Exhibit 10.4

INDEMNIFICATION AGREEMENT

This Agreement (this “Agreement”) is made as of the      day of August, 2007, by
and between Distributed Energy Systems Corp., a Delaware corporation (the
“Corporation), and                                          (the “Indemnitee”),
a director or officer of the Corporation.

WHEREAS, it is essential to the Corporation to retain and attract as directors
and officers the most capable persons available, and

WHEREAS, the substantial increase in corporate litigation subjects directors and
officers to expensive litigation risks at the same time that the availability of
directors’ and officers’ liability insurance has been severely limited, and

WHEREAS, it is now and has always been the express policy of the Corporation to
indemnify its directors and officers, and

WHEREAS, the Indemnitee does not regard the protection available under the
Corporation’s Certificate of Incorporation and insurance as adequate in the
present circumstances, and may not be willing to serve or continue to serve as a
director or officer without adequate protection, and

WHEREAS, the Corporation desires the Indemnitee to serve, or continue to serve,
as a director or officer of the Corporation.

NOW THEREFORE, the Corporation and the Indemnitee do hereby agree as follows:

1. Agreement to Serve. The Indemnitee agrees to serve or continue to serve as a
director or officer of the Corporation for so long as the Indemnitee is duly
elected or appointed or until such time as the Indemnitee tenders a resignation
in writing. Indemnitee may at any time and for any reason resign from such
position(s), subject to any other contractual obligation or any obligation
imposed by operation of law, and such resignation shall have no effect on the
Corporation’s obligations hereunder.

2. Definitions. As used in this Agreement:

(a) The term “Proceeding” shall include any threatened, pending or completed
action, suit, arbitration, alternative dispute resolution proceeding,
investigation, administrative hearing or other proceeding, whether brought by or
in the right of the Corporation or otherwise and whether of a civil, criminal,
administrative or investigative nature, and any appeal therefrom.

(b) The term “Corporate Status” shall mean the status of a person who is or was,
or has agreed to become, a director or officer of the Corporation, or is or was
serving, or has agreed to serve, at the request of the Corporation, as a
director, officer, fiduciary, partner, trustee, member, employee or agent of, or
in a similar capacity with, another corporation, partnership, joint venture,
trust, limited liability company or other enterprise.

(c) The term “Expenses” shall be broadly construed and shall include, without
limitation, attorneys’ fees, retainers, court costs, transcript costs, fees and
expenses of experts,

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travel expenses, food and lodging expenses while traveling, duplicating costs,
printing and binding costs, telephone charges, postage, delivery service fees
and 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 any Proceeding, but
shall not include the amount of judgments, fines or penalties against Indemnitee
or amounts paid in settlement in connection with such matters.

(d) The term “Change in Control” shall mean:

(i) the acquisition by an individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) (a “Person”) of beneficial ownership of any capital stock
of the Corporation if, after such acquisition, such Person beneficially owns
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) 50% or
more of either (x) the then-outstanding shares of common stock of the
Corporation (the “Outstanding Corporation Common Stock”) or (y) the combined
voting power of the then-outstanding securities of the Corporation entitled to
vote generally in the election of directors (the “Outstanding Corporation Voting
Securities”); provided, however, that for purposes of this subsection (i), the
following acquisitions shall not constitute a Change in Control: (A) any
acquisition directly from the Corporation (excluding an acquisition pursuant to
the exercise, conversion or exchange of any security exercisable for,
convertible into or exchangeable for common stock or voting securities of the
Corporation, unless the Person exercising, converting or exchanging such
security acquired such security directly from the Corporation or an underwriter
or agent of the Corporation), (B) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Corporation or any corporation
controlled by the Corporation, or (C) any acquisition by any corporation
pursuant to a Business Combination (as defined below) which complies with
clauses (x) and (y) of subsection (iii) of this definition; or

(ii) such time as the Continuing Directors (as defined below) do not constitute
a majority of the Board (or, if applicable, the Board of Directors of a
successor corporation to the Corporation), where the term “Continuing Director”
means at any date a member of the Board (x) who was a member of the Board on the
date of this Agreement or (y) who was nominated or elected subsequent to such
date by at least a majority of the directors who were Continuing Directors at
the time of such nomination or election or whose election to the Board was
recommended or endorsed by at least a majority of the directors who were
Continuing Directors at the time of such nomination or election; provided,
however, that there shall be excluded from this clause (y) any individual whose
initial assumption of office occurred as a result of an actual or threatened
election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents, by or on behalf of a
person other than the Board, and any individual whose initial assumption of
office occurred pursuant to any right granted to a securityholder of the
Corporation to nominate, elect or appoint, or have nominated, elected or
appointed, one or more directors; or

