<PAGE>
Exhibit 10.7
FORM OF
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is effective as of ____, _______,
by and between RadView Software Ltd., a company incorporated under the laws of
the State of Israel, with its principal offices at 7 New England Executive Park
Burlington MA 01803, USA, (the "Company"), and ______________ ("Indemnitee"),
residing at the address set forth beneath Indemnitee's signature to this
Agreement.
Whereas, the Company and Indemnitee recognize the difficulty in obtaining full
and adequate liability insurance for directors and other office holders, as such
term is defined in the Israeli Companies Law, 1999 (collectively "Office
Holders"), the significant increases in the cost of such insurance and the
general reductions in the coverage of such insurance;
Whereas, the Company and Indemnitee further recognize the substantial increase
in corporate litigation in general, subjecting Office Holders to expensive
litigation risks at the same time as the availability and coverage of liability
insurance have been severely limited;
Whereas, the Company desires to attract and retain the services of highly
qualified individuals, such as Indemnitee, to serve the Company and, in part, in
order to induce Indemnitee to continue to provide services to the Company,
wishes to provide for the indemnification and advancement of expense to
Indemnitee and to exempt Indemnitee from liability to the Company, all of the
foregoing to the maximum extent permitted by law; and
Whereas, in view of the considerations set forth above, the Company desires that
Indemnitee shall be indemnified and exempted by the Company, all as set forth
herein;
Now, therefore, the Company and Indemnitee hereby agree as follows:
1. Indemnification.
a. Indemnification of Expenses. The Company shall indemnify
Indemnitee to the fullest extent permitted by law and subject
to the limitations set forth in paragraph 1(b) and under
applicable law if Indemnitee was or is or becomes a party to
or witness or other participant in, any threatened, pending or
completed action, suit, proceeding or alternative dispute
resolution mechanism, or any hearing, inquiry or investigation
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 (unless convicted of committing an offense which
requires proof of criminal intent), administrative,
investigative or other (hereinafter a "Claim") by reason of
(or arising in part out of) any Indemnifiable Event (as
defined below) against any and all expenses (including
attorneys' fees and all other costs, expenses and obligations
reasonably incurred in connection with investigating,
defending, being a witness or in participating in (including
on appeal), or preparing to defend,
<PAGE>
2
be a witness in or participate in, any such action, suit,
proceeding, alternative dispute resolution mechanism, hearing,
inquiry or investigation), judgments, and amounts paid in
settlement (if such settlement is approved in advance by the
Company, which approval shall not be unreasonably withheld) of
such Claim and any US federal, state, local or non US taxes
imposed on the Indemnitee as a result of the actual or deemed
receipt of any payments under this Agreement (collectively,
hereinafter "Expenses"), including all interest, assessments
and other charges paid or payable in connection with or in
respect of such Expenses, provided that in respect of any
specific Indemnifiable Event, the Expenses for which
Indemnitee may be indemnified hereunder will not exceed,
individually or in the aggregate, the Limit Amount (as defined
below) applicable to such Indemnifiable Event. Such payments
of Expenses shall be made by the Company as soon as
practicable but in any event no later than five (5) days after
written demand by Indemnitee therefor is presented to the
Company.
b. Indemnifiable Event; Limit Amounts. For the purpose of this
section, an Indemnifiable Event shall mean any event or
occurrence falling all or inpart within any one or more of the
categories set forth in Exhibit A to this Agreement and
related to the fact that Indemnitee is or was an Office Holder
of the Company, or any subsidiary of the Company (regardless
of whether it was a subsidiary of the Company at the time of
the event giving rise to Claim), or is or was serving at the
request of the Company as an Office Holder of another
corporation, 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. The Limit Amount
with respect to each such category of events described in
Exhibit A is specified following its description. The
Indemnification provided herein shall not be subject to the
foregoing limits, if and to the extent such limits are no
longer required by Israeli law.
c. Reviewing Party. Notwithstanding the foregoing: (i) the
obligations of the Company under Section 1(a) shall be subject
to the condition that the Reviewing Party (as described in
Section 9(e) hereof) shall not have determined that Indemnitee
would not be permitted to be indemnified under applicable law,
and (ii) the obligation of the Company to make an advance
payment of Expenses to Indemnitee pursuant to Section 2(a) (an
"Expense Advance") shall be subject to the condition that, if,
when and to the extent that the Reviewing Party determines
that Indemnitee should not be permitted to be so indemnified
under applicable law, the Company shall be entitled to be
reimbursed by Indemnitee (who hereby agrees to reimburse the
Company) for all such amounts theretofore paid.
