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EXHIBIT 10.3
INDEMNIFICATION AGREEMENT dated as of _______________ ____, 2000, between
INTERWORLD CORPORATION, a Delaware corporation (the "Company"), and the director
or the executive officer named on the signature page hereto (the
"Director/Executive Officer").
Section 145 of the Delaware General Corporation Law (the
"DGCL") empowers corporations to indemnify persons serving as a director,
officer, employee or agent of such corporation or persons who serve at the
request of such corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, and Section
145(f) of the DGCL further specifies that the indemnification set forth in said
Section shall not be deemed exclusive of any other rights to which those seeking
indemnification may be entitled under any by-law, agreement, vote of
stockholders or disinterested directors or otherwise.
The Company desires to have the Director/Executive Officer
serve or continue to serve as an executive officer and/or director of the
Company free from undue concern for unpredictable, inappropriate or unreasonable
claims for damages by reason of his or her decisions or actions on its behalf;
and the Director/Executive Officer desires to serve, or to continue to serve, in
such capacity. Accordingly, in consideration of the Director/Executive Officer's
serving or continuing to serve as an executive officer and/or director of the
Company, the parties agree as follows:
1.Indemnification. The Company shall indemnify, defend and
hold harmless the Director/Executive Officer against all expenses, losses,
claims, damages and liabilities, including, without limitation, attorneys' fees,
judgments, fines and amounts paid in settlement (all such expenses,
collectively, "Costs"), actually and reasonably incurred by him or her in
connection with the investigation, defense or appeal of any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, to which the Director/Executive Officer is a party or
threatened to be made a party (all such actions, collectively, "Proceedings")
(i) by reason of the fact that the Director/Executive Officer is or was a
director, officer, employee or agent of the Company or of any other corporation,
partnership, joint venture, trust or other enterprise (collectively,
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"Affiliates") of which he or she has been or is serving at the request of, for
the convenience of or to represent the interest of the Company or (ii) by reason
of anything done or not done by the Director/Executive Officer in any such
capacity referred to in the foregoing clause (i).
2.Culpable Action. (a) Notwithstanding the provisions of
Section 1, the Director/Executive Officer shall not be entitled to
indemnification if (i) the Company is prohibited from paying such
indemnification under applicable law, (ii) the Director/Executive Officer
breached his or her duty of loyalty to the Company or its stockholders or any
Affiliate or its stockholders, (iii) the Director/Executive Officer's actions or
omissions were not in good faith or involved intentional misconduct or a knowing
violation of law or (iv) the Director/Executive Officer derived an improper
personal benefit from any transaction which is a subject of the applicable
Proceeding (any existence or occurrence described in the foregoing clauses (i) -
(iv), individually, a "Culpable Action").
(b) The existence or occurrence of a Culpable Action shall be
conclusively determined by (i) a non-appealable, final decision of the court
having jurisdiction over the applicable Proceeding or (ii) a non-appealable,
final decision of the Court of Chancery of the State of Delaware (or if such a
decision is appealable, by the court in such State which has jurisdiction to
render a non-appealable, final decision). Such determination shall be final and
binding upon the parties hereto.
(c) The existence or occurrence of a Culpable Action may also
be determined by (i) the Board of Directors of the Company, by a majority vote
of a quorum consisting of directors who were not parties to the applicable
Proceeding (the "Disinterested Directors"), (ii) the stockholders of the
Company, by a majority vote of a quorum consisting of stockholders who were not
parties to the applicable Proceeding (the "Disinterested Stockholders"), or
(iii) any other entity to which the Disinterested Directors or the Disinterested
Stockholders shall have delegated the authority to make such a determination;
provided, however, that such determination shall be binding upon the parties
hereto only if a determination shall not have been made or shall not be
subsequently made pursuant to Subsection (b) above.
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(d) If a Proceeding involves more than one claim, issue or
matter, the determination as to whether there exists or has occurred a Culpable
Action shall be severable as to each and every claim, issue and matter.
(e) The termination of any Proceeding by judgment, order,
settlement or conviction, or upon a plea of nolo contendere or its equivalent,
does not change the presumption of Section 1 that the Director/Executive Officer
is entitled to indemnification hereunder and does not create a presumption that
there exists a Culpable Action.
3.Payment of Costs. The Costs incurred by the
Director/Executive Officer in connection with any Proceeding, including any
Proceeding brought pursuant to Section (2)(b), shall be paid by the Company on
an "as incurred" basis; provided, however, that if it shall ultimately be
determined that there exists or has occurred a Culpable Action with respect to
such Proceeding, the Director/Executive Officer shall repay to the Company the
amount (or the appropriate portion thereof as contemplated by Section 2(d)) so
advanced, including the costs of obtaining a determination pursuant to Section
2(b).
4.Severability. If any provision of this Agreement shall be
determined to be illegal and unenforceable by any court of law, the remaining
provisions shall be severable and enforceable in accordance with their terms.
0.Xx Right to Employment or Directorship. This Agreement shall
not entitle the Director/Executive Officer to any right or claim to be retained
as an employee and/or director of the Company or limit the right of the Company
to terminate the employment and/or directorship of the Director/Executive
Officer or to change the terms of such employment and/or directorship.
6.Other Rights and Remedies. This Agreement shall not be
deemed exclusive as to any other non-contractual rights to indemnification to
which the Director/Executive Officer may be entitled under any provision of law,
the Restated Certificate of Incorporation of the Company, any By-law of the
Company or otherwise.
7.Counterparts. This Agreement may be executed in any number
of counterparts, and each such counterpart shall
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be deemed to be an original instrument, but all such counterparts together shall
constitute but one agreement.
8.Descriptive Headings. Descriptive headings are for
convenience only and shall not control or affect the meaning or construction of
any provision of this Agreement.
9.Modification. This Agreement shall not be altered or
otherwise amended except pursuant to an instrument in writing signed by each of
the parties.
10.Notice to the Company by the Director/Executive Officer.
The Director/Executive Officer, as a condition precedent to his or her right to
be indemnified under this Agreement, shall give to the Company notice in writing
as soon as practicable of any Proceeding for which indemnity will or could be
sought under this Agreement.
11.Notices. All notices, requests, consents and other
communications hereunder to any party shall be deemed to be sufficient if
contained in a written instrument delivered in person or by facsimile
transmission with electronic confirmation of receipt or if sent by nationally
recognized overnight courier or first class certified mail, postage prepaid,
return receipt requested, addressed to such party at the address set forth below
or such other address as may hereafter be designated in writing by notice given
pursuant to this Section 11:
(i) if to the Company, to:
InterWorld Corporation
000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President and Chief Executive Officer
Telephone:(000) 000-0000; and
(ii) if to the Director/Executive Officer, to:
the Director/Executive Officer's name and address
as it appears in the records of the Company.
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12.Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
contracts made and performed wholly therein.
13.Successors and Assigns. This Agreement shall be binding
upon the Company and its successors and assigns and shall inure to the benefit
of the Director/Executive Officer and his or her spouse, heirs, executors and
administrators.
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IN WITNESS WHEREOF, each of the undersigned have duly executed
this Indemnification Agreement as of the date first above written.
INTERWORLD CORPORATION
By:__________________________
Name:
Title:
__________________________
Director/Executive Officer
Name:
