Exhibit 10.16

 

INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement (“Agreement”) is made as of [   ], 20[  ], by and
between Alteva, Inc. (the “Company”), a New York corporation, and the
undersigned officer and/or director (“Indemnitee”).

 

WITNESSETH:

 

WHEREAS, Section 722(a) of the Business Corporation Law of New York (the “BCL”)
empowers corporations to indemnify any person made, or threatened to be made, a
party to an action or proceeding (other than one by or in the right of the
Company to procure a judgment in its favor), whether civil or criminal,
including an action by or in the right of any other corporation of any type or
kind, domestic or foreign, or any partnership, joint venture, trust, employee
benefit plan or other enterprise, which any director or officer of the Company
served in any capacity at the request of the Company, by reason of the fact that
he, his testator or intestate, was a director or officer of the Company, or
served such other corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise in any capacity, against judgments, fines,
amounts paid in settlement and reasonable expenses, including attorneys’ fees
actually and necessarily incurred as a result of such action or proceeding, or
any appeal therein, if such director or officer acted, in good faith, for a
purpose which he reasonably believed to be in, or, in the case of service for
any other corporation or any partnership, joint venture, trust, employee benefit
plan or other enterprise, not opposed to, the best interests of the Company and,
in criminal actions or proceedings, in addition, had no reasonable cause to
believe that his conduct was unlawful; and

 

WHEREAS, Section 722(c) of the BCL empowers corporations to indemnify any person
made, or threatened to be made, a party to an action by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that he,
his testator or intestate, is or was a director or officer of the corporation,
or is or was serving at the request of the corporation as a director or officer
of any other corporation of any type or kind, domestic or foreign, of any
partnership, joint venture, trust, employee benefit plan or other enterprise,
against amounts paid in settlement and reasonable expenses, including attorneys’
fees, actually and necessarily incurred by him in connection with the defense or
settlement of such action, or in connection with an appeal therein, if such
director or officer acted, in good faith, for a purpose which he reasonably
believed to be in, or, in the case of service for any other corporation or any
partnership, joint venture, trust, employee benefit plan or other enterprise,
not opposed to, the best interests of the corporation, except that no
indemnification under Section 722(c) may be made in respect of (1) a threatened
action, or a pending action which is settled or otherwise disposed of, or
(2) any claim, issue or matter as to which such person shall have been adjudged
to be liable to the corporation, unless and only to the extent that the court in
which the action was brought, or, if no action was brought, any court of
competent jurisdiction, determines upon application that, in view of all the
circumstances of the case, the person is fairly and reasonably entitled to
indemnity for such portion of the settlement amount and expenses as the court
deems proper; and

 

WHEREAS, the Company and the Indemnitee further recognize the substantial amount
of corporate litigation in general, which subjects directors, officers,
employees, controlling persons, agents and fiduciaries to expensive litigation
risks; and

 

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WHEREAS, the Company and Indemnitee recognize the increasing expense of or
difficulty in obtaining liability insurance for the Company’s directors,
officers, employees, controlling persons, agents and fiduciaries, the
significant increases in the cost of such insurance and the general reductions
in the coverage of such insurance; and

 

WHEREAS, highly competent persons have become more reluctant to serve as
officers or directors of publicly-held corporations unless they are provided
with adequate protection through insurance and indemnification against risks of
claims and actions against them arising out of their service to, and activities
on behalf, of the corporation;

 

WHEREAS, the Indemnitee is concerned that the current protection available may
not be adequate under the present circumstances, and Indemnitee and other
directors and officers of the Company may not be willing to serve in such
capacities without additional protection; and

 

WHEREAS, the Company’s directors and officers have certain existing
indemnification arrangements pursuant to the Company’s Certificate of
Incorporation and By-Laws and may be entitled to indemnification pursuant to
Section 722 et seq., but the protection provided by such indemnification is
limited and its availability is uncertain as to any particular situation; and

 

WHEREAS, in recognition of Indemnitee’s need for (i) substantial protection
against personal liability for services rendered to the Company, (ii) specific
contractual assurance that the protection promised by the Company’s Certificate
of Incorporation and By-Laws will be available to Indemnitee (regardless of,
among other things, any amendment to or revocation of the Certificate of
Incorporation or By-Laws or any change in the composition of the Board of
Directors of the Company or acquisition transaction relating to the Company),
and (iii) an inducement to provide effective services to the Company as a
director and/or officer, as the case may be, the Company wishes to provide in
this Agreement for the indemnification of and the advancing of expenses to
Indemnitee to the fullest extent (whether partial or complete) permitted under
law (including, without limitation, Section 721 of the BCL) and as set forth in
this Agreement, and, to the extent insurance is maintained, to provide for the
continued coverage of Indemnitee under the Company’s directors and officers
liability insurance policies; and

