Document:

Exhibit 10.2 Form of Indemnification Agreement

Exhibit 10.2

Form Agreement (ARCP Directors)

INDEMNIFICATION AGREEMENT (1) 

THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is made and entered into as of the [•] day of [•], 20__ (the “Effective Date”), by and between American Realty Capital Properties, Inc., a Maryland corporation (the “Company”), and [•] (“Indemnitee”) (together referred to as the “Parties”).
WHEREAS, Indemnitee commenced service as a director of the Company as of [•] (the “Start Date”);
WHEREAS, by reason of Indemnitee’s status as a director of the Company, Indemnitee may be subjected to claims, suits or proceedings arising as a result of Indemnitee’s service; and
WHEREAS, as an inducement to Indemnitee to serve or continue to serve as a director of the  Company, the Company has agreed to indemnify and to advance expenses and costs incurred by Indemnitee in connection with any such claims, suits or proceedings, to the maximum extent permitted by law and subject to the terms set forth herein; and
WHEREAS, the parties to this Agreement desire to set forth their agreement regarding indemnification and advancement of expenses.
NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:
Section 1.Definitions.  For purposes of this Agreement:
(a)“Bylaws” means the Bylaws of the Company, as amended, supplemented or otherwise modified from time to time. 
(b)“Charter” means the charter of the Company, as amended, supplemented or otherwise modified from time to time.
(c)“Change in Control” means a change in control of the Company occurring after the Effective Date of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), whether or not the Company is then subject to such reporting requirement; provided, however, that, without limitation, such a Change in Control shall be deemed to have occurred if, after the Effective Date (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 15% or more of the combined voting power of all of the Company’s then-outstanding securities entitled to vote generally in the election of directors without the prior approval of at least two-thirds of the members of the Board of Directors of the Company (the “Board of Directors”) in office immediately prior to such person’s attaining such percentage interest; (ii) the Company is a party to a merger, consolidation, sale of assets, plan of liquidation or other reorganization not approved by at least two-thirds of the members of the Board of Directors then in office, as a consequence of which members of the Board of Directors in office immediately prior to such transaction or event constitute less than a majority of the Board of Directors thereafter; or (iii) at any time, a majority of the members of the Board of Directors are not individuals (A) who were directors as of the Effective Date or (B) whose election by the Board of Directors or nomination for election by the Company’s stockholders was approved by the affirmative vote of at least two-thirds of the members of the Board of Directors then in office who were directors as of the Effective Date or whose election or nomination for election was previously so approved.

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(1) To the extent the director indemnitee is also an officer of the Company, such indemnitee shall be indemnified in his/her capacities as a director and as an officer of the Company.

(d)“Corporate Status” means the status of a person as a present or former director, officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company.  Indemnitee’s Corporate Status shall be deemed to have commenced on the Start Date.  As a clarification and without limiting the circumstances in which Indemnitee may be serving at the request of the Company, service by Indemnitee shall be deemed to be at the request of the Company if Indemnitee serves or served as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise (i) of which a majority of the voting power or equity interest is owned directly or indirectly by the Company or (ii) the management of which is controlled directly or indirectly by the Company.  
(e)“Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification and/or advancement of Expenses is sought by Indemnitee.
(f)“Effective Date” means the date set forth in the first paragraph of this Agreement.
(g)“Expenses” means any and all reasonable and out-of-pocket attorneys’ fees, expenses and costs, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, computer research charges, postage, delivery service fees, paralegal and secretarial services, federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, Employee Retirement Income Security Act of 1974, as amended, excise taxes and penalties and any other disbursements or expenses incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in or otherwise participating in a Proceeding.  Expenses shall also include Expenses incurred in connection with any appeal resulting from any Proceeding including, without limitation, the premium, security for and other costs relating to any cost bond, supersedeas bond or other appeal bond or its equivalent.    
(h)“Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither is, nor in the past five years has been, retained to represent:  (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement or of other indemnitees under similar indemnification agreements), or (ii) any other party to or participant or witness in the Proceeding giving rise to a claim for indemnification or advancement of Expenses hereunder.  Notwithstanding the foregoing, the term “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 Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.
(i)“Proceeding” means any threatened, pending or completed claim, action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other proceeding, whether brought by or in the right of the Company, its shareholders or otherwise and whether of a civil (including intentional or unintentional tort claims), criminal, administrative or investigative (formal or informal) nature, including any appeal therefrom, including any pending on or before the Effective Date.  If Indemnitee reasonably believes that a given situation may lead to or culminate in the institution of a Proceeding, such situation shall also be considered a Proceeding.
Section 2.Services by Indemnitee.  Indemnitee serves as a director of the Company.  However, this Agreement shall not impose any independent obligation on Indemnitee or the Company to continue Indemnitee’s service to the Company.  This Agreement shall not be deemed an employment contract between the Company (or any other entity) and Indemnitee.  
Section 3.General.  Subject in all respects to Section 4 and Section 5, the Company shall indemnify and advance Expenses to, Indemnitee (a) as provided in this Agreement and (b) otherwise to the maximum extent permitted by Maryland law in effect on the Effective Date and as amended from time to time; provided, however, that no change in Maryland law shall have the effect of reducing the benefits available to Indemnitee hereunder based on Maryland law as in effect on the Effective Date.  Subject in all respects to Section 4 and Section 5, the rights of Indemnitee provided in this Section 3 shall include, without limitation, the rights set forth in the other sections of this Agreement, including any additional indemnification permitted by Section 2-418(g) of the Maryland General Corporation Law (the “MGCL”).
Section 4.Standard for Indemnification.  If, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the Company shall indemnify, defend and hold harmless Indemnitee against all judgments, penalties, fines and settlements and advance all Expenses actually incurred by Indemnitee or on Indemnitee’s behalf in connection with any such Proceeding, subject to the limitations and requirements set forth herein, including the Certain Limits on Indemnification as set forth in Section 5 of this Agreement.

