EXHIBIT 10.1

 
FORM OF INDEMNIFICATION AGREEMENT
 
This Agreement, made and entered into this ___ day of _________, 2009
(“Agreement”), by and between TranSwitch Corporation, a Delaware corporation
(“Company”), and __________ (“Indemnitee”).
 
WHEREAS, the Company desires to retain the availability of its existing
directors and to be in a position to attract additional persons to serve in such
capacity; and
 
WHEREAS, highly competent persons are becoming more reluctant to serve as
directors or in other capacities unless they are provided with adequate
protection through insurance or adequate indemnification against inordinate
risks of claims and actions against them arising out of their service to and
activities on behalf of the Company; and
 
WHEREAS, the current impracticability of obtaining adequate insurance and the
uncertainties relating to indemnification have increased the difficulty of
attracting and retaining such persons; and
 
WHEREAS, it is reasonable, prudent and necessary for the Company contractually
to obligate itself to indemnify such persons to the maximum extent permitted by
applicable law so that they will serve or continue to serve the Company free
from undue concern that they will not be so indemnified;
 
WHEREAS, Indemnitee does not regard the protection available under the Company’s
Amended and Restated Certificate of Incorporation, as amended (“Certificate of
Incorporation”) and Second Amended and Restated By-laws (“By-laws”) as adequate
in the present circumstances, and may not be willing to serve as a director
without adequate protection and the Company desires Indemnitee to serve in such
capacity.  Indemnitee is willing to serve, continue to serve and to take on
additional service for or on behalf of the Company on the condition that
Indemnitee be indemnified to the maximum extent permitted by applicable law so
that Indemnitee will serve or continue to serve the Company free from undue
concern that Indemnitee will not be so indemnified;
 
WHEREAS, this Agreement is a supplement to and in furtherance of the bylaws of
the Company and any resolutions adopted pursuant thereto, and shall not be
deemed a substitute therefore nor to diminish or abrogate any right of
Indemnitee thereunder; and
 

 
 

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NOW, THEREFORE, in consideration of the premises and the covenants contained
herein, the Company and Indemnitee do hereby covenant and agree as follows:
 
ARTICLE I
 
Definitions
 
For purposes of this Agreement the following terms shall have the meanings
indicated:
 
1.01.                      “Board” shall mean the Board of Directors of the
Company.
 
1.02.                      “Change of Control” shall be deemed to occur upon the
earliest to occur after the date of this Agreement of any of the following
events:
 
(a)           Acquisition of Stock by Third Party.  Any Person (as defined
below) is or becomes the Beneficial Owner (as defined below), directly or
indirectly, of securities of the Company representing fifteen percent (15%) or
more of the combined voting power of the Company’s then outstanding securities;
 
(b)           Change in the Board.  During any period of two (2) consecutive
years (not including any period prior to the execution of this Agreement),
individuals who at the beginning of such period constitute the Board, and any
new director (other than a director designated by a person who has entered into
an agreement with the Company to effect a transaction described in Sections
1.02(a), 1.02(c) or 1.02(d)) whose election by the Board or nomination for
election by the Company’s stockholders was approved by a vote of a majority of
the directors then still in office who either were directors at the beginning of
the period or whose election or nomination for election was previously so
approved, cease for any reason to constitute at least a majority of the members
of the Board;
 
(c)           Corporate Transactions.  The effective date of a merger or
consolidation of the Company with any other entity, other than a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 51% of the combined voting power
of the voting securities of the surviving entity outstanding immediately after
such merger or consolidation and with the power to elect at least a majority of
the board of directors or other governing body of such surviving entity;
 

 
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(d)           Liquidation.  The approval by the stockholders of the Company of a
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company’s assets; and
 
(e)           Other Events.  There occurs any other event of a nature that would
be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A (or a response to any similar item on any similar schedule or
form) promulgated under the Exchange Act (as defined below), whether or not the
Company is then subject to such reporting requirement.
 
For purposes of this Section 1.02, the following terms shall have the following
meanings:
 
 
(A)
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from
time to time, and the rules and regulations promulgated thereunder.

 
 
(B)
“Person” shall have the meaning as set forth in Sections 13(d) and 14(d) of the
Exchange Act (including without limitation any two or more persons acting as a
group and deemed to be a single person under Section 13(d) pursuant to Section
13(d)(3) and Rule 13d-5 promulgated thereuder); provided, however, that Person
shall exclude (i) the Company, (ii) any trustee or other fiduciary holding
securities under an employee benefit plan of the Company, and (iii) any
corporation owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the Company.