(iii) the consummation of a merger, consolidation, reorganization,
recapitalization or share exchange involving the Corporation (a “Business
Combination”), unless, immediately following such Business Combination, each of
the following two conditions is satisfied: (x) all or substantially all of the
individuals and entities who were the beneficial

 

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owners of the Outstanding Corporation Common Stock and Outstanding Corporation
Voting Securities immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 50% of the then-outstanding shares of
common stock and the combined voting power of the then-outstanding securities
entitled to vote generally in the election of directors, respectively, of the
resulting or acquiring corporation in such Business Combination (which shall
include, without limitation, a corporation which as a result of such transaction
owns the Corporation or substantially all of the Corporation’s assets either
directly or through one or more subsidiaries) (such resulting or acquiring
corporation is referred to herein as the “Acquiring Corporation”) in
substantially the same proportions as their ownership of the Outstanding
Corporation Common Stock and Outstanding Corporation Voting Securities,
respectively, immediately prior to such Business Combination and (y) no Person
(excluding the Acquiring Corporation or any employee benefit plan (or related
trust) maintained or sponsored by the Corporation or by the Acquiring
Corporation) beneficially owns, directly or indirectly, 30% or more of the
then-outstanding shares of common stock of the Acquiring Corporation, or of the
combined voting power of the then-outstanding securities of such corporation
entitled to vote generally in the election of directors (except to the extent
that such ownership existed prior to the Business Combination).

(e) The term “Special Independent Counsel” shall mean a law firm, or a member of
a law firm, that is experienced in matters of corporation law and neither
currently is, nor in the past three years has been, retained to represent:
(i) the Corporation, an affiliate of the Corporation or the Indemnitee in any
matter material to such party or (ii) any other party to the Proceeding giving
rise to a claim for indemnification hereunder. Notwithstanding the foregoing,
the term “Special Independent Counsel” shall not include any person who, under
the applicable standards of professional conduct then prevailing, would have a
conflict of interest in representing either the Corporation or the Indemnitee in
an action to determine the Indemnitee’s rights under this Agreement.

(f) References to “other enterprise” shall include employee benefit plans;
references to “fines” shall include any excise tax assessed with respect to any
employee benefit plan; references to “serving at the request of the Corporation”
shall include any service as a director, officer, employee or agent of the
Corporation which imposes duties on, or involves services by, such director,
officer, employee, or agent with respect to an employee benefit plan, its
participants, or beneficiaries; and a person who acted in good faith and in a
manner such person reasonably believed to be in the interests of the
participants and beneficiaries of an employee benefit plan shall be deemed to
have acted in a manner “not opposed to the best interests of the Corporation” as
referred to in this Agreement.

3. Indemnity of Indemnitee. Subject to Sections 6, 7 and 9, the Corporation
shall indemnify the Indemnitee in connection with any Proceeding as to which the
Indemnitee is, was or is threatened to be made a party (or is otherwise
involved) by reason of the Indemnitee’s Corporate Status, to the fullest extent
permitted by law (as such may be amended from time to time).

4. Indemnification of Expenses of Successful Party. Notwithstanding any other
provision of this Agreement, to the extent that the Indemnitee has been
successful, on the merits or otherwise, in defense of any Proceeding or in
defense of any claim, issue or matter therein

 

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(other than a Proceeding referred to in Section 6), the Indemnitee shall be
indemnified against all Expenses actually and reasonably incurred by or on
behalf of the Indemnitee in connection therewith. Without limiting the
foregoing, if any Proceeding or any claim, issue or matter therein is disposed
of, on the merits or otherwise (including a disposition without prejudice),
without (i) the disposition being adverse to the Indemnitee, (ii) an
adjudication that the Indemnitee was liable to the Corporation, (iii) a plea of
guilty or nolo contendere by the Indemnitee, (iv) an adjudication that the
Indemnitee did not act in good faith and in a manner the Indemnitee reasonably
believed to be in or not opposed to the best interests of the Corporation, and
(v) with respect to any criminal proceeding, an adjudication that the Indemnitee
had reasonable cause to believe his or her conduct was unlawful, the Indemnitee
shall be considered for the purposes hereof to have been wholly successful with
respect thereto.