 

WHEREAS, the Company wishes to obligate itself to advance such expenses to
Indemnitee under the circumstances contemplated by this Agreement and the
Indemnitee wishes to have the Company so obligate itself as a condition for
continuing to serve as an officer and/or director of the Company; and

 

WHEREAS, Section 721 of the BCL specifically provides that the indemnification
and advancement of expenses granted pursuant to, or provided by, Sections 722
through 725 of the BCL shall not be deemed exclusive of any other rights to
which a director or officer seeking indemnification or advancement of expenses
may be entitled, provided that (1) any agreement providing for such other rights
is authorized by the By-Laws of the Company, and (2) no indemnification may be
made to or on behalf of any director or officer if a judgment or other final
adjudication adverse to the director or officer establishes that his acts were
committed in bad faith or were the result of active and deliberate dishonesty
and were material to the cause of action so adjudicated, or that he personally
gained in fact a financial profit or other advantage to which he was not legally
entitled.

 

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WHEREAS, Article X, Section 3 of the Company’s By-Laws permits the Company to
provide indemnification to its officers and directors beyond that permitted by
Section 722 et seq., as required by Section 721; and

 

WHEREAS, the Board of Directors of the Company has authorized and directed the
proper officers of the Company to enter into this Agreement in the name of or on
behalf of the Company;

 

NOW, THEREFORE, in consideration of the premises, the agreements herein set
forth, and other good and valuable consideration, the Company and Indemnitee
hereby agree as follows:

 

ARTICLE I

 

Section 1.01.                          DEFINITIONS.  As used in this Agreement,
the following terms have the following meanings, unless a Section of this
Agreement specifically provides otherwise:

 

1.                                      “Agreement” means this Indemnification
Agreement and any amendments pursuant to Section 7.01 of this Agreement.

 

2.                                      “Board” means the Board of Directors of
the Company.

 

3.                                      “Change in Control” shall have occurred
in any of the following circumstances occurring after the date of this
Agreement:  (i) an occurrence of an event required to be reported with respect
to the Company in response to item 6(e) of Schedule 14A or Regulation 14A (or in
response to any similar item on any similar schedule or form) under the Exchange
Act, regardless of whether the Company is then subject to such reporting
requirement; (ii) a Business Combination (as defined in Article Fifth of the
Company’s Certificate of Incorporation) shall take place which has not been
approved pursuant to Sub-paragraph 2(a) of such Article Fifth; (iii) any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act) shall have become the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing 20% or more of the combined voting power of the Company’s then
outstanding voting securities (provided that as used in clause (iii), the term
“person” excludes a trustee or other fiduciary . holding securities under an
employee benefit plan of the Company), (iv) the consummation of a
reorganization, merger or consolidation, unless immediately following such
reorganization, merger or consolidation all of the beneficial owners of voting
securities of the Company outstanding immediately prior to such reorganization,
merger or consolidation beneficially own, directly or indirectly, more than 51%
of the combined voting power of the voting securities of the surviving or
resulting entity outstanding immediately after such transaction and with the
power to elect at least a majority of the board of directors or other governing
body of such surviving or resulting entity; (v) all or substantially all the
assets of the Company are sold or otherwise disposed of in a transaction or
series of related transactions; (vi) the approval by the stockholders of the
Company of a complete liquidation of the Company or the sale or other
disposition of all or substantially all of the assets of the Company, or
(vii) the individuals who on the date of this Agreement constitute the Board
(including, for this purpose, any new director whose election or nomination for
election by the Company’s stockholders was

 

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approved by a vote of at least a majority of the directors then still in office
who were directors on the date hereof or whose election or nomination was so
approved, but excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of either an actual or threatened
election contest or other actual or threatened solicitation of proxies or
consents by or on behalf of a person or entity other than the Board (including
by reason of agreement intended to avoid or settle any such actual or threatened
contest or solicitation)) cease for any reason to constitute at least a majority
of the members of the Board.

 

4.                                      “Company” means Alteva, Inc. and any
parent, affiliate, subsidiary and any successors (whether direct or indirect by
purchase, merger, consolidation, or otherwise) and any assigns.

 

5.                                      “Controlling Person” means any person
who controls Indemnitee or Indemnitee’s Spouse or any person or entity who may
be liable within the meaning of Section 15 of the Securities Act of 1933, as
amended, or Section 20 of the Securities Exchange Act of 1934, as amended.

