Exhibit
10.01


 


DEMAND MEDIA, INC.


 


INDEMNIFICATION AGREEMENT


 


This
Indemnification Agreement (“Agreement”)
is effective as of              , by and between Demand Media, Inc.,
a Delaware corporation (the “Company”),
and              (“Indemnitee”).


 


A.           The Company recognizes the continued
difficulty in obtaining liability insurance for its directors, officers,
employees, controlling persons, fiduciaries and other agents and affiliates,
the significant increases in the cost of such insurance and the general reductions
in the coverage of such insurance.


 


B.             The Company further recognizes the substantial
increase in corporate litigation in general, subjecting directors, officers,
employees, controlling persons, fiduciaries and other agents and affiliates to
expensive litigation risks at the same time as the availability and coverage of
liability insurance has been severely limited.


 


C.             The current protection available to directors,
officers, employees, controlling persons, fiduciaries and other agents and
affiliates of the Company may not be adequate under the present circumstances,
and directors, officers, employees, controlling persons, fiduciaries and other
agents and affiliates of the Company (or persons who may be alleged or deemed
to be the same), including the Indemnitee, may not be willing to continue to
serve or be associated with the Company in such capacities without additional
protection.


 


D.            The Company (a) desires to attract and retain
the involvement of highly qualified persons, such as Indemnitee, to serve and
be associated with the Company and, accordingly, (b) wishes to provide for the
indemnification and advancement of expenses to the Indemnitee to the maximum
extent permitted by law.


 


E.              In view of the considerations set forth above,
the Company desires that Indemnitee shall be indemnified and advanced expenses
by the Company as set forth herein.


 


In
consideration of the mutual promises and covenants contained herein, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:


 


1.                                      Certain Definitions.


 


(a)                                  “Change
in Control”
shall be deemed to have occurred if, on or after the date of this Agreement,
(i) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the Company
acting in such capacity or a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company, becomes the “beneficial owner” (as defined
in Rule 13d-3 under said Act), directly or indirectly, of securities of the
Company representing more than fifty percent (50%) of the total voting power
represented by the Company’s then outstanding Voting Securities (as defined
below), (ii) 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 of
Directors of the Company 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 (i), (iii) or (iv) herein) whose election by
the Board of Directors or nomination for election by the Company’s stockholders
was approved by a vote of at least two-thirds (2/3) 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 a majority thereof, (iii) the stockholders of the Company
approve a merger or consolidation of the Company with any other corporation
other than a merger or consolidation which would result in the Voting
Securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into Voting
Securities of the surviving entity) at least eighty percent (80%) of the total
voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation or (iv)
the stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of (in one
transaction or a series of related transactions) all or substantially all of
the Company’s assets.


 


(b)                                 “Claim” shall mean with respect to a Covered Event
(as defined below):  any threatened,
asserted, pending or completed action, suit, proceeding or alternative dispute
resolution mechanism, whether brought in the right of the Company or otherwise,
or any hearing, inquiry or investigation (formal or informal) that Indemnitee
in good faith believes might lead to the institution of any such action, suit,
proceeding or alternative dispute resolution mechanism, whether civil,
criminal, administrative, investigative or other, including any appeal
therefrom.


 


(c)                                  References to the “Company” shall include, in addition to Demand Media, Inc.,
any constituent corporation (including any constituent of a constituent)
absorbed in a consolidation or merger to which Demand Media, Inc. (or any of
its wholly owned subsidiaries) is a party, which, if its separate existence had
continued, would have had power and authority to indemnify its directors,
officers, employees, agents or fiduciaries, so that if Indemnitee is or was a
director, officer, employee, agent or fiduciary of such constituent
corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee, agent or fiduciary of another
corporation, partnership, joint venture, employee benefit plan, trust or other
enterprise, Indemnitee shall stand in the same position under the provisions of
this Agreement with respect to the resulting or surviving corporation as
Indemnitee would have with respect to such constituent corporation if its
separate existence had continued.


 


(d)                                 “Covered
Event” shall mean any
event or occurrence by reason of the fact that Indemnitee is or was a director,
trustee, partner, managing member, officer, employee, agent or fiduciary of the
Company, or any subsidiary of the Company, or is or was serving at the request
of the Company as a director, trustee, partner, managing member, officer,
employee, agent or fiduciary of another corporation, limited liability company,
partnership, joint venture, trust or other enterprise, or by reason of any
action or inaction on the part of Indemnitee while serving in such capacity.


 


(e)                                  “Expense
Advance” shall mean a
payment to Indemnitee pursuant to Section 3 of Expenses in advance of the
settlement of or final judgment in any action, suit, 


 


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proceeding or alternative
dispute resolution mechanism, hearing, inquiry or investigation, which
constitutes a Claim.