5. Indemnification for Expenses of a Witness. To the extent that the Indemnitee
is, by reason of the Indemnitee’s Corporate Status, a witness in any Proceeding
to which the Indemnitee is not a party, the Indemnitee shall be indemnified
against all Expenses actually and reasonably incurred by or on behalf of the
Indemnitee in connection therewith.

6. Exceptions to Right of Indemnification. Notwithstanding anything to the
contrary to this Agreement, except as set forth in Section 10, the Corporation
shall not indemnify the Indemnitee in connection with a Proceeding (or part
thereof) initiated by the Indemnitee unless (a) the initiation thereof was
approved by the Board of Directors of the Corporation or (b) the Proceeding was
commenced following a Change in Control. Notwithstanding anything to the
contrary in this Agreement, the Corporation shall not indemnify the Indemnitee
to the extent the Indemnitee is reimbursed from the proceeds of Corporation D&O
Insurance (as defined below), and in the event the Corporation makes any
indemnification payments to the Indemnitee and the Indemnitee is subsequently
reimbursed from the proceeds of insurance, the Indemnitee shall promptly refund
such indemnification payments to the Corporation to the extent of such insurance
reimbursement. Nothing contained in this Agreement shall obligate the Indemnitee
to file a claim or otherwise pursue collection under any insurance policy other
than the Corporation D&O Insurance with respect to any matter.

7. Notification and Defense of Claim. As a condition precedent to the
Indemnitee’s right to be indemnified, the Indemnitee must notify the Corporation
in writing as soon as practicable of any Proceeding for which indemnity will or
could be sought; but the omission so to notify the Corporation will not relieve
it from any liability that it may have to Indemnitee if such omission does not
actually prejudice the Corporation’s rights and, if such omission does prejudice
the Corporation’s rights, it will relieve the Corporation from liability only to
the extent of such prejudice; nor will such omission relieve the Corporation
from any liability which it may have to Indemnitee otherwise than under this
Agreement. With respect to any Proceeding of which the Corporation is so
notified, the Corporation will be entitled to participate therein at its own
expense and/or to assume the defense thereof at its own expense, with legal
counsel reasonably acceptable to the Indemnitee. After notice from the
Corporation to the Indemnitee of its election so to assume such defense, the
Corporation shall not be liable to the Indemnitee for any legal or other
expenses subsequently incurred by the Indemnitee in connection with such
Proceeding, other than as provided below in this Section 7. The Corporation
shall only have the right to assume the defense of any Proceeding if it
acknowledges in writing that the Indemnitee is entitled to indemnification
hereunder with respect thereto, which acknowledgement shall be

 

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subject to any subsequent determination pursuant to Section 9 of this Agreement
that Indemnitee is not entitled to such indemnification. The Indemnitee shall
have the right to employ his or her own counsel in connection with such
Proceeding, but the fees and expenses of such counsel incurred after notice from
the Corporation of its assumption of the defense thereof shall be at the expense
of the Indemnitee unless (i) the employment of counsel by the Indemnitee has
been authorized by the Corporation, (ii) counsel to the Indemnitee shall have
reasonably concluded that there may be a conflict of interest or position on any
significant issue between the Corporation and the Indemnitee in the conduct of
the defense of such Proceeding or (iii) the Corporation shall not in fact have
employed counsel to assume the defense of such Proceeding, in each of which
cases the fees and expenses of counsel for the Indemnitee shall be at the
expense of the Corporation, except as otherwise expressly provided by this
Agreement, and provided that Indemnitee’s counsel shall cooperate reasonably
with the Corporation’s counsel to minimize the cost of defending claims against
the Corporation and the Indemnitee. The Corporation shall not be entitled,
without the consent of the Indemnitee, to assume the defense of any claim
brought by or in the right of the Corporation or as to which counsel for the
Indemnitee shall have reasonably made the conclusion provided for in clause
(ii) above. The Corporation shall not be required to indemnify the Indemnitee
under this Agreement for any amounts paid in settlement of any Proceeding
effected without its written consent. The Corporation shall not settle any
Proceeding in any manner that would impose any penalty or limitation on the
Indemnitee without the Indemnitee’s written consent. Neither the Corporation nor
the Indemnitee will unreasonably withhold or delay their consent to any proposed
settlement.