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Section 5.Certain Limits on Indemnification.  Notwithstanding any other provision of this Agreement (other than Section 6), Indemnitee shall not be entitled to:
(a)indemnification or advancement of Expenses hereunder if the Proceeding was one by or in the right of the Company and Indemnitee is adjudged to be liable to the Company as described in Section 2-418(b)(2)(ii) of the MGCL;
(b)indemnification or advancement of Expenses hereunder if it is finally determined (in that all rights of appeal have been exhausted or lapsed) in a Proceeding that (i) the act or omission of Indemnitee was material to the matter giving rise to the Proceeding and (x) was committed in bad faith or (y) was the result of Indemnitee’s active and deliberate dishonesty; (ii) Indemnitee actually received and is adjudged to be liable for an improper personal benefit in money, property or services, as a result of an act or omission by Indemnitee; or (iii) in the case of any criminal proceeding, Indemnitee had reasonable cause to believe that Indemnitee’s act or omission was unlawful; or
(c)indemnification or advancement of Expenses hereunder if the Proceeding was brought by Indemnitee, unless:  (i) the Proceeding was brought to enforce any of Indemnitee’s rights under this Agreement, and then only to the extent in accordance with and as authorized by Section 12 of this Agreement, or (ii) the Charter or Bylaws, a resolution of the stockholders entitled to vote generally in the election of directors or of the Board of Directors or an agreement approved by the Board of Directors to which the Company is a party, expressly provide otherwise.
Section 6.Court-Ordered Indemnification.  Notwithstanding any other provision of this Agreement, a court of appropriate jurisdiction, upon application of Indemnitee and such notice as the court shall require, may order indemnification of Indemnitee by the Company in the following circumstances:
(a)if such court determines that Indemnitee is entitled to reimbursement under Section 2-418(d)(1) of the MGCL, the court shall order indemnification, in which case Indemnitee shall be entitled to recover the Expenses of securing such reimbursement; or
(b)if such court determines that Indemnitee is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not Indemnitee (i) has met the standards of conduct set forth in Section 2-418(b) of the MGCL or (ii) has been adjudged liable for receipt of an improper personal benefit under Section 2-418(c) of the MGCL, the court may order such indemnification as the court shall deem proper.  However, indemnification with respect to any Proceeding by or in the right of the Company or in which liability shall have been adjudged in the circumstances described in Section 2-418(c) of the MGCL shall be limited to Expenses.
Section 7.Indemnification for Expenses of an Indemnitee Who Is Wholly or Partially Successful.  Notwithstanding any other provision of this Agreement, and without limiting any such provision, to the extent that Indemnitee was or is, by reason of Indemnitee’s Corporate Status, made a party to (or otherwise becomes a participant in) any Proceeding and is successful, on the merits or otherwise, in the defense of such Proceeding, Indemnitee shall be indemnified for all Expenses actually incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.  If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee under this Section 7 for all Expenses actually incurred by Indemnitee or on Indemnitee’s behalf in connection with each such claims, issues or matters, allocated on a reasonable and proportionate basis.  For purposes of this Section 7 and without limitation, the termination of any claim, issue or matter in such a Proceeding by settlement or dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.  As clarification, notwithstanding whether Indemnitee is successful in any Proceeding, Indemnitee shall be entitled to indemnification of Expenses if the standard for indemnification under Section 4, subject to Section 5, of this Agreement is met. 
Section 8.Procedure for Advancement of Expenses to Indemnitee.  If, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the Company shall, without requiring a preliminary determination of Indemnitee’s ultimate entitlement to indemnification hereunder, advance all reasonable Expenses incurred by or on behalf of Indemnitee in connection with such Proceeding within ten days after the receipt by the Company of a statement or statements requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding.  Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall include or be preceded or accompanied by a written affirmation by Indemnitee of Indemnitee’s good faith belief that the standard of conduct necessary for indemnification by the Company as authorized by law and by this Agreement has been met and a written undertaking by or on behalf of Indemnitee, in substantially the form attached hereto as Exhibit A or in such form as may be required under applicable law as in effect at the time of the execution thereof.  To the extent that Expenses advanced to Indemnitee do not relate to a specific claim, issue or matter in the Proceeding, such Expenses shall be allocated on a reasonable and proportionate basis.  The undertaking required by this Section 8 shall be an unlimited general obligation by or 

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on behalf of Indemnitee and shall be accepted without reference to Indemnitee’s financial ability to repay such advanced Expenses and without any requirement to post security therefor.
Section 9.Indemnification and Advancement of Expenses as a Witness or Other Participant.  Notwithstanding any other provision of this Agreement (other than Section 5), to the extent that Indemnitee is or may be, by reason of Indemnitee’s Corporate Status, made a witness or otherwise asked to participate in any Proceeding, including through any deposition, interview, interrogatory or document or similar request, whether instituted by the Company or any other party, and to which Indemnitee is not a party, Indemnitee shall be advanced all reasonable Expenses and indemnified against all Expenses actually incurred by Indemnitee or on Indemnitee’s behalf in connection therewith within ten days after the receipt by the Company of a statement or statements requesting any such advance or indemnification from time to time, whether prior to or after final disposition of such Proceeding.  Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee.
Section 10.Procedure for Determination of Entitlement to Indemnification.
(a)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.  Indemnitee may submit one or more such requests from time to time and at such time(s) as Indemnitee deems appropriate in Indemnitee’s sole discretion.  The officer of the Company receiving any such request from Indemnitee shall, promptly upon receipt of such a request for indemnification, advise the Board of Directors in writing that Indemnitee has requested indemnification.
(b)Upon written request by Indemnitee for indemnification pursuant to Section 10(a) above, a determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto shall promptly be made in the specific case:  (i) if a Change in Control shall have occurred, by Independent Counsel, in a written opinion to the Board of Directors, a copy of which shall be delivered to Indemnitee, which Independent Counsel shall be selected by the Indemnitee and approved by the Board of Directors in accordance with Section 2-418(e)(2)(ii) of the MGCL, which approval shall not be unreasonably withheld; or (ii) if a Change in Control shall not have occurred, (A) by the Board of Directors by a majority vote of a quorum consisting of Disinterested Directors or, if such a quorum cannot be obtained, then by a majority vote of a duly authorized committee of the Board of Directors consisting solely of one or more Disinterested Directors, (B) if Independent Counsel has been selected by the Board of Directors in accordance with Section 2-418(e)(2)(ii) of the MGCL and approved by the Indemnitee, which approval shall not be unreasonably withheld, by Independent Counsel, in a written opinion to the Board of Directors, a copy of which shall be delivered to Indemnitee, or (C) by the stockholders of the Company.  If it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten days after such determination.  Indemnitee shall cooperate with the person, persons or entity making such determination with respect to 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 Indemnitee and reasonably necessary to such determination in the discretion of the Board of Directors or Independent Counsel if retained pursuant to clause (ii)(B) of this Section 10(b).  Any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company shall indemnify and hold Indemnitee harmless therefrom.
(c)The Company shall pay the reasonable fees and expenses of Independent Counsel, if one is appointed.
Section 11.Presumptions and Effect of Certain Proceedings.
(a)In making any determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 10(a) of this Agreement, and the Company shall have the burden of proof to overcome that presumption in connection with the making of any determination contrary to that presumption.
(b)The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement does not create a presumption that Indemnitee did not meet the requisite standard of conduct described herein for indemnification.  The termination of any Proceeding or of any claim, issue or matter therein, by conviction, or a plea of nolo contendere or its equivalent, or an entry of an order of probation prior to judgment, creates a rebuttable presumption that the Indemnitee did not meet the requisite standard of conduct described herein for indemnification.