 
 
(C)
“Beneficial Owner” shall have the meaning given to such term in Rule 13d-3 under
the Exchange Act; provided, however, that Beneficial Owner shall exclude any
Person otherwise becoming a Beneficial Owner by reason of the stockholders of
the Company approving a merger of the Company with another entity.

 
1.03.                      “Corporate Status” describes the status of a person
who is or was a director, officer, employee, agent, trustee or fiduciary of the
Company or of any other corporation, limited liability company, partnership,
joint venture, trust, employee benefit plan or other enterprise for which such
person is or was serving as a director, officer, employee or agent at the
request of the Company.
 
1.04.                      “Court” means the Court of Chancery of the State of
Delaware, the court in which the Proceeding in respect of which indemnification
is sought by Indemnitee shall have been brought or is pending, or another court
having subject jurisdiction and personal jurisdiction over the parties.
 

 
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1.05.                      “Disinterested Director” means a director of the
Company who is not and was not and is not threatened to be a party to the
Proceeding in respect of which indemnification is sought by Indemnitee.
 
1.06.                      “Enterprise” shall mean the Company and any other
corporation, limited liability company, partnership, joint venture, trust,
employee benefit plan or other entity of which Indemnitee is or was serving at
the request of the Company as a director, officer, employee, agent, trustee or
fiduciary.
 
1.07.                      “Expenses” shall mean all reasonable costs and
expenses (including, without limitation, all reasonable attorneys’ fees,
retainers, court costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees, and all other disbursements or expenses of the
types customarily) incurred in connection with prosecuting, defending, preparing
to prosecute or defend, investigating or being or preparing to be a witness in a
Proceeding or otherwise participating in a Proceeding.  Expenses also shall
include (i) all reasonable costs and 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, and (ii) for purposes of Section 8.06 only,
all reasonable costs and expenses incurred by Indemnitee in connection with the
interpretation, enforcement or defense of Indemnitee’s rights under this
Agreement, by litigation or otherwise.  The parties agree that for the purposes
of any advancement of Expenses for which Indemnitee has made written demand to
the Company in accordance with this Agreement, all Expenses included in such
demand that are certified by affidavit of Indemnitee’s counsel as being
reasonable shall be presumed conclusively to be reasonable.  Expenses, however,
shall not include amounts paid in settlement by Indemnitee or the amount of
judgments or fines against Indemnitee.
 
1.08.                      “Good Faith” shall mean Indemnitee having acted in
good faith and in a manner Indemnitee reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any
Proceeding which is criminal in nature, having had no reasonable cause to
believe Indemnitee’s conduct was unlawful.
 
1.09.                      “Independent Counsel” means a law firm, or a member
of a law firm, that is experienced in matters of corporation law and may include
law firms or members thereof that are regularly retained by the Company but not
any other party to the Proceeding giving rise to a claim for indemnification
hereunder.  Notwithstanding the foregoing, the term “Independent Counsel” shall
not include any person who, under the standards of professional conduct then
prevailing and applicable to such counsel, would have a conflict of interest in
representing either the Company or Indemnitee in an action to determine
Indemnitee’s rights under this Agreement.  The Company agrees to pay the
reasonable fees and expenses of the Independent Counsel referred to above and to
fully indemnify such counsel against any and all Expenses, claims, liabilities
and damages arising out of or relating to this Agreement or its engagement
pursuant hereto.
 
1.10.                      “Proceeding” shall include any pending, threatened or
completed action, suit, arbitration, alternate dispute resolution mechanism,
investigation (including any internal corporate investigation), administrative
hearing or any other pending, threatened or completed proceeding whether civil,
criminal, administrative, legislative or investigative (whether formal or
informal), other than one initiated by Indemnitee including any appeal therefrom
in which Indemnitee was, is or will be involved as a party, potential party,
non-party witness or otherwise by reason of the fact that Indemnitee is or was a
director or officer of the Company, by reason of any action taken by him or of
any action on his part while acting as director or officer of the Company, or by
reason of the fact that he is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, limited liability
company, partnership, joint venture, trust or other enterprise, in each case
whether or not serving in such capacity at the time any liability or expense is
incurred for which indemnification, reimbursement, or advancement of Expenses
can be provided under this Agreement.  If Indemnitee believes in good faith that
a given situation may lead to or culminate in the institution of a Proceeding,
this shall be considered a Proceeding under this paragraph.  For purposes of
this paragraph, a “Proceeding” shall not be deemed to have been initiated by
Indemnitee where Indemnitee seeks pursuant to Article VIII of this Agreement to
enforce Indemnitee’s rights under this Agreement.
 

