1---2name: director-indemnification-agreement3description: Drafts U.S. director indemnification agreements maximizing protection under state corporate law, with advancement of expenses and determination procedures. Use when drafting or updating a director indemnification agreement, onboarding directors, strengthening governance beyond bylaws, or coordinating with D&O coverage. Triggers: indemnification agreement, director advancement, corporate governance, D&O, DGCL 145.4---56# Director Indemnification Agreement78Drafts an enforceable director indemnification agreement under the state of incorporation with clear advancement and determination procedures.910## Quick Start1112Gather before drafting:13141. State of incorporation and governing statute152. Charter and bylaws (indemnification/advancement provisions)163. Board authorization status or resolutions174. Director name, titles, start date, covered capacities (subsidiaries, affiliates, benefit plans)185. D&O insurance policies and coordination preferences196. Prior indemnification agreements or house style template2021## Intake Checklist2223- [ ] Governing law matches state of incorporation24- [ ] Coverage scope: director only, or also officer/employee roles25- [ ] Retroactive to prior service or prospective only26- [ ] Advancement timing (default: 30 days from request)27- [ ] Determination method order and deadlines28- [ ] Presumption in favor of indemnification: yes/no29- [ ] Fee shifting on enforcement actions: yes/no30- [ ] Insurance priority: company primary (default) or insurance primary31- [ ] Term and post-service survival period3233## Required Definitions3435| Term | Notes |36|---|---|37| Proceeding | Threatened, pending, or completed civil, criminal, administrative, investigative, arbitration, or ADR matter |38| Expenses | All fees, costs, disbursements: attorneys, experts, witnesses, travel, transcripts, settlements where permitted |39| Indemnifiable Event | Made party or participant by reason of service to Company or at Company's request |40| Independent Counsel | Disinterested counsel meeting independence criteria |4142## Agreement Structure4344```451. Definitions462. Indemnification473. Advancement of Expenses484. Procedure for Advancement Requests495. Procedure for Indemnification Determinations506. Presumptions and Burdens517. Enforcement; Fee Shifting528. Notice of Proceedings; Defense and Settlement539. Non-Exclusivity; Subrogation; Survival5410. Insurance5511. Contribution; Partial Indemnification5612. Term; Successors5713. Governing Law; Forum5814. Severability; Amendment; Notices; Counterparts59```6061## Core Clauses6263| Section | Required Content |64|---|---|65| Recitals | Authority to indemnify to fullest extent permitted; director reliance to serve |66| Indemnification Grant | Maximum extent permitted by law; statutory conduct standard; derivative action settlement limits if required |67| Advancement | Prompt advancement on written request; fixed payment deadline; undertaking to repay after final non-appealable denial; not conditioned on initial conduct determination |68| Determination | Ordered decision makers; Company pays independent counsel; deadline for decision; presumption favoring indemnification; deemed approval if no timely determination |69| Enforcement | Judicial determination right; fee shifting on successful enforcement; Company bears clear-and-convincing burden when contesting |70| 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 |71| Non-Exclusivity/Survival | Additive to charter, bylaws, other agreements; survives for heirs/estates; no retroactive impairment |72| Insurance | Company obligation primary, not conditioned on insurance; equal coverage with other directors; notice of material policy changes |73| Contribution | Equitable contribution if indemnity unavailable; prioritize Expenses over judgments/settlements |74| General | Governing law of incorporation state; forum selection; successors assume obligations; severability; written amendment only; counterparts and e-signatures |7576## Decision Defaults7778| Issue | Default | Range |79|---|---|---|80| Advancement deadline | 30 days | 15-45 days |81| Determination deadline | 60 days | 30-90 days |82| Presumption | Director favored | No presumption (higher risk) |83| Insurance priority | Company primary | Insurance primary (rare) |8485## Pitfalls8687- Verify state statute terminology for conduct standards and limits; flag uncertain citations with `[VERIFY]` (e.g., DGCL 145 `[VERIFY]`)88- Never promise indemnification for acts prohibited by law, bad faith, or improper personal benefit89- Align with charter/bylaws — do not conflict with exculpation or indemnification limitations90- Keep advancement independent from ultimate entitlement determination91- Include explicit retroactivity rule if covering past service92- For public or regulated companies, add required board/committee approvals and securities law constraints93- Avoid cooperation clauses that undermine defense strategy or waive privilege
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