 


(f)                                    “Expenses” shall mean any and all direct and indirect
costs, losses, claims, damages, fees, expenses and liabilities, joint or
several (including attorneys’ fees and all other costs, expenses and
obligations incurred in connection with investigating, defending, being a
witness in or participating in (including on appeal), or preparing to defend,
to be a witness in or to participate in, any action, suit, proceeding,
alternative dispute resolution mechanism, hearing, inquiry or investigation),
judgments, fines, penalties and amounts paid in settlement (if such settlement
is approved in advance by the Company, which approval shall not be unreasonably
withheld) actually and reasonably incurred, of any Claim and any federal,
state, local or foreign taxes imposed on the Indemnitee as a result of the
actual or deemed receipt of any payments under this Agreement.  Expenses also shall include (i) Expenses
incurred in connection with any appeal resulting from any Claim, including
without limitation the premium, security for, and other costs relating to any
cost bond, supersedeas bond, or other appeal bond or its equivalent, (ii) Expenses
incurred in connection with recovery under any directors’ and officers’
liability insurance policies maintained by the Company, regardless of whether
the Indemnitee is ultimately determined to be entitled to such indemnification,
advancement or Expenses or insurance recovery, as the case may be and (iii) for
purposes of Section 13(e) only, Expenses incurred by or on behalf of 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.


 


(g)                                 “Independent
Legal Counsel”
shall mean an attorney or firm of attorneys, selected in accordance with the
provisions of Section 2(d) hereof, who shall not have otherwise performed
services for (i) the Company or Indemnitee in any matter material to either
such party (other than with respect to matters concerning the rights of
Indemnitee under this Agreement, or of other indemnitees under similar
indemnity agreements) or (ii) any other party to the Claim giving rise to a
claim for indemnification hereunder, within the last three (3) years.  Notwithstanding the foregoing, the term “Independent
Legal 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 Company or Indemnitee in an action to determine
Indemnitee’s rights under this Agreement.


 


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


 


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(i)                                     “Reviewing
Party” shall mean,
subject to the provisions of Section 2(d), any person or body appointed by the
Board of Directors in accordance with applicable law to review the Company’s
obligations hereunder and under applicable law, which may include a member or
members of the Company’s Board of Directors, Independent Legal Counsel or any
other person or body not a party to the particular Claim for which Indemnitee
is seeking indemnification, exoneration or hold harmless rights.


 


(j)                                     “Section” refers to a section of this Agreement unless
otherwise indicated.


 


(k)                                  “Voting
Securities”
shall mean any securities of the Company that vote generally in the election of
directors.


 


2.                                      Indemnification.


 


(a)                                  Indemnification of Expenses.


 


(i)                                     Subject to the provisions of Section 2(b) below,
the Company shall indemnify, exonerate or hold harmless Indemnitee for Expenses
to the fullest extent permitted by law if Indemnitee was or is or becomes a
party or potential party to or witness or other participant in, or is
threatened to be made a party to or other participant in, any Claim (whether by
reason of or arising in part out of a Covered Event), including all interest,
assessments and other charges incurred in connection with or in respect of such
Expenses.  The parties hereto intend that
this Agreement shall provide to the fullest extent permitted by law for
indemnification in excess of that expressly permitted by statute, including,
without limitation, any indemnification provided by the Certificate of
Incorporation, the Bylaws, vote of its stockholders or disinterested directors.


 


(ii)                                  Notwithstanding any other provision of this
Agreement, to the fullest extent permitted by applicable law and to the extent
that Indemnitee is, by reason of a Covered Event, a witness or otherwise asked
to participate in any aspect of a Claim to which Indemnitee is not a party, he
shall be indemnified against all Expenses actually and reasonably incurred by
him or on his behalf in connection therewith.


 


(b)                                 Review of Indemnification Obligations.


 


(i)                                     Notwithstanding the foregoing, in the event
any Reviewing Party shall have determined (in a written opinion, in any case in
which Independent Legal Counsel is the Reviewing Party) that Indemnitee is not
entitled to be indemnified, exonerated or held harmless hereunder under
applicable law, (A) the Company shall have no further obligation under Section 2(a)
to make any payments to Indemnitee not made prior to such determination by such
Reviewing Party and (B) the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees to reimburse the Company) for all Expenses
theretofore paid in indemnifying, exonerating or holding harmless Indemnitee
(within thirty (30) days after such determination); provided, however,
that if Indemnitee has commenced or thereafter commences legal proceedings in a
court of competent jurisdiction to secure a determination that Indemnitee is
entitled to be indemnified, exonerated or held harmless hereunder under
applicable law, any determination made by any Reviewing Party that Indemnitee
is not entitled to be indemnified 


 


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hereunder under
applicable law shall not be binding and Indemnitee shall not be required to reimburse the
Company for any Expenses theretofore paid in indemnifying, exonerating or
holding harmless Indemnitee until a final judicial determination is made with
respect thereto (as to which all rights of appeal therefrom have been exhausted
or lapsed).  Indemnitee’s obligation to
reimburse the Company for any Expenses shall be unsecured and no interest shall
be charged thereon.


 


(ii)                                  Subject to Section 2(b)(iii) below, if the
Reviewing Party shall not have made a determination within forty-five (45) days
after receipt by the Company of the request therefor, the requisite
determination of entitlement to indemnification shall, to the fullest extent
not prohibited by law, be deemed to have been made and Indemnitee shall be
entitled to such indemnification, absent (A) a misstatement by Indemnitee of a
material fact, or an omission of a material fact necessary to make Indemnitee’s
statement not materially misleading, in connection with the request for
indemnification or (B) a prohibition of such indemnification under applicable
law; provided, however, that such 45-day period may be
extended for a reasonable time, not to exceed an additional thirty (30) days,
if the person, persons or entity making the determination with respect to
entitlement to indemnification in good faith requires such additional time for
the obtaining or evaluating of documentation and/or information relating
thereto.