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(c)The knowledge and/or actions, or failure to act, of any other director, officer, employee or agent of the Company or any other director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise shall not be imputed to Indemnitee for purposes of determining any right to indemnification under this Agreement.
Section 12.Remedies of Indemnitee.
(a)If (i) a determination is made pursuant to Section 10(b) of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Sections 8 or 9 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 10(b) of this Agreement within 45 days after receipt by the Company of the request for indemnification, (iv) payment of indemnification is not made pursuant to Sections 7 or 9 of this Agreement within ten days after receipt by the Company of a written request therefor, or (v) payment of indemnification pursuant to any other section of this Agreement or the Charter or Bylaws is not made within ten days after a determination has been made that Indemnitee is entitled to indemnification, Indemnitee shall be entitled to an adjudication in an appropriate court located in the State of Maryland, or in any other court of competent jurisdiction, of Indemnitee’s entitlement to such indemnification or advancement of Expenses.  Alternatively, Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association.  Indemnitee shall commence a 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 12(a); provided, however, that the foregoing clause shall not apply to a Proceeding brought by Indemnitee to enforce Indemnitee’s rights under Section 7 or 8 of this Agreement.  Except as set forth herein, the provisions of Maryland law (without regard to its conflicts of laws rules) shall apply to any such arbitration.  The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.
(b)In any judicial proceeding or arbitration commenced pursuant to this Section 12, Indemnitee shall be presumed to be entitled to indemnification or advancement of Expenses, as the case may be, under this Agreement and the Company shall have the burden of proving that Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be.  If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 12, Indemnitee shall not be required to reimburse the Company for any advances pursuant to Section 8 of this Agreement until a final determination is made with respect to Indemnitee’s entitlement to indemnification (as to which all rights of appeal have been exhausted or lapsed).  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 12 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 of the provisions of this Agreement.
(c)If a determination shall have been made pursuant to Section 10(b) of 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 12, absent 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.
(d)In the event that Indemnitee is successful in any such judicial adjudication or arbitration, Indemnitee shall be entitled to recover from the Company, and shall be indemnified by the Company for, any and all Expenses actually incurred by Indemnitee in seeking, pursuant to this Section 12, a judicial adjudication of or an award in arbitration to enforce Indemnitee’s rights under, or to recover damages for breach of, this Agreement.  If it shall be determined in such judicial adjudication or arbitration that Indemnitee is entitled to receive part but not all of the indemnification or advancement of Expenses sought, the Expenses incurred by Indemnitee in connection with such judicial adjudication or arbitration shall be allocated on a reasonable and proportionate basis.
(e)Interest shall be paid by the Company to Indemnitee at the maximum rate allowed to be charged for judgments under the Courts and Judicial Proceedings Article of the Annotated Code of Maryland for amounts which the Company pays or is obligated to pay for the period (i) commencing with either the tenth day after the date on which the Company was requested to advance Expenses in accordance with Sections 8 or 9 of this Agreement or the 45th day after the date on which the Company was requested to make the determination of entitlement to indemnification under Section 10(b) of this Agreement, as applicable, and (ii) ending on the date such payment is made to Indemnitee by the Company.
Section 13.Defense of the Underlying Proceeding.
(a)Indemnitee shall notify the Company promptly in writing upon being served with any summons, citation, subpoena, complaint, indictment, request or other document relating to any Proceeding which is reasonably likely to result in the right to indemnification or the advancement of Expenses hereunder and shall include with such notice a description of the nature of the Proceeding and a summary of the facts underlying the Proceeding.  The failure to give any such notice shall 

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not disqualify Indemnitee from the right, or otherwise affect in any manner any right of Indemnitee, to indemnification or the advancement of Expenses under this Agreement unless the Company’s ability to defend in such Proceeding or to obtain proceeds under any insurance policy is materially and adversely prejudiced thereby, and then only to the extent the Company is thereby actually so prejudiced.
(b)Subject to the provisions of the last sentence of this Section 13(b) and of Section 13(c) below, the Company shall have the right to defend Indemnitee in any Proceeding which may give rise to indemnification hereunder; provided, however, that the Company shall notify Indemnitee of any such decision to defend within 15 calendar days following receipt of notice of any such Proceeding under Section 13(a) above.  The Company shall not, without the prior written consent of Indemnitee, which shall not be unreasonably withheld or delayed, consent to the entry of any judgment against Indemnitee or enter into any settlement or compromise which (i) includes an admission of fault of Indemnitee, (ii) does not include, as an unconditional term thereof, the full release of Indemnitee from all liability in respect of such Proceeding, which release shall be in form and substance reasonably satisfactory to Indemnitee or (iii) would impose any Expense, judgment, fine, penalty or limitation on Indemnitee.  This Section 13(b) shall not apply to a Proceeding brought by Indemnitee under Section 12 of this Agreement.
(c)Notwithstanding the provisions of Section 13(b), if in a Proceeding to which Indemnitee is a party by reason of Indemnitee’s Corporate Status, (i) Indemnitee reasonably concludes, based upon the opinion of counsel, that Indemnitee may have one or more separate defenses or counterclaims to assert with respect to any issue which may not be consistent with other defendants in such Proceeding, (ii) Indemnitee reasonably concludes, based upon the opinion of counsel, that an actual or apparent conflict of interest or potential conflict of interest exists between Indemnitee and the Company, or (iii) if the Company fails to assume the defense of such Proceeding in a timely manner, Indemnitee shall be entitled to be represented by separate legal counsel of Indemnitee’s choice, subject in the case of this subsection (iii) to the prior approval of the Company, which approval shall not be unreasonably withheld, at the expense of the Company.  In addition, if the Company fails to comply with any of its obligations under this Agreement or in the event that the Company or any other person takes any action to declare this Agreement void or unenforceable, or institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be provided to Indemnitee hereunder, Indemnitee shall have the right to retain counsel of Indemnitee’s choice at the expense of the Company (subject to Section 12(d) of this Agreement), to represent Indemnitee in connection with any such matter.
Section 14.Non-Exclusivity; Survival of Rights; Subrogation.
(a)The rights to indemnification and advancement of expenses provided by the Charter and the Bylaws shall vest immediately upon election of Indemnitee as a director of the Company. The rights of indemnification and advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Charter or Bylaws, any agreement or a resolution of the stockholders entitled to vote generally in the election of directors or of the Board of Directors, or otherwise.  Unless consented to in writing by Indemnitee, no amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in Indemnitee’s Corporate Status prior to such amendment, alteration or repeal, regardless of whether a claim with respect to such action or inaction is raised prior or subsequent to such amendment, alteration or repeal.  No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right or remedy shall be cumulative and in addition to every other right or remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion of any right or remedy hereunder, or otherwise, shall not prohibit the concurrent assertion or employment of any other right or remedy.    
(b)All rights of Indemnitee under this Agreement shall survive termination of Indemnitee’s employment with the Company.
(c)In the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.
Section 15.Insurance.  The Company will use its reasonable best efforts to acquire directors and officers liability insurance, on terms and conditions deemed appropriate by the Board of Directors, with the advice of counsel, covering Indemnitee for any claim made against or any expense, liability or loss incurred by Indemnitee by reason of Indemnitee’s Corporate Status and covering the Company for any indemnification or advancement of Expenses made by the Company to Indemnitee for any claims made against Indemnitee by reason of Indemnitee’s Corporate Status, whether or not the Company would have the power to indemnify such person against such liability under the MGCL.    Additionally, after any termination of employment of Indemnitee, for a period through the sixth anniversary of the termination of employment, the Company shall use 