 
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ARTICLE II
 
Term of Agreement
 
This Agreement shall continue until and terminate upon the later of:  (i) ten
(10) years after the date that Indemnitee shall have ceased to serve as a
director, officer, employee, agent, trustee or fiduciary of the Company or of
any other Enterprise; or (ii) the final termination of all pending Proceedings
in respect of which Indemnitee is granted rights of indemnification or
advancement of Expenses hereunder and of any proceeding commenced by Indemnitee
pursuant to Article VIII of this Agreement relating thereto.
 
ARTICLE III
 
Services by Indemnitee, Notice of Proceedings
 
3.01.                      Services.  Indemnitee agrees to serve or continue to
serve as a director of the Company for so long as he is duly elected or
appointed.  Indemnitee may at any time and for any reason resign from such
position (subject to any other contractual obligation or any obligation imposed
by operation of law).  This Agreement shall not be deemed an employment contract
between the Company (or any of its subsidiaries or any Enterprise) and
Indemnitee.  This Agreement shall continue in force after Indemnitee has ceased
to serve as a director of the Company.
 
3.02.                      Notice of Proceeding.  Indemnitee agrees promptly to
notify the Company in writing upon being served with any summons, citation,
subpoena, complaint, indictment, information or other document relating to any
Proceeding or matter which may be subject to indemnification or advancement of
Expenses covered hereunder, but the omission so to notify the Company shall not
relieve the Company from its obligations hereunder.
 
ARTICLE IV
 
Indemnification
 
4.01.                      In General.  In connection with any Proceeding, the
Company shall indemnify and advance Expenses to Indemnitee as provided in this
Agreement and to the maximum extent permitted by applicable law in effect on the
date hereof and including indemnification and advancement of Expenses in excess
of that expressly permitted by statute, including, without limitation, any
indemnification provided by the Company’s Certificate of Incorporation, the
Company’s By-laws, vote of its stockholders or disinterested directors, or
applicable law.
 
4.02.                      Proceedings Other Than Proceedings by or in the Right
of the Company.  Indemnitee shall be entitled to the rights of indemnification
to the maximum extent not prohibited by law provided in this Section 4.02 if, by
reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be
made, a party to or is otherwise involved in any Proceeding, other than a
Proceeding by or in the right of the Company to procure a judgment in its
favor.  Pursuant to this Section 4.02, Indemnitee shall be indemnified to the
maximum extent permitted by law against Expenses, judgments, penalties, fines
and amounts paid in settlement actually and reasonably incurred by Indemnitee or
on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or
matter therein, if Indemnitee acted in Good Faith.
 

 
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4.03.                      Proceedings by or in the Right of the
Company.  Indemnitee shall be entitled to the rights of indemnification to the
maximum extent not prohibited by law provided in this Section 4.03 if, by reason
of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a
party to or is otherwise involved in any Proceeding brought by or in the right
of the Company to procure a judgment in its favor.  Pursuant to this Section
4.03, Indemnitee shall be indemnified to the maximum extent permitted by
applicable law against Expenses, judgments, penalties, and amounts paid in
defense or settlement, actually and reasonably incurred by Indemnitee or on
Indemnitee’s behalf in connection with such Proceeding or any claim, issue or
matter therein, if Indemnitee acted in Good Faith.  Notwithstanding the
foregoing, no such indemnification for Expenses shall be made in respect of any
claim, issue or matter in such Proceeding as to which Indemnitee shall have been
finally adjudged to be liable to the Company unless and only to the extent that
the Court in which the Proceeding was brought shall determine upon application
that, despite the adjudication of liability, but in view of all the
circumstances of the case, Indemnitee is fairly and reasonably entitled to
indemnification.
 
4.04.                      Indemnification of a Party Who is Wholly or Partly
Successful.  Notwithstanding any other provision of this Agreement, to the
extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a party
to or is otherwise involved in and is successful, on the merits or otherwise, in
any Proceeding or in defense of any claim, issue or matter therein, in whole or
in part, Indemnitee shall be indemnified by the Company to the maximum extent
permitted by law, against all Expenses, judgments, penalties, fines, and amounts
paid in defense or settlement, actually and reasonably incurred by Indemnitee or
on Indemnitee’s behalf in connection therewith.  If Indemnitee is not wholly
successful in such Proceeding but is successful, on the merits or otherwise, as
to one or more but less than all claims, issues or matters in such Proceeding,
the Company shall indemnify Indemnitee to the maximum extent permitted by law,
against all Expenses, judgments, penalties, fines, and amounts paid in defense
or settlement, actually and reasonably incurred by Indemnitee or on Indemnitee’s
behalf in connection with each successfully resolved claim, issue or
matter.  For purposes of this Section 4.04 and without limitation, the
termination of any claim, issue or matter in such a Proceeding by dismissal,
with or without prejudice, shall be deemed to be a successful result as to such
claim, issue or matter.
 

