Director Indemnification Agreement (D&O)
A contractual director-and-officer indemnification agreement, separate from the bylaws, that binds the Company to defend, advance expenses to, and indemnify the individual director/officer to the fullest extent permitted by law, with 2026-current clawback carve-outs and D&O insurance priority language.
What is a Director Indemnification Agreement?
A Director Indemnification Agreement (D&O) is a contractual director-and-officer indemnification agreement, separate from the bylaws, that binds the Company to defend, advance expenses to, and indemnify the individual director/officer to the fullest extent permitted by law, with 2026-current clawback carve-outs and D&O insurance priority language.
Any Delaware (or other-state) corporation entering into a separate contractual indemnity with a director or officer. The usual occasions are a board appointment after a Series A or later financing, the promotion of a new C-suite officer, or a venture or private-equity fund placing a designee on the board and requiring belt-and-suspenders indemnification protection in addition to the bylaws.
Director Indemnification Agreement template, current for 2026
The 2026-current statutory carve-outs (SOX §304, Dodd-Frank §954, and SEC Rule 10D-1 erroneously-awarded compensation clawbacks) are named expressly rather than left to a general "as required by law" catchall. It adds a Fund Indemnitor priority waterfall for VC-designated directors (Company primary, insurer excess, fund third), a six-year run-off tail covenant on change of control, presumption-of-entitlement with clear-and-convincing burden on the Company, and deemed-approval if no determination is made within the response window. Forum defaults to the Delaware Court of Chancery with fee-shifting on successful enforcement.
How HDAi does this differently
Unlike a static form, HDAi runs a guided interview and assembles your Director Indemnification Agreement as you answer. When you want it finished, a licensed Hart David Carson attorney reviews it and tailors it to your facts before you sign. The interview and the first draft are automated. The judgment belongs to an attorney.
What you’ll be asked
- Full legal name of the Company Use the exact name on the certificate of incorporation or articles of organization; this becomes the indemnitor of record.
- State of incorporation or formation Delaware is the default; if not Delaware, an attorney must confirm the statutory indemnification and exculpation framework maps cleanly for 2026.
- Entity type Corporations rely on DGCL Section 145 (or the state analog); LLCs rely on the operating agreement and the state LLC act. The agreement switches its operative references accordingly.
- Company principal office address Used for notice and for identifying the corporate signatory.
- Full legal name of the Indemnitee The individual fiduciary being indemnified. One agreement per person.
- Indemnitee notice address Notices, litigation triggers, and advancement checks flow to this address.
- Capacity in which Indemnitee will serve Directors/managers and officers receive slightly different treatment in some sub-provisions (for example, mandatory indemnification for successful defense).
- Is the Indemnitee a fund- or investor-designated board seat? If a VC or PE fund appointed this seat, we add express priority language making the Company's indemnity primary to any fund-provided indemnity, plus the third-party-beneficiary enforcement rights; critical for portfolio directors.
- Name of the designating fund (for priority waterfall) We name the fund so its indemnitors get the benefit of the excess/secondary language, the subrogation-release, and express beneficiary standing.
- Does the Company maintain D&O insurance? Drives the insurance-maintenance covenant and the primary/excess ordering between policy proceeds and Company indemnity.
- Minimum aggregate D&O tower limit to maintain A floor limit gives the indemnitee a contractual hook if the Company later drops coverage. Typical Series A: $3M to $5M; Series C and later: $10M or more.
- Should advancement of expenses be mandatory or discretionary? Mandatory advancement (with a repayment undertaking) is market for directors of Delaware corporations and is the default here.
- Days from written request within which Company must advance expenses Market is 10 to 30 days. Shorter is more indemnitee-friendly. Only a repayment undertaking is required, not collateral or proof of ability to repay.
- Who determines entitlement to indemnification? For directors, Independent Counsel after a Change in Control is standard; disinterested directors or managers work in the normal course.
- Days for the determination to be made If no determination is made within this window, entitlement is deemed established; a critical presumption for the indemnitee.
- Include contribution provision (if indemnification is unavailable)? Contribution language allows recovery even where full indemnification is barred by public policy or statute; recommended.
- Include modern clawback carve-outs (SOX 304, Dodd-Frank 954, Rule 10D-1)? 2026-current: recoveries under SOX Section 304, Dodd-Frank Section 954, and SEC Rule 10D-1 erroneously-awarded compensation are excluded from indemnification by statute; we name them expressly.
- Exclusive forum for enforcement Delaware Court of Chancery is the sophisticated choice for DGCL-based disputes; parties can alternatively pick the Company's HQ jurisdiction.
- Governing law Usually mirrors state of incorporation or formation so the applicable indemnification standards control.
- Effective Date Usually the date of election or appointment. Indemnity is retroactive to services rendered on or after this date and, per the template, covers pre-execution service if the person was already serving.
- Company signatory name Typically the CEO or another officer or manager authorized by resolution.
- Company signatory title Confirm authority to bind; a board or manager resolution approving the form is prudent.