification may
be made.
(c) Indemnification for Expenses of a Party Who is Wholly or Partly Successful.
Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason
of his or her Corporate Status, a party to and is successful, on the merits or otherwise, in any
Proceeding, he or she shall be indemnified to the maximum extent permitted
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by law, as such may be amended from time to time, against all Expenses actually and reasonably
incurred by him or her or on his or her 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 actually and reasonably incurred by him or her or on his or her
behalf in connection with each successfully resolved claim, issue, or matter. For purposes of this
Section 2(c) 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.
3. Contribution.
(a) Whether or not the indemnification provided in Sections 2 hereof is available, in
respect of any threatened, pending or completed action, suit, or proceeding in which the Company is
jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), the
Company shall pay, in the first instance, the entire amount of any judgment or settlement of such
action, suit or proceeding without requiring Indemnitee to contribute to such payment and the
Company hereby waives and relinquishes any right of contribution it may have against Indemnitee.
The Company shall not enter into any settlement of any action, suit or proceeding in which the
Company is jointly liable with Indemnitee (or would be if joined in such action, suit or
proceeding) unless such settlement provides for a full and final release of all claims asserted
against Indemnitee.
(b) Without diminishing or impairing the obligations of the Company set forth in Section
3(a), if, for any reason, Indemnitee shall elect or be required to pay all or any portion of
any judgment or settlement in any threatened, pending or completed action, suit or proceeding in
which the Company is jointly liable with Indemnitee (or would be if joined in such action, suit or
proceeding), the Company shall contribute to the amount of Expenses and Liabilities actually and
reasonably incurred and paid or payable by Indemnitee in proportion to the relative benefits
received by the Company and all officers, directors, or employees of the Company, other than
Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such action, suit or
proceeding), on the one hand, and Indemnitee, on the other hand, from the transaction or events
from which such action, suit or proceeding arose; provided, however, that the proportion determined
on the basis of relative benefit may, to the extent necessary to conform to law, be further
adjusted by reference to the relative fault of the Company and all officers, directors or employees
of the Company other than Indemnitee who are jointly liable with Indemnitee (or would be if joined
in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, in
connection with the transaction or events that resulted in such expenses, judgments, fines, or
settlement amounts, as well as any other equitable considerations which applicable law may require
to be considered. The relative fault of the Company and all officers, directors, or employees of
the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined
in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, shall be
determined by reference to, among other things, the degree to which their actions were motivated by
intent to gain personal profit or advantage, the degree to which their liability is primary or
secondary and the degree to which their conduct is active or passive.
(c) The Company hereby agrees to fully indemnify and hold Indemnitee harmless from any claims
of contribution which may be brought by officers,
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directors or employees of the Company, other than Indemnitee, who may be jointly liable with
Indemnitee.
(d) 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. Notwithstanding any other provision of
this Agreement, to the extent that Indemnitee is, by reason of his or her Corporate Status, a
witness, or is made (or asked) to respond to discovery requests, in any Proceeding to which
Indemnitee is not a party, he or she shall be indemnified against all Expenses actually and
reasonably incurred by him or her or on his or her behalf in connection therewith.
5. Notification and Defense of Claim. As a condition precedent to Indemnitee’s right
to be indemnified, Indemnitee must notify the Company in writing as soon as practicable of any
Proceeding involving such Indemnitee for which indemnity will or could be sought. With respect to
any Proceeding of which the Company is so notified, the Company will be entitled to participate
therein at its own expense and/or to assume the defense thereof at its own expense, with legal
counsel reasonably acceptable to Indemnitee. After notice from the Company to Indemnitee of its
election so to assume such defense, the Company shall not be liable to Indemnitee for any legal or
other expense subsequently incurred by Indemnitee in connection with such action, suit, proceeding,
or investigation, other than as provided below in this Section 5. Indemnitee shall have
the right to employ his or her own counsel in connection with such action, suit, proceeding, or
investigation, but the fees the expenses of such counsel incurred after notice from the Company of
its assumption of the defense thereof shall be at the expense of Indemnitee unless (i) the
employment of counsel by Indemnitee has been authorized by the Company, (ii) counsel to Indemnitee
shall have reasonably concluded that there may be a conflict of interest or position on any
significant issue between the Company and Indemnitee in the conduct of the defense of such
Proceeding or (iii) the Company shall not in fact have employed counsel to assume the defense of
such Proceeding, in each of which cases the fees and expenses of counsel for Indemnitee, shall be
at the expense of the Company, except as otherwise expressly provided by this Agreement. The
Company shall not be entitled, without the consent of Indemnitee, to assume the defense of any
claim brought by or in the right of the Company or as to which counsel for Indemnitee shall have
reasonably made the conclusion provided for in Section 5(ii) above. The Company shall not
be required to indemnify Indemnitee under this Agreement for any amounts paid in settlement of any
Proceeding effected without its written consent. The Company shall not settle any Proceeding in
any manner which would impose any penalty or limitation on Indemnitee without Indemnitee’s written
consent. Neither the Company nor Indemnitee will unreasonably withhold or delay its consent to any
proposed settlement.