 

6.                                      “Disinterested Director” means a
director of the Company who is not and was not a party to the Proceeding in
respect of which indemnification or advancement of Expenses is sought by
Indemnitee, Indemnitee’s Spouse, or a Controlling Person.

 

7.                                      “Expenses” means any and all costs and
fees (including, without limitation, fees and expenses of counsel) reasonably
incurred in connection with any Proceeding including, without limitation, costs
and fees reasonably incurred by counsel, consultants and experts, including all
costs and fees reasonably incurred in connection with the enforcement of this
Agreement. Expenses also shall include Expenses incurred in connection with any
appeal resulting from any Proceeding, including without limitation the premium,
security for, and other costs relating to any cost bond, supersede as bond, or
other appeal bond or its equivalent.

 

8.                                      “Independent Counsel” means the law firm
or a member(s) of a law firm, that is experienced in matters of corporate law
and (i) unless otherwise consented to by the Company, neither currently is, nor
in the past five years has been, retained by the Indemnitee, Indemnitee’s Spouse
or any Controlling Person with respect to any matter materially related to the
Proceeding for which indemnification is being sought, (ii) unless otherwise
consented to by Indemnitee, neither currently is, nor in the past five years has
been, retained by either the Company or any person who controls the Company or
any person or entity who may be liable within the meaning of Section 15 of the
Securities Act of 1933, as amended, or Section 20 of the Securities Exchange Act
of 1934, as amended, and (iii) otherwise complies with any requirements of
independence that may be applicable.  Prior service as Independent Counsel under
this Agreement or in any similar capacity with respect to any dispute involving
the Company shall be grounds for disqualification from serving as Independent
Counsel.  This Agreement is not intended to and does not supersede any
obligation incumbent upon Independent Counsel pursuant to applicable standards
of professional conduct.  Independent Counsel shall be an independent
decision-maker and shall not owe any fiduciary responsibility to, or have any

 

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attorney-client relationship with, any of the Company, Indemnitee, Indemnitee’s
Spouse or any Controlling Person.

 

9.                                      “Liabilities” means all judgments, fines
(including any excise taxes assessed with respect to any employee benefit plan),
penalties and amounts paid in settlement and other liabilities (including all
interest, assessments and other charges paid or payable in connection with or in
respect of any such amounts) arising out of or in connection with any
Proceeding; provided that Liabilities shall not include any Expenses.

 

10.                               “Proceeding” means any reasonably foreseeable,
threatened, pending or completed action, suit, hearing, investigation or inquiry
(whether internal or external), arbitration or other alternative dispute
mechanism, or other proceeding, whether civil, criminal, administrative,
regulatory, congressional or investigative investigations, including, without
limitation any action, suit or hearing seeking injunctive or declarative relief
regarding the existence of any fiduciary duty, brought or conducted by any third
party or by or in the right of the Company or an affiliate of the Company.

 

11.                               “Spouse” means the person with whom Indemnitee
has entered into a lawful marriage, civil union or domestic partnership
arrangement that has not been annulled, dissolved, or otherwise invalidated or
terminated under the law of the jurisdiction in which it was entered.

 

12.                               “State” means any of the fifty states, the
District of Columbia and any territory of the United States.

 

13.                               “To The Fullest Extent Authorized By Law”
means (i) to the fullest extent permitted by the BCL as in effect on the date of
this Agreement, and (ii) to the fullest extent authorized or permitted by any
amendments to or replacements of the BCL adopted after the date of this
Agreement that increases the extent to which a corporation may provide
indemnification, and shall be understood to include indemnification for
Liabilities and Expenses and the advancement of funds for Expenses to the extent
permitted by the BCL for indemnification or advancement under an agreement
permitted pursuant to Section 721, clause (iii) of the BCL, subject only to any
prohibitions or limitations set forth expressly in the BCL as being applicable
even with respect to such an agreement, such as the proviso set forth in
Section 721 of the BCL immediately after such clause (iii).

 

ARTICLE II

 

Section 2.01.                          SERVICES BY INDEMNITEE.  Indemnitee
hereby agrees to serve or continue to serve the Company, for so long as
Indemnitee is duly elected or appointed or until Indemnitee tenders his
resignation or is removed, subject to the terms of any retention agreement
between Indemnitee and the Company.

