Director & Officer Indemnification Agreement Template

DIRECTOR & OFFICER INDEMNIFICATION AGREEMENT TEMPLATE FAQ

What is a director & officer indemnification agreement?

A Director & Officer (D&O) Indemnification Agreement is a contract between a company and an individual director or officer that describes when the company will indemnify (cover losses) and advance expenses (pay legal fees upfront) if the individual is sued or investigated because of their role.

How is it different from D&O insurance?

D&O insurance is a policy purchased from an insurer. An indemnification agreement is a direct promise by the company. Many companies use both: insurance as a backstop and an agreement to clarify advancement, procedures, and protections.

What does it typically cover?

It often covers: legal defense costs, settlements, judgments, and expenses for civil, criminal, administrative, and investigative proceedings arising from service as a director/officer. Coverage is usually limited by law and excludes fraud, willful misconduct, or improper personal benefit.

What is “advancement of expenses”?

Advancement means the company pays legal fees as they are incurred, before the matter is resolved, usually in exchange for a written undertaking to repay if the person is later found not entitled to indemnification.

Who is covered?

Typically directors and officers, and sometimes former directors/officers, and sometimes service at affiliates at the company’s request. This template includes optional affiliate/agent coverage.

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