8. Advancement of Expenses. The Corporation shall, subject to Section 7, advance
all reasonable Expenses which, by reason of Indemnitee’s Corporate Status, are
incurred by or on behalf of Indemnitee, within twenty days after the receipt by
the Corporation of a statement or statements from Indemnitee requesting such
advance or advances, whether prior to or after final disposition of any related
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. Such statements may be redacted to the extent necessary
to preserve attorney-client confidentiality, work product or other applicable
privileges, if any. Any advance and undertakings to repay pursuant to this
Section 8 shall be unsecured and interest free.

9. Procedures for Indemnification.

(a) In order to obtain indemnification pursuant to this Agreement, the
Indemnitee shall submit to the Corporation a written request, including in such
request such documentation and information as is reasonably available to the
Indemnitee and is reasonably necessary to determine whether and to what extent
the Indemnitee is entitled to indemnification as provided in Section 7 hereof.
Any such indemnification shall be made promptly, and in any event within (i) in
the case of indemnification under Sections 4, 5 or 9(d), 30 days after receipt
by the Corporation of the written request of the Indemnitee, or (ii) in the case
of all other indemnification, 60 days after receipt by the Corporation of the
written request of the Indemnitee, unless with respect to requests under this
clause (ii) the Corporation determines, by clear and convincing evidence, within
the 60-day period referred to above that the Indemnitee did not meet the
applicable standard of conduct. Such determination, and any determination that
advanced Expenses must be repaid to the Corporation, shall be made as follows:

 

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(x) if a Change in Control shall have occurred, by Special Independent Counsel
in a written opinion to the Board of Directors of the Corporation, a copy of
which shall be delivered to the Indemnitee (unless the Indemnitee shall request
that such determination be made by the Board of Directors of the Corporation, in
which case the determination shall be made in the manner provided below in
clauses (y)(1) or (y)(2)).

(y) in all other cases, in the good faith discretion of the Board of Directors,
(1) by a majority vote of the directors of the Corporation consisting of persons
who are not at that time parties to the Proceeding (“disinterested directors”),
whether or not a quorum, (2) by a committee of disinterested directors
designated by a majority vote of disinterested directors, whether or not a
quorum, (3) if there are no disinterested directors, or if the disinterested
directors so direct, by Special Independent Counsel in a written opinion to the
Board, or (4) by the stockholders of the Corporation.

(b) In the event that a Change in Control shall have occurred and the
determination of entitlement to indemnification is to be made by Special
Independent Counsel, the Special Independent Counsel shall be selected as
provided in this Section 9(b). The Special Independent Counsel shall be selected
by the Indemnitee, unless the Indemnitee shall request that such selection be
made by the Board of Directors of the Corporation. The party making the
determination shall give written notice to the other party advising it of the
identity of the Special Independent Counsel so selected. The party receiving
such notice may, within seven days after such written notice of selection shall
have been given, deliver to the other party a written objection to such
selection. Such objection may be asserted only on the ground that the Special
Independent Counsel so selected does not meet the requirements of “Special
Independent Counsel” as defined in Section 2, 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 Special Independent
Counsel. If a written objection is made, the Special Independent Counsel so
selected may not serve as Special Independent Counsel unless and until a court
has determined that such objection is without merit. If, within 20 days after
submission by the Indemnitee of a written request for indemnification, no
Special Independent Counsel shall have been selected, or if selected, shall have
been objected to, in accordance with this paragraph either the Corporation or
the Indemnitee may petition the Court of Chancery of the State of Delaware or
other court of competent jurisdiction for resolution of any objection which
shall have been made by the Corporation or the Indemnitee to the other’s
selection of Special Independent Counsel and/or for the appointment as Special
Independent Counsel of a person selected by the court or by such other person as
the court shall designate, and the person with respect to whom an objection is
favorably resolved or the person so appointed shall act as Special Independent
Counsel. The Corporation shall pay the reasonable and necessary fees and
expenses of Special Independent Counsel incurred in connection with its acting
in such capacity. The Corporation shall pay any and all reasonable and necessary
fees and expenses incident to the procedures of this paragraph, regardless of
the manner in which such Special Independent Counsel was selected or appointed.
Upon the due commencement of any judicial proceeding pursuant to Section 10 of
this Agreement, any Special Independent Counsel shall be discharged and relieved
of any further responsibility in such capacity (subject to the applicable
standards of professional conduct then prevailing).