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reasonable best efforts to maintain such directors and officers insurance covering Indemnitee.  Without in any way limiting any other obligation under this Agreement, the Company shall indemnify Indemnitee for any payment by Indemnitee arising out of the amount of any deductible or retention and the amount of any excess of the aggregate of all judgments, penalties, fines, settlements and Expenses incurred by Indemnitee in connection with a Proceeding over the coverage of any insurance referred to in the previous sentence.  The purchase, establishment and maintenance of any such insurance shall not in any way limit or affect the rights or obligations of the Company or Indemnitee under this Agreement except as expressly provided herein, and the execution and delivery of this Agreement by the Company and the Indemnitee shall not in any way limit or affect the rights or obligations of the Company under any such insurance policies.  If, at the time the Company receives notice from any source of a Proceeding to which Indemnitee is a party or a participant (as a witness or otherwise) the Company has director and officer liability insurance in effect, the Company shall give prompt notice of such Proceeding to the insurers in accordance with the procedures set forth in the respective policies. 
Section 16.Coordination of Payments.  The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable or payable or reimbursable as Expenses hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.
Section 17.Reports to Stockholders.  To the extent required by the MGCL, the Company shall report in writing to its stockholders the payment of any amounts for indemnification of, or advancement of Expenses to, Indemnitee under this Agreement arising out of a Proceeding by or in the right of the Company with the notice of the meeting of stockholders of the Company next following the date of the payment of any such indemnification or advancement of Expenses or prior to such meeting.
Section 18.Duration of Agreement; Binding Effect.
(a)This Agreement shall continue until and terminate on the later of (i) the date that Indemnitee shall have ceased to serve as a director, officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company and (ii) the date that Indemnitee is no longer subject to any actual or possible Proceeding (including any rights of appeal thereto and any Proceeding commenced by Indemnitee pursuant to Section 12 of this Agreement).
(b)The indemnification and advancement of Expenses provided by, or granted pursuant to, this Agreement shall be binding upon 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 or assets of the Company), shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company, and shall inure to the benefit of Indemnitee and Indemnitee’s spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.
(c)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.
(d)The Company and Indemnitee agree that a monetary remedy for breach of this Agreement, at some later date, may be inadequate, impracticable and difficult of proof, and further agree that such breach may cause Indemnitee irreparable harm.  Accordingly, the Parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief and/or specific performance hereof, without any necessity of showing actual damage or irreparable harm and that by seeking injunctive relief and/or specific performance, Indemnitee shall not be precluded from seeking or obtaining any other relief to which Indemnitee may be entitled.  Indemnitee shall further be entitled to such specific performance and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bonds or other undertakings in connection therewith.  The Company acknowledges that, in the absence of a waiver, a bond or undertaking may be required of Indemnitee by a court, and the Company hereby waives any such requirement of such a bond or undertaking.
Section 19.Most-Favored Nation.  If the Company provides indemnification to another current or former director of the Company on terms that are more favorable to such current or former director than the terms of indemnification contained in this Agreement, then this Agreement shall automatically be deemed to be amended (without any action on the part of the Company or Indemnitee) to include such more favorable terms.   

7

Section 20.Severability.  If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever:  (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.
Section 21.Identical Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement.  One such counterpart signed by the party against whom enforceability is sought shall be sufficient to evidence the existence of this Agreement.
Section 22.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.
Section 23.Modification and Waiver.  No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the Parties hereto.  No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.
Section 24.Notices.  All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if (i) delivered by hand or facsimile and receipted for by the Party to whom said notice or other communication shall have been directed, on the day of such delivery, or (ii) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed:
(a)If to Indemnitee, to the address set forth on the signature page hereto.
(b)If to the Company, to:
American Realty Capital Properties, Inc.
2325 East Camelback Road, Suite 1100
Phoenix, AZ 85016
Attention: Richard A. Silfen, General Counsel
Facsimile: (480) 449-7029

with a copy to:

Milbank, Tweed, Hadley & McCloy LLP
1 Chase Manhattan Plaza  
New York, NY 10005
Attention:  George S. Canellos
Facsimile: (212) 822-5792            
or to such other address as may have been furnished in writing to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.
Section 25.Governing Law.  This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Maryland, without regard to its conflicts of laws rules.
[SIGNATURE PAGE FOLLOWS]

8

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the day and year first above written.
COMPANY:
AMERICAN REALTY CAPITAL PROPERTIES, INC.
By:    _____________________________________
Name: 
Title: 

INDEMNITEE
_____________________________________
Name: 
Address: 
 

[Signature Page to Indemnification Agreement]

9

EXHIBIT A
AFFIRMATION AND UNDERTAKING TO REPAY EXPENSES ADVANCED

To:  The Board of Directors of American Realty Capital Properties, Inc.
Re:  Affirmation and Undertaking
Ladies and Gentlemen:
This Affirmation and Undertaking is being provided pursuant to that certain Indemnification Agreement dated the    ____day of ________ 20__, by and between American Realty Capital Properties, Inc., a Maryland corporation (the “Company”), and the undersigned Indemnitee (the “Indemnification Agreement”), pursuant to which I am entitled to advancement of Expenses in connection with [Description of Proceeding] (the “Proceeding”).
Terms used herein and not otherwise defined shall have the meanings specified in the Indemnification Agreement.
I am subject to the Proceeding by reason of my Corporate Status or by reason of alleged actions or omissions by me in such capacity.  I hereby affirm my good faith belief that at all times, insofar as I was involved as a director of the Company, in any of the facts or events giving rise to the Proceeding, I (1) did not act with bad faith or active or deliberate dishonesty, (2) did not receive any improper personal benefit in money, property or services, as a result of an act or omission by me, (3) in the case the Proceeding is criminal in nature, had no reasonable cause to believe that any act or omission by me was unlawful and (4) in the case the Proceeding is by or in the right of the Company, am not liable to the Company.
In consideration of the advancement of Expenses by the Company for reasonable attorneys’ fees and related Expenses incurred by me in connection with the Proceeding (the “Advanced Expenses”), I hereby agree that if, in connection with the Proceeding, it is finally determined (in that all rights of appeal have been exhausted or lapsed) that (1) the act or omission by me was material to the matter giving rise to the Proceeding and was committed in bad faith or was the result of my active and deliberate dishonesty, (2)  I actually received and am adjudged to be liable for an improper personal benefit in money, property or services, as a result of an act or omission by me, (3) in the case the Proceeding is criminal in nature, I had reasonable cause to believe that my conduct was unlawful, or (4) in the case the Proceeding is by or in the right of the Company, I am adjudged to be liable to the Company, then I shall promptly reimburse the Company for the portion of the Advanced Expenses relating to the claims, issues or matters in the Proceeding as to which the foregoing findings have been established.
IN WITNESS WHEREOF, I have executed this Affirmation and Undertaking on this __ day of _________________, 20__.
		
	Name:  
	____________________________SREV 12.31.2014 Exhibit 10.15+

Exhibit 10.15+

EMPLOYMENT AND CONFIDENTIAL INFORMATION AGREEMENT
This Employment Agreement (the “Agreement”) is entered into by and between ServiceSource International, Inc. (“ServiceSource” or the “Company”) and Christopher M. Carrington (“Executive”) to become effective on December 1, 2014 (the “Effective Date”). 
Recitals
WHEREAS, ServiceSource and Executive desire to enter into this Agreement in connection with Executive’s employment as Chief Executive Officer of ServiceSource.
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements of the parties contained herein, the parties acknowledge and agree as follows:
1.EMPLOYMENT TERMS AND CONDITIONS.  ServiceSource hereby employs Executive as Chief Executive Officer, and Executive hereby accepts such employment with ServiceSource upon all of the terms and conditions described in this Agreement, effective as of the Effective Date.  This Agreement is contingent upon Executive’s satisfactory background and reference checks, and other standard human resources procedures.

2.DUTIES.

(a)Responsibilities.  Executive’s position is ServiceSource’s Chief Executive Officer, reporting to the ServiceSource Board of Directors (the “Board”).  Executive shall be responsible for and expected to perform all duties and tasks incident to his position customarily associated with the role of a chief executive officer, including related duties and tasks as may be specifically assigned to Executive by the Board.

(b)Loyal and Full Time Performance of Duties.  While employed by ServiceSource, Executive shall not engage in any Competitive Activity.  For the purpose of this Agreement, “Competitive Activity” is any activity which is the same as or competitive with any activity engaged in by ServiceSource during Executive’s employment by ServiceSource.  Competitive Activities may include, without limitation, the provision of (a) outsourced sales, technology and/or marketing services, or (b) consulting services for a client with respect to the sales and marketing of services agreements to end users where such clients compete with ServiceSource and/or its customers.  

