INDEMNIFICATION
AGREEMENT
This
Indemnification Agreement (the “Agreement”) is made as
of ___, 200_, by and between Visicu, Inc., a Delaware corporation
(the “Company”) and [name of indemnified person]
«Name» (the “Indemnitee”).
A. The
Company is aware that competent and experienced persons are
increasingly reluctant to serve as directors, officers, advisors,
or agents of corporations unless they are protected by
comprehensive liability insurance or indemnification, due to
increased exposure to litigation costs and risks resulting from
their service to such corporations, and due to the fact that the
exposure frequently bears no reasonable relationship to the
compensation of such directors, officers, advisors, and other
agents.
B. The
statutes and judicial decisions regarding the duties of directors
and officers are often difficult to apply, ambiguous, or
conflicting, and therefore fail to provide such directors,
officers, advisors, and agents with adequate, reliable knowledge of
legal risks to which they are exposed or information regarding the
proper course of action to take.
C. Plaintiffs
often seek damages in such large amounts and the costs of
litigation may be so enormous (whether or not the case is
meritorious), that the defense and/or settlement of such litigation
is often beyond the personal resources of directors, officers,
advisors, and other agents.
D. The
Company believes that it is unfair for its directors, officers,
advisors to assume the risk of huge judgments and other expenses
which may occur in cases in which the director, officer, advisor,
or agent received no personal profit and in cases where the
director, officer, advisor, or agent was not culpable.
E. The
Company recognizes that the issues in controversy in litigation
against a director, officer, advisor, or agent of a corporation
such as the Company are often related to the knowledge, motives and
intent of such director, officer, advisor, or agent, that he is
usually the only witness with knowledge of the essential facts and
exculpating circumstances regarding such matters, and that the long
period of time which usually elapses before the trial or other
disposition of such litigation often extends beyond the time that
the director, officer, advisor, or agent can reasonably recall such
matters and may extend beyond the normal time for retirement for
such director, officer, advisor, or agent with the result that he,
after retirement or in the event of his death, his spouse, heirs,
executors or administrators, may be faced with limited ability and
undue hardship in maintaining an adequate defense, which may
discourage such a director, officer, advisor, or agent from serving
in that position.
F. Based upon
their experience as business managers, the Board of Directors of
the Company has concluded that, to retain and attract talented and
experienced individuals to serve as directors, officers, advisors,
and agents of the Company and to encourage such individuals to take
the business risks necessary for the success of the Company, it is
necessary for the Company to contractually indemnify its directors,
officers, advisors, and agents, and to assume for itself maximum
liability for expenses and damages in connection with claims
against such directors, officers, advisors, and agents in
connection with their service to the Company, and has further
concluded that the failure to provide such contractual
indemnification could result in great harm to the Company and the
Company’s stockholders.
G. Section 145
of the General Corporation Law of Delaware, under which the Company
is organized, empowers the Company to indemnify its directors,
officers, employees and agents by
agreement and
to indemnify persons who serve, at the request of the Company, as
the directors, officers, employees or agents of other corporations
or enterprises, and expressly provides that the indemnification
provided by Section 145 is not exclusive.
H. The
Company’s Certificate of Incorporation (as amended to date)
(the “Certificate”) and By-Laws (as amended to date)
(the “By-Laws” and together with the Certificate, the
“Charter Documents”), do not prohibit or restrict
contracts between the Company and its directors, officers, advisors
or agents with respect to indemnification of such directors,
officers, advisors and agents.
I. The
Company desires and has requested the Indemnitee to serve or
continue to serve as a director, officer, advisor, or agent of the
Company and/or one or more subsidiaries of the Company free from
undue concern for claims for damages arising out of or related to
such services to the Company and/or one or more subsidiaries of the
Company.
J. Indemnitee
is willing to serve, or to continue to serve, the Company, provided
that he is furnished the indemnity provided for herein.
NOW ,
THEREFORE , to induce the Indemnitee to serve or continue to
serve the Company and in consideration of these premises and the
mutual agreements set forth in this Agreement, as well as other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and the Indemnitee
hereby agree as follows:
1.
Agreement to Serve. The Indemnitee agrees to serve the
Company as a [director/officer/advisor/agent] at the
Company’s will (or under separate agreement, if such
agreement exists), in the capacity in which the Indemnitee has been
requested to serve by the Company, for so long as the Indemnitee is
duly appointed or elected and qualified in accordance with the
Charter Documents, or until such time as the Indemnitee tenders the
Indemnitee’s resignation in writing or Indemnitee’s
employment contract with the Company, if the same exists, expires
without extension or renewal or is terminated; provided ,
however , that the Indemnitee may at any time and for any
reason resign from such position, subject to any contractual
obligation that the Indemnitee may have assumed apart from this
Agreement; and provided further , that neither the
Company nor any Subsidiary (as defined below) shall have any
obligation under this Agreement to continue the Indemnitee in any
such position or at any particular compensation.