 

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(c) The termination of any Proceeding by judgment, order, settlement, conviction
or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the Indemnitee did not act in good faith and in a
manner that the Indemnitee reasonably believed to be in, or not opposed to, the
best interests of the Corporation, and, with respect to any criminal Proceeding,
had reasonable cause to believe that his or her conduct was unlawful.

(d) The Indemnitee shall cooperate with the person, persons or entity making
such determination with respect to the Indemnitee’s entitlement to
indemnification, 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 the Indemnitee and reasonably necessary to such determination. Any
Expenses actually and reasonably incurred by the Indemnitee in so cooperating
shall be borne by the Corporation (irrespective of the determination as to the
Indemnitee’s entitlement to indemnification) and the Corporation hereby
indemnifies the Indemnitee therefrom.

(e) If an initial determination is made or deemed to have been made pursuant to
the terms of this Agreement that Indemnitee is entitled to indemnification, the
Corporation shall be bound by such determination in the absence of (a) a
misrepresentation of a material fact by Indemnitee in the request for
indemnification or (b) a specific finding by a court of competent jurisdiction
that is not overturned on appeal all or any part of such indemnification is
expressly prohibited by law.

10. Remedies; Effect of Other Indemnification. (a) The right to indemnification
or advancement of Expenses as provided by this Agreement shall be enforceable by
the Indemnitee in any court of competent jurisdiction if the Corporation denies
such request, in whole or in part, or if no disposition thereof is made within
the applicable period referred to in Section 9. Unless otherwise required by
law, the burden of proving that indemnification or advancement of Expenses is
not appropriate shall be on the Corporation. Neither the failure of the
Corporation to have made a determination prior to the commencement of such
action that indemnification is proper in the circumstances because the
Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Corporation that the Indemnitee has not met such applicable
standard of conduct, shall be a defense to the action or create a presumption
that the Indemnitee has not met the applicable standard of conduct. The
Indemnitee’s Expenses actually and reasonably incurred in connection with
successfully establishing the Indemnitee’s right to indemnification, in whole or
in part, in any such Proceeding shall also be indemnified by the Corporation.

[ For Perseus-designated directors only: (b) The Corporation hereby acknowledges
and agrees that the indemnification provided to the Indemnitee by the
Corporation under this Agreement, the Corporation’s Certificate of Incorporation
or By-Laws or otherwise with respect to matters arising by reason of the
Indemnitee’s Corporate Status (collectively, the “Corporation’s Indemnification
Obligation”) is primary and shall not be affected by any indemnification
obligations of any other persons or entities that may apply to such matters,

 

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which other indemnification obligations shall be secondary as to such matters.
Without limiting the generality of the foregoing, the Corporation acknowledges
and agrees that the Indemnitee is serving as a director of the Corporation and
in the other capacities resulting in his Corporate Status as a representative of
Perseus Partners VII, L.P. (“Perseus”) pursuant to a contractual right Perseus
has to appoint representatives to the Corporation’s Board of Directors and
certain of its committees. In the event the Indemnitee is provided
indemnification by Perseus or any of its affiliates (collectively, the “Perseus
Entities”) in connection with any matters resulting from the Indemnitee’s
service to the Corporation or otherwise for which a claim for indemnification
may be made under the Corporation’s Indemnification Obligation, such other
indemnification by such Perseus Entity shall be secondary and shall have no
effect on the Corporation’s Indemnification Obligation, which shall be primary
as to all matters arising by reason of the Indemnitee’s Corporate Status. The
Indemnitee shall have the right to assign to any Perseus Entity its right to
receive indemnification payments (including without limitation advancement of
expenses) from the Corporation whether under this Agreement or otherwise and the
Corporation will recognize and honor such assignment. In the event any Perseus
Entity makes any payment to the Indemnitee in connection with any matter for
which indemnification may be sought by the Indemnitee under this Agreement or
otherwise pursuant to the Corporation’s Indemnification Obligation, the
Corporation will promptly reimburse such Perseus Entity for the full amount of
such payment (subject, in the case of any payment that constitutes an
advancement of Expenses, to the delivery by such Perseus Entity to the
Corporation of an undertaking to repay such amount if it shall ultimately be
determined that Indemnitee is not entitled to be indemnified against such
Expenses) and the Corporation hereby agrees that such Perseus Entity shall be
fully subrogated to the rights of the Indemnitee to the extent of any such
payment (including without limitation any rights of contribution under
Section 11(b) hereof). The Corporation acknowledges and agrees that the
agreements set forth in this Section 10(b) are intended to induce Perseus to
consummate the investments contemplated by the Securities Purchase Agreement
dated as of May 10, 2007 between the Corporation and Perseus and that each
Perseus Entity is intended to be and shall be a third party beneficiary of the
provisions hereof. ]