 
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4.05.                      Indemnification for Expenses of a
Witness.  Notwithstanding any other provision of this Agreement, to the maximum
extent permitted by applicable law and to the extent that Indemnitee is, by
reason of Indemnitee’s Corporate Status, a witness or otherwise asked to
participate in any Proceeding to which Indemnitee is not a party, Indemnitee
shall be indemnified against all Expenses actually and reasonably incurred by
Indemnitee or on Indemnitee’s behalf in connection therewith.
 
4.06.                      Partial Indemnification.  If Indemnitee is entitled
under any provision of this Agreement to indemnification by the Company for some
or a portion of Expenses, but not, however, for the total amount thereof, the
Company shall nevertheless indemnify Indemnitee, to the maximum extent not
prohibited by law, for the portion thereof to which Indemnitee is entitled.
 
4.07.                      Additional Indemnification.
 
(a)           Notwithstanding any limitation in Sections 4.01, 4.02, 4.03, or
4.04, the Company shall indemnify Indemnitee to the maximum extent permitted by
applicable law if Indemnitee is a party to or threatened to be made a party to
any Proceeding (including a Proceeding by or in the right of the Company to
procure a judgment in its favor) against all Expenses, judgments, fines and
amounts paid in settlement actually and reasonably incurred by Indemnitee in
connection with the Proceeding.
 
(b)           For purposes of Section 4.07(a), the meaning of the phrase “to the
maximum extent permitted by applicable law” shall include, but not be limited
to:
 
 
(A)
to the maximum extent permitted by the provision of the General Corporation Law
of the State of Delaware (the “DGCL”) that authorizes or contemplates additional
indemnification by agreement or pursuant to the Company’s Certificate of
Incorporation or By-laws, or the corresponding provision of any amendment to or
replacement of the DGCL, and

 
 
(B)
to the maximum extent authorized or permitted by any amendments to or
replacements of the DGCL adopted after the date of this Agreement that increase
the extent to which a corporation may indemnify its officers and directors.

 

 
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4.08.                      Exclusions.  Notwithstanding any provision in this
Agreement, the Company shall not be obligated under this Agreement to make any
indemnity in connection with any claim made against Indemnitee:
 
(a)           for which payment has actually been made to or on behalf of
Indemnitee under any insurance policy, contract, agreement or other indemnity
provision or arrangement (whether with the Company or any other corporation,
limited liability company, partnership, joint venture, trust, employee benefit
plan or other entity), except with respect to any excess beyond the amount
actually paid under any insurance policy contract, agreement or other indemnity
provision or arrangement; or
 
(b)           for (i) an accounting of profits made from the purchase and sale
(or sale and purchase) by Indemnitee of securities of the Company within the
meaning of Section 16(b) of the Exchange Act (as defined in Section 1.02 hereof)
or similar provisions of state statutory law or common law, or (ii) any
reimbursement of the Company by Indemnitee of any bonus or other incentive-based
or equity-based compensation or of any profits realized by Indemnitee from the
sale of securities of the Company, as required in each case under the Exchange
Act (including any such reimbursements that arise from an accounting restatement
of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the
“Sarbanes-Oxley Act”), or the payment to the Company of profits arising from the
purchase and sale by Indemnitee of securities in violation of Section 306 of the
Sarbanes-Oxley Act); or
 
(c)           except as provided in Section 8.06 of this Agreement, in
connection with any Proceeding (or any part of any Proceeding) initiated by
Indemnitee, including any Proceeding (or any part of any Proceeding) initiated
by Indemnitee against the Company or its directors, officers, employees or other
indemnitees, unless (i) the Board authorized the Proceeding (or any part of any
Proceeding) prior to its initiation or (ii) the Company provides the
indemnification, in its sole discretion, pursuant to the powers vested in the
Company under applicable law.
 
