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EXHIBIT
10.2
INDEMNIFICATION
AGREEMENT
This Agreement is made as of
the [ ] day of
[ ],
by and between Vonage Holdings Corp., a Delaware corporation (the
“Corporation), and
[ ]
(the “Indemnitee”), a director or officer of the
Corporation.
WHEREAS, it is essential to
the Corporation to retain and attract as directors and officers the
most capable persons available, and
WHEREAS, the substantial
increase in corporate litigation subjects directors and officers to
expensive litigation risks at the same time that the availability
of directors’ and officers’ liability insurance has
been severely limited, and
WHEREAS, it is now and has
always been the express policy of the Corporation to indemnify its
directors and officers, and
WHEREAS, the Indemnitee does
not regard the protection available under the Corporation’s
Certificate of Incorporation and insurance as adequate in the
present circumstances, and may not be willing to serve or continue
to serve as a director or officer without adequate protection,
and
WHEREAS, the Corporation
desires the Indemnitee to serve, or continue to serve, as a
director or officer of the Corporation.
NOW THEREFORE, the
Corporation and the Indemnitee do hereby agree as
follows:
1. Agreement to Serve
. The Indemnitee agrees to serve or continue to serve as a director
or officer of the Corporation for so long as the Indemnitee is duly
elected or appointed or until such time as the Indemnitee tenders a
resignation in writing.
2. Definitions . As
used in this Agreement:
(a) The term “Change in
Control” shall mean, and shall be deemed to have occurred if,
on or after the date of this Agreement, (i) any
“person” (as such term is used in Section 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended),
other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Corporation acting in such capacity or
a corporation owned directly or indirectly by the stockholders of
the Corporation in substantially the same proportions as their
ownership of stock of the Corporation, becomes the
“beneficial owner” (as defined in Rule 13d-3 under said
Act), directly or indirectly, of securities of the Corporation
representing more than 50% of the total voting power represented by
the Corporation’s then outstanding Voting Securities (as
defined below), (ii) during any period of two consecutive
years, individuals who at the beginning of such period constitute
the Board of Directors of the Corporation and any new director
whose election by the Board of Directors or nomination for election
by the Corporation’s stockholders was approved by a vote of
at least two thirds (2/3) 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 a majority thereof, or
(iii) the stockholders of the Corporation approve a merger or
consolidation of the Corporation with any other entity
other
than a merger or consolidation which
would result in the Voting Securities of the Corporation
outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into Voting
Securities of the surviving entity) at least 80% of the total
voting power represented by the Voting Securities of the
Corporation or such surviving entity outstanding immediately after
such merger or consolidation, or the stockholders of the
Corporation approve a plan of complete liquidation of the
Corporation or an agreement for the sale or disposition by the
Corporation of (in one transaction or a series of related
transactions) all or substantially all of the Corporation’s
assets.
(b) The term “Corporate
Status” shall mean the status of a person who is or was, or
has agreed to become, a director or officer of the Corporation, or
is or was serving, or has agreed to serve, at the request of the
Corporation, as a director, officer, fiduciary, partner, trustee,
member, employee or agent of, or in a similar capacity with,
another corporation, partnership, joint venture, trust or other
enterprise (including any employee benefit plan).
(c) References to the
“Corporation” shall include, in addition to Vonage
Holdings Corp., any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or merger
to which Vonage Holdings Corp. (or any of its wholly owned
subsidiaries) is a party which, if its separate existence had
continued, would have had the power and authority to indemnify its
directors, officers, employees, agents or fiduciaries, so that if
the Indemnitee is or was a director, officer, employee, agent or
fiduciary of such constituent corporation, or is or was serving at
the request of such constituent corporation as a director, officer,
employee, agent or fiduciary of another corporation, partnership,
joint venture, employee benefit plan, trust or other enterprise,
the Indemnitee shall stand in the same position under the
provisions of this Agreement with respect to the resulting or
surviving corporation as the Indemnitee would have with respect to
such constituent corporation if its separate existence had
continued.
(d) The term
“Expenses” shall include, without limitation,
attorneys’ fees, retainers, court costs, transcript costs,
fees and expenses of experts, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery
service fees and other disbursements or expenses of the types
customarily incurred in connection with actions, suits,
proceedings, alternative dispute resolution mechanisms, hearings,
inquiries or investigations, including any costs or expenses
incurred defending, being a witness in or participating in, or
preparing to defend, to be a witness in or to participate in, such
actions, suits, proceedings, alternative dispute resolution
mechanisms, hearings, inquiries or investigations, including any
federal, state, local or foreign taxes imposed on the Indemnitee as
a result of actual or deemed receipt of payments for the foregoing,
but shall not include the amount of judgments, fines or penalties
against the Indemnitee or amounts paid in settlement in connection
with such matters.