 


(iii)                               Notwithstanding anything in this Agreement to
the contrary, no determination as to entitlement of Indemnitee to
indemnification under this Agreement shall be required to be made prior to the
final disposition of the Claim.


 


(c)                                  Indemnitee Rights on Unfavorable
Determination; Binding Effect.  If any
Reviewing Party determines that Indemnitee substantively is not entitled to be
indemnified, exonerated or held harmless hereunder in whole or in part under
applicable law, Indemnitee shall have the right to commence litigation seeking
an initial determination by the court or challenging any such determination by
such Reviewing Party or any aspect thereof, including the legal or factual
bases therefor, and, subject to the provisions of Section 15, the Company
hereby consents to service of process and to appear in any such
proceeding.  Absent such litigation, any
determination by any Reviewing Party shall be conclusive and binding on the
Company and Indemnitee.


 


(d)                                 Selection of Reviewing Party; Change in
Control.  If there has not been a Change in Control,
any Reviewing Party shall be (i) by a majority vote of the directors of the
Company who are not and were not a party to the Claim in respect of which
indemnification is sought by Indemnitee (“Disinterested Directors”), even
though less than a quorum of the Board, (ii) by 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; and if there has been such a Change in Control
(other than a Change in Control which has been approved by a majority of the
Company’s Board of Directors who were directors immediately prior to such
Change in Control), any Reviewing Party with respect to all matters thereafter
arising concerning Indemnitee’s indemnification,


 


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exoneration or hold
harmless rights for Expenses under this Agreement or any other agreement or
under the Company’s Certificate of Incorporation or bylaws as now or hereafter
in effect, or under any other applicable law, if desired by Indemnitee, shall
be Independent Legal Counsel selected by the Indemnitee and approved by Company
(which approval shall not be unreasonably withheld).  Such counsel, among other things, shall
render its written opinion to the Company and Indemnitee as to whether and to
what extent Indemnitee would be entitled to be indemnified, exonerated or held
harmless hereunder under applicable law and the Company agrees to abide by such
opinion.  The Company agrees to pay the
reasonable fees of the Independent Legal Counsel referred to above and to fully
indemnify, exonerate and hold harmless such counsel against any and all
expenses (including attorneys’ fees), claims, liabilities and damages arising
out of or relating to this Agreement or its engagement pursuant hereto.  Notwithstanding any other provision of this
Agreement, the Company shall not be required to pay Expenses of more than one
Independent Legal Counsel in connection with all matters concerning a single
Indemnitee, and such Independent Legal Counsel shall be the Independent Legal
Counsel for any or all other Indemnitees unless (A) the Company otherwise
determines or (B) any Indemnitee shall provide a written statement setting
forth in detail a reasonable objection to such Independent Legal Counsel
representing other Indemnitees.


 


(e)                                  Mandatory Payment of Expenses. 
Notwithstanding any other provision of this Agreement other than Section
10 hereof, to the fullest extent permitted by applicable law and to the extent
that Indemnitee was a party to (or participant in) and has been successful on
the merits or otherwise, in any Claim or in defense of any claim, issue or
matter therein, in whole or in part, Indemnitee shall be indemnified,
exonerated and held harmless against all Expenses actually and reasonably
incurred by Indemnitee in connection therewith. 
If Indemnitee is not wholly successful in such Claim but is successful,
on the merits or otherwise, as to one or more but less than all claims, issues
or matters in such Claim, the Company shall indemnify Indemnitee against all
Expenses actually and reasonably incurred by him or on his behalf in connection
with or related to each successfully resolved claim, issue or matter to the
fullest extent permitted by law.  For
purposes of this Section and without limitation, the termination of any claim,
issue or matter in such a Claim by dismissal, with or without prejudice, shall
be deemed to be a successful result as to such claim, issue or matter.


 


(f)                                    Contribution.  To the
fullest extent permitted by law, if the indemnification, exoneration or hold
harmless rights provided for in this Agreement is for any reason whatsoever
unavailable to an Indemnitee, then in lieu of indemnifying, exonerating or
holding harmless Indemnitee thereunder, the Company shall contribute to the
amount incurred by or on behalf of Indemnitee, whether for judgments, fines,
penalties, excise taxes, amounts paid or to be paid in settlement and/or for
Expenses (i) in such proportion as is deemed fair and reasonable in light of
all of the circumstances 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
cause to such Claim or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company (and its directors, officers, employees and
agents) and Indemnitee in connection with the action or inaction which resulted
in such Expenses, as well as any other relevant equitable considerations.  In connection with the registration of the
Company’s securities, the relative benefits received by the Company and
Indemnitee shall be deemed to be in the same respective proportions that the
net proceeds from 


 


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the
offering (before deducting expenses) received by the Company and Indemnitee, in
each case as set forth in the table on the cover page of the applicable
prospectus, bear to the aggregate public offering price of the securities so
offered.  The relative fault of the
Company and Indemnitee shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or Indemnitee and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.


