EXHIBIT 10(b)
INDEMNIFICATION AGREEMENT
THIS AGREEMENT is made this _____ day of __________ by and between
VALUE CITY DEPARTMENT STORES, INC., an Ohio corporation (the "Company"), and
___________________, an individual and a director and/or officer of the Company
(the "Indemnitee").
RECITALS
WHEREAS, Indemnitee is either a member of the Board of Directors or an
officer of the Company, or both, and in such capacity is performing a valuable
service for the Company;
WHEREAS, the Company has adopted Articles of Incorporation (the
"Articles") providing for the indemnification of the directors, officers, agents
and employees of the Company to the maximum extent authorized by Ohio General
Corporation Law, as amended to date (the "Ohio Statute");
WHEREAS, the Ohio Statute specifically provides that it is not
exclusive, and thereby contemplates that contracts may be entered into between
the Company and its directors, officers, agents and employees with respect to
indemnification of such persons;
WHEREAS, recent developments with respect to the application, amendment
and enforcement of statutory and other indemnification provisions generally have
raised questions concerning the adequacy and reliability of the protection
afforded to directors and officers thereby; and
WHEREAS, in order to resolve such questions and thereby induce
Indemnitee to continue to serve as a member of the Board of Directors of the
Company or an officer, or both, the Company has determined and agreed to enter
into this contract with Indemnitee;
AGREEMENT
NOW, THEREFORE, in consideration of Indemnitee's continued service with
the Company after the date hereof the parties agree as follows:
1. D & O Insurance. The Company represents that it has directors and
officers liability insurance ("D& O Insurance").
2. Indemnity. Subject only to the exclusions set forth in Section 3
hereof, the Company hereby further agrees to hold harmless and indemnify
Indemnitee against any and all expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by
Indemnitee in connection with any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative
(including an action by or in the right of the Company) to which Indemnitee is,
was or at any time becomes a party, or is threatened to be made a party, by
reason of the fact that Indemnitee is, was or at any time becomes a director,
officer, employee or agent of the Company, or is or was serving or at any time
serves at the request of the Company as a director, trustee, officer, employee,
member, manager or agent of another corporation, limited liability company,
partnership, joint venture, trust or other enterprise to the fullest extent
authorized and permitted by the provisions of the Ohio Statute, or by any
amendment thereof or other statutory provisions authorizing or permitting such
indemnification which is adopted after the date hereof.
3. Limitations on Indemnity. No indemnity pursuant to Section 2 hereof
shall be paid by the Company:
(a) except to the extent the aggregate of losses to be
indemnified hereunder exceed the amount of such losses for which the
Indemnitee is indemnified either pursuant to Section 2 hereof or
pursuant to any D & O Insurance purchased and maintained by the
Company;
(b) in respect to remuneration paid to Indemnitee if it shall
be determined by a final judgment or other final adjudication that such
remuneration was in violation of law;
(c) on account of any suit in which judgment is rendered
against an Indemnitee for an accounting of profits made from the
purchase or sale by Indemnitee of securities of the Company pursuant to
the provisions of Section 16(b) of the Securities Exchange Act of 1934
and amendments thereto or similar provisions of any federal, state or
local statutory law;
(d) on account of Indemnitee's act or omission being finally
adjudged to have involved an act or omission undertaken with deliberate
intent to cause injury to the Company or undertaken with reckless
disregard for the best interests of the Company; or
(e) if a final decision by a Court having jurisdiction in the
matter shall determine that such indemnification is not lawful.
4. Continuation of Indemnity. All agreements and obligations of the
Company contained herein shall continue during the period Indemnitee is a
director, officer, employee or agent of the Company (or is or was serving at the
request of the Company as a director, trustee, officer, employee, member,
manager or agent of another corporation, limited liability company, partnership,
joint venture, trust or other enterprise) and shall continue thereafter so long
as Indemnitee shall be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether civil, criminal or investigative,
by reason of the fact that Indemnitee was a director of the Company or serving
in any other capacity referred to herein.