6. Advancement of Expenses. Notwithstanding any other provision of this Agreement,
the Company shall advance all Expenses actually and reasonably incurred by or on
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behalf of Indemnitee in connection with any Proceeding by reason of Indemnitee’s Corporate
Status within thirty (30) days after the receipt by the Company of a statement or statements from
Indemnitee requesting such advance or advances from time to time, whether prior to or after final
disposition of such Proceeding. Such statement or statements shall reasonably evidence the
Expenses incurred by Indemnitee and shall include or be preceded or accompanied by a written
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. Advances shall
be made without regard to Indemnitee’s ability to repay such amounts and without regard to
Indemnitee’s ultimate entitlement to indemnification under other provisions of this Agreement. Any
advances and undertakings to repay pursuant to this Section 6 shall be unsecured and
interest free.
7. 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 as
favorable as may be permitted under the DGCL 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:
(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 General Counsel of the Company shall, promptly upon
receipt of such a request for indemnification, advise the Board in writing that Indemnitee has
requested indemnification. Notwithstanding the foregoing, 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.
(b) Upon written request by Indemnitee for indemnification pursuant to the first sentence of
Section 7(a) hereof, as soon as practicable (but in any event not later than sixty (60)
days) after final disposition of the relevant Proceeding, a determination with respect to
Indemnitee’s entitlement thereto shall be made in the specific case: (i) if a Change of Control
shall not have occurred, (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 majority
vote of the Disinterested Directors, even though less than a quorum of the Board, (C) if there are
no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent
Counsel (as hereinafter defined) in a written opinion to the Board, a copy of which shall be
delivered to Indemnitee; or (ii) if a Change of Control shall have occurred, by Independent Counsel
in a written opinion to the Board, a copy of which shall be delivered to Indemnitee.
(c) If the determination of entitlement to indemnification is to be made by Independent
Counsel pursuant to Section 7(b)(ii) hereof, such Independent Counsel shall be selected by
Indemnitee, and Indemnitee shall give written notice to the Company advising it of the identity of
the Independent Counsel so selected. If the determination of entitlement to indemnification is to
be made by Independent Counsel pursuant to Section 7(b)(i)(C) (or if Indemnitee requests
that such selection be made by the Board), such Independent Counsel shall
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be selected by the Company in which case the Company shall give written notice to Indemnitee
advising him or her of the identity of the Independent Counsel so selected. In any event,
Indemnitee or the Company, as the case may be, may, within ten (10) days after such written notice
of selection shall have been received, deliver to the Company or 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 13 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 a written objection is made
and substantiated, the Independent Counsel 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 submission by Indemnitee of a written request for
indemnification pursuant to Section 7(a) hereof and final disposition of the Proceeding, no
Independent Counsel shall have been selected and not objected to, either the Company or Indemnitee
may petition the Court of Chancery of the State of Delaware or other court of competent
jurisdiction for resolution of any objection which shall have been made by Company or Indemnitee to
the other’s selection of Independent Counsel and/or 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 7(b) hereof. The Company shall pay any and all
reasonable fees and expenses of Independent Counsel incurred by such Independent Counsel in
connection with acting pursuant to Section 7(b) hereof, and the Company shall pay all
reasonable fees and expenses incident to the procedures of this Section 7(c), regardless of
the manner in which such Independent Counsel was selected or appointed. If it is so determined
that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10)
days of such determination.
(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. 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 legal 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
legal 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 (as hereinafter defined), including financial
statements, or on information supplied to Indemnitee by the officers 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 with reasonable care 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
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provisions of this Section 7(e) are satisfied, it shall in any event be presumed that
Indemnitee has at all times acted in good faith and in a manner he or she 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 7 to
determine whether Indemnitee is entitled to indemnification shall not have made a determination
within the sixty (60) day period referred to in Section 7(b), 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) a prohibition of such indemnification
under applicable law; provided, however, that such sixty (60) day period may be extended for a
reasonable time, not to exceed an additional thirty (30) days, if the person, persons or entity
making such determination with respect to entitlement to indemnification in good faith requires
such additional time to obtain or evaluate documentation and/or information relating thereto.