ARTICLE V
 
Advancement of Expenses
 
Notwithstanding any provision to the contrary in this Agreement, the Company
shall, to the maximum extent not prohibited by law, advance all reasonable
Expenses which, by reason of Indemnitee’s Corporate Status, were incurred by or
on behalf of Indemnitee in connection with any Proceeding, within thirty (30)
days after the receipt by the Company of a statement or statements from
Indemnitee requesting such advance or advances of Expenses, whether prior to or
after final disposition of such Proceeding.  Such statement or 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 if it shall ultimately be determined that Indemnitee is not
entitled to be indemnified against such Expenses.  Any advance and undertakings
to repay pursuant to this Article V shall be unsecured and interest free and
without reference to the financial ability of Indemnitee to make such repayment
or to Indemnitee’s ultimate entitlement to indemnification under other
provisions of this Agreement.  Advancement of Expenses pursuant to this Article
V shall not require approval of the Board or the stockholders of the Company, or
of any other person or body.  The Secretary of the Company shall promptly advise
the Board in writing of the request for advancement of Expenses, of the amount
and other details of the advancement and of the undertaking to make repayment
pursuant to this Article V.  Advances shall include any and all reasonable
Expenses incurred pursuing an action to enforce this right of advancement,
including Expenses incurred preparing and forwarding statements to the Company
to support the advances claimed.  This Article V shall not apply to any claim
made by Indemnitee for which indemnification is excluded pursuant to Section
4.08.
 

 
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ARTICLE VI
 
Procedures for Determination of Entitlement to Indemnification
 
6.01.                      Initial Request.  To obtain indemnification under
this Agreement (other than advancement of Expenses pursuant to Article V),
Indemnitee shall submit to the Company a written request, including therein or
therewith such documentation and information as is reasonably available to
Indemnitee and is reasonably necessary to determine whether and to what extent
Indemnitee is entitled to indemnification including, but not limited to, a
description of the nature of the Proceeding and the facts underlying the
Proceeding.  The Secretary of the Company shall promptly advise the Board in
writing that Indemnitee has requested indemnification.  The omission by
Indemnitee to notify the Company hereunder will not relieve the Company from any
liability which it may have to Indemnitee hereunder or otherwise than under this
Agreement, and any delay in so notifying the Company shall not constitute a
waiver by Indemnitee of any rights under this Agreement.
 
6.02.                      Method of Determination.  Upon written request by
Indemnitee pursuant to Section 6.01, a determination (if required by applicable
law) with respect to Indemnitee’s entitlement to indemnification shall be made
as follows:
 
(a)           if a Change in Control has occurred, unless Indemnitee shall
request in writing that such determination be made in accordance with clause (b)
of this Section 6.02, the determination shall be made by Independent Counsel in
a written statement to the Board, a copy of which shall be delivered to
Indemnitee; or
 
(b)           if a Change of Control has not occurred, and subject to Section
6.05, the determination shall be made by (i) the Board by a majority vote of a
quorum consisting of Disinterested Directors (or pursuant to unanimous written
consent in lieu of a meeting if all of the Company’s Directors are
Disinterested).  In the event that a quorum of the Board consisting of
Disinterested Directors is not obtainable or, even if obtainable, such quorum of
Disinterested Directors so directs, the determination shall be made by
Independent Counsel in a written opinion to the Board, a copy of which shall be
delivered to Indemnitee, (ii) a committee of Disinterested Directors designated
by a majority vote of the Disinterested Directors, even though less than a
quorum of the Board, (iii) if there are no such Disinterested Directors or, if
such Disinterested Directors so direct, by Independent Counsel in a written
opinion to the Board, a copy of which shall be delivered to Indemnitee, or (iv)
if so directed by the Board, by the stockholders of the Company.
 
6.03.                      Selection, Payment, Discharge, of Independent
Counsel.  In the event the determination of entitlement to indemnification is to
be made by Independent Counsel pursuant to Section 6.02 of this Agreement, the
Independent Counsel shall be selected, paid, and discharged in the following
manner:
 
(a)           If a Change of Control has not occurred, the Independent Counsel
shall be selected by the Board, and the Company shall give written notice to
Indemnitee advising Indemnitee of the identity of the Independent Counsel so
selected.
 
(b)           If a Change of Control has occurred, the Independent Counsel shall
be selected by Indemnitee (unless Indemnitee shall request that such selection
be made by the Board, in which event clause (a) of this section shall apply),
and Indemnitee shall give written notice to the Company advising it of the
identity of the Independent Counsel so selected.
 

 
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(c)           Following the initial selection described in clauses (a) and (b)
of this Section 6.03, Indemnitee or the Company, as the case may be, may, within
seven (7) days after such written notice of selection has been given, deliver to
the other party a written objection to such selection.  Such objection may be
asserted only on the ground that the Independent Counsel so selected does not
meet the requirements of “Independent Counsel” as defined in Section 1.09 of
this Agreement, and the objection shall set forth with particularity the factual
basis of such assertion.  Absent a proper and timely objection, the person so
selected shall act as Independent Counsel.  If such written objection is made,
the Independent Counsel so selected may not serve as Independent Counsel unless
and until a court has determined that such objection is without merit.
 