d. Reserved.
e. Mandatory Payment of Expenses. Notwithstanding any other
provision of this Agreement other than Section 8 hereof, to
the extent that Indemnitee has been successful on the merits
or otherwise, including, without limitation, the dismissal of
an action without prejudice, in defense of any
<PAGE>
3
action, suit, proceeding, inquiry or investigation referred to
in Section (1)(a) hereof or in the defense of any claim, issue
or matter therein, Indemnitee shall be indemnified against all
Expenses incurred by Indemnitee in connection therewith.
2. Expenses; Indemnification Procedure.
a. Advancement of Expenses. Subject to applicable law, the
Company shall advance all Expenses incurred by Indemnitee. The
advances to be made hereunder shall be paid by the Company to
Indemnitee as soon as practicable, but in any event no later
than five (5) days after written demand by Indemnitee therefor
to the Company.
b. Notice; Cooperation by Indemnitee. Indemnitee shall, as a
condition precedent to Indemnitee's right to be indemnified
under this Agreement, give the Company notice in writing as
soon as practicable of any Claim made against Indemnitee for
which Indemnification will or could be sought under this
Agreement, provided, however, that any failure to provide such
notice shall not affect Indemnitee's rights to indemnification
hereunder unless and to the extent such failure to provide
notice materially and adversely prejudices the Company's right
to defend against such action. Notice to the Company shall be
directed to the 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), or if the Indemnitee is then the Chief Executive
Officer of the Company, such notice shall be directed to the
Chairman of the Company's Board of Directors, at the same
address. In addition, Indemnitee shall give the Company such
nformation and cooperation as it may reasonably require and as
shall be within Indemnitee's power.
c. No Presumptions; Burden of Proof. For purposes of this
Agreement, the termination of any Claim by judgement, order,
settlement (whether with or without court approval) or
conviction, or upon a plea of guilty, shall not create a
presumption that Indemnitee did not meet any particular
standard of conduct or have any particular belief or that a
court has determinedthat indemnification is not permitted by
applicable law. In addition, neither the failure of the
Reviewing Party to have made a determination as to whether
Indemnitee has met any particular standard of conduct or had
any particular belief, nor an actual determination by the
Reviewing Party that Indemnitee has not met such standard of
conduct or did not have such belief, prior to the commencement
of legal proceedings by Indemnitee to secure a judicial
determination that Indemnitee should be indemnified under
applicable law, shall be a defense against Indemnitee's claim
or create a presumption that Indemnitee has not met any
particular standard of conduct or did not have any particular
belief. In connection with any determination by the Reviewing
Party or otherwise as to whether the Indemnitee is entitled to
be indemnified hereunder, the burden of proof shall be on the
Company to establish that Indemnitee is not so entitled.
<PAGE>
4
d. Notice to Insurers. If, at the time of the receipt by the
Company of a notice of a claim pursuant to Section 2(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 action,
suit, proceeding, inquiry or investigation in accordance with
the terms of such policies.
e. Selection of Counsel. In the event the Company shall be
obligated hereunder to pay the Expenses of any Claim, the
Company 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 its election to do so. After delivery of
such written confirmation and 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 of counsel subsequently incurred
by Indemnitee with respect to the same Claim; 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
against Indemnitee without the consent of the Indemnitee
provided any such settlement includes (i) a complete release
discharge of indemnity; (ii) does not contain any admittance
of wrong doing by Indemnitee; and (iii) is monetary only.
3. Additional Indemnification Rights; Nonexclusivity.
a. Scope. In the event of any change after the date of this
agreement of any applicable law, statute or rule which expands
the right of a corporation of the Company's state of
incorporation to indemnify an Office Holder, 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 corporation of the Company's
country or state of incorporation to indemnify an Office
Holder 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 8(a)
hereof.
b. Nonexclusivity. The indemnification provided by this Agreement
shall be in addition to any rights to which Indemnitee may be
entitled under the Company's Memorandum and Articles of
Association, as may from time to time be amended or replaced,
any agreement, any vote of shareholders or disinterested
directors, the laws of the Company's state of incorporation,
or otherwise. The indemnification provided under this
Agreement shall continue as to Indemnitee for any action
Indemnitee took or did not take while serving in an
indemnified capacity even though Indemnitee may have ceased to
serve in such capacity.