(a)
Third Party Proceedings . The Company shall indemnify
Indemnitee, to the fullest extent permitted by law, if Indemnitee
is or was a party or is threatened to be made a party to or is
otherwise involved in (including, without limitation, as a witness)
any threatened, pending or completed action, suit, arbitration, or
other alternate dispute resolution mechanism, or investigation,
inquiry, administrative hearing or any other actual, threatened or
completed proceeding, whether civil, criminal, administrative or
investigative, including, without limitation, any appeal therefrom
(collectively, “Proceeding”) (other than a Proceeding
by or in the right of the Company and/or any of its Subsidiaries to
procure a judgment in its favor) by reason of (or arising in part
out of) any event or occurrence related to the fact that Indemnitee
is or was a director, officer, employee, advisor, and/or agent of
the Company or any Subsidiary, or is or was serving at the request
of the Company as a director, officer, employee, advisor, or agent
of another corporation, partnership, joint venture, trust or other
enterprise (collectively, “Corporate Status”), or by
reason of any action alleged to have been taken or omitted on the
part of Indemnitee while serving in such capacity, against all
Expenses (as defined below), judgments, penalties, fines and
amounts paid in settlement, including without limitation all
interest, assessments and other charges paid or payable in
connection with or in respect of the foregoing, actually and
reasonably
incurred by
Indemnitee or on his behalf in connection with such Proceeding or
any claim, issue or matter therein, provided 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 or
such Subsidiary, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe Indemnitee’s
conduct was unlawful.
As
used herein, (i) “Subsidiary” shall mean any
corporation, limited liability company, partnership, joint venture,
trust or other entity of which more than 50% of the outstanding
voting securities are owned directly or indirectly by the Company,
by the Company and one or more other Subsidiaries, or by one or
more other Subsidiaries, and (ii) “Expenses” shall mean
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, being or preparing to be a witness in, or otherwise
participating in a Proceeding.
(b)
Proceedings by or in the Right of the Company . The Company
shall indemnify Indemnitee, to the fullest extent permitted by law,
if, by reason of his Corporate Status, or by reason of any action
alleged to have been taken or omitted on the part of Indemnitee
while serving in such capacity, Indemnitee was or is a party or is
threatened to be made a party to or is otherwise involved in (e.g.
as a witness) any threatened, pending or completed Proceeding
brought by or in the right of the Company or any Subsidiary to
procure a judgment in its favor, against all Expenses, and, to the
extent permitted by law, amounts paid in settlement, including
without limitation all interest, assessments and other charges paid
or payable in connection with or in respect of the foregoing,
actually and reasonably incurred by Indemnitee or on his behalf in
connection with such Proceeding or any claim, issue or matter
therein, provided 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 or such Subsidiary, except that, if
applicable law so provides, no such indemnification shall be made
under this Section 2(b) in respect of any Proceeding, claim, issue
or matter as to which Indemnitee shall have been finally
adjudicated by court orders or judgment to be liable to the Company
or such Subsidiary, unless and only to the extent that the Delaware
Court of Chancery or any other court in which such Proceeding is or
was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of
the case, Indemnitee is fairly and reasonably entitled to indemnity
for such reasonable Expenses and other amounts as the Court of
Chancery or other such court shall deem proper.
(c)
Mandatory Payment of Expenses . Notwithstanding any other
provision of this Agreement, to the extent that Indemnitee has been
successful, on the merits or otherwise, in defense of any
Proceeding referred to in Section 2(a) or Section 2(b) above, or in
defense of any claim, issue or matter therein, Indemnitee shall be
indemnified against all Expenses actually and reasonably incurred
by Indemnitee in connection therewith. Without limiting the
generality of the foregoing, if any Proceeding 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 Company, (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 he
reasonably believed to be in or not opposed to the best interests
of the Company, and (v) with respect to any criminal action or
proceeding, an adjudication that the Indemnitee had reasonable
cause to believe his conduct was unlawful, the Indemnitee shall be
considered for the purpose hereof to have been wholly successful
with respect thereto. If Indemnitee is not wholly successful in
defense of 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 on
his behalf in connection with each successfully resolved claim,
issue or matter.
(d)
Advancement of Expenses . The Company shall advance, without
duplication, all Expenses actually and reasonably incurred by or on
behalf of Indemnitee in connection with any Proceeding referenced
in Section 2(a) or 2(b) above (including, without limitation,
retainers and prepaid, deposited or escrowed amounts), in the event
of the receipt by the Company of a statement or statements from
Indemnitee requesting such advance or advances from time to time.
Such statement or statements shall reasonably evidence the Expenses
incurred 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. All such undertakings shall be unsecured, shall bear no
interest and shall be accepted without reference to the financial
ability of the Indemnitee to make repayment.
(e)
Security . To the extent requested by the Indemnitee
and approved by the Company’s Board of Directors, 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 letter 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
Indemnitee.
3.
Notice of Proceeding and Review of Indemnification Request
.