(e) References to
“other enterprise” shall include employee benefit
plans; references to “fines” shall include any excise
tax assessed with respect to any employee benefit plan; references
to “serving at the request of the Corporation” shall
include any service as a director, officer, employee, agent or
fiduciary of the Corporation which imposes duties on, or involves
services by, such director, officer, employee, agent or fiduciary
with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner
such person reasonably believed to be in the interests of the
participants and beneficiaries of an employee benefit plan shall be
deemed to have acted in a manner “not opposed to the best
interests of the Corporation” as referred to in this
Agreement.
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(f) The term
“Proceeding” shall include any threatened, pending or
completed action, suit, arbitration, alternative dispute resolution
mechanism, hearing, inquiry, investigation or other proceeding,
whether brought by or in the right of the Corporation or otherwise
and whether of a civil, criminal, administrative or investigative
nature, and any appeal therefrom.
(g) The term “Special
Independent Counsel” shall mean a law firm, or a member of a
law firm, that is experienced in matters of corporation law and
neither currently is, nor in the past three years has been,
retained to represent: (i) the Corporation or the Indemnitee
in any matter material to either such party or (ii) any other
party to the Proceeding giving rise to a claim for indemnification
hereunder. Notwithstanding the foregoing, the term “Special
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
Corporation or the Indemnitee in an action to determine the
Indemnitee’s rights under this Agreement.
(h) The term “Voting
Securities” shall mean any securities of the Corporation that
vote generally in the election of directors.
3. Indemnity of
Indemnitee . Subject to Sections 6, 7 and 9, the Corporation
shall indemnify the Indemnitee in connection with any Proceeding as
to which the Indemnitee is, was or is threatened to be made a party
(or is a witness or participant in or otherwise involved with) by
reason of the Indemnitee’s Corporate Status, to the fullest
extent permitted by law (as such may be amended from time to time).
To the extent that a change in applicable law (whether by statute
or judicial decision) permits greater indemnification than would be
afforded currently hereunder, the Indemnitee shall enjoy the
greater benefits so afforded by such change without any further
action by the Corporation. In furtherance of the foregoing and
without limiting the generality thereof:
(a) Indemnification in
Third-Party Proceedings . The Corporation shall indemnify the
Indemnitee in accordance with the provisions of this
Section 3(a) if the Indemnitee was or is a party to or
threatened to be made a party to or otherwise involved in any
Proceeding (other than a Proceeding by or in the right of the
Corporation to procure a judgment in its favor or a Proceeding
referred to in Section 6 below) by reason of the
Indemnitee’s Corporate Status or by reason of any action
alleged to have been taken or omitted in connection therewith,
against all Expenses, liabilities, losses, judgments, fines, ERISA
taxes or penalties and amounts paid in settlement actually and
reasonably incurred by or on behalf of the Indemnitee in connection
with such Proceeding, if the Indemnitee acted in good faith and in
a manner which the Indemnitee reasonably believed to be in, or not
opposed to, the best interests of the Corporation and, with respect
to any criminal Proceeding, had no reasonable cause to believe that
his or her conduct was unlawful.
(b) Indemnification in
Proceedings by or in the Right of the Corporation . The
Corporation shall indemnify the Indemnitee in accordance with the
provisions of this Section 3(b) if the Indemnitee was or is a
party to or threatened to be made a party to or
otherwise
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involved in any Proceeding by or in the
right of the Corporation to procure a judgment in its favor by
reason of the Indemnitee’s Corporate Status or by reason of
any action alleged to have been taken or omitted in connection
therewith, against all Expenses and, to the extent permitted by
law, amounts paid in settlement actually and reasonably incurred by
or on behalf of the Indemnitee in connection with such Proceeding,
if the Indemnitee acted in good faith and in a manner which the
Indemnitee reasonably believed to be in, or not opposed to, the
best interests of the Corporation, except that, if applicable law
so provides, no indemnification shall be made under this
Section 3(b) in respect of any claim, issue or matter as to
which the Indemnitee shall have been adjudged to be liable to the
Corporation, unless, and only to the extent, that the Court of
Chancery of Delaware or the court in which such action or suit was
brought shall determine upon application that, despite the
adjudication of such liability but in view of all the circumstances
of the case, the Indemnitee is fairly and reasonably entitled to
indemnity for such Expenses as the Court of Chancery or such other
court shall deem proper.