<PAGE>
5
4. 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, the Articles or Memorandum of
Association or otherwise) of the amounts otherwise Indemnifiable
hereunder, except for the difference, if any, between the amounts
received by the Indemnitee as aforesaid and the total Expenses incurred
by Indemnitee in connection with such Claim. For the removal of any
doubt, any amount received from Directors and Officers Insurance shall
not count against (i.e. shall not set-off any Limit Amount hereunder).
5. Partial Indemnification. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a
portion of Expenses incurred in connection with any Claim, but not,
however, for all of the total amount thereof, the Company shall
nevertheless indemnify Indemnitee for the portion of such Expenses to
which Indemnitee is entitled.
6. Reserved.
7. Exemption. To the maximum extent permitted by law, the Company hereby
exempts and releases Indemnitee from any and all liability to the
Company related to any breach by Indemnitee of his or her duty of care
to the Company.
8. Exceptions. Any other provision herein to the contrary notwithstanding,
the Company shall not be obligated pursuant to the terms of this
Agreement:
a. Excluded Acts and Omissions. To indemnify or exempt Indemnitee
from or against any liability arising out of (i) Indemnitee's
breach of fiduciary duty to the Company, unless Indemnitee has
acted or omitted to act in good faith and had reasonable
ground to believe such action would not harm the Company's
interests, (ii) intentional or reckless breach by Indemnitee
of his or her duty of care to the Company; (iii) an action
taken with the intention to unduly profit therefrom; or (iv)
any fine or penalty payment to propitiate an offense; or
b. Claims Initiated by Indemnitee. To indemnify or advance
expenses to Indemnitee with respect to Claims initiated or
brought voluntarily by Indemnitee and not by way of defense,
except in specific cases if the Board of Directors has
approved the initiation or bringing of such suit; or
c. Claims Under Section 16(B). To indemnify Indemnitee for
expenses and the payment of profits arising from the purchase
and sale by Indemnitee of securities in violation of Section
16(b) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or any similar successor or Israeli statute.
9. Construction of Certain Phrases. For purposes of this Agreement, a
"Reviewing Party" shall mean the members of the Company's Board of
Directors who are not party to the particular Claim for which
Indemnitee is seeking indemnification.
<PAGE>
6
10. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original. \
11. 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, 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 representative. 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 with respect to Claims relating to
Indemnifiable Events regardless of whether Indemnitee continues to
serve as a director, officer of the Company or any other enterprise at
the Company's request.
12. Reserved.
13. Notice. All notices and other communications required or permitted
hereunder shall be in writing, shall be effective when given and shall
in any event be deemed to be given: (a) five (5) business days after
deposit with the applicable postal service, if delivered by first class
mail, postage prepaid, (b) upon delivery, if delivered by hand, (c) one
business day after the business day of deposit with Federal Express or
similar overnight courier, freight prepaid, or (d) one day after the
business day of delivery by facsimile transmission, if delivered by
facsimile transmission, with copy by first class mail, postage prepaid,
and shall be addressed if to Indemnitee, at the Indemnitee's address as
set forth beneath Indemnitee's signature to this Agreement and if to
the Company at the address of its principal corporate offices or at
such other address as such party may designate by ten days' advance
written notice to the other party hereto.
14. Consent to Jurisdiction. The Company and Indemnitee each hereby
irrevocably consent to the jurisdiction of the courts of the State of
Israel 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 competent Courts of the Tel-Aviv District,
which shall be the exclusive and only proper forum for adjudicating
such a claim.
15. Severability. The provisions of this Agreement shall be severable in
the event that any of the provision 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 limitations, each
portion of this Agreement containing any provision held to be
<PAGE>
7
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.
16. Choice of Law. This Agreement shall be governed by and its provisions
construed and enforced in accordance with the laws of the State of
Israel, as applied to contracts between Israeli residents, entered into
and to be performed entirely within the State of Israel, without regard
to the conflict of laws principles thereof or of any other
jurisdiction.