(a)
Notice . Indemnitee shall give the Company notice in
writing, as soon as practicable, of any Proceeding for which
Indemnitee expects to or will seek indemnification under this
Agreement. Such notice shall include a written request for
indemnification, and shall be accompanied by a copy of any summons,
citation, subpoena, complaint, indictment, investigation, and/or
inquiry received by Indemnitee, as well as any other 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. Indemnitee shall direct
such notice, request and documentation to the Chief Executive
Officer of the Company at the address shown in the notices section
of this Agreement. Notwithstanding the foregoing, any failure of
Indemnitee to provide such notice to the Company shall not relieve
the Company of any liability that it may have to Indemnitee unless
and to the extent such failure materially prejudices the interests
of the Company.
(b)
Assumption of Defense and Selection of Counsel; Settlement .
With respect to any Proceeding of which the Company is notified
under the preceding Section 3(a), the Company shall be
entitled to participate therein at its own expense and/or, if
appropriate, to assume the defense thereof at its own expense, with
legal counsel approved by Indemnitee, which approval shall not be
unreasonably withheld, upon the delivery to Indemnitee of written
notice of its election to do so, in which case Indemnitee shall
provide the Company such information and cooperation as the Company
may reasonably require in connection with such defense and as shall
be within Indemnitee’s power to so provide. After delivery of
such notice from the Company to the Indemnitee of its intention to
assume the defense of the Proceeding, Indemnitee’s approval
of Company counsel, and the retention of such counsel by the
Company, the Company will not be liable to Indemnitee under this
Agreement for any fees and expenses of counsel subsequently
incurred by Indemnitee with respect to such Proceeding, other than
as provided below. The Indemnitee shall have the right to employ
his own counsel in connection with such Proceeding, but the fees
and expenses of such counsel incurred after such notice, approval
and retention shall be at the expense of the Indemnitee, unless
(i) the employment of counsel by the Indemnitee has been
authorized by the Company, (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 Company
and the Indemnitee in the conduct of the defense of such action or
(iii) the Company shall not in fact have employed counsel to
assume the defense of such action, in each of which cases the fees
and expenses of counsel for the 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 the Indemnitee,
to assume the
defense of any claim brought by or in the right of the Company or
as to which counsel for the Indemnitee shall have reasonably made
the conclusion provided for in clause (ii) above. Notwithstanding
any of the foregoing, the Company shall not be permitted to settle
any Proceeding, or any claim, issue or matter therein, on behalf of
the Indemnitee, without the prior written consent of Indemnitee,
unless (A) the Company assumes full and sole responsibility
for such settlement, (B) such settlement does not contain any
admission of guilt by, on behalf or, or with respect to Indemnitee,
(C) such settlement does not contain and will not result in
any penalty or sanction of Indemnitee, and (D) such settlement
grants the Indemnitee a complete and unqualified release in respect
of any potential or resulting liability of Indemnitee, in law and
in equity, or Indemnitee is otherwise fully indemnified against all
such liability .
(c)
Payment; Procedure for Review; Reviewing Party . Any
indemnification and Expense advances provided for in Section 2
and this Section 3 shall be made by the Company promptly, and
in any event within forty-five (45) days after receipt by the
Company of the applicable written request of the Indemnitee, except
that Expense advances pursuant to Section 2(d) shall be made no
later than ten (10) days after such receipt (each, a
“Payment Period”), unless in any case with respect to
such requests the Company determines, by clear and convincing
evidence, prior to expiration of the applicable Payment Period that
the Indemnitee did not meet the applicable standard of conduct for
indemnification set forth in this Agreement. The Company’s
determination as to whether the Indemnitee meets the applicable
standard of conduct shall be made, within the applicable Payment
Period, as follows: (i) if a Change in Control shall have
occurred (other than a Change in Control which has been approved by
a majority of the Company’s Board of Directors who were
directors immediately prior to such Change in Control), then, with
respect to all matters thereafter arising concerning the rights of
Indemnitee to indemnification under this Agreement or any other
agreement, or under the Company’s Charter Documents, the
Company’s determination shall be made by Independent Legal
Counsel (as defined below), in a written legal opinion to Company
and Indemnitee, such Independent Legal Counsel to be selected in
accordance with the procedures set forth in Section 3(d) below; or
(ii) if a Change in Control shall not have occurred (or if a
Change in Control occurred but was approved by a majority of the
Company’s Board of Directors who were directors immediately
prior to such Change in Control), the Company’s determination
shall be made, at the election of the Board of Directors, by:
(A) a majority vote of the directors of the Company who are
not at that time parties to the Proceeding in question
(“Disinterested Directors”), even though less than a
quorum of the Board; or (B) a committee of such Disinterested
Directors designated by majority vote of such 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 Legal Counsel in
a written opinion to the Company, a copy of which shall be promptly
delivered to the Indemnitee (the party making the determination in
accordance with the foregoing as to whether the Indemnitee meets
the applicable standard of conduct being referred to herein as the
“Reviewing Party”).
“Change in
Control” means the occurrence after the date of this
Agreement of any of the following: (i) any
“person” (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
“Act”)), other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company
acting in such capacity or a corporation owned directly or
indirectly by the stockholders of the Co
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