Twitter's Agreements With Their Executives: What the Company Promised Them

The Indemnification Agreements Require Advancement and Indemnification

22. To maintain Plaintiffs services as officers of Twitter, the Company entered into the Agreements with Plaintiffs. See supra n.1. The terms of each of Plaintiffs Agreements are substantially similar, and the specific provisions cited herein are identical across Agreements unless otherwise noted. Relevant excerpts are provided from the Agrawal Agreement. Each of the Agreements is governed by Delaware law.

23. The preamble to each Agreement provides that its purpose is to afford indemnification and advancement rights to the fullest extent permitted by applicable law and that the Company is obligating itself to afford such rights to ensure protection of and retain its officers. Ex. Bat 1.

24. Section of the Agreements, titled Indemnity of Indemnitee, sets forth the Company's obligation to indemnify Plaintiffs to the fullest extent permitted by law. Id. 1. This includes indemnification for all Expenses defined to include all reasonable attorneys fees, retainers, court costs, transcript costs, fees of experts, witness fees, and other obligations in a Proceeding. Id. 14(e). Proceeding is broadly defined to include "any threatened, pending or completed action, suit ... investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought by or in the right of the Company or otherwise and whether civil, criminal, administrative or investigative, in which Indemnitee was, is or will be involved as a party or otherwise, by reason of the fact that Indemnitee is or was an officer or director of the Company Id. § 14(g).

25. Section 5 of the Agreements, titled Advancement of Expenses, sets forth the Company's advancement obligations. It states in part:

Notwithstanding any other provision of this Agreement, the Company shall advance all Expenses incurred by or on behalf of Indemnitee in connection with any Proceeding by reason of Indemnitee's Corporate Status within thirty (30) days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time prior to final disposition of such Proceeding. Such state mentor 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.

Id. 5.

26. In connection with the advancement of expenses, the Agreements require an undertaking by an indemnitee to repay any advanced amounts if it is ultimately determined that such indemnitee is not entitled to indemnification. See id.

27. The Agreements further state that if advancement of Expenses is not timely made pursuant to Section 5, Plaintiffs shall be entitled to an adjudication in an appropriate court of the State of Delaware. Id. 8(a).

28. In the event any action is brought by Plaintiffs in order to enforce the Agreements, Plaintiffs also are entitled to be paid for any and all Expenses incurred in connection with such action. Id. 8(d). The Agreements provide that Plaintiffs are not required to incur Expenses associated with enforcing their rights under the Agreements by litigation or other legal action, because the cost and expense thereof would substantially detract from the benefits intended to be extended to Plaintiffs under the Agreements.