(g) Indemnitee shall cooperate with the person, persons or entity making such determination
with respect to Indemnitee’s entitlement to indemnification, including providing to such person,
persons or entity upon reasonable advance request any documentation or information which is not
privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee
and reasonably necessary to such determination. Any Independent Counsel or member of the Board
shall act reasonably and in good faith in making a determination regarding 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 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
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 he or she 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 his or her conduct was unlawful.
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8. Remedies of Indemnitee.
(a) In the event that (i) a determination is made pursuant to Section 7 of this
Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement
of Expenses is not timely made pursuant to Section 6 of this Agreement, (iii) no
determination of entitlement to indemnification is made pursuant to Section 7(b) of this
Agreement within the sixty (60) day period referred to in Section 7(b), or (v) payment of
indemnification is not made within ten (10) 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 7 of this Agreement, Indemnitee shall be entitled to an adjudication in
an appropriate court of the State of Delaware, or in any other court of competent jurisdiction, of
Indemnitee’s entitlement to such indemnification. Indemnitee shall commence such proceeding
seeking an adjudication within one hundred and eighty (180) days following the date on which
Indemnitee first has the right to commence such proceeding pursuant to this Section 8(a).
The Company shall not oppose Indemnitee’s right to seek any such adjudication.
(b) In the event that a determination shall have been made pursuant to Section 7(b) of
this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding
commenced pursuant to this Section 8 shall be conducted in all respects as a de novo trial
on the merits, and Indemnitee shall not be prejudiced by reason of the adverse determination under
Section 7(b).
(c) If a determination shall have been made pursuant to Section 7(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 8, absent (i) a misstatement by
Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s
misstatement not materially misleading in connection with the application for indemnification, or
(ii) a prohibition of such indemnification under applicable law, as such may be amended from time
to time.
(d) In the event that Indemnitee, pursuant to this Section 8, seeks a judicial
adjudication of his or her rights under, or to recover damages for breach of, this Agreement, or to
recover under any directors’ and officers’ liability insurance policies maintained by the Company,
the Company shall pay on his or her behalf, in advance, any and all expenses of the types described
in the definition of Expenses in Section 13 of this Agreement actually and reasonably
incurred by him or her in such judicial adjudication, regardless of whether Indemnitee ultimately
is determined to be entitled to such indemnification, advancement of expenses or insurance
recovery.
(e) The Company shall be precluded from asserting in any judicial proceeding commenced
pursuant to this Section 8 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. The Company shall indemnify Indemnitee against any and all
expenses of the types described in the definition of Expenses in Section 13 of this
Agreement and, if requested by Indemnitee, shall (within ten (10) days after receipt by the Company
of a written request therefore) advance, to the extent not prohibited by law, such expenses to
Indemnitee, which are incurred by Indemnitee in connection with any action brought by Indemnitee
for indemnification or advance of Expenses from the Company under this Agreement or under any
directors’ and officers’ liability insurance policies maintained
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by the Company, regardless of whether Indemnitee ultimately is determined to be entitled to
such indemnification, advancement of Expenses or insurance recovery, as the case may be.
(f) Notwithstanding anything in this Agreement to the contrary, no determination as to
entitlement to indemnification under this Agreement shall be required to be made prior to the final
disposition of the Proceeding.
9. Non-Exclusivity; Survival of Rights; Insurance; Primacy of Indemnification;
Subrogation.
(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, the By-laws, any agreement, a vote of stockholders, a resolution of
directors of the Company, 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 such Indemnitee in his or her Corporate Status 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, By-laws and this Agreement, it is the intent of the parties hereto
that 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.
(b) To the extent that the Company maintains an insurance policy or policies providing
liability insurance for any director, officer, trustee, general partner, managing member,
fiduciary, board of directors’ committee member, employee, or agent of the Company or of any other
corporation, partnership, joint venture, trust, employee benefit plan or other Enterprise that such
person serves at the request of the Company, Indemnitee shall be covered by such policy or policies
in accordance with its or their terms to the maximum extent of the coverage available for any
director, officer, trustee, general partner, managing member, fiduciary, board of directors’
committee member, employee, or agent under such policy or policies. If, at the time of the receipt
of a notice of a claim pursuant to the terms hereof, the Company has directors’ and officers’
liability insurance in effect, 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 necessary or desirable action to cause such insurers to pay,
on behalf of Indemnitee, all amounts payable as a result of such proceeding in accordance with the
terms of such policies.
(c) The Company hereby acknowledges that Indemnitee has or may from time to time obtain
certain rights to indemnification, advancement of expenses and/or insurance provided by one or more
third parties (collectively, the “Third-Party Indemnitors”). The Company hereby agrees (i)
that it is the indemnitor of first resort (i.e., its obligations to Indemnitee are primary and any
obligation of the Third-Party Indemnitors to advance expenses or to provide indemnification for the
same expenses or liabilities incurred by Indemnitee are secondary), (ii) that it shall be required
to advance the full amount of Expenses incurred by
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Indemnitee and shall be liable for the full amount of all Expenses and Liabilities to the
extent legally permitted and as required by the terms of this Agreement and the Certificate of
Incorporation or Bylaws of the Company (or any other agreement between the Company and Indemnitee),
without regard to any rights Indemnitee may have against the Third-Party Indemnitors, and (iii)
that it irrevocably waives, relinquishes and releases the Third-Party Indemnitors from any and all
claims against the Third-Party Indemnitors for contribution, subrogation or any other recovery of
any kind in respect thereof. The Company further agrees that no advancement or payment by the
Third-Party Indemnitors on behalf of Indemnitee with respect to any claim for which Indemnitee has
sought indemnification from the Company shall affect the foregoing and the Third-Party Indemnitors
shall have a right of contribution and/or be subrogated to the extent of such advancement or
payment to all of the rights of recovery of Indemnitee against the Company.
(d) Except as provided in Section 9(c) above, in the event of any payment under this
Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee (other than against the Third-Party Indemnitors), 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.
(e) Except as provided in Section 9(c) above, the Company shall not be liable under
this Agreement to make any payment of amounts otherwise indemnifiable hereunder if and to the
extent that Indemnitee has otherwise actually received such payment under any insurance policy,
contract, agreement, or otherwise.
(f) Except as provided in Section 9(c) above, the Company’s obligation to indemnify or
advance Expenses hereunder to Indemnitee who is or was serving at the request of the Company as a
director, officer, trustee, general partner, managing member, fiduciary, board of directors’
committee member, employee, or agent of any other corporation, partnership, joint venture, trust,
employee benefit plan or other Enterprise shall be reduced by any amount Indemnitee has actually
received as indemnification or advancement of expenses from such other corporation, partnership,
joint venture, trust, employee benefit plan or other Enterprise.
10. Exception to Right of Indemnification. Notwithstanding any provision in this
Agreement, the Company shall not be obligated under this Agreement to make any indemnity in
connection with any claim made against Indemnitee:
(a) for which payment has actually been made to or on behalf of Indemnitee under any insurance
policy or other indemnity provision, except with respect to any excess beyond the amount paid under
any insurance policy or other indemnity provision, provided, that the foregoing shall not affect
the rights of Indemnitee or the Third-Party Indemnitors set forth in Section 9(c); or
(b) for an accounting of profits made from the purchase and sale (or sale and purchase) by
Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange
Act (as hereinafter defined) or similar provisions of state statutory law or common law; or
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(c) in connection with any Proceeding (or any part of any Proceeding) initiated by Indemnitee,
including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the
Company or its directors, officers, employees or other indemnitees, unless (i) the Board authorized
the Proceeding (or any part of any Proceeding) prior to its initiation or (ii) the Company provides
the indemnification, in its sole discretion, pursuant to the powers vested in the Company under
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 is
or was serving at the request of the Company as a director, officer, trustee, general partner,
managing member, fiduciary, board of directors’ committee member, employee, or agent of another
corporation, partnership, joint venture, trust or other Enterprise) and shall continue thereafter
so long as Indemnitee shall be subject to any Proceeding (or any proceeding commenced under
Section 8 hereof) by reason of his or her Corporate Status, whether or not he or she 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.
12. Entire Agreement. This Agreement and the documents referred to herein constitute
the entire agreement between the parties hereto with respect to the subject matters covered hereby,
and any other prior or contemporaneous oral or written understandings or agreements with respect to
the matters covered hereby are superseded by this Agreement, provided that this Agreement is a
supplement to and in furtherance of the Certificate of Incorporation and By-Laws of the Company and
applicable law, and shall not be deemed a substitute therefore, nor to diminish or abrogate any
rights of Indemnitee thereunder.