(c)ServiceSource Policies.  Executive agrees to abide by ServiceSource’s rules, regulations, policies and practices, as they may from time to time be adopted or modified by ServiceSource at its sole discretion, provided Executive first has been notified of such rules, regulations, policies and practices.  ServiceSource’s written rules, policies, practices and procedures shall be binding on Executive unless superseded by or in conflict with this Agreement.

(d)Nomination for Membership on the Board.  ServiceSource shall ensure the nomination of Executive for membership on the Board for so long as Executive remains Chief Executive Officer. For clarity, there is no additional compensation as a Director while also an Executive with the Company 

(e)Executive’s State of Residence and Principal Place of Business.  ServiceSource understands and accepts that Executive intends to maintain his residence and principal place of business in the Denver metropolitan area.  Executive understands that the Company’s principal headquarters are in San Francisco, 

CA and Company has offices and operations in centers across the U.S. and in locations around the world.  Frequent travel to these locations, in particular San Francisco, is an inherent part of the job.  For clarity, any change of the Company’s headquarters from San Francisco, CA will require Board approval.

3.EMPLOYMENT AT-WILL.  Executive and ServiceSource acknowledge and agree that during Executive’s employment with ServiceSource the parties intend to strictly maintain an at-will employment relationship.  This means that at any time during the course of Executive’s employment with ServiceSource, Executive is entitled to resign with or without cause and with or without advance notice.  Similarly, ServiceSource specifically reserves the same right to terminate Executive’s employment at any time with or without cause and with or without advance notice.  Nothing in this Agreement or the relationship between the parties now or in the future may be construed or interpreted to create an employment relationship for a specific length of time or a right to continued employment.  Executive and ServiceSource understand and agree that only the Board possesses the authority to alter the at-will nature of Executive’s employment status, and that any such change may be made only by an express written employment contract signed by an authorized ServiceSource officer, as explicitly authorized by the Board. No implied contract concerning any employment-related decision or term or condition of employment can be established by any other statement, conduct, policy or practice.

4.CASH COMPENSATION - BASE SALARY AND TARGET BONUS.  In consideration for the services and covenants described in this Agreement, ServiceSource agrees to pay Executive an annual base salary of five hundred thousand dollars ($500,000), paid on ServiceSource’s normal payroll dates, subject to all applicable withholdings.  In addition, Executive will be eligible for a potential annual target Corporate Incentive Plan (“CIP”) bonus amount of three hundred fifty thousand dollars ($350,000) (the “Target Bonus”), subject to all applicable withholdings.  The CIP is a discretionary incentive program that ServiceSource funds based on the achievement of business results and individual objectives established by ServiceSource and may also be subject to applicable performance requirements as determined by the Board or its Compensation Committee in their sole discretion.  The Board will provide Executive with his individual objectives for the year no later than January 31 of each year.  In the discretion of the Board (or relevant designated committees, as applicable), the Target Bonus can be paid out up to 2x its value based on over-performance of the approved plan, and may be paid out at less than the Target Bonus (or even zero) for underperformance. Notwithstanding the foregoing, Executive’s prorated CIP 2014 bonus for the month of December 2014 and for H1 2015 will be paid out in full in an amount equivalent to no less than 100% of the Target Bonus amount, as prorated or adjusted for such applicable time period pursuant to the terms of the CIP plan and regardless of funding levels for other similarly situated employees.  For example, December 2014’s pro-rated CIP amount will be $29,166.67.  Except as otherwise provided in this Agreement, Executive must be employed as of the date of the scheduled bonus payment in order to be eligible for any form of bonus payment. In no event shall any such bonus be paid after the later of (i) the fifteenth (15th) day of the third (3rd) month following the close of ServiceSource’s fiscal year in which any such bonus is earned or (ii) March 15 following the calendar year in which any such bonus is earned.  The Board (or relevant designated committees, as applicable) may, at its sole discretion, increase Executive’s base pay and/or Target Bonus pay for future years, most likely during its annual review cycle.  

5.EQUITY COMPENSATION.  Executive will be eligible to participate in the ServiceSource International, Inc. 2011 Equity Incentive Plan (the “Equity Incentive Plan”) and the ServiceSource International, Inc. 2011 Executive Stock Purchase Plan (the “Employee Stock Purchase Plan”), subject to the requirements of the applicable plan.  Subject to (i) approval by the Board of Directors (or its Compensation Committee), (ii) the terms of the Equity Incentive Plan, and (iii) the terms of the respective equity compensation award agreements under the Plan, the Company will recommend to the Board of Directors (or its Compensation Committee) that Executive be granted the equity compensation described under 

subsections (a) and (b) of this Section 5, in addition to Executive’s cash compensation, effective upon the action of the Board of Directors (or Compensation Committee) approving the equity compensation grant (or such later date as the Board of Director or Compensation Committee may determine).  The date the equity compensation is approved by the Board of Directors (or Compensation Committee) is herein referred to as the “Grant Date.”  Such Grant Date shall be no later than December 31, 2014.

(a)Stock Option Grant.   The Company will recommend to the Board of Directors (or its Compensation Committee) that Executive be granted a nonqualified stock option to purchase up to two million (2,000,000) shares of ServiceSource’s common stock (“Shares”) under the Equity Incentive Plan (the “Option”).  The Option will be scheduled to vest as follows: (i) twenty five percent (25%) of the Shares underlying the Option shall vest on the first anniversary of the Grant Date and (ii) the remaining seventy five percent (75%) of the Shares underlying the Option shall vest monthly on a pro rata basis over the following thirty six (36) months such that all Options would have vested in full within forty-eight (48) months after the Grant Date.  If there is no corresponding day in a given month, vesting will occur on the last day of the month.  In all cases, vesting shall be subject to Executive remaining as a Service Provider (as such term is defined in the Equity Incentive Plan) through each vesting date, subject to any acceleration of vesting as provided in this Agreement.  Note that the above grant and its terms remain subject to approval by the Board of Directors (or the Compensation Committee), and to the terms and conditions of the Equity Incentive Plan and a related stock option agreement, and that any granted shares will be subject to all applicable state and federal tax and securities laws.

(b)Restricted Stock Units Grant.  The Company will recommend to the Board of Directors of ServiceSource (or its Compensation Committee) that Executive be granted five hundred thousand (500,000) restricted stock units (“RSUs”) under the Equity Incentive Plan.  The proposed RSUs will be scheduled to vest and be payable as follows: (i) twenty-five percent (25%) of Executive’s RSUs will vest on the first anniversary of the Grant Date and (ii) the remaining seventy five percent (75%) of the RSUs shall vest quarterly on a pro rata basis over the following twelve (12) quarters such that all RSUs would have vested in full within four (4) years after the Grant Date.  If there is no corresponding day in a given quarter, vesting will occur on the last day of the quarter.  . In all cases, vesting shall be subject to Executive remaining as a Service Provider (as such term is defined in the Equity Incentive Plan) through each vesting date, subject to any acceleration of vesting as provided in this Agreement.  Note that the above grant and its terms remain subject to approval by the Board of Directors (or the Compensation Committee), and to the terms and conditions of the Equity Incentive Plan and a related RSU agreement, and that any granted shares will be subject to all applicable state and federal tax and securities laws.

(c)Employee Stock Purchase Plan.  Subject to the terms and conditions of the Employee Stock Purchase Plan as now or hereafter in effect as determined by the Board of Directors (or Compensation Committee), Executive will be eligible to participate in the Executive Stock Purchase Plan while he meets the eligibility requirements under the Executive Stock Purchase Plan.  Note that any purchase rights or purchased shares under the Executive Stock Purchase Plan will be subject to all applicable state and federal tax and securities laws and the employment policies of ServiceSource.