 

ARTICLE III

 

Section 3.01.                          INDEMNIFICATION GENERALLY.  The Company
will indemnify, pay on behalf of, or will reimburse Indemnitee, Indemnitee’s
Spouse and each Controlling Person who is or

 

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was made a party or a witness or other participant in or is or was threatened to
be made a party or a witness or other participant in any Proceeding, by reason
of the fact that such person was or may be deemed the legal representative, or a
director, officer, employee or agent of the Company or is or was or may be
deemed serving at the request of the Company as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust, or other
enterprise against any and all Expenses and Liabilities actually and reasonably
incurred To The Fullest Extent Authorized By Law (in each case, relating to
events or occurrences occurring before, on, or after the date of this
Agreement); provided however, that no indemnification shall be made to or on
behalf of Indemnitee if a judgment or other final adjudication adverse to
Indemnitee establishes that (i) Indemnitee’s acts were committed in bad faith or
were the result of active and deliberate dishonesty and were material to the
cause of action so adjudicated, or (ii) Indemnitee personally gained in fact a
financial profit or other advantage to which Indemnitee was not legally
entitled. Any acts of Indemnitee which are so finally adjudged or adjudicated to
constitute intentional illegal conduct shall be presumed to have been committed
in bad faith.

 

Section 3.02.                          SUCCESSFUL DEFENSE; PARTIAL SUCCESS. 
Except to the extent set forth in the proviso in Section 3.01, the obligation of
the Company set forth in such Section is not limited to only those circumstances
in which Indemnitee, Indemnitee’s Spouse or any Controlling Person is wholly or
partially successful on the merits or otherwise in the defense of any
Proceeding.

 

Section 3.03.                          WITNESS EXPENSES.  If
Indemnitee, Indemnitee’s Spouse or any Controlling Person appears as witness, is
deposed or is otherwise involved in the defense of any Proceeding against the
Company or the Company’s affiliates, officers, managers, directors or employees,
the Company will pay Indemnitee, Indemnitee’s Spouse or such Controlling Person,
as applicable, (i) with respect to each day that such person appears as a
witness or is deposed and/or (ii) with respect to each day that such person is
involved in the preparation therefor, a fee of $2,500 per day for each such
person with respect to (a) each appearance as a witness or a deponent and
(b) any preparation for any such appearance, and the Company will reimburse
Indemnitee, Indemnitee’s Spouse and any such Controlling Person, as applicable,
for all Expenses incurred by such Indemnitee, Indemnitee’s Spouse and any
Controlling Person, as applicable, by reason of any such person being involved
in any such Proceeding.

 

ARTICLE IV

 

Section 4.01.                          ADVANCES; WRITTEN REQUEST.  The Company
shall advance to Indemnitee, Indemnitee’s Spouse and each Controlling Person any
and all Expenses actually and reasonably incurred by such person in connection
with any Proceeding within 14 calendar days of receipt of a written request for
advancement, which may be delivered to the Company at such time and from time to
time as Indemnitee, Indemnitee’s Spouse or each Controlling Person deems
appropriate in such person’s discretion, whether prior to or after final
disposition of any Proceeding.

 

Section 4.02.                          SUFFICIENCY OF WRITTEN REQUEST FOR
ADVANCES.  A written request for advancement that conveys, without the need to
do so verbatim, that Indemnitee, Indemnitee’s Spouse or the respective
Controlling Person believes in good faith that such person is entitled to
advancement of expenses under the terms of this Agreement shall be sufficient to
invoke the right to advancement under Section 4.01.

 

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Section 4.03.                          PROMISE TO REPAY. 
Indemnitee, Indemnitee’s Spouse and each Controlling Person hereby each agree
and promise that such person shall promptly repay any and all advanced Expenses
to the Company if and to the extent it is ultimately determined, under the
procedure set forth in Section 723(b) of the BCL, that such person is not
entitled to indemnification under Section 3.01 above or has received
reimbursement or advances for Expenses in excess of the amount to which such
person is entitled.

 

ARTICLE V

 

Section 5.01.                          NOTICE TO COMPANY. 
Indemnitee, Indemnitee’s Spouse and each Controlling Person shall notify the
Company in writing as soon as reasonably practicable after being served with any
summons, citation, subpoena, complaint, indictment, information or other
document relating to any Proceeding with respect to which
Indemnitee, Indemnitee’s Spouse or any Controlling Person intends to seek
indemnification or advancement of Expenses and Liabilities under this Agreement.
The failure by Indemnitee, Indemnitee’s Spouse, or any Controlling Person to
timely notify the Company hereunder shall not relieve the Company from any
liability hereunder unless the Company’s ability to participate in the defense
of such claim was materially and adversely affected by such failure.