11. Partial Indemnification; Contribution. (a) If the Indemnitee is entitled
under any provision of this Agreement to indemnification by the Corporation for
some or a portion of the Expenses, judgments, fines, penalties or amounts paid
in settlement actually and reasonably incurred by or on behalf of the Indemnitee
in connection with any Proceeding but not, however, for the total amount
thereof, the Corporation shall nevertheless indemnify the Indemnitee for the
portion of such Expenses, judgments, fines, penalties or amounts paid in
settlement to which the Indemnitee is entitled.

(b) To the fullest extent permissible under applicable law, if the
indemnification provided for in this Agreement is unavailable to Indemnitee for
any reason whatsoever, the Corporation, in lieu of indemnifying Indemnitee,
shall contribute to the amount incurred by Indemnitee, whether for judgments,
fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or
for Expenses, in connection with any claim relating to an indemnifiable event
under this Agreement, in such proportion as is deemed fair and reasonable in
light of all of the circumstances of such Proceeding in order to reflect (i) the
relative benefits received by the Company and Indemnitee as a result of the
event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the
relative fault of the Company (and its directors, officers, employees and
agents) and Indemnitee in connection with such event(s) and/or transaction(s),
provided that

 

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in the case of an Indemnitee who is a director of the Corporation or any of its
subsidiaries, the amount of losses paid by such Indemnittee shall not exceed the
amount of fees paid to such Indemnitee for serving as a director during the 12
months preceding the commencement of the Proceeding.

12. Directors’ and Officers’ Insurance. The Corporation hereby covenants and
agrees that, so long as Indemnitee shall continue to serve as a director or
officer of the Corporation and thereafter so long as Indemnitee shall be subject
to any possible Proceeding, the Corporation, subject to the last sentence of
this Section 12, shall maintain directors’ and officers’ insurance (“Corporation
D&O Insurance”) in full force and effect. The Indemnitee shall have the right to
receive a copy or copies of all such policies of insurance prior to execution of
this Agreement or upon reasonable request at any time hereafter. In all
Corporation D&O Insurance policies, the Indemnitee shall be named as an insured
in such manner as to provide the Indemnitee the same rights and benefits,
subject to the same limitations, as are accorded the Corporation’s directors or
officers most favored by such policy. Nothing herein shall impose upon the
Corporation the obligation to maintain Corporation D&O Insurance if the
Corporation determines in good faith that such insurance is not reasonably
available, the premium costs for such insurance are disproportionate to the
amount of coverage provided, or the coverage provided by such insurance is
limited by exclusions so as to provide an insufficient benefit.

13. Subrogation. In the event of any payment under this Agreement, the
Corporation shall be subrogated to the extent of such payment to all of the
rights of recovery of the 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 Corporation to bring suit to enforce
such rights.

14. Term of Agreement. This Agreement shall continue so long as Indemnitee shall
be subject to any possible Proceeding subject to indemnification by reason of
his Corporate Status and shall be applicable to Proceedings commenced or
continued after execution of this Agreement, whether arising from acts or
omissions occurring before or after such execution.

15. Indemnification Hereunder Not Exclusive. The indemnification and advancement
of Expenses provided by this Agreement shall not be deemed exclusive of any
other rights to which the Indemnitee may be entitled under the Certification of
Incorporation, the By-Laws, any other agreement, any vote of stockholders or
disinterested directors, the General Corporation Law of Delaware, any other law
(common or statutory), or otherwise, both as to action in the Indemnitee’s
official capacity and as to action in another capacity while holding office for
the Corporation. Nothing contained in this Agreement shall be deemed to prohibit
the Corporation from purchasing and maintaining insurance, at its expense, to
protect itself or the Indemnitee against any expense, liability or loss incurred
by it or the Indemnitee in any such capacity, or arising out of the Indemnitee’s
status as such, whether or not the Indemnitee would be indemnified against such
expense, liability or loss under this Agreement; provided that the Corporation
shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable hereunder if and to the extent that the Indemnitee has
otherwise actually received such payment under any insurance policy, contract,
agreement or otherwise.

