Exhibit 10.1
Certain identified information has been excluded from this exhibit because it is both (i) not material and (ii) is the type of information that the registrant treats as private or confidential. Triple asterisks denote omissions.
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is entered into, effective as of the inception date and time of the Primary Additional D&O Policy as defined below (the “Effective Date”) by and between Michael J. Saylor (the “Indemnitor”) and MicroStrategy Incorporated, a Delaware corporation (the “Company”).
WHEREAS, it is essential to the Company to retain and attract as directors and officers the most capable persons available;
WHEREAS, the Indemnitor and the Company recognize the increased risk of litigation and other claims currently being asserted and that may be asserted in the future against directors and officers of corporations;
WHEREAS, the Company is obligated to indemnify each person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he 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 or trustee of, or in a similar capacity with, another corporation, partnership, joint venture, trust or other enterprise (including any employee benefit plan) (each such person, an “Indemnitee”) under Article EIGHT of the Company’s Second Amended and Restated Certificate of Incorporation and to pay or advance expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by or on behalf of an Indemnitee in connection with such action, suit or proceeding and any appeal therefrom (“Expenses”) of each such person arising from any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he 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 or trustee of, or in a similar capacity with, another corporation, partnership, joint venture, trust or other enterprise (including an employee benefit plan) (each, an “Indemnifiable Event”) to the maximum extent permitted by law;
WHEREAS, in addition to the indemnification provided under the Company’s Certificate of Incorporation, the Company has purchased from time to time directors’ and officers’ liability insurance to indemnify and advance Expenses of Indemnitees from certain losses and expenses not otherwise indemnified or indemnifiable by the Company pursuant to applicable laws;
WHEREAS, directors’ and officers’ liability insurance that the Company has in force (“Other D&O Insurance”) excludes coverage for claims based on actions and omissions prior to the Effective Date, and later interrelated actions or omissions;
WHEREAS, the parties entered into an Indemnification Agreement effective June 24, 2022 (the “2022 Indemnification Agreement”) that was intended to provide, subject to its terms, indemnification for claims excluded from coverage by the Other D&O Insurance;
WHEREAS, the Company has subsequently arranged additional directors’ and officers’ liability insurance covering certain claims excluded from the Other D&O Insurance, including claims based on Acts (defined below) prior to and after the Effective Date of a primary policy issued by [***] (the “Primary Additional D&O Policy”) and policies providing layers of coverage excess to that policy, which policies exclude from coverage claims described in Section III.A.1, III.A.2 and III.A.3 of the Primary Additional D&O Policy and Endorsement 6 to the Primary Additional D&O Policy (the “Prior Acts and Litigation Exclusions”);
WHEREAS this Agreement, subject to its terms, is intended to amend and supersede the 2022 Indemnification Agreement and provide indemnification of claims that would be covered by the Primary Additional D&O Policy and its excess policies but for the Prior Acts and Litigation Exclusions;
WHEREAS, in recognition of each Indemnitee’s need for protection against personal liability with respect to claims not covered by the Company’s directors’ and officers’ liability insurance, in order to enhance such Indemnitee’s willingness to continue service to the Company and/or its subsidiaries as a director and/or officer, the Indemnitor, subject to the terms herein, desires to agree, in his individual capacity, to indemnify each Indemnitee for Expenses of such Indemnitee arising from an Indemnifiable Event which arises from an actual or alleged act, error, omission, misstatement, misleading statement, neglect or breach of duty (“Act”) prior to the Effective Date, or an Act on or after the Effective Date having as a common nexus with an Act prior to the Effective Date any fact, circumstance, event, transaction or series of of facts, circumstances, situations or transactions (“Interrelated Act”), and which is which excluded from coverage under the Primary New D&O Policy and its excess layers by means of any of the Prior Acts and Litigation Exclusions, solely to the extent that the Company is unable to do so, for the purpose of providing assurance to the Indemnitees of the availability of funds to make payments that the Indemnitees would, but for such inability of the Company, be entitled to pursuant to any present or future indemnification agreement that an Indemnitee may enter into with the Company or pursuant to a directors’ and officers’ liability insurance policy; and
WHEREAS, the Company and its Board of Directors (the “Board”) believe it to be in the best interests of the Company and its stockholders to enter into this Agreement.
NOW, THEREFORE, in consideration of the above premises and covenants herein and for good and valuable consideration, the sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the parties agree as follows:
“Proceeding” or “claim” shall mean any threatened, pending, or completed demand, action, suit, proceeding or alternative dispute resolution mechanism (including an action by or in the right of the Company), or any inquiry, hearing, or formal or informal investigation (including a request or by the company, court-appointed trustee, examiner, receiver, liquidator, conservator, rehabilitator or similar official of the company, or a regulatory authority, to appear for an interview or meeting or to provide sworn testimony or to produce documents), whether conducted by the Company or any other party, that Indemnitee in good faith believes might lead to the institution of any such demand, action, suit, or proceeding, whether civil, criminal, administrative, investigative, or other, including: any appeal from a judgment in a completed action, suit or proceeding; any request by or on behalf of any person or organization, including a party to any litigation, arbitration, investigation or other kind of proceeding against the Company, to provide an interview, testimony or production of documents; any proceeding before the Equal Opportunity Commission or any other similar federal, state, local or foreign government body; any demand or proceeding arising out of any statutory liability due to the failure of the Company to deduct, withhold or remit taxes (including non-resident withholding taxes, goods and services taxes, salary or withholding taxes and employee source deductions), or make unemployment insurance contributions or pension plan contributions, or pay debts for services performed by an employee of the Company for salary, wages or related amounts such as vacation pay or holiday pay; for any extradition proceeding; for any arrest, detainment or incarceration; a raid or non-routine site visit upon the Company by a regulatory authority.
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement effective as of the date and time specified above.
MICROSTRATEGY INCORPORATED, | |
a Delaware Corporation | |
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By: | /s/ Andrew Kang |
Name: | Andrew Kang |
Title: | Senior Executive Vice President & CFO |
MICHAEL J. SAYLOR, |
as Indemnitor |
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/s/ Michael J. Saylor |
Michael J. Saylor |