 

Section 5.02.                          NOTICE BY COMPANY.  The Company shall
notify Indemnitee, Indemnitee’s Spouse and each Controlling Person in writing as
soon as reasonably practicable after being served with any summons, citation,
subpoena, complaint, indictment, information or other document relating to any
Proceeding with respect to which Indemnitee, Indemnitee’s Spouse or any
Controlling Person may be entitled to indemnification or advancement under this
Agreement. If at the time of such notice is required to be made pursuant to the
preceding sentence (or at the time notice is provided to the Company pursuant to
Section 5.01), the Company has directors’ and officers’ liability insurance in
effect under which coverage is potentially available for Proceedings related to
matters in respect of which Indemnitee, Indemnitee’s Spouse, or any Controlling
Person may be entitled to indemnification or advancement under this Agreement,
the Company shall give prompt written notice to the applicable insurers in
accordance with the procedures set forth in the applicable policies. The Company
shall provide to Indemnitee, Indemnitee’s Spouse, and any Controlling Person a
copy of such notice delivered to the applicable insurers, and copies of all
subsequent correspondence between the Company and such insurers regarding the
Proceeding, in each case substantially concurrently with the delivery or receipt
thereof by the Company.

 

Section 5.03.                          DETERMINATION OF ENTITLEMENT TO
INDEMNIFICATION.  (a)  Upon the final disposition of the matter that is the
subject of the request for indemnification delivered pursuant to this Article, a
determination shall be made with respect to Indemnitee’s entitlement thereto in
the specific case in the manner set forth in section 723(b) of the BCL.

 

(b)  If it is determined that Indemnitee, Indemnitee’s Spouse or a Controlling
Person is entitled to indemnification, payment to such person shall be made
within 10 calendar days after such determination.

 

Section 5.04.                          COOPERATION WITH INDEPENDENT COUNSEL.  In
connection with any determination of entitlement to indemnification in the
manner set forth in Section 723(b) of the BCL that involves the use of
Independent Counsel, Indemnitee, Indemnitee’s Spouse and each Controlling Person
and the Company agree to reasonably cooperate with the Independent Counsel

 

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including providing, upon reasonable request, any documentation or information
which is not privileged or otherwise protected from disclosure and which is
reasonably available to the party of whom the request was made and reasonably
necessary to such determination.

 

Section 5.05.                          PAYMENT OF INDEPENDENT COUNSEL.  The
Company agrees to pay all Expenses incurred by Indemnitee, Indemnitee’s Spouse
or each Controlling Person in so cooperating with Independent Counsel in making
such determination (irrespective of the determination as to
Indemnitee, Indemnitee’s Spouse or each Controlling Person’s entitlement to
indemnification), and the Company indemnifies and agrees to hold such persons
harmless from such Expenses.

 

Section 5.06.                          OBJECTIONS TO SELECTION OF INDEPENDENT
COUNSEL.  Following receipt of notice of the selection of Independent Counsel,
if any, the party receiving the notice may, within 10 calendar days, deliver to
the other party a written objection to such selection; provided that such
objection may be asserted only on the ground that Independent Counsel selected
does not meet the requirements of “Independent Counsel” as defined in Article I
of this Agreement, and the objection shall set forth with particularity the
factual basis for such assertion.  Absent a proper and timely objection, the
person selected shall act as Independent Counsel.  If a proper and timely
objection is made, the person selected may not serve as Independent Counsel
unless and until such objection is withdrawn or the competent New York state
court (or, at Indemnitee’s option, pursuant to an arbitration) has determined
that such objection is without merit.  If, within 20 days after receipt by the
Company of a request for indemnification pursuant to this Agreement, no
Independent Counsel shall have been selected and not objected to, either the
Company or Indemnitee, Indemnitee’s Spouse or a Controlling Person may petition
the competent New York state court (or, at such person’s option an arbitration)
for resolution of any objection which shall have been made to the selection of
Independent Counsel and/or for the appointment of another person as Independent
Counsel, and the person with respect to whom all objections are so resolved or
the person so appointed shall act as Independent Counsel.

 

Section 5.07.                          APPEAL RIGHT.  Indemnitee, Indemnitee’s
Spouse and each Controlling Person and the Company shall have the right to
appeal any decision of the Disinterested Directors, the Board or Independent
Counsel to the competent New York state court, or, at Indemnitee’s, Indemnitee’s
Spouse’s or the Controlling Person or Company’s sole option, to an arbitrator
pursuant to the Commercial Arbitration Rules of the American Arbitration
Association.  Any such adjudication or arbitration shall be conducted in all
respects as a de novo trial or arbitration on the merits.  In any such
adjudication or arbitration the presumptions and burdens articulated in
Article VI shall apply.

