Exhibit 10.13
May 23, 1996
Xx. Xxxxxxx Xxxxxxxx
Global Shopping Network, Inc.
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: Indemnification Agreement
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Dear Xx. Xxxxxxxx:
This letter ("Letter Agreement") memorializes the agreement among
Global Shopping Network, Inc. ("Global"), Rachamin Anatian ("Anatian") and you
with regard to any indemnification by Global and Anatian to you. To induce you
to enter into and maintain certain guarantees of obligations of Global that you
have undertaken, Global and Anatian hereby agree are follows:
1. Indemnification Against Guaranteed Obligations. Global and
Anatian recognize that you have executed certain personal guaranties of certain
obligations of Global, and that such personal guaranties have benefited Global
and Anatian as its principal stockholder. The obligations of Global that you
have personally guaranteed as of the date hereof are listed on Schedule 1
hereto; such obligations as they may exist from time to time, together with any
other obligations of Global that you may elect to personally guarantee as they
may exist from time to time, are referred to herein as the "Guaranteed
Obligations." Global and Anatian hereby agree, jointly and severally, to
indemnify you, and pay or reimburse you for any costs, losses, or damages or
liabilities (including, without limitation, reasonable fees of attorneys,
interest and penalties) (collectively, "Guaranteed Losses" and individually, a
"Guaranteed Loss") whatsoever
Ms. Xxxxxxx Xxxxxxxx
Global Network, Inc.
May 23, 1996
Page 2
incurred or suffered by you regardless of the cause of the reason for which such
Guaranteed Loss(es) are incurred or suffered. Such indemnification obligation
shall be absolute, unconditional and irrevocable and Global and Anatian
specifically waive any right of contribution on your part in respect of such
indemnification, regardless of whether your negligence or misconduct may have
contributed to the causation of such Guaranteed Loss(es). Such indemnification
obligation shall not be affected by any action or omission of Global or you
that may have the effect of increasing the amount of, delaying the payment or
satisfaction of, or releasing any collateral for, any Guaranteed Obligations, or
any other thing, fact or matter whatsoever including without limitation the
bankruptcy or insolvency of Global.
2. Collateral Security. To secure the prompt and timely satisfaction
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of the obligations of Global and Anatian pursuant to paragraph 1 hereof, Global
and Anatian authorize you to cause Global to establish and maintain (and Global
and Anatian agree to cooperate in the establishment and maintenance of), and to
cause Global to pay the premiums with respect to, a term life insurance policy
for Global's benefit on the life of Anatian having a policy amount equal to $2
million and to cause Global to grant to you and perfect a first lien and
security interest in such life insurance policy and all proceeds thereof. Global
irrevocably agrees that in the event of the death of Anatian and if there are
Guaranteed Obligations outstanding and unsatisfied as of such date of death, all
proceeds of such life insurance policy shall be payable
Ms. Xxxxxxx Xxxxxxxx
Global Shopping Network, Inc.
May 23, 1996
Page 3
to you or as you shall direct in satisfaction of (x) the Guaranteed Obligations
or (y) the indemnification obligations of Global hereunder, and hereby assigns
and sets over to you all such proceeds for such purpose. You shall be entitled
to cause such proceeds to be so applied in any order and amount that you shall
elect, and to cause any such proceeds to be held in escrow pending the final
adjudication or settlement of any Guaranteed Obligations, and following such
final adjudication and settlement and the payment and satisfaction in full of
the obligations of Global and Anatian under paragraph 1 hereof you shall take
all steps necessary on your part to cause any excess proceeds to be paid or
remitted to Global. In the event of the death of Anatian, you shall be entitled
to assign any such proceeds or your interest in such life insurance policy to
any creditor or creditors in respect of the Guaranteed Obligations.
3. Release of Personal Guarantees. It is recognized that the objective of
Global is to be in a position that does not require you to execute or maintain
any personal guarantee in respect of the obligations of Global, and nothing
herein shall be deemed to required you to executed or maintain any such personal
guarantees. Global agrees to use, and you are authorized to cause Global to use,
reasonable commercial efforts to cause any personal guarantees executed by you
to be released as soon as reasonably practical. At such time as you have been
irrevocably released in writing by the beneficiaries of all such personal
guarantees to
Ms. Xxxxxxx Xxxxxxxx
Global Shopping Network, Inc.