6.BENEFITS.  As a full-time employee, Executive shall be entitled to all of the benefits provided to ServiceSource employees, in accordance with any benefit plan or policy adopted by ServiceSource from time to time during the existence of this Agreement.  Executive’s rights and those of Executive’s dependents under any such benefit plan or policy shall be governed solely by the terms of such plan or policy.  ServiceSource reserves the right to cancel or change the benefit plans and policies it offers to its employees at any time.  ServiceSource reserves to itself or its designated administrators exclusive authority and discretion to determine all issues of eligibility, interpretation and administration of each such benefit plan or policy.  

7.PAID TIME OFF.  Per Company policy, at your level you will not accrue paid time off or be required to track or report paid time off.  Instead, time off is left to the mutual agreement of you and the Board.  The Board will not unreasonably deny any requested time off, and it is the parties’ understanding that such time off will include company-recognized holidays, sick leave, and vacation of four weeks per year.

8.PROPRIETARY AND CONFIDENTIAL INFORMATION (INCLUDING TRADE SECRETS).  Executive acknowledges that his employment with ServiceSource will allow him access to Proprietary and Confidential Information.  Executive understands that Proprietary and Confidential Information includes customer and applicant lists, whether written or solely a function of memory, data bases, whether on computer disc or not, business files, contracts and all other information which is used in the day-to-day operation of ServiceSource which is not known by persons not employed by ServiceSource and which ServiceSource undertakes efforts to maintain its secrecy.  Executive understands and agrees that this is confidential information which the law treats as privileged, therefore protecting an employer from use without consent.

(a)Definition.  “Proprietary and Confidential Information” is defined as all information and any idea in whatever form, tangible or intangible, of a confidential or secret nature that pertains in any manner to the business of ServiceSource.  As used herein, the term “Confidential Information” shall include any and all non-public information relating to ServiceSource or its business, operations, financial affairs, performance, assets, pricing and pricing strategies, technology, research and development, processes, products, contracts, customers, licensees, sublicensees, suppliers, personnel, plans or prospects, whether or not in written form and whether or not expressly designated as confidential, including (without limitation) any such information consisting of or otherwise relating to trade secrets, know-how, technology (including software and programs), designs, drawings, photographs, samples, processes, license or sublicense arrangements, formulae, proposals, product specifications, customer lists or preferences, referral sources, marketing or sales techniques or plans, operating manuals, service manuals, financial information or projections, lists of suppliers or distributors or sources of supply.
Proprietary and Confidential Information shall include both information developed by Executive for ServiceSource and information Executive obtained while in ServiceSource’s employment.  All Proprietary and Confidential Information, whether created by Executive or other employees, shall remain the property of ServiceSource.
(b)Non-Disclosure and Return.  Executive agrees that he will not, under any circumstances, or at any time, whether as an individual, partnership, or corporation, or employee, principal, agent, partner or shareholder thereof, in any way, either directly or indirectly, divulge, disclose, copy, use, divert or attempt to divulge, disclose, copy, use or divert ServiceSource’s Proprietary and Confidential Information, except to the extent authorized and necessary to carry out Executive’s responsibilities during employment with ServiceSource, or as required by law.  Upon termination of Executive’s employment with ServiceSource, Executive shall promptly return to ServiceSource all property in Executive’s possession or control that belongs to ServiceSource, including all property in electronic form and all copies of Proprietary and Confidential Information.

(c)Former Employer Information.  Executive agrees that Executive will not, during Executive’s employment with ServiceSource, improperly use or disclose any proprietary information or trade secrets of any former or concurrent employer or other person or entity and that Executive will not bring onto the premises of ServiceSource any unpublished document or proprietary information belonging to any such employer, person or entity unless consented to in writing by such employer, person or entity.  Executive 

represents and warrants to ServiceSource that, to the best of his knowledge and understanding, Executive is not in breach of any agreement with any former Employer by accepting employment with ServiceSource.

(d)Third Party Information.  Executive recognizes that ServiceSource may have received and in the future may continue to receive from third parties their confidential or proprietary information as they may so designate, subject to a duty on ServiceSource’s part to maintain the confidentiality of such information and to use it only for certain limited purposes.  Executive agrees to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it except as necessary in carrying out Executive’s work for ServiceSource consistent with ServiceSource’s agreement with such third party.

(e)Notification to New Employer.  In the event that Executive’s employment with ServiceSource ends, Executive consents to notification by ServiceSource to any subsequent employer of Executive’s rights and obligations under this Paragraph 8 only.

(f)No Solicitation of Clients Using Proprietary and Confidential Information.  Executive acknowledges and agrees that the names, addresses, and contact information of ServiceSource’s clients and all other confidential information relating to those clients, have been compiled by ServiceSource at great expense and represent a real asset of ServiceSource.  Executive further understands and agrees that this information is deemed confidential by ServiceSource and constitutes trade secrets of ServiceSource.  Executive understands that this information has been provided to Executive in confidence, and Executive agrees that the sale or unauthorized use or disclosure of any of ServiceSource’s trade secrets obtained by Executive during employment with ServiceSource constitutes unfair competition.  Executive agrees and promises not to engage in any unfair competition with ServiceSource.  Executive further agrees not to, directly or indirectly, during or after termination of employment, make known to any person, firm, or company any information concerning any of the clients of ServiceSource which, as Employee acknowledges, is confidential and constitutes trade secrets of ServiceSource.  Nor shall Executive use any such confidential and trade secret information to solicit, take away, or attempt to call on, solicit or take away any of the clients of ServiceSource on whom Executive called or whose accounts Executive had serviced during employment with ServiceSource, whether on Executive’s own behalf or for any other person, firm, or ServiceSource.

(g)No Solicitation of Employees.  Executive understands and acknowledges that as an employee of ServiceSource he has certain fiduciary duties to ServiceSource which would be violated by the solicitation and/or encouragement of ServiceSource employees to leave the employ of ServiceSource.  Executive therefore agrees that he will not, either during his employment or for a period of one year after employment has terminated, solicit any of ServiceSource’s employees for a competing business or otherwise induce or attempt to induce such employees to terminate employment with ServiceSource, either directly or through any third parties.

(h)Assignment of Rights.  All Proprietary and Confidential Information and all patents, patent rights, copyrights, trade secret rights, trademark rights and other rights (including, without limitation, intellectual property rights) owned by or otherwise belonging to ServiceSource anywhere in the world in connection therewith, is and shall be the sole property of the ServiceSource.  Executive hereby assigns to ServiceSource any and all rights, title and interest Executive may have or acquire in ServiceSource’s Proprietary and Confidential Information and ServiceSource’s property. 

9.SEVERANCE BENEFITS.  

(a)Termination Without Cause or Resignation for Good Reason.  If ServiceSource should terminate Executive’s employment without Cause or if Executive should resign for Good Reason (as defined below), Executive shall receive the following benefits: 

(i)Salary and Bonus Severance.  Subject to Section 9(d) below, Executive shall receive twelve (12) months of Executive’s then current base salary plus 100% of Executive’s then applicable annual target bonus, in a single lump sum payment in cash, in all instances subject to applicable withholding requirements.

(ii)Vesting Acceleration.  In addition, Executive’s outstanding equity compensation awards (including, without limitation, all stock options, restricted stock, restricted stock units and any other equity compensation awards) shall immediately have their vesting accelerated by twelve (12) months from the employment termination or resignation date. 