17. Subrogation. 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, 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.
18. 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 or shall constitute a
waiver of any other provisions hereof (whether or not similar) nor
shall such waiver constitute a continuing waiver.
19. Integration and Entire Agreement. This Agreement sets forth the
entireunderstanding 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.
20. No Construction as Employment Agreement. Nothing contained in this
Agreement shall be construed as giving Indemnitee any right to be
retained in the employ or otherwise in the service of the Company or
any of its subsidiaries.
IN WITNESS WHEREOF, the parties hereto have executed this Indemnification
Agreement as of the date first above written.
RADVIEW SOFTWARE LTD.
By: _________________________________
AGREED TO AND ACCEPTED AS OF THE DATE FIRST WRITTEN ABOVE:
-------------------------------------
[Name of Indemnitee]
Address: ____________________________
_____________________________________
_____________________________________
Telecopier No. ______________________
<PAGE>
8
EXHIBIT A
INDEMNIFIABLE EVENTS AND LIMIT AMOUNTS
<TABLE>
<CAPTION>
INDEMNIFIABLE EVENT LIMITATION AMOUNT
(IN US$)
<S> <C> <C>
1. Any claim or demand made by customers suppliers, contractors or other $10,000,000
third parties transacting any form of business with the Company, its
subsidiaries or affiliates, in the ordinary course of their respective
businesses, relating to the negotiations or performance of such
transactions, representations or inducements provided in connection
thereto or otherwise.
2. Any claim or demand made in connection with any transaction not in the $10,000,000
ordinary course of business of either the Company, its subsidiaries or
affiliates or the party making such claim, including the sale, lease or
purchase of any assets or business.
3. Any claim or demand made by employees, consultants, agents or other $10,000,000
individuals or entities employed by or providing services to the
Company relating to compensation owed to them or damages or liabilities
suffered by them in connection with such employment or service.
4. Any claim or demand made under any securities laws or by reference $10,000,000
thereto, or related to the failure to disclose any information in the
manner or time such information is required to be disclosed pursuant to
such laws, or related to inadequate or improper disclosure of
information to stockholders, or prospective stockholders, or related to
the purchasing,holding or disposition of securities of theCompany or
any other investment activityinvolving or affected by such securities.
5. Any claim or demand made for actual or alleged infringement, $10,000,000
misappropriation or misuse of any third party's intellectual property
rights by the Company, its subsidiaries or affiliates.
</TABLE>
<PAGE>
9
<TABLE>
<S> <C> <C>
6. Any claim or demand made by any lenders or other creditors or for $10,000,000
monies borrowed by, or other indebtedness of, the Company, its
subsidiaries or affiliates.
7. Any claim or demand made by any third party suffering any personal $10,000,000
injury or damage to business or personal property through any act or
omission attributed to the Company, its subsidiaries or affiliates, or
their respective employees, agents or other persons acting or allegedly
acting on their behalf.
8. Any claim or demand made directly or indirectly in connection with $10,000,000
complete or partial failure, by the Company or any subsidiary or
affiliate thereof, or their respective directors, officers and
employees, to pay, report, keep applicable records or otherwise, of any
foreign, federal, state, county, local, municipal or city taxes or
other compulsory payments of any nature whatsoever, including, without
limitation, income, sales, use, transfer, excise, value added,
registration, severance, stamp, occupation, customs, duties, real
property, personal property, capital stock, social
security,unemployment, disability, payroll or employee withholding or
other withholding, including any interest, penalty or addition thereto,
whether disputed or not.
9. Any claim or demand made by purchasers, holders, lessors or other users $10,000,000
of products of the Company, or individuals treated with such products,
for damages or losses related to such use or treatment.
10. Reserved
11. Any administrative, regulatory or judicial actions, orders, decrees, $10,000,000
suits, demands, demand letters, directives, claims, liens,
investigations, proceedings or notices of noncompliance or violation by
any governmental entity or other person alleging the failure to comply
with any statute, law, ordinance, rule, regulation, order or decree of
any governmental entity applicable to the Company or any of its
subsidiaries, or any of their respective businesses or operations.
</TABLE>