(d)           Either the Company or Indemnitee may petition a Court if the
parties have been unable to agree on the selection of Independent Counsel within
thirty (30) days after submission by Indemnitee of a written request for
indemnification pursuant to Section 6.01 of this Agreement.  Such petition may
request a determination whether an objection to the party’s selection is without
merit and/or seek the appointment as Independent Counsel of a person selected by
the Court or by such other person as the Court shall designate.  A person so
appointed shall act as Independent Counsel under Section 6.02 of this Agreement.
 
(e)           The Company shall pay any and all reasonable fees and expenses of
Independent Counsel incurred by such Independent Counsel in connection with
acting pursuant to this Agreement, and the Company shall pay all reasonable fees
and expenses incident to the procedures of this Section 6.03, regardless of the
manner in which such Independent Counsel was selected or appointed.
 
(f)           Upon the due commencement of any judicial proceeding or
arbitration pursuant to Section 8.01(c) of this Agreement, Independent Counsel
shall be discharged and relieved of any further responsibility in such capacity
(subject to the applicable standards of professional conduct then prevailing).
 
6.04.                      Cooperation.  Indemnitee shall cooperate with the
person, persons or entity making the determination with respect to Indemnitee’s
entitlement to indemnification under this Agreement, including providing to such
person, persons or entity upon reasonable advance request any documentation or
information which is not privileged or otherwise protected from disclosure and
which is reasonably available to Indemnitee and reasonably necessary to such
determination.  Any costs or expenses (including attorneys’ fees and
disbursements) incurred by Indemnitee in so cooperating with the person, persons
or entity making such determination shall be borne by the Company (irrespective
of the determination as to Indemnitee’s entitlement to indemnification), and the
Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.
 
6.05.                      Payment.  If it is determined that Indemnitee is
entitled to indemnification, payment to Indemnitee shall be made within ten (10)
days after such determination.
 

 
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ARTICLE VII
 
Presumptions and Effect of Certain Proceedings
 
7.01.                      Burden of Proof.  In making a determination with
respect to entitlement to indemnification hereunder, the person, persons or
entity making such determination shall presume that Indemnitee is entitled to
indemnification under this Agreement if Indemnitee has submitted a request for
indemnification in accordance with Article VI of this Agreement, and the Company
shall, to the maximum extent not prohibited by law, have the burden of proof to
overcome that presumption in connection with the making by any person, persons
or entity of any determination contrary to that presumption.  Neither the
failure of the Company (including by its directors or Independent Counsel) to
have made a determination prior to the commencement of any action pursuant to
this Agreement that indemnification is proper in the circumstances because
Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Company (including by its directors or Independent Counsel)
that Indemnitee has not met such applicable standard of conduct, shall be a
defense to the action or create a presumption that Indemnitee has not met the
applicable standard of conduct.
 
7.02.                      Effect of Other Proceedings.  The termination of any
Proceeding or of any claim, issue or matter therein, by judgment, order,
settlement or conviction, or upon a plea of guilty or of nolo contendere or its
equivalent, shall not (except as otherwise expressly provided in this Agreement)
of itself adversely affect the right of Indemnitee to indemnification or create
a presumption that Indemnitee did not act in Good Faith.
 
7.03.                      Reliance as Safe Harbor.  For purposes of any
determination of Good Faith, Indemnitee shall be deemed to have acted in Good
Faith if Indemnitee’s action is based on the records or books of account of the
Enterprise, including financial statements, or on information supplied to
Indemnitee by the officers of the Enterprise in the course of their duties, or
on the advice of legal counsel for the Enterprise or on information or records
given or reports made to the Enterprise by an independent certified public
accountant or by an appraiser or other expert selected with reasonable care by
the Enterprise.  The provisions of this Section 7.03 shall not be deemed to be
exclusive or to limit in any way the other circumstances in which Indemnitee may
be deemed to have met the applicable standard of conduct set forth in this
Agreement.
 
7.04.                      Actions of Others.  The knowledge and/or actions, or
failure to act, of any director, officer, employee, agent, trustee or fiduciary
of the Enterprise shall not be imputed to Indemnitee for purposes of determining
the right to indemnification hereunder.
 