(iii)COBRA Coverage.  Executive shall be entitled to receive an additional lump-sum payment (less applicable withholding taxes) equal to the result of (A) times (B).  For this purpose, “A” will equal twelve (12), and “B” will equal the amount of the monthly premium that would be required for the first month of coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended and all applicable regulations (referred to collectively as “COBRA”), with the premium calculated on the assumption that the Executive in fact elects coverage for himself, and any eligible spouse and/or dependents of the Executive that were enrolled in the applicable Company health plan immediately prior to his last date of employment.  However, Executive will be eligible for this payment without regard to whether he actually elects COBRA continuation coverage.  

(b)Termination Without Cause or Resignation for Good Reason Following a Change of Control (Equity Acceleration).   If ServiceSource or a successor should terminate Executive’s employment without Cause or Executive should resign from his employment for Good Reason, in either case within eighteen (18) months following a “Change of Control” (as defined below), then Executive shall receive the following benefits:

(i)Salary and Bonus Severance.  Subject to Section 9(d) below, Executive shall receive eighteen (18) months of Executive’s then current base salary plus 150% of Executive’s then applicable annual target bonus, in a single lump sum payment in cash, in all instances subject to applicable withholding requirements. 

(ii)Vesting Acceleration.  In addition, Executive’s outstanding equity compensation awards (including, without limitation, all stock options, restricted stock, restricted stock units and any other equity compensation awards) shall immediately have their vesting accelerated 100%, so as to become fully vested. 

(iii)COBRA Coverage.  Executive shall be entitled to receive an additional lump-sum payment (less applicable withholding taxes) equal to the result of (A) times (B).  For this purpose, “A” will equal eighteen (18), and “B” will equal the amount of the monthly premium that would be required for the first month of coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended and all applicable regulations (referred to collectively as “COBRA”), with the premium calculated on the assumption that the Executive in fact elects coverage for himself, and any eligible spouse and/or dependents of the Executive that were enrolled in the applicable Company health plan immediately prior to his last date 

of employment.  However, Executive will be eligible for this payment without regard to whether he actually elects COBRA continuation coverage.  

(c)Definitions:  For purposes of this Section 9:

(i)“Cause” shall mean the occurrence of any of the following events: (i) Executive’s commission of any felony or any crime involving fraud or dishonesty under the laws of the United States or any state thereof; (ii) Executive’s commission of, or participation in, a fraud or act of dishonesty against ServiceSource; (iii) Executive’s willful violation of a material provision of this Agreement or of any contract or agreement between Employee and ServiceSource or any statutory duty owed to ServiceSource;  (iv) Employee’s unauthorized use or disclosure of Proprietary and Confidential Information; or (v) Executive’s gross misconduct; and

(ii)“Good Reason” shall mean the occurrence of any one of the following events, without Executive’s written consent:  (1) a material change in Executive’s job title, including the assignment of the same job title at the divisional level of any lesser organizational unit (including, for the avoidance of doubt, Executive becoming CEO of a division or subsidiary of ServiceSource, or of the surviving entity following a Change of Control rather than CEO of the entire surviving entity); (2) a material change in Executive’s duties, authorities or job responsibilities  that is not commensurate with the role of chief executive officer; (3) a relocation of Executive’s principal place of employment beyond the metropolitan area of Denver, Colorado (Executive understands that the Company’s principal HQ’s is in SF and has offices and operations in centers across the US and in locations around the World. Frequent travel to these locations, in particular San Francisco, is an inherent part of the job.) or (4) any material reduction in Executive’s base salary, target bonus or aggregate level of benefits; provided that Executive has notified ServiceSource in writing of the event described in (1), (2), (3) or (4) above within ninety (90) days after the occurrence of such event, ServiceSource (or its successor) has within thirty (30) days thereafter failed to restore Executive to the appropriate job title, duties, authorities, responsibility, location, salary, target commissions or benefits and Executive actually terminates employment within thirty (30) days following the expiration of ServiceSource’s thirty (30)-day cure period described above; and

(iii)“Change of Control” shall mean the occurrence of one of the following events: a sale of all or substantially all of the shares of stock of ServiceSource; a merger, consolidation or similar transaction involving ServiceSource following which the persons entitled to elect a majority of the members of the Board of Directors of ServiceSource immediately before the transaction are not entitled to elect a majority of the members of the Board of Directors of ServiceSource or the surviving entity following the transaction; or a sale of all or substantially all of the assets of ServiceSource.  Notwithstanding the foregoing, a transaction shall not constitute a Change of Control unless the transaction qualifies as a “change in control event” within the meaning of Section 409A.

(iv)“Section 409A Limit” shall mean the lesser of two (2) times:  (a) Employee’s annualized compensation based upon the annual rate of pay paid to Employee during Employee’s taxable year preceding Employee’s taxable year of Employee’s separation from service with ServiceSource; or (b) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Internal Revenue Code of 1986, as amended (the “Code”) for the year in which Employee’s employment is terminated.

(d)Release.  Notwithstanding the foregoing, the severance benefits described in this Section 9 are subject to Executive’s execution and delivery of a binding general release of claims in a form consistent with Schedule A, and such release shall becoming effective, binding and irrevocable in accordance with its terms within fifty-two (52) days following the termination date.  No severance payments or vesting 

acceleration under this Agreement shall be paid or provided unless and until the release becomes effective.  Any severance payment to which Executive is entitled shall be paid by ServiceSource in full on the fifty-third (53d) day following Executive’s employment termination date or such later date as is required to avoid the imposition of additional taxes under Code Section 409A and the regulations and guidance thereunder, and any applicable state law equivalent (together, “Section 409A”).

(e)Section 409A Compliance.  Notwithstanding any provision to the contrary herein, no Deferred Payments (as defined below) that become payable under this Agreement by reason of Executive’s termination of employment with ServiceSource (or any successor entity thereto) will be made unless such termination of employment constitutes a “separation from service” within the meaning of Section 409A.  Further, if Executive is a “specified employee” of ServiceSource (or any successor entity thereto) within the meaning of Section 409A on the date of Executive’s termination of employment (other than a termination of employment due to death), then the Deferred Payments that are payable within the first six (6) months following Executive’s termination of employment, shall be delayed until the first payroll date that occurs on or after the date that is six (6) months and one (1) day after the date of Executive’s termination of employment, when they shall be paid in full arrears.  All subsequent Deferred Payments, if any, will be paid in accordance with the payment schedule applicable to each payment or benefit.  Notwithstanding anything herein to the contrary, if Executive dies following Executive’s employment termination but prior to the six (6) month anniversary of his employment termination, then any payments delayed in accordance with this paragraph will be payable in a lump sum as soon as administratively practicable after the date of death and all other Deferred Payments will be payable in accordance with the payment schedule applicable to each payment or benefit.  Each payment and benefit payable under this Agreement is intended to constitute a separate payment for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations. For the purposes of this Agreement, “Deferred Payment” means any severance pay or benefits to be paid or provided to Executive (or Executive’s estate or beneficiaries) pursuant to this Agreement and any other severance payments or separation benefits, that in each case, when considered together, are considered deferred compensation under Section 409A.
The foregoing provisions and all payments and benefits under this Agreement are intended to be exempt from or comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities or ambiguous terms herein will be interpreted to so comply or be exempt.  ServiceSource and Executive agree to work together in good faith to consider amendments to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to Executive under Section 409A.