May 23, 1996
Page 4
your reasonable satisfaction, you shall release the security interest described
in paragraph 2 and the obligations of Global and Anatian under paragraph 1 shall
terminate.
4. General Indemnification. In addition to the indemnification obligations
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under paragraph 1 hereof, Global and Anatian hereby agree, jointly and
severally, to indemnify you, and pay or reimburse you for, any other cost,
losses, damages or liabilities (including, without limitation, reasonable fees
of attorneys, interest and any penalties) (collectively, "Losses" and
individually, a "Loss") incurred or suffered by you with respect to or in
connection with any and all actions taken or omitted by you on behalf of Global,
except for any and all Losses which result from your gross negligence or
willfull misconduct. In no event shall the provisions of this paragraph 4 be
construed to limit the provisions of paragraph 1 hereof, and if any conflict
shall be found to exist between such provisions the provisions of paragraph 1
shall govern. You shall be entitled to be advanced the costs of any defense of
any action or proceeding that may give rise to an indemnification obligation
hereunder against an undertaking to repay any amounts so advanced if it is
ultimately determined by a final judgment not subject to appeal that you were
not entitled to indemnification under the standards of this paragraph 4.
5. Successors and Assigns. The terms and conditions of this Agreement shall
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inure to the benefit of and be binding upon the respective successors of the
parties hereto;
Ms. Xxxxxxx Xxxxxxxx
Global Shopping Network, Inc.
May 23, 1996
Page 5
provided, however, that this Agreement may not be assigned by the parties hereto
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without the prior written consent of the other parties hereto, except for the
permitted assignment of life insurance proceeds described in paragraph 2.
6. Modification and Waiver. No amendment, modification,
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alteration of the terms or provisions of this Agreement shall be binding unless
the same shall be in writing and duly executed by the parties hereto, except
that any of the terms or provisions of this Agreement may be waived in writing
at any time by the party which is entitled to the benefits of such waived terms
or provisions. No waiver of any of the provisions of this Agreement shall be
deemed to or will constitute a waiver of any other provision hereof (whether or
not same). No delay on the part of any party hereto in exercising any right,
power or privilege herein shall operate as a waiver thereof.
7. Notices. Any and all notices, payments and other
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communications required or permitted under the Agreement shall be in writing,
and shall be deemed to have been effectively delivered for all purposes upon the
mailing thereof by first-class certified mail, return receipt requested, postage
prepaid, addressed to Global Shopping Network, Inc. at 0000 Xxxxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, and to Rachamin Anatian at 0000 Xxxxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, or at such other address as a party
Ms. Xxxxxxx Xxxxxxxx
Global Shopping Network, Inc.
May 23, 1996
Page 6
may designate in writing sent by first-class certified mail, return receipt
requested, postage prepaid, to the other party.
8. Entire Agreement. This Agreement sets forth the entire understanding
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of the parties hereto with respect to the subject matter hereof. Any prior
agreements or undertakings among the parties hereto regarding the subject matter
hereof are merged into and superseded by this Agreement.
9. Governing Law. This Agreement shall be governed by, construed and
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enforced in accordance with the laws of the State of New York without regard to
the principles of conflict of laws.
10. The provisions of this agreement shall survive the termination of
your employment by and/or stockholding in Global until the final and irrevocable
satisfaction in full or all Guaranteed Obligations and the payment of all
Guarantee Losses and Losses.
Ms. Xxxxxxx Xxxxxxxx
Global Shopping Network, Inc.
May 23, 1996
Page 7
IN WITNESS WHEREOF, the undersigned have executed this Agreement on
the 23rd day of May 1996.
GLOBAL SHOPPING NETWORK, INC.
By: /s/ Rachamin Anatian
--------------------------------
Name:
Title:
/s/ Rachamin Anatian
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Rachamin Anatian
ACCEPTED AND AGREED TO:
/s/ Xxxxxxx Xxxxxxxx
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XXXXXXX XXXXXXXX
SCHEDULE 1 TO XXXXXXXX INDEMNIFICATION AGREEMENT
1. Advanta Leasing Corp., dated January 12, 1996.
2. American Express.
3. Xxxxxxx Office Furniture, dated December 23, 1996.
4. Century Copies Services.
5. DMGT.
6. Great America Leasing, dated October 5, 1995.
7. Xxx Xxxxxxxx.
8. Matrixx Marketing Inc., dated September 5, 1995.
9. National Fulfillment, Inc.
10. PDR Productions.
