1---2name: director-indemnification-agreement3description: >-4 Drafts U.S. director indemnification agreements maximizing protection under5 state corporate law, with advancement of expenses and determination6 procedures. Use when drafting or updating a director indemnification7 agreement, onboarding directors, strengthening governance beyond bylaws, or8 coordinating with D&O coverage. Triggers: indemnification agreement,9 director advancement, corporate governance, D&O, DGCL 145.10---1112# Director Indemnification Agreement1314Drafts an enforceable director indemnification agreement under the state of incorporation with clear advancement and determination procedures.1516## Quick Start1718Gather before drafting:19201. State of incorporation and governing statute212. Charter and bylaws (indemnification/advancement provisions)223. Board authorization status or resolutions234. Director name, titles, start date, covered capacities (subsidiaries, affiliates, benefit plans)245. D&O insurance policies and coordination preferences256. Prior indemnification agreements or house style template2627## Intake Checklist2829- [ ] Governing law matches state of incorporation30- [ ] Coverage scope: director only, or also officer/employee roles31- [ ] Retroactive to prior service or prospective only32- [ ] Advancement timing (default: 30 days from request)33- [ ] Determination method order and deadlines34- [ ] Presumption in favor of indemnification: yes/no35- [ ] Fee shifting on enforcement actions: yes/no36- [ ] Insurance priority: company primary (default) or insurance primary37- [ ] Term and post-service survival period3839## Required Definitions4041| Term | Notes |42|---|---|43| Proceeding | Threatened, pending, or completed civil, criminal, administrative, investigative, arbitration, or ADR matter |44| Expenses | All fees, costs, disbursements: attorneys, experts, witnesses, travel, transcripts, settlements where permitted |45| Indemnifiable Event | Made party or participant by reason of service to Company or at Company's request |46| Independent Counsel | Disinterested counsel meeting independence criteria |4748## Agreement Structure4950```511. Definitions522. Indemnification533. Advancement of Expenses544. Procedure for Advancement Requests555. Procedure for Indemnification Determinations566. Presumptions and Burdens577. Enforcement; Fee Shifting588. Notice of Proceedings; Defense and Settlement599. Non-Exclusivity; Subrogation; Survival6010. Insurance6111. Contribution; Partial Indemnification6212. Term; Successors6313. Governing Law; Forum6414. Severability; Amendment; Notices; Counterparts65```6667## Core Clauses6869| Section | Required Content |70|---|---|71| Recitals | Authority to indemnify to fullest extent permitted; director reliance to serve |72| Indemnification Grant | Maximum extent permitted by law; statutory conduct standard; derivative action settlement limits if required |73| Advancement | Prompt advancement on written request; fixed payment deadline; undertaking to repay after final non-appealable denial; not conditioned on initial conduct determination |74| Determination | Ordered decision makers; Company pays independent counsel; deadline for decision; presumption favoring indemnification; deemed approval if no timely determination |75| Enforcement | Judicial determination right; fee shifting on successful enforcement; Company bears clear-and-convincing burden when contesting |76| Notice and Defense | Prompt written notice; no forfeiture absent material prejudice; Company may assume defense with director consent to counsel; separate counsel at Company expense for conflicts; settlement consent with unconditional-release carveout |77| Non-Exclusivity/Survival | Additive to charter, bylaws, other agreements; survives for heirs/estates; no retroactive impairment |78| Insurance | Company obligation primary, not conditioned on insurance; equal coverage with other directors; notice of material policy changes |79| Contribution | Equitable contribution if indemnity unavailable; prioritize Expenses over judgments/settlements |80| General | Governing law of incorporation state; forum selection; successors assume obligations; severability; written amendment only; counterparts and e-signatures |8182## Decision Defaults8384| Issue | Default | Range |85|---|---|---|86| Advancement deadline | 30 days | 15-45 days |87| Determination deadline | 60 days | 30-90 days |88| Presumption | Director favored | No presumption (higher risk) |89| Insurance priority | Company primary | Insurance primary (rare) |9091## Pitfalls9293- Verify state statute terminology for conduct standards and limits; flag uncertain citations with `[VERIFY]` (e.g., DGCL 145 `[VERIFY]`)94- Never promise indemnification for acts prohibited by law, bad faith, or improper personal benefit95- Align with charter/bylaws — do not conflict with exculpation or indemnification limitations96- Keep advancement independent from ultimate entitlement determination97- Include explicit retroactivity rule if covering past service98- For public or regulated companies, add required board/committee approvals and securities law constraints99- Avoid cooperation clauses that undermine defense strategy or waive privilege
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