 


The
Company and Indemnitee agree that it would not be just and equitable if
contribution pursuant to this Section 2(f) were determined by pro rata or by
any other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph.  In connection with the registration of the
Company’s securities, in no event shall Indemnitee be required to contribute
any amount under this Section 2(f) in excess of the net proceeds received by
Indemnitee from its sale of securities under such registration statement.  No person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(1) of the Securities Act)
shall be entitled to contribution from any person who was not found guilty of
such fraudulent misrepresentation.


 


3.                                      Expense Advances.  Notwithstanding any provision of this
Agreement to the contrary (other than Sections 13(d) and (e)), the Company
shall make Expense Advances, to the extent not prohibited by law, to an
Indemnitee in connection with any Claim (or any part of any Claim) not
initiated by Indemnitee, and such advancement shall be made within twenty (20)
days after the receipt by the Company of a statement or statements requesting
such advances from time to time (which shall include invoices received by the
Indemnitee in connection with such Expenses but, in the case of invoices in
connection with legal services, any references to legal work performed or to
expenditures made that would cause Indemnitee to waive any privilege accorded
by applicable law shall not be so included), whether prior to or after final
disposition of any Claim.  Expense
Advances shall be unsecured and interest free. 
Expense Advances shall be made without regard to Indemnitee’s ability to
repay the Expenses and without regard to Indemnitee’s ultimate entitlement to
indemnification under the other provisions of this Agreement.  In accordance with Section 13(e), advances
shall include any and all 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.  The Indemnitee shall qualify for advances
upon the execution and delivery to the Company of this Agreement, which shall
constitute an undertaking providing that the Indemnitee undertakes to repay the
amounts advanced (without interest) to the extent that it is ultimately
determined that Indemnitee is not entitled to be indemnified by the
Company.  No other form of undertaking
shall be required other than the execution of this Agreement.  This Section 3 shall not apply to any claim
made by Indemnitee for which indemnity is excluded pursuant to Section 10.


 


4.                                      Procedures
for Indemnification and Expense Advances.


 


(a)                                  Timing of Payments.  All
payments of Expenses (including without limitation Expense Advances) by the
Company to the Indemnitee pursuant to this Agreement shall be made to the
fullest extent permitted by law as soon as practicable after written demand by
Indemnitee therefor is presented to the Company, but in no event later than
forty-five (45) 


 


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days after such written
demand by Indemnitee is presented to the Company, except in the case of Expense
Advances, which shall be in accordance with Section 3 of this Agreement.  If the Company disputes a portion of the
amounts for which indemnification is requested, the undisputed portion shall be
paid and only the disputed portion withheld pending resolution of any such
dispute.


 


(b)                                 Notice/Cooperation by Indemnitee. 
Indemnitee shall give the Company notice in writing as soon as
practicable of any Claim made against Indemnitee for which indemnification,
Expense Advances, exoneration or hold harmless right will or could be sought
under this Agreement.  Notice to the
Company shall be directed to the President or Chief Executive Officer of the
Company at the address shown on the signature page of this Agreement (or such
other address as the Company shall designate in writing to Indemnitee) and
shall include a description of the nature of the Claim and the facts underlying
the Claim, in each case to the extent known to Indemnitee.  To obtain indemnification under this
Agreement, 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 following the final
disposition of such Claim.  In addition, Indemnitee
shall give the Company such information and cooperation as it may reasonably
require and as shall be within Indemnitee’s power.  The failure 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, except to the extent (solely with respect
to the indemnity hereunder) that such failure or delay materially prejudices
the Company.


 


(c)                                  Presumptions and Effect of Certain Proceedings.


 


(i)                                     In making a determination with respect to
entitlement to indemnification hereunder, the person or persons or entity
making such determination shall, to the fullest extent not prohibited by law,
presume that Indemnitee is entitled to indemnification under this Agreement if
Indemnitee has submitted a request for indemnification in accordance with Section
4 of this Agreement, and the Company shall, to the fullest extent not prohibited
by law, have the burden of proof and burden or persuasion by clear and
convincing evidence 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 Legal 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 Legal
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.


 


(ii)                                  The termination of any Claim or of any claim,
issue or matter therein, by judgment, order, settlement or conviction, or upon
a plea 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 and in a manner which he reasonably believed to be in or not 


 


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opposed to the best
interests of the Company or, with respect to any criminal Claim, that
Indemnitee had reasonable cause to believe that his conduct was unlawful.


 


(iii)                               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 directors
or 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
4(c) shall not be deemed to be exclusive or to limit in any way the other
circumstances in which the Indemnitee may be deemed to have met the applicable
standard of conduct set forth in this Agreement.  Whether or not the foregoing provisions of
this Section 4(c) are satisfied, it shall in any event be presumed that
Indemnitee has at all times acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Company.  Anyone seeking to overcome this presumption
shall have the burden of proof and the burden of persuasion by clear and
convincing evidence.


 


(iv)                              The knowledge and/or actions, or failure to
act, of any director, officer, trustee, partner, managing member, fiduciary,
agent or employee of the Enterprise shall not be imputed to Indemnitee for
purposes of determining the right to indemnification under this Agreement.


 


(v)                                 For purposes of this Section 4(c), “Enterprise” shall mean the Company and any
other corporation, limited liability company, partnership, joint venture, trust
or other enterprise of which Indemnitee is or was serving at the request of the
Company as a director, officer, trustee, partner, managing member, employee, agent
or fiduciary.