 

Section 5.08.                          VALIDITY OF AGREEMENT.  The Company shall
not oppose the right of Indemnitee, Indemnitee’s Spouse or any Controlling
Person to seek any adjudication or arbitration sought under the terms of this
Agreement and shall be precluded from asserting that the procedures or
presumptions contained herein are not valid, binding or enforceable and shall
stipulate in any such adjudication or arbitration that the Company is bound by
all of the provisions of this Agreement.

 

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ARTICLE VI

 

Section 6.01.                          PRESUMPTIONS AND BURDENS OF PROOF. 
Indemnitee, Indemnitee’s Spouse and each Controlling Person shall be entitled to
a presumption that such person is entitled to indemnification, advancement of
fees or both under this Agreement if the notice requirement of Section 5.01 has
been met.  The Company shall bear the burden of proving, by a preponderance of
the evidence that Indemnitee, Indemnitee’s Spouse or the Controlling Person is
not entitled to indemnification or advancement.  Neither a determination by the
Disinterested Directors, the Board or by Independent Counsel against
Indemnitee, Indemnitee’s Spouse or a Controlling Person, nor the termination of
any Proceeding by judgment, order, settlement, or conviction, or upon a plea of
nolo contrendere, or its equivalent, shall create a presumption that
Indemnitee, Indemnitee’s Spouse or a Controlling Person is not entitled to
indemnification or advancement or otherwise affect the burden of proof or
persuasion in any subsequent Proceeding.

 

ARTICLE VII

 

Section 7.01.                          AMENDMENT.  This Agreement may not be
modified or amended except by a written instrument executed by or on behalf of
each of the parties hereto.

 

Section 7.02.                          BINDING EFFECT.  (a)  The Company
expressly confirms and agrees that it has entered into this Agreement and
assumed the obligations imposed on it in order to induce Indemnitee to serve (or
continue serving) the Company, and the Company acknowledges that Indemnitee is
relying upon this Agreement in serving the Company.

 

(b)  This Agreement shall be binding upon, and inure to the benefit of, and be
enforceable by the parties hereto and their respective successors and permitted
assigns, including any direct or indirect successor by purchase, merger,
consolidation or otherwise to all or substantially all of the business and/or
assets of the Company, heirs, executors, administrators or other successors. 
The Company shall require and cause any successor (whether direct or indirect by
purchase, merger, consolidation or otherwise) to all or substantially all or a
substantial part of the business or assets of the Company, by written agreement
in form and substance reasonably satisfactory to Indemnitee, expressly to assume
and agree to perform this Agreement in the manner and to the same extent that
the Company would be required to perform if no such succession had taken place.

 

(c)  The indemnification and advancement of expenses provided by this Agreement
shall continue as to a person who has ceased to be a director, officer, employee
or agent or is deceased and shall inure to the benefit of the heirs, executors,
administrators or other successors of the estate of such person.

 

(d)  Except to the extent, if any, as may be required by the BCL with respect to
agreements to indemnify or advance expenses, all rights and obligations of the
Company and Indemnitee, Indemnitee’s Spouse and any Controlling Person hereunder
shall continue in full force and effect despite the subsequent amendment or
modification of the Company’s Certificate of Incorporation or By-Laws, as such
are in effect on the date hereof, and such rights and obligations shall not be
affected by any such amendment or modification, any resolution of directors or
shareholders of the Company, or by any other corporate action which conflicts
with or purports to amend, modify, limit or eliminate any of the rights or
obligations of the Company and/or of Indemnitee, Indemnitee’s Spouse or any
Controlling Person hereunder, except as set forth in Section 7.01 hereof.

 

Section 7.03.                          CONSENT TO JURISDICTION.  Except with
respect to any arbitration commenced by Indemnitee, the Company and Indemnitee
hereby irrevocably and unconditionally

 

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(i) agree that any action, suit or other proceeding arising out of or in
connection with this Agreement shall be brought only in a competent New York
state court and any New York court to which an appeal may be taken in such
action, suit or other proceeding (the “New York Court”), and not in any other
state or federal court in the United States of America or any court in any other
country, (ii) consent to and submit to the exclusive jurisdiction of the New
York Court for purposes of any action, suit or other proceeding arising out of
or in connection with this Agreement, (iii) waive any objection to the laying of
venue of any such action, suit or other proceeding in the New York Court, and
(iv) waive, and agree not to plead or to make, any claim that any such action,
suit or other proceeding brought in the New York Court has been brought in an
improper or inconvenient forum.