4. Indemnification of
Expenses of Successful Party . Notwithstanding any other
provision of this Agreement, to the extent that the Indemnitee has
been successful, on the merits or otherwise, in defense of any
Proceeding or in defense of any claim, issue or matter therein
(other than a Proceeding referred to in Section 6), the
Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by or on behalf of the Indemnitee in connection
therewith. Without limiting the foregoing, if any Proceeding or any
claim, issue or matter therein is disposed of, on the merits or
otherwise (including a disposition without prejudice), without
(i) the disposition being adverse to the Indemnitee,
(ii) an adjudication that the Indemnitee was liable to the
Corporation, (iii) a plea of guilty or nolo
contendere by the Indemnitee, (iv) an adjudication that
the Indemnitee did not act in good faith and in a manner the
Indemnitee reasonably believed to be in or not opposed to the best
interests of the Corporation, and (v) with respect to any
criminal proceeding, an adjudication that the Indemnitee had
reasonable cause to believe his or her conduct was unlawful, the
Indemnitee shall be considered for the purposes hereof to have been
wholly successful with respect thereto.
5. Indemnification for
Expenses of a Witness . To the extent that the Indemnitee is,
by reason of the Indemnitee’s Corporate Status, a witness in
any Proceeding to which the Indemnitee is not a party, the
Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by or on behalf of the Indemnitee in connection
therewith.
6. Exceptions to Right of
Indemnification . Notwithstanding anything to the contrary in
this Agreement, except as set forth in Section 10, the
Corporation shall not indemnify the Indemnitee in connection with a
Proceeding (or part thereof) initiated by the Indemnitee unless
(a) the initiation thereof was approved by the Board of
Directors of the Corporation or (b) the Proceeding was
commenced following a Change in Control. Notwithstanding anything
to the contrary in this Agreement, the Corporation shall not
indemnify the Indemnitee to the extent the Indemnitee is reimbursed
from the proceeds of insurance, and in the event the Corporation
makes any indemnification payments to the Indemnitee and the
Indemnitee is subsequently reimbursed from the proceeds of
insurance, the Indemnitee shall promptly refund such
indemnification payments to the Corporation to the extent of such
insurance reimbursement.
7. Notification and
Defense of Claim . As a condition precedent to the
Indemnitee’s right to be indemnified, the Indemnitee must
notify the Corporation in writing as soon as
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practicable of any Proceeding for which
indemnity will or could be sought. With respect to any Proceeding
of which the Corporation is so notified, the Corporation 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 the Indemnitee. After notice from the
Corporation to the Indemnitee of its election so to assume such
defense, the Corporation shall not be liable to the Indemnitee for
any legal or other expenses subsequently incurred by the Indemnitee
in connection with such Proceeding, other than as provided below in
this Section 7. The Indemnitee shall have the right to employ
his or her own counsel in connection with such Proceeding, but the
fees and expenses of such counsel incurred after notice from the
Corporation of its assumption of the defense thereof shall be at
the expense of the Indemnitee unless (i) the employment of
counsel by the Indemnitee has been authorized by the Corporation,
(ii) counsel to the Indemnitee shall have reasonably concluded
that there may be a conflict of interest or position on any
significant issue between the Corporation and the Indemnitee in the
conduct of the defense of such Proceeding or (iii) the
Corporation 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 the Indemnitee shall be at the expense of
the Corporation, except as otherwise expressly provided by this
Agreement. The Corporation shall not be entitled, without the
consent of the Indemnitee, to assume the defense of any claim
brought by or in the right of the Corporation or as to which
counsel for the Indemnitee shall have reasonably made the
conclusion provided for in clause (ii) above. The Corporation
shall not be required to indemnify the Indemnitee under this
Agreement for any amounts paid in settlement of any Proceeding
effected without its written consent. The Corporation shall not
settle any Proceeding in any manner that would impose any penalty
or limitation on the Indemnitee without the Indemnitee’s
written consent. Neither the Corporation nor the Indemnitee will
unreasonably withhold or delay their consent to any proposed
settlement.
8. Advancement of
Expenses . In the event that the Corporation does not assume
the defense pursuant to Section 7 of any Proceeding of which
the Corporation receives notice under this Agreement, any Expenses
actually and reasonably incurred by or on behalf of the Indemnitee
in defending such Proceeding shall be paid by the Corporation in
advance of the final disposition of such Proceeding; provided,
however, that the payment of such Expenses incurred by or on behalf
of the Indemnitee in advance of the final disposition of such
Proceeding shall be made only upon receipt of an
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