 


(d)                             Notice to Insurers.  If,
at the time of the receipt by the Company of a notice of a Claim pursuant to
Section 4(b) hereof, the Company has liability insurance in effect which may
cover such Claim, the Company shall give prompt notice of the commencement of
such Claim to the insurers in accordance with the procedures set forth in the
respective policies.  The Company shall
thereafter take all necessary or desirable action to cause such insurers to
pay, on behalf of the Indemnitee, all amounts payable as a result of such Claim
in accordance with the terms of such policies.


 


(e)                                  Selection of Counsel.  In
the event the Company shall be obligated hereunder to provide indemnification,
exoneration or hold harmless rights for or make any Expense Advances with
respect to the Expenses of any Claim, the Company, if appropriate, shall be
entitled to assume the defense of such Claim with counsel approved by
Indemnitee (which approval shall not be unreasonably withheld) upon the
delivery to Indemnitee of written notice of the Company’s election to do
so.  After delivery of such notice,
approval of such counsel by Indemnitee and the retention of such counsel by the
Company, the Company will not be liable to Indemnitee under this Agreement for
any fees or expenses of separate counsel subsequently employed by or on behalf
of Indemnitee with respect to the same Claim; provided, however, that (i) Indemnitee shall have
the right to employ Indemnitee’s separate counsel in any such Claim at 


 


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Indemnitee’s expense and
(ii) if (A) the employment of separate counsel by Indemnitee has been
previously authorized by the Company, (B) Indemnitee shall have reasonably
concluded that there may be a conflict of interest between the Company and
Indemnitee in the conduct of any such defense or (C) the Company shall not
continue to retain such counsel to defend such Claim, then the fees and
expenses of Indemnitee’s separate counsel shall be Expenses for which
Indemnitee may receive indemnification, exoneration or hold harmless rights or
Expense Advances hereunder.  The Company
shall have the right to conduct such defense as it sees fit in its sole
discretion, including the right to settle any claim, action or proceeding
against Indemnitee without the consent of Indemnitee, provided that the terms
of such settlement include either: (1) a full release of Indemnitee by the
claimant from all liabilities or potential liabilities under such claim or (2),
in the event such full release is not obtained, the terms of such settlement do
not limit any indemnification, exoneration or hold harmless right Indemnitee
may now, or hereafter, be entitled to under this Agreement, the Company’s
Certificate of Incorporation, bylaws, any agreement, any vote of stockholders
or disinterested directors, the General Corporation Law of the State of
Delaware (the “DGCL”) or otherwise.


 


5.                                      Additional
Indemnification Rights; Nonexclusivity.


 


(a)                                  Scope.  The
Company hereby agrees to indemnify, exonerate and hold harmless the Indemnitee
to the fullest extent permitted by law, notwithstanding that such
indemnification, exoneration or hold harmless right is not specifically
authorized by the other provisions of this Agreement, the Company’s Certificate
of Incorporation, the Company’s bylaws or by statute, any agreement, a vote of
stockholders or a resolution of directors, or otherwise.  The rights of indemnification and to receive
Expense Advances as provided by this Agreement shall be interpreted
independently of, and without reference to, any other such rights to which
Indemnitee may at any time be entitled. 
In the event of any change after the date of this Agreement in any
applicable law, statute or rule which expands the right of a Delaware
corporation to indemnify, exonerate or hold harmless a member of its board of
directors or an officer, employee, agent or fiduciary, it is the intent of the
parties hereto that Indemnitee shall enjoy by this Agreement the greater
benefits afforded by such change.  In the
event of any change in any applicable law, statute or rule which narrows the
right of a Delaware corporation to indemnify, exonerate or hold harmless a
member of its board of directors or an officer, employee, agent or fiduciary,
such change, to the extent not otherwise required by such law, statute or rule to
be applied to this Agreement, shall have no effect on this Agreement or the
parties’ rights and obligations hereunder except as set forth in Section 10(a) hereof.


 


(b)                                 Nonexclusivity.  The
indemnification, exoneration or hold harmless rights and the payment of Expense
Advances provided by this Agreement shall be cumulative and in addition to any
rights to which Indemnitee may be entitled under the Company’s Certificate of
Incorporation, its bylaws, any other agreement, any vote of stockholders or
disinterested directors, the DGCL, or otherwise.  The indemnification, exoneration or hold
harmless rights and the payment of Expense Advances provided under this
Agreement shall continue as to Indemnitee for any action taken or not taken
while serving in an indemnified, exonerated or held harmless capacity even
though subsequent thereto Indemnitee may have ceased to serve in such capacity.


 


10














 


6.                                      No
Duplication of Payments.  The Company shall not be liable under this
Agreement to make any payment in connection with any Claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under any insurance policy, provision of the Company’s Certificate of
Incorporation, bylaws or otherwise) of the amounts otherwise payable hereunder,
except as provided in Section 18 below.


 


7.                                      Partial
Indemnification.  If Indemnitee is entitled under any provision
of this Agreement to indemnification, exoneration or hold harmless rights by
the Company for some or a portion of Expenses incurred in connection with any
Claim, but not, however, for the total amount thereof, the Company shall
nevertheless indemnify, exonerate or hold harmless Indemnitee for the portion
of such Expenses to which Indemnitee is entitled.