 

Section 7.04.                          CONTRIBUTION.  To The Fullest Extent
Authorized By Law, if the indemnification provided for in this Agreement is
unavailable to Indemnitee, Indemnitee’s Spouse or any Controlling Person for any
reason, the Company, in lieu of indemnifying Indemnitee, Indemnitee’s Spouse and
each Controlling Person, shall contribute to the amount reasonably incurred
whether for Liabilities and/or Expenses in connection with a Proceeding or other
expenses related to an indemnifiable event or transaction under this Agreement,
in such proportion as is deemed fair and reasonable in light of all of the
circumstances of such other proceeding in order to reflect the relative benefits
received by the Company and Indemnitee as a result of the event(s) and/or
transaction(s) giving rise to such other proceeding; and/or the relative fault
of the Company and Indemnitee in connection with such event(s) and/or
transaction(s).

 

Section 7.05.                          COUNTERPARTS.  This Agreement may be
executed in one or more counterparts (which may be effectively delivered by
facsimile or other electronic means), each of which shall constitute an
original.

 

Section 7.06.                          DEFENSE OF CLAIMS.  The Company shall be
entitled to participate in any proceeding at its own expense.  The Company shall
not settle any Proceeding (in whole or in part) in a manner that imposes any
expense, liability or limitation on Indemnitee, Indemnitee’s Spouse or any
Controlling Person without his, her or its prior written consent  (such consent
not to be unreasonably withheld) unless the Company first indemnifies such
person.  Indemnitee, Indemnitee’s Spouse or any Controlling Person shall not
settle any Proceeding (in whole or in part) in a manner that imposes any
expense, liability or limitation on the Company without (i) the Company’s prior
written consent (such consent not to be unreasonably withheld) or (ii) if a
Change in Control has occurred, with the approval of Independent Counsel
selected in accordance with Section 5.06.

 

Section 7.07.                          ENTIRE AGREEMENT.  This Agreement
constitutes the entire agreement between the parties with respect to the matters
covered herein and supersedes all prior oral or written understandings or
agreements with respect to the matters covered herein, except that, this
Agreement shall not supersede any indemnification provisions contained in any
other agreement, between the Company and the Indemnitee the primary purpose of
which is to provide rights other than indemnification, including but not limited
to, employment and severance agreements. This Section shall not be construed to
limit any other rights Indemnitee, Indemnitee’s Spouse, or each Controlling
Person may have under the Company’s Certificate of Incorporation and Bylaws,
applicable law or otherwise.

 

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Section 7.08.                          GOVERNING LAW.  This Agreement and the
legal relations among the parties hereto shall be governed by, and construed and
enforced in accordance with, the local law of the State of New York.

 

Section 7.09.                          HEADINGS.  The Article and
Section headings in this Agreement are for convenience of reference only, and
shall not be deemed to alter or affect the meaning or interpretation of any
provisions hereof.

 

Section 7.10.                          IMPUTATION.  The knowledge or actions or
failure to act on the part of any fiduciary of the Company shall not be imputed
to Indemnitee, Indemnitee’s Spouse or any Controlling Person for purposes of
determining entitlement to indemnification under this Agreement.

 

Section 7.11.                          LIABILITY INSURANCE.  The Company shall
obtain and maintain with reputable insurance companies an insurance policy or
policies providing general and/or directors and officers liability insurance on
terms with respect to coverage and amount (including with respect to the payment
of expenses) no less favorable than those of such policy or policies in effect
on the date hereof except for any changes approved by the Board prior to a
Change in Control.  Indemnitee shall be covered by such policy or policies, in
accordance with its or their terms, to the maximum extent of the coverage
available for any member of the Board.  Upon request by Indemnitee, Indemnitee’s
Spouse or any Controlling Person, the Company shall provide to such person
copies of any such policy or policies in effect.  The Company shall promptly
notify Indemnitee, Indemnitee’s Spouse and each Controlling Person of any
material change in the insurance coverage. Upon request by Indemnitee, upon a
Change in Control the Company shall maintain the insurance coverage required by
this Section 7.11 for events occurring on or prior to the date of such Change in
Control through the purchase of customary “tail” coverage (with a term of not
less than 6 years following the date of such Change in Control) with terms that
otherwise meet the requirements of this Section 7.11.

 

Section 7.12.                          SEVERABILITY.  If any provision or
provisions of this Agreement shall be held to be invalid, illegal or
unenforceable for any reason whatsoever:  (a) the validity, legality and
enforceability of the remaining provisions of this Agreement (including, without
limitation, each portion of any Section of this Agreement containing any such
provision held to be invalid, illegal or unenforceable, that is not itself
invalid, illegal or unenforceable) shall not in any way be affected or impaired
thereby and shall remain enforceable To The Fullest Extent Authorized By Law;
(b) such provision or provisions shall be deemed reformed to the extent
necessary to conform to applicable law and to give the maximum effect to the
intent of the parties hereto; and (c) to the fullest extent possible, the
provisions of this Agreement (including, without limitation, each portion of any
Section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall be construed so as to give effect to the intent manifested thereby.