(f)Termination of Employment for Other Reasons. The above severance benefits in this Section 9 shall not be paid or provided in the event of the termination of Executive’s employment due to Executive’s death, disability or resignation (other than a resignation for Good Reason upon or following a Change in Control as set forth above), or the termination of his employment by ServiceSource or its successor for Cause (as defined above).  For purposes of clarity, a termination by reason of Executive’s death or disability shall not be deemed a termination without “Cause” under this Agreement.

10.SEVERABILITY.  In the event that any provision of this Agreement is determined by a court of competent jurisdiction to be illegal, invalid or unenforceable to any extent, such term or provision shall be enforced to the fullest extent permissible under the law and all remaining terms and provisions hereof shall continue in full force and effect.

11.MODIFICATION OF AGREEMENT.  This Agreement may be modified only in writing by mutual agreement of ServiceSource and Executive.  Any such writing must specifically state that it is 

intended to modify the parties’ Agreement and state which specific provision or provisions this writing intends to modify.  Such written modification will only be effective if signed by ServiceSource’s Chief Human Resources Officer or other authorized officer, and as explicitly authorized by the Board.  Any attempt to modify this Agreement orally, or by a writing signed by any person other than as authorized by the Board, shall be null and void.  This Agreement is intended to be the final and complete statement of the parties’ agreement concerning the legal nature of their employment relationship in any and all disputes arising from that relationship.

12.COMPLETE AND VOLUNTARY AGREEMENT.  This Agreement constitutes the entire understanding of the parties on the subject covered.  The parties expressly warrant that they have read and fully understand this Agreement; that they have had the opportunity to consult with legal counsel of their own choosing to have the terms of this Agreement fully explained to them; that they are not executing this Agreement in reliance on any promises, representations or inducements other than those contained herein; and that they are executing this Agreement voluntarily, free of any duress or coercion.

13.DISPUTE RESOLUTION.  This Agreement shall be governed by California law, without regard to its principles of conflicts of laws. Any dispute arising from this Agreement shall be subject to the exclusive jurisdiction of state and federal courts located in the Northern District of California, and each party hereby waives any and all objections to that venue. The prevailing party in any such dispute shall recover its reasonable attorneys’ fees and costs from the losing party, including any fees or costs arising from an appeal. 

14.SUCCESSORS AND ASSIGNS.  This Agreement will be binding upon Executive’s heirs, executors, administrators and other legal representatives and will be for the benefit of ServiceSource, its successors, and its assigns.

15.GOLDEN PARACHUTE BEST AFTER TAX RESULTS   If any of the payments to Executive (prior to any reduction, below) provided for in this Agreement, together with any other payments which Executive has the right to receive from ServiceSource or any corporation which is a member of an “affiliated group” as defined in Section 1504(a) of the Internal Revenue Code of 1986, as amended (“Code”), without regard to Section 1504(b) of the Internal Revenue Code), of which ServiceSource is a member (the “Payments”) would constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Code), and if the Safe Harbor Amount is greater than the Taxed Amount, then the total amount of such Payments shall be reduced to the Safe Harbor Amount.  The “Safe Harbor Amount” is the largest portion of the Payments that would result in no portion of the Payments being subject to the excise tax set forth at Section 4999 of the Code (“Excise Tax”), after reduction for taxes as described below.  The “Taxed Amount” is the total amount of the Payments after reduction for taxes as described below (prior to any reduction, above) notwithstanding that all or some portion of the Payments may be subject to the Excise Tax.  Solely for the purpose of comparing which of the Safe Harbor Amount and the Taxed Amount is greater, the determination of each such amount, shall be made on an after-tax basis, taking into account all applicable federal, state and local employment taxes, income taxes, and, if applicable, the Excise Tax (all of which shall be computed at the highest applicable marginal rate regardless of Executive’s actual marginal rate).  If a reduction of the Payments to the Safe Harbor Amount is necessary, then the reduction shall occur in the following order: reduction of cash payments; cancellation of accelerated vesting of equity awards other than options; cancellation of accelerated vesting of options; and reduction of employee benefits.  In the event that acceleration of vesting of equity awards or options is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant of the Executive’s awards.  If two or more equity awards other than options are granted on the same date, and reduction of acceleration is required under this paragraph, each award will be reduced on a pro-rata basis.  If two or more options are granted on the same date, and 

reduction of acceleration is required under this paragraph, each option will be reduced on a pro-rata basis. In no event shall Executive have any discretion with respect to the ordering of payment reductions.  ServiceSource and its tax advisors shall make all determinations and calculations required to be made to effectuate this paragraph at ServiceSource’s expense. 

ServiceSource International, Inc.

By: /s/MATTHEW GOLDBERG                    November 16, 2014
       Matthew Goldberg                         Date 
       General Counsel        

Executive

/s/CHRISTOPHER M. CARRINGTON                November 16, 2014
Christopher M. Carrington                         Date    
Schedule A
Form of Release
In exchange for the consideration provided by ServiceSource International, Inc. or its successor (the “Company”) to the undersigned current or former employee of the Company (the “Employee”) under this Agreement or the employment agreement between the Company and the Employee, that Employee is not otherwise entitled to receive, and subject to the Company’s compliance with its post-termination obligations to Employee, Employee hereby generally and completely releases the Company and its directors, officers, employees, shareholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates, and assigns from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to my signing this Agreement.  This general release includes, but is not limited to: (1) all claims arising out of or in any way related to Employee’s employment with the Company or the termination of that employment; (2) all claims related to Employee’s compensation or benefits from the Company, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company; (3) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (4) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (5) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act of 1967 (as amended) (“ADEA”), the Family and Medical Leave Act; the Employee Retirement Income Security Act; California Fair Employment and Housing Act (as amended ), any state labor code; the Equal Pay Act, of 1963, as amended.   Notwithstanding the above, it is understood and agreed to by the parties that neither party is waiving rights relative to compliance with those terms of the Employment Agreement and Company’s Proprietary 

Confidential Information Agreement that impose duties on either party upon and following Employee’s termination of employment.
Section 1542 Waiver.  Employee hereby acknowledges that he has read and understands Section 1542 of the Civil Code of the State of California, which reads as follows:
A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.
Employee hereby expressly waives and relinquishes all rights and benefits under that section and any law or legal principle of similar effect in any jurisdiction with respect to the release of any unknown or unsuspected claims Employee may have against the Company, its affiliates, and the entities and persons specified above.
ADEA Waiver and Release.  Employee acknowledges that Employee knowingly and voluntarily waives and releases any rights Employee may have under the ADEA, as amended.  Employee also acknowledges that the consideration given for the waiver and release in the preceding paragraph hereof is in addition to anything of value to which Employee was already entitled.  Employee further acknowledges that Employee has been advised by this writing, as required by the ADEA, that:  (a) his waiver and release does not apply to any rights or claims that may arise after the execution date of this Agreement; (b) Employee has been advised that he has the right to consult with an attorney prior to executing this Agreement; (c) Employee has been given twenty-one (21) days to consider this Agreement; (d) Employee has seven (7) days following the execution of this Agreement by the parties to revoke the Agreement; and (e) this Agreement will not be effective until the date upon which the revocation period has expired, which will be the eighth day after this Agreement is executed by Employee, provided that the Company has also executed this Agreement by that date (“Effective Date”).  The parties acknowledge and agree that revocation by Employee of the ADEA Waiver and Release is not effective to revoke his waiver or release of any other claims pursuant to this Agreement.

By:                         Date:

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