 


8.                                      Mutual
Acknowledgment.  Both the Company and Indemnitee acknowledge
that, in certain instances, federal law or applicable public policy may
prohibit the Company from indemnifying, exonerating or holding harmless its
directors, officers, employees, agents or fiduciaries under this Agreement or
otherwise.  Indemnitee understands and
acknowledges that the Company may be required in the future to undertake with
the Securities and Exchange Commission to submit the question of
indemnification, exoneration or hold harmless rights to a court in certain
circumstances for a determination of the Company’s right under public policy to
indemnify, exonerate or hold harmless Indemnitee.


 


9.                                      Liability
Insurance.  To the extent the Company maintains liability
insurance applicable to directors, officers, employees, agents or fiduciaries,
Indemnitee shall be covered by such policies in such a manner as to provide
Indemnitee the same rights and benefits as are provided to the most favorably
insured of the Company’s directors, if Indemnitee is a director; or of the
Company’s officers, if Indemnitee is not a director of the Company but is an
officer; or of the Company’s key employees, agents or fiduciaries, if
Indemnitee is not an officer or director but is a key employee, agent or
fiduciary.


 


10.                               Exceptions.  Notwithstanding any other provision of this
Agreement, the Company shall not be obligated pursuant to the terms of this
Agreement:


 


(a)                                  Excluded Action or Omissions.  To
indemnify, exonerate or hold harmless Indemnitee for Expenses resulting from
acts, omissions or transactions for which Indemnitee is prohibited from
receiving indemnification, exoneration or hold harmless rights under this
Agreement or applicable law; provided, however, that notwithstanding any
limitation set forth in this Section 10(a) regarding the Company’s obligation
to provide indemnification, exoneration or hold harmless rights to Indemnitee
shall be entitled under Section 3 to receive Expense Advances hereunder with
respect to any such Claim unless and until a court having jurisdiction over the
Claim shall have made a final judicial determination (as to which all rights of
appeal therefrom have been exhausted or lapsed) that Indemnitee has engaged in
acts, omissions or transactions for which Indemnitee is prohibited from
receiving indemnification under this Agreement or applicable law.


 


(b)                                 Claims Initiated by Indemnitee.  To
indemnify, exonerate or hold harmless or make Expense Advances to Indemnitee
with respect to Claims initiated or brought voluntarily 


 


11

















 


by Indemnitee and not by
way of defense, counterclaim or cross claim, except (i) with respect to actions
or proceedings brought to establish or enforce an indemnification, Expense
Advances, exoneration or hold harmless right under this Agreement or any other
agreement or insurance policy or under the Company’s Certificate of
Incorporation or bylaws now or hereafter in effect relating to Claims for
Covered Events, (ii) in specific cases if the Board of Directors has approved
the initiation or bringing of such Claim or (iii) as otherwise required under
Section 145 of the DGCL, regardless of whether Indemnitee ultimately is
determined to be entitled to such indemnification, exoneration, hold harmless
right, Expense Advances or insurance recovery, as the case may be.


 


(c)                                  Claims Under Section 16(b) or Sarbanes-Oxley
Act.  To indemnify, exonerate or hold harmless
Indemnitee for expenses and the payment of profits arising from (i) the
purchase and sale by Indemnitee of securities in violation of Section 16(b) of
the Securities Exchange Act of 1934, as amended, or any similar successor
statute or (ii) any reimbursement of the Company by the Indemnitee of any bonus
or other incentive-based or equity-based compensation or of any profits
realized by the 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); provided, however, that notwithstanding any
limitation set forth in this Section 10(c) regarding the Company’s obligation
to provide indemnification or exoneration or hold harmless, Indemnitee shall be
entitled under Section 3 to receive Expense Advances hereunder with respect to
any such Claim unless and until a court having jurisdiction over the Claim
shall have made a final judicial determination (as to which all rights of
appeal therefrom have been exhausted or lapsed) that Indemnitee has violated
said statute.


 


11.                               Counterparts.  This
Agreement may be executed in counterparts and by facsimile or electronic
transmission, each of which shall constitute an original and all of which,
together, shall constitute one instrument.


 


12.                               Binding
Effect; Successors and Assigns.  This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the parties hereto and
their respective successors, and 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, spouses, heirs, and personal and
legal representatives.  The Company shall
require and cause any successor (whether direct or indirect by purchase,
merger, consolidation or otherwise) to all, substantially all, or a substantial
part, of the business and/or assets of the Company, by written agreement in
form and substance satisfactory to Indemnitee, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform if no such succession had taken
place.  This Agreement shall continue in
effect regardless of whether Indemnitee continues to serve as a director,
officer, employee, agent or fiduciary (as applicable) of the Company or of any
other enterprise at the Company’s request. 
The Company and Indemnitee agree that the Third-Party Indemnitors are
express third party beneficiaries of this Agreement.