 

Section 7.13.                          NOTICES.  All notices, requests, demands
and other communications under this Agreement shall be in writing and shall be
deemed to have been duly given (a) if delivered by hand or by courier and
receipted for by the party to whom said notice or other communication shall have
been directed, (b) if mailed by certified or registered mail with postage
prepaid, on the third business day after the date on which it is so mailed or
(c) if sent by facsimile transmission and fax confirmation is received, on the
next business day following the date on which such facsimile

 

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transmission was sent. Addresses for notice to either party are as shown on the
signature page of this Agreement, or such other address as any party shall have
given by written notice to the other party as provided above.

 

Section 7.14.                          STATUTE OF LIMITATIONS.  The Company
agrees not to assert that a claim for indemnification is barred by the statute
of limitations as an affirmative defense or otherwise.

 

Section 7.15.                          SUBROGATION.  In the event of any payment
under this Agreement, the Company shall be subrogated to the extent of such
payment to all of the rights of recovery of Indemnitee, Indemnitee’s Spouse and
each Controlling Person, who shall execute all papers required and take all
actions necessary to secure such rights, including execution of such documents
as are necessary to enable the Company to bring suit to enforce such rights. 
The Company shall not be liable under this Agreement to make any payment of
amounts otherwise indemnifiable hereunder (or for which advancement is provided
hereunder) if and to the extent that Indemnitee, Indemnitee’s Spouse or any
Controlling Person has otherwise actually received such payment under any
insurance policy, contract, agreement or otherwise.  The Company’s obligation to
indemnify or advance expenses hereunder to Indemnitee who is or was serving as a
director, officer, employee, agent or fiduciary of another partnership, joint
venture, trust or other enterprise at the request of the Company shall be
reduced by any amount Indemnitee, Indemnitee’s Spouse or any Controlling Person
has actually received as indemnification or advancement of expenses from such
partnership, joint venture, trust or other enterprise.

 

Section 7.16.                          TRUST.  The Company shall, within 30 days
of receipt of written request by Indemnitee, Indemnitee’s Spouse or any
Controlling Person, establish a trust for the benefit of
Indemnitee, Indemnitee’s Spouse or the Controlling Person and from time to time
within 10 days of receipt of written request by Indemnitee, Indemnitee’s Spouse
or any Controlling Person, fund the trust in an amount sufficient to satisfy any
and all Expenses anticipated in good faith to be reasonably incurred in
connection with any Proceeding as stated in Indemnitee’s, Indemnitee’s Spouse’s
or the Controlling Person’s written request that the trust be funded. Any
dispute arising under this Section shall be decided by Independent Counsel who
shall be selected in accordance with the terms of Article V.  Any determination
by Independent Counsel may be appealed by Indemnitee, Indemnitee’s Spouse or any
Controlling Person in accordance with the terms of Article V.  The presumptions
and burdens of proof articulated in Article VI shall apply to any dispute
arising under this Section.

 

Section 7.17.                          USE OF CERTAIN TERMS.  As used in this
Agreement, the words “herein,” “hereof,” and “hereunder” and other words of
similar import refer to this Agreement as a whole and not to any particular
paragraph, subparagraph, Section, or other subdivision.  Whenever the context
may require, any pronoun used in this Agreement shall include the corresponding
masculine, feminine or neuter forms, and the singular form of nouns, pronouns
and verbs shall include the plural and vice versa.

 

Section 7.18.                          WAIVERS.  The observance of any term of
this Agreement may be waived (either generally or in a particular instance and
either retroactively or prospectively) only by a writing signed by the party
against which such waiver is to be asserted.  Unless otherwise expressly
provided herein, no delay on the part of the party hereto in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any waiver on the part of any party hereto of any right, power or privilege
hereunder operate as a waiver of any other right, power or privilege hereunder
nor shall

 

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any single or partial exercise of any right, power or privilege hereunder
preclude any other or further exercise thereof of the exercise of any other
right, power or privilege hereunder.

 

signature page follows

 

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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered to be
effective as of the date first above written.

 

 

 

ALTEVA, INC.

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

Address:

401 Market Street, 1st Floor
Philadelphia, PA 19106

 

 

 

 

 

INDEMNITEE

 

 

 

 

 

Name:

 

Address:

 

 

 

 

 

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