ARTICLE VIII
 
Remedies of Indemnitee
 
8.01.                      Application.  This Article VIII shall apply in the
event of a Dispute.  For purposes of this Article, “Dispute”, shall mean any of
the following events:
 
(a)           a determination is made pursuant to Article VI of this Agreement
that Indemnitee is not entitled to indemnification under this Agreement;
 
(b)           advancement of Expenses is not timely made pursuant to Article V
of this Agreement;
 

 
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(c)           the determination of entitlement to be made pursuant to Section
6.02 of this Agreement has not been made within ninety (90) days after receipt
by the Company of the request for indemnification;
 
(d)           payment of indemnification is not made pursuant to Section 4.05 of
this Agreement within ten (10) days after receipt by the Company of a written
request therefor;
 
(e)           payment of indemnification is not made within ten (10) days after
a determination has been made that Indemnitee is entitled to indemnification or
such determination is deemed to have been made pursuant to Article VI of this
Agreement; or
 
(f)           the event that the Company or any other person takes or threatens
to take any action to declare this Agreement void or unenforceable, or
institutes any litigation or other action or Proceeding designed to deny, or to
recover from, Indemnitee the benefits provided or intended to be provided to
Indemnitee hereunder, Indemnitee shall be entitled to an adjudication by a court
of his entitlement to such indemnification or advancement of Expenses.
 
8.02.                      Adjudication.  In the event of a Dispute, Indemnitee
shall be entitled to an adjudication in an appropriate Court of Indemnitee’s
entitlement to such indemnification or advancement of Expenses.  Alternatively,
Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be
conducted by a single arbitrator pursuant to the rules of the American
Arbitration Association.  Indemnitee shall commence such proceeding seeking an
adjudication or an award in arbitration within one hundred eighty (180) days
following the date on which a Dispute arose.  The Company shall not oppose
Indemnitee’s right to seek any such adjudication or award in arbitration.
 
8.03.                      De Novo Review.  In the event that a determination
shall have been made pursuant to Article VI of this Agreement that Indemnitee is
not entitled to indemnification, any judicial proceeding or arbitration
commenced pursuant to this Article VIII shall be conducted in all respects as a
de novo trial, or arbitration, on the merits and Indemnitee shall not be
prejudiced by reason of that adverse determination.  In any such proceeding or
arbitration, the Company shall have the burden of proving that Indemnitee is not
entitled to indemnification or advancement of Expenses, as the case may be.
 
8.04.                      Company Bound.  If a determination shall have been
made or deemed to have been made pursuant to Article VI of this Agreement that
Indemnitee is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration absent (i) a
misstatement by Indemnitee of a material fact, or any omission of a material
fact necessary to make Indemnitee’s statement not materially misleading, in
connection with Indemnitee’s request for indemnification, or (ii) a prohibition
of such indemnification under applicable law.
 
8.05.                      Procedures Valid.  The Company shall be precluded
from asserting in any judicial proceeding or arbitration commenced pursuant to
this Article VIII that the procedures and presumptions of this Agreement are not
valid, binding and enforceable and shall stipulate in any such court or before
any such arbitrator that the Company is bound by all the provisions of this
Agreement.
 

 
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8.06.                      Expenses of Adjudication.  The Company shall, to the
maximum extent not prohibited by law, be precluded from asserting in any
judicial proceeding or arbitration commenced pursuant to this Section 8.06 that
the procedures and presumptions of this Agreement are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator
that the Company is bound by all the provisions of this Agreement.  It is the
intent of the Company that, to the maximum extent permitted by law, Indemnitee
not be required to incur legal fees or other Expenses associated with the
interpretation, enforcement or defense of Indemnitee’s rights under this
Agreement by litigation or otherwise because the cost and expense thereof would
substantially detract from the benefits intended to be extended to Indemnitee
hereunder.  The Company shall, to the maximum extent permitted by law, indemnify
Indemnitee against any and all Expenses and, if requested by Indemnitee, shall
(within ten (10) days after receipt by the Company of a written request
therefor) advance, to the extent not prohibited by law, such Expenses to
Indemnitee, which are incurred by Indemnitee in connection with any action
brought by Indemnitee for indemnification or advance of Expenses from the
Company under this Agreement or under any directors’ and officers’ liability
insurance policies maintained by the Company if Indemnitee is wholly successful
on the underlying claims; if Indemnitee is not wholly successful on the
underlying claims, then such indemnification and advancement shall be only to
the extent Indemnitee is successful on such underlying claims or otherwise as
permitted by law, whichever is greater.
 