 

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16. No Special Rights. Nothing herein shall confer upon the Indemnitee any right
to continue to serve as an officer or director of the Corporation for any period
of time or at any particular rate of compensation.

17. Savings Clause. If this Agreement or any portion thereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify the Indemnitee as to Expenses,
judgments, fines, penalties and amounts paid in settlement with respect to any
Proceeding to the full extent permitted by any applicable portion of this
Agreement that shall not have been invalidated and to the fullest extent
permitted by applicable law.

18. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall constitute the original.

19. Successors and Assigns. This Agreement shall be binding upon the Corporation
and its successors and assigns (including any direct or indirect successor by
purchase, merger, consolidation or otherwise to all or substantially all of the
business or assets of the Corporation) and shall inure to the benefit of
Indemnitee and his spouse, assigns, heirs, devisees, executors, administrators
and other legal representatives.

20. 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.

21. Modification and Waiver. This Agreement may be amended from time to time to
reflect changes in Delaware law or for other reasons. 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
provision hereof nor shall any such waiver constitute a continuing waiver.

22. Notices. All notices, requests, demands and other communications hereunder
shall be in writing and shall be deemed to have been given (i) when delivered by
hand or (ii) if mailed by certified or registered mail with postage prepaid, on
the third day after the date on which it is so mailed:

 

  (a) if to the Indemnitee, to:

 

 

              

 

              

 

              

 

              

 

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  (b) if to the Corporation, to:

 

Distributed Energy Systems Corp. 10 Technology Drive Wallingford, CT 06492 Attn:
Chief Executive Officer With a copy to: Distributed Energy Systems Corp. 10
Technology Drive Wallingford, CT 06492 Attn: Chairman of the Board of Directors

or to such other address as may have been furnished to the Indemnitee by the
Corporation or to the Corporation by the Indemnitee, as the case may be.

23. Applicable Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware. The Indemnitee
may elect to have the right to indemnification or reimbursement or advancement
of Expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advancement
of Expenses is sought. Such election shall be made, by a notice in writing to
the Corporation, at the time indemnification or reimbursement or advancement of
Expenses is sought; provided, however, that if no such notice is given, and if
the General Corporation Law of Delaware is amended, or other Delaware law is
enacted, to permit further indemnification of the directors and officers, then
the Indemnitee shall be indemnified to the fullest extent permitted under the
General Corporation Law, as so amended, or by such other Delaware law, as so
enacted.

24. Enforcement. The Corporation expressly confirms and agrees that it has
entered into this Agreement in order to induce the Indemnitee to continue to
serve as an officer or director of the Corporation, and acknowledges that the
Indemnitee is relying upon this Agreement in continuing in such capacity.

25. Entire Agreement. This Agreement sets forth the entire agreement of the
parties hereto in respect of the subject matter contained herein and supercedes
all prior agreements, whether oral or written, by any officer, employee or
representative of any party hereto in respect of the subject matter contained
herein; and any prior agreement of the parties hereto in respect of the subject
matter contained herein is hereby terminated and cancelled. For avoidance of
doubt, the parties confirm that the foregoing does not apply to or limit the
Indemnitee’s rights under Delaware law or the Corporation’s Certificate of
Incorporation or By-Laws.

26. Consent to Suit. In the case of any dispute under or in connection with this
Agreement, the Indemnitee may only bring suit against the Corporation in the
Court of Chancery

 

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of the State of Delaware. The Indemnitee hereby consents to the exclusive
jurisdiction and venue of the courts of the State of Delaware, and the
Indemnitee hereby waives any claim the Indemnitee may have at any time as to
forum non conveniens with respect to such venue. The Corporation shall have the
right to institute any legal action arising out of or relating to this Agreement
in any court of competent jurisdiction. Any judgment entered against either of
the parties in any proceeding hereunder may be entered and enforced by any court
of competent jurisdiction.

[signatures appear on following page]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Indemnification
Agreement to be duly executed as of the day and year first above written.

 

DISTRIBUTED ENERGY SYSTEMS CORP. By:  

 

Name:   Title:   INDEMNITEE

 

Name:  

 

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