13. Definitions. For purposes of this Agreement:
(a) “Change of Control” means any one of the follow circumstances occurring after the
date hereof: (i) there shall have occurred an event required to be reported with respect to the
Company in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar
item or any similar schedule or form) under the Exchange Act, regardless of whether the Company is
then subject to such reporting requirement; (ii) any “person” or “group” (as such terms are used in
Section 13(d) and 14(d) of the Exchange Act) shall have become, without prior approval of the
Company’s Board by approval of at least two-thirds of the Continuing Directors, the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), 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 (provided that, for the purpose of this Section 13(a)(ii),
the term “person” shall exclude (x) the Company, (y) any trustee or other fiduciary holding
securities under an employee benefit plan of the Company, and (z) 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); (iii) there occurs 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 fifty-
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one percent (51%) if 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 of directors or other governing body of such surviving entity; (iv)
all or substantially all of the assets of the Company are sold or disposed of in a transaction or
series of related transactions; (v) the approval of the stockholders of the Company of a complete
liquidation of the Company; or (vi) the Continuing Directors cease for any reason to constitute at
least a majority of the members of the Board.
(b) “Continuing Director” means (i) each director on the Board on the date hereof or
(ii) any new director whose election 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 were directors
on the date hereof or whose election or nomination was approved.
(c) “Corporate Status” means the status of a person who is or was a director, officer,
trustee, general partner, managing member, fiduciary, board of directors’ committee member,
employee, or agent of the Company or of any other corporation, partnership, joint venture, trust,
employee benefit plan or other Enterprise that such person is or was serving at the express written
request of the Company.
(d) “Disinterested Director” means a director of the Company who is not and was not a
party to the Proceeding in respect of which indemnification is sought by Indemnitee.
(e) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
(f) “Enterprise” means the Company and any other corporation, limited liability
company, partnership, joint venture, trust, employee benefit plan or other enterprise that
Indemnitee is or was serving at the express written request of the Company as a director, officer,
trustee, general partner, managing member, fiduciary, board of directors’ committee member,
employee, or agent.
(g) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(h) “Expenses” means 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 and any federal, state, local or foreign taxes imposed on Indemnitee as a result of the
actual or deemed receipt of any payments under this Agreement, 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 any Liabilities.
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(i) “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 years has
been, retained to represent: (i) the Company or Indemnitee in any matter material to either such
party (other than with respect to matters concerning Indemnitee under this Agreement, or of other
indemnitees under similar indemnification agreements), or (ii) any other party to 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. 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.
(j) “Liabilities” means any losses or liabilities, including any judgments, fines,
ERISA excise taxes and penalties, penalties and amounts paid in settlement, arising out of or in
connection with any Proceeding (including all interest, assessments, and other charges paid or
payable in connection with or in respect of any judgments, fines, ERISA excise taxes and penalties,
penalties or amounts paid in settlement).
(k) “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 his or her Corporate
Status, by reason of any action taken by him or her or of any inaction on his or her part while
acting in his or her Corporate Status; in each case whether or not he or she 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,
but excluding one initiated by an Indemnitee pursuant to Section 8 of this Agreement to
enforce his or her rights under this Agreement.
14. Severability. The invalidity or unenforceability of any provision hereof shall in
no way affect the validity or enforceability of any other provision. 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. In the event any provision hereof
conflicts with any applicable law, such provision shall be deemed modified, consistent with the
aforementioned intent, to the extent necessary to resolve such conflict.
15. 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.
16. Notice By Indemnitee. Indemnitee agrees promptly to notify the Company in writing
upon being served with or otherwise receiving 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
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Company shall not relieve the Company of any obligation which it may have to Indemnitee under
this Agreement or otherwise unless and only to the extent that such failure or delay materially
prejudices the Company.
17. Notices. All notices and other communications given or made pursuant to this
Agreement shall be in writing and shall be deemed effectively given: (a) upon personal delivery to
the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during
normal business hours of the recipient, and if not so confirmed, then on the next business day, (c)
five (5) days after having been sent by registered or certified mail, return receipt requested,
postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. All communications shall be
sent:
(a) To Indemnitee at the address set forth below Indemnitee signature hereto.
(b) To the Company at:
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
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.
18. Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed 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 two or
more counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
19. 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.
20. Governing Law and Consent to Jurisdiction. This Agreement and the legal relations
among the parties shall be governed by, and construed and enforced in accordance with, the laws of
the State of Delaware, without regard to its conflict of laws rules. 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 Chancery Court of the State of Delaware
(the “Delaware Court”), 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 for purposes of any action or proceeding arising out of or in connection with
this Agreement, (iii) waive any objection to the laying of venue of any such action or proceeding
in the Delaware Court, and (iv) waive, and agree not to plead or to make, any claim that any such
action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient
forum.
SIGNATURE PAGE TO FOLLOW
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IN WITNESS WHEREOF, the parties hereto have executed this Indemnification Agreement on and as
of the day and year first above written.
| CARBONITE, INC. |
||||
| By: | ||||
| Name: | ||||
| Its: | ||||
| INDEMNITEE |
||||
| Name: | ||||
| Address: | |||
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