5. Notification and Defense of Claim. Promptly after receipt by
Indemnitee of notice of the commencement of any action, suit or proceeding,
Indemnitee will, if a claim in respect thereof is to be made against the Company
under this Agreement, notify the Company of the commencement thereof; but the
omission so to notify the Company will not relieve it from any liability which
it may have to Indemnitee otherwise than under this Agreement. With respect to
any such action, suit or proceeding as to which Indemnitee notifies the Company
of the commencement thereof:
(a) The Company will be entitled to participate therein at its
own expense; and
(b) Except as otherwise provided below, to the extent that it
may wish, the Company jointly with any other indemnifying party
similarly notified will be entitled to assume the defense thereof, with
counsel selected by the Company and reasonably satisfactory to
Indemnitee. After notice from the Company to Indemnitee of its election
so to assume the defense thereof, the Company will not be liable to
Indemnitee under this Agreement for any legal or other expenses
subsequently incurred by Indemnitee in connection with the defense
thereof other than reasonable costs of investigation or as otherwise
provided below. Indemnitee shall have the right to employ counsel in
such action, suit or proceeding but the fees and expenses of such
counsel incurred after notice from the Company of its assumption of the
defense thereof shall be at the expense of Indemnitee unless (i) the
employment of counsel by Indemnitee has been authorized by the Company,
(ii) Indemnitee shall have reasonably concluded that there may be a
conflict of interest
between the Company and Indemnitee in the conduct of the defense of
such action, or (iii) the Company shall not in fact have employed
counsel to assume the defense of such action, in each of which cases
the fees and expenses of counsel shall be at the expense of the
Company. The Company shall not be entitled to assume the defense of any
action, suit or proceeding brought by or on behalf of the Company or as
to which Indemnitee shall have made the conclusion provided for in (ii)
above.
(c) The Company shall not be liable to indemnify Indemnitee
under this Agreement for any amounts paid in settlement of any action
or claim effected without its written consent. The Company shall not
settle in any manner which would impose any penalty or limitation on
Indemnitee without Indemnitee written consent. Neither the Company nor
Indemnitee will unreasonably withhold their consent to any proposed
settlement.
6. Repayment of Expenses. Indemnitee agrees that Indemnitee will
reimburse the Company for all reasonable expenses paid by the Company in
defending any civil or criminal action, suit or proceeding against Indemnitee in
the event and only to the extent that it shall be ultimately determined that
Indemnitee is not entitled to be indemnified by the Company for such expenses
under the provisions of the Ohio Statute, the Articles, this Agreement or
otherwise.
7. Enforcement.
(a) The Company expressly confirms and agrees that it has
entered into this Agreement and assumed the obligations imposed on the
Company hereby in order to induce Indemnitee to continue as a director
or an officer of the Company, or both, and acknowledges that Indemnitee
is relying upon this Agreement in continuing in such capacity.
(b) In the event Indemnitee is required to bring any action to
enforce rights or to collect moneys due under this Agreement and is
successful in such action, Company shall reimburse Indemnitee for all
of Indemnitee reasonable fees and expenses in bringing and pursuing
such action.
8. Separability. Each of the provisions of this Agreement is a separate
and distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability
of the other provisions hereof.
9. Governing Law; Binding Effect; Amendment and Termination.
(a) This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Ohio.
(b) This Agreement shall be binding upon Indemnitee and upon
the Company, its successors and assigns, and shall inure to the benefit
of Indemnitee, his heirs, personal representatives and assigns and to
the benefit of the Company, its successors and assigns.
(c) No amendment, modification, termination or cancellation of
this Agreement shall be effective unless in writing signed by both
parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
and as of the day and year first above written.
VALUE CITY DEPARTMENT STORES, INC.
By:
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Name:
Title:
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, Indemnitee
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