 


12

















 


13.                               Remedies
of Indemnitee.


 


(a)                                  Subject to Section 2(b)(iii), in the event that (i) a determination is
made pursuant to this Agreement that Indemnitee is not entitled to
indemnification under this Agreement, (ii) Expense Advances are not timely made
pursuant to Section 3 of this Agreement, (iii) no determination of entitlement
to indemnification shall have been made pursuant to the provisions of this
Agreement within ninety (90) days after receipt by the Company of the request
for indemnification, (iv) payment of indemnification is not made pursuant to
Sections 2(a)(i), 2(e) or 7 of this Agreement within ten (10) days after
receipt by the Company of a written request therefor, (v) payment of
indemnification pursuant to the provisions of this Agreement is not made within
ten (10) days after a determination has been made that Indemnitee is entitled
to indemnification by a Reviewing Party or (vi) the Company or any other person
or entity 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 the Indemnitee hereunder, Indemnitee shall be
entitled to an adjudication by a court of his entitlement to such
indemnification or Expense Advances. 
Alternatively, Indemnitee, at his option, may seek an award in
arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. 
Indemnitee shall commence such proceeding seeking an adjudication or an
award in arbitration within 180 days following the date on which Indemnitee
first has the right to commence such proceeding pursuant to this Section
13(a).  The Company shall not oppose
Indemnitee’s right to seek any such adjudication or award in arbitration.


 


(b)                                 In the event that a determination shall have been made pursuant to this
Agreement that Indemnitee is not entitled to indemnification, any judicial
proceeding or arbitration commenced pursuant to this Section 13 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
judicial proceeding or arbitration commenced pursuant to this Section 13, the
Company shall have the burden of proof and the burden of persuasion by clear
and convincing evidence that Indemnitee is not entitled to indemnification or
Expense Advances, as the case may be.


 


(c)                                  If a determination shall have been made pursuant to this Agreement that
Indemnitee is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration commenced pursuant to
this Section 13, absent (i) a misstatement by Indemnitee of a material fact, or
an omission of a material fact necessary to make Indemnitee’s statement not
materially misleading, in connection with the request for indemnification or
(ii) a prohibition of such indemnification under applicable law.


 


(d)                                 The Company shall, to the fullest extent not prohibited by law, be
precluded from asserting in any judicial proceeding or arbitration commenced
pursuant to this Section 13 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.


 


(e)                                  It is the intent of the Company that, to the fullest extent permitted by
law, the 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 


 


13

















 


or otherwise because the cost and expense thereof
would substantially detract from the benefits intended to be extended to the
Indemnitee hereunder.  In the event that
any action is instituted by Indemnitee under this Agreement or under any
liability insurance policies maintained by the Company to enforce or interpret
any of the terms hereof or thereof, Indemnitee shall be entitled to be
indemnified for all Expenses incurred by Indemnitee with respect to such action
(including without limitation attorneys’ fees), regardless of whether
Indemnitee is ultimately successful in such action, unless as a part of such
action a court having jurisdiction over such action makes a final judicial
determination (as to which all rights of appeal therefrom have been exhausted
or lapsed) that each of the material assertions made by Indemnitee as a basis
for such action was not made in good faith or was frivolous; provided, however, that
until such final judicial determination is made, Indemnitee shall be entitled
under Section 3 to receive payment of Expense Advances hereunder with respect
to such action.  In the event of an
action instituted by or in the name of the Company under this Agreement to
enforce or interpret any of the terms of this Agreement, Indemnitee shall be
entitled to be indemnified, exonerated or held harmless for all Expenses
incurred by Indemnitee in defense of such action (including without limitation
costs and expenses incurred with respect to Indemnitee’s counterclaims and
cross-claims made in such action), unless as a part of such action a court
having jurisdiction over such action makes a final judicial determination (as
to which all rights of appeal therefrom have been exhausted or lapsed) that
each of the material defenses asserted by Indemnitee in such action was made in
bad faith or was frivolous; provided, however, that until such final judicial determination is
made, Indemnitee shall be entitled under Section 3 to receive payment of
Expense Advances hereunder with respect to such action.


 


14.                               Notices.  All
notices, requests, demands and other communications under this Agreement shall
be in writing and shall be deemed duly given (i) if delivered by hand and
signed for by the party addressed, on the date of such delivery or (ii) if
mailed by domestic certified or registered mail with postage prepaid, on the
third business day after the date postmarked. 
Addresses for notice to either party are as shown on the signature page
of this Agreement or as subsequently modified by written notice.


 


15.                               Consent
to Jurisdiction.  The Company and Indemnitee each
hereby irrevocably consent to the jurisdiction of the courts of the State of
Delaware for all purposes in connection with any action or proceeding which
arises out of or relates to this Agreement and agree that any action instituted
under this Agreement shall be commenced, prosecuted and continued only in the
Court of Chancery of the State of Delaware in and for New Castle County, which
shall be the exclusive and only proper forum for adjudicating such a claim.


 


16.                               Severability.  The
provisions of this Agreement shall be severable in the event that any of the
provisions hereof (including any provision within a single section, paragraph
or sentence) are held by a court of competent jurisdiction to be invalid, void
or otherwise unenforceable, and the remaining provisions shall remain
enforceable to the fullest extent permitted by law.  Furthermore, to the fullest extent possible,
the provisions of this Agreement (including without limitation each portion of
this Agreement containing any provision held to be invalid, void or otherwise
unenforceable, that is not itself invalid, void or unenforceable) shall be
construed so as to give effect to the intent manifested by the provision held
invalid, illegal or unenforceable.