ARTICLE IX
 
Non-Exclusivity, Insurance, Subrogation
 
9.01.                      Non-Exclusivity.  The rights of indemnification and
to receive advancement of Expenses as provided by this Agreement shall not be
deemed exclusive of any other rights to which Indemnitee may at any time be
entitled under applicable law, the Company’s Certificate of Incorporation, the
Company’s By-Laws, any agreement, a vote of shareholders or a resolution of
Disinterested Directors, or otherwise.  No amendment, alteration, rescission or
replacement of this Agreement or any provision hereof shall be effective as to
Indemnitee with respect to any action taken or omitted by such Indemnitee in
Indemnitee’s Corporate Status prior to such amendment, alteration, rescission or
replacement.  To the extent that a change in Delaware law, whether by statute or
judicial decision, or a change in the Company’s By-laws or Certificate of
Incorporation, permits greater indemnification or advancement of Expenses than
would be afforded currently under the Company’s By-laws, Certificate of
Incorporation and this Agreement, it is the intent of the parties hereto that
Indemnitee shall enjoy by this Agreement the greater benefits so afforded by
such change.
 
9.02.                      Insurance.  The Company may maintain, at its expense,
an insurance policy or policies to protect itself and Indemnitee against
liability arising out of the subject matter of this Agreement or otherwise.
 
9.03.                      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, who shall execute all papers required
and take all action necessary to secure such rights, including execution of such
documents as are necessary to enable the Company to bring suit to enforce such
rights.
 

 
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ARTICLE X
 
General Provisions
 
10.01.                      Successors and Assigns.  This Agreement shall be
binding upon the Company and its successors and assigns and shall inure to the
benefit of Indemnitee and Indemnitee’s legal representatives, heirs, executors
and administrators.
 
10.02.                      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
 
(b)           to the maximum 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 by the provision held invalid, illegal or
unenforceable.
 
10.03.                      No Adequate Remedy.  The parties declare that it is
impossible to measure in money the damages which will accrue to either party by
reason of a failure to perform any of the obligations under this
Agreement.  Therefore, if either party shall institute any action or proceeding
to enforce the provisions hereof, such party against whom such action or
proceeding is brought hereby waives the claim or defense that such party has an
adequate remedy at law, and such party shall not urge in any such action or
proceeding the claim or defense that the other party has an adequate remedy at
law.
 

 
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10.04.                      Headings.  The headings of the paragraphs of this
Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction thereof.
 
10.05.                      Modification and Waiver.  No supplement,
modification or amendment of this Agreement shall be binding unless executed in
writing by both of the parties hereto.  No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provisions hereof (whether or not similar) nor shall such waiver constitute a
continuing waiver.
 
10.06.                      Notices.  All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if (i) delivered by hand and receipted for by the party to whom said
notice or other communication shall have been directed, or (ii) mailed by
certified or registered mail with postage prepaid, on the third business day
after the date on which it is so mailed:
 
If to Indemnitee, to:
As shown with Indemnitee’s
 
signature below.
If to the Company, to:
TranSwitch Corporation
 
3 Enterprise Drive
 
Shelton, CT  06484

 
 
 
or to such other address as may have been furnished to Indemnitee by the Company
or to the Company by Indemnitee, as the case may be.
 
10.07.                      Governing Law.  The parties agree that this
Agreement shall be governed by, and construed and enforced in accordance with,
the laws of the State of Delaware without application of the conflict of laws
principles thereof.
 
10.08.                      Entire Agreement.  This Agreement constitutes the
entire agreement and understanding between the parties hereto in reference to
all the matters herein agreed upon.  This Agreement replaces in full all prior
indemnification agreements or understandings of the parties hereto, and any all
such prior agreements or understandings are hereby rescinded by mutual
agreement.
 

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and year first above written.
 
 
   
TRANSWITCH CORPORATION
ATTEST:
     
    
 
By:
      
By:
    
 
 
 
Name:
   
 
 
Title:
         
    
 
 
 
   
INDEMNITEE
 
        
    
     
 
   
Name:
 
 
   
Address:
 

 
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Schedule to Indemnification Agreement
 
The following is a list of our directors who are party to the Indemnification
Agreement, the form of which is filed herewith:
 
Dr. Santanu Das
 
Mr. Gerald F. Montry
 
Dr. Hagen Hultzsch
 
Mr. Alfred Boschulte
 
Mr. James M. Pagos
 
Dr. Albert E. Paladino
 
Mr. Thomas H. Baer
 
Mr. Herbert Chen
 
Mr. Faraj Aalaei
 
Mr. Sam Srinivasan
 
Mr. Michael Crawford

 

 

 
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