 


14

















 


17.                               Choice
of Law.  This Agreement, and all rights, remedies,
liabilities, powers and duties of the parties to this Agreement, shall be
governed by and construed in accordance with the laws of the State of Delaware
without regard to principles of conflicts of laws.


 


18.                               Primacy
of Indemnification; Subrogation.


 


(a)                                  The Company
hereby acknowledges that Indemnitee has or may in the future have certain
indemnification, exoneration, hold harmless or Expense advancement rights
and/or insurance provided by one or more Third-Party Indemnitors.  The Company hereby agrees (i) that it is the
indemnitor of first resort (i.e., its
obligations to Indemnitee are primary and any obligation of any Third-Party
Indemnitors to advance Expenses or to provide indemnification, exoneration or
hold harmless rights for the same Expenses incurred by Indemnitee are
secondary), (ii) that it shall be required to advance the full amount of
Expenses incurred by Indemnitee and shall be liable for the full amount of all
Expenses, to the extent legally permitted and as required by the Certificate of
Incorporation or bylaws of the Company (or any agreement between the Company
and Indemnitee), without regard to any rights Indemnitee may have against the
Third-Party Indemnitors and (iii) that it irrevocably waives, relinquishes and
releases the Third-Party Indemnitors from any and all claims against the
Third-Party Indemnitors for contribution, subrogation or any other recovery of
any kind in respect thereof.  The Company
further agrees that no advancement or payment by the Third-Party Indemnitors on
behalf of Indemnitee with respect to any Claim for which Indemnitee has sought
indemnification, exoneration or hold harmless rights from the Company shall
affect the foregoing and the Third-Party Indemnitors shall have a right to
receive from the Company, contribution and/or be subrogated, to the extent of
such advancement or payment to all of the rights of recovery of Indemnitee
against the Company.


 


(b)                                 Except as provided in Section 18(a) above, in the event of payment under
this Agreement, the Company shall be subrogated to the extent of such payment
to all of the rights of recovery of Indemnitee from any insurance policy
purchased by the Company, who shall execute all documents required and shall do
all acts that may be necessary to secure such rights and to enable the Company
effectively to bring suit to enforce such rights.  In no event, however, shall the Company or
any other person have any right of recovery, through subrogation or otherwise,
against (i) Indemnitee, (ii) any Third-Party Indemnitor or (iii) any insurance
policy purchased or maintained by Indemnitee or any Third-Party Indemnitor.


 


(c)                                  For purposes of this Agreement “Third-Party Indemnitor”
means any person or entity that has or may in the future provide to the
Indemnitee any indemnification, exoneration, hold harmless or Expense
advancement rights and/or insurance benefits other than (i) the Company and
(ii) any entity or entities through which the Company maintains liability
insurance applicable to the Indemnitee.


 


19.                               Amendment
and Termination.  No amendment, modification,
termination or cancellation of this Agreement shall be effective unless it is
in writing signed by both the parties hereto. 
No waiver of any of the provisions of this Agreement shall be deemed to
be or shall constitute a waiver of any other provisions hereof (whether or not
similar), nor shall such waiver constitute a continuing waiver.


 


15

















 


20.                               Integration
and Entire Agreement.  This Agreement sets forth the
entire understanding between the parties hereto and supersedes and merges all
previous written and oral negotiations, commitments, understandings and
agreements relating to the subject matter hereof between the parties hereto; provided, however, that
this Agreement is a supplement to and in furtherance of the Certificate of
Incorporation, the Bylaws, any directors and officers insurance maintained by
the Company and applicable law, and shall not be deemed a substitute therefor,
nor to diminish or abrogate any rights of Indemnitee thereunder.


 


21.                               No Construction as Employment Agreement.  Nothing contained in this
Agreement shall be construed as giving Indemnitee any right to employment by
the Company or any of its subsidiaries or affiliated entities.


 


22.  Additional
Acts.  If for the
validation of any of the provisions in this Agreement any act, resolution,
approval or other procedure is required, the Company undertakes to cause such
act, resolution, approval or other procedure to be affected or adopted in a
manner that will enable the Company to fulfill its obligations under this
Agreement.


 


(The
remainder of this page is intentionally left blank.)


 


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IN WITNESS WHEREOF, the parties hereto have
executed this Indemnification Agreement as of the date first above written.


 


 


	
   

  	
   

  	
   

  	
  DEMAND
  MEDIA, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Richard
  Rosenblatt

  
	
   

  	
   

  	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Address:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  AGREED TO AND
  ACCEPTED BY:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  INDEMNITEE:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
						



 


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SCHEDULE

 

List of Individuals Who Will Become Parties to the

Demand Media, Inc. Indemnification Agreement

(Exhibit 10.01 to the Registration Statement)

 

1.                                       Charles S. Hilliard

2.                                       David E. Panos

3.                                       Fredric W. Harman

4.                                       Gaurav Bhandari

5.                                       James R. Quandt

6.                                       Joanne K. Bradford

7.                                       John A. Hawkins

8.                                       Joshua G. James

9.                                       Larry D. Fitzgibbon

10.                                 Matthew P. Polesetsky

11.                                 Michael L. Blend

12.                                 Michael L. Zemetra

13.                                 Peter Guber

14.                                 Richard M. Rosenblatt

15.                                 Robert R. Bennett

16.                                 Shawn J. Colo

17.                                 Victor E. Parker