INDEMNIFICATION AGREEMENT
AGREEMENT,
dated as of the 4th day of September, 2007, between Collective
Brands, Inc., a Delaware corporation (the "Company") and
Douglas J. Treff (the "Indemnitee").
WHEREAS,
it is essential to the Company to retain and attract as
directors and officers the most capable persons available;
and
WHEREAS,
Indemnitee is a director or officer of the Company;
and
WHEREAS,
both the Company and Indemnitee recognize the increased risk
of litigation and other claims being asserted against
directors and officers of public companies in today's
environment; and
WHEREAS,
basic protection against undue risk of personal liability of
directors and officers heretofore has been provided through
insurance coverage providing reasonable protection at
reasonable cost, and Indemnitee has relied on the availability
of such coverage; but as a result of substantial changes in
the marketplace for such insurance it generally has become
more difficult to obtain such insurance on terms providing
reasonable protection at reasonable cost; and
WHEREAS,
the Delaware legislature, in recognition of the need to secure
the continued service of competent and experienced people in
senior corporate positions and to assure that they will be
able to exercise judgment without fear of personal liability
so long as they fulfill the basic duties of honesty, care and
good faith, has so enacted Section 145 of The Delaware General
Corporation Law (the "DGCL"), which empowers the Company to
indemnify its officers, directors, employees and agents and
expressly provides that the indemnification provided by the
statute is not exclusive; and
WHEREAS,
the Certificate of Incorporation of the Company requires the
Company to indemnify and advance expenses to its directors and
officers to the fullest extent now or hereafter authorized or
permitted by law and authorizes the Company to enter into
agreements providing for such indemnification and advancement
of expenses; and
WHEREAS,
in recognition of the fact that the Indemnitee continues to
serve as a director or officer of the Company, in part in
reliance on the aforesaid By-laws, and of the fact of
Indemnitee's need for substantial protection against personal
liability in order to enhance Indemnitee's continued service
to the Company in an effective manner, and in part to provide
Indemnitee with specific contractual assurance that the
protection promised by such Certificate of Incorporation will
be available to Indemnitee (regardless of, among other things,
any amendment to or revocation of such Certificate of
Incorporation or any change in the composition of the
Company's Board of Directors or any acquisition transaction
relating to the Company), and due to the possibility that the
Company's directors' and officers' liability insurance
coverage could at some future time become inadequate, the
Company wishes to provide in this Agreement for the
indemnification of, and the advancing of expenses to,
Indemnitee to the fullest extent (whether partial or complete)
now or hereafter authorized or permitted by law and as set
forth in this Agreement, and, to the extent insurance is
maintained, for the continued coverage of Indemnitee under the
Company's directors' and officers' liability insurance
policies,
NOW,
THEREFORE, in consideration of the premises and of Indemnitee
continuing to serve the Company directly or, at its request,
with another enterprise, and intending to be legally bound
hereby, the parties hereto agree as follows:
1.
CERTAIN
DEFINITIONS:
(1)
“Approved
Law Firm” shall mean any law firm (i) located in New
York or Delaware, (ii) having 50 or more attorneys and (iii)
rated "av" by Martindale-Hubbell Law Directory; provided,
however, that such law firm shall not, for a five- year period
prior to the Indemnifiable Event, have been engaged by the
Company, an Acquiring Person or the Indemnitee.
(2)
“Applicable
Standard of Conduct” shall mean the standard established
by Section 145(a)-(b) of the DGCL.
(3)
“Board
of Directors” shall mean the Board of Directors of the
Company.
(4)
A
“Change of Control” shall be deemed to have
occurred upon:
(A)
The
acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”)) (a “Person”) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either (A) the
then-outstanding shares of common stock of the Company (the
“Outstanding Company Common Stock”) or (B) the
combined voting power of the then-outstanding voting
securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting
Securities”);
provided ,
however ,
that, for purposes of this Section 1(d), none of the following
shall constitute a Change of Control: (i) any acquisition directly
from the Company, (ii) any acquisition by the Company, (iii) any
acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any affiliated company,
(iv) any acquisition by any corporation pursuant to a transaction
that complies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C)
or (v) any acquisition by the Company which, by reducing the number
of shares of Outstanding Company Common Stock or Outstanding
Company Voting Securities, increases the proportionate number of
shares of Outstanding Company Common Stock or Outstanding Company
Voting Securities beneficially owned by any Person to 20% or more
of the Outstanding Company Common Stock or Outstanding Company
Voting Securities;
provided, however, that,
if such Person shall thereafter become the beneficial owner of any
additional shares of Outstanding Company Common Stock or
Outstanding Company Voting Securities and beneficially owns 20% or
more of either the Outstanding Company Common Sock or the
Outstanding Company Voting Securities, then such additional
acquisition shall constitute a Change of Control; or
(B)
The
cessation, for any reason, of individuals who, as of the date
hereof, constitute the Board (the “Incumbent
Board”) to constitute at least a majority of the
Board;
provided ,
however ,
that any individual becoming a director subsequent to the date
hereof whose election, or nomination for election by the
Company’s stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result of
an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person
other than the Board; or
(C)
The
consummation of a reorganization, merger, consolidation or
sale or other disposition of all or substantially all of the
assets of the Company (a “Business Combination”),
in each case, unless, following such Business Combination, (i)
all or substantially all of the individuals and entities that
were the beneficial owners, respectively, of the Outstanding
Company Common Stock and the Outstanding Company Voting
Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50%,
respectively, of the then-outstanding shares of common stock
and the combined voting power of the then-outstanding voting
securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting
from such Business Combination (including, without limitation,
a corporation that, as a result of such transaction, owns the
Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership
immediately prior to such Business Combination of the
Outstanding Company Common Stock and the Outstanding Company
Voting Securities, as the case may be, (ii) no Person
(excluding any corporation resulting from such Business
Combination or any employee benefit plan (or related trust) of
the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 20% or
more of, respectively, the then-outstanding shares of common
stock of the corporation resulting from such Business
Combination or the combined voting power of the
then-outstanding voting securities of such corporation, except
to the extent that such ownership existed prior to the
Business Combination, and (iii) at least a majority of the
members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement or
of the action of the Board providing for such Business
Combination; or
(D)
The
approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.
(5)
A Claim
@ shall
mean any threatened, pending or completed action, suit or
proceeding, or any inquiry or investigation, whether conducted by
the Company or any other party, that Indemnitee in good faith
believes might lead to the institution of any such action, suit or
proceeding, whether civil, criminal, administrative, investigative
or other.
(6)
A Expenses
@ shall
include attorneys' fees and all other costs, expenses and
obligations paid or incurred in connection with investigating,
defending, being a witness in or participating in (including on
appeal), or preparing to defend, be a witness in or participate in,
any Claim relating to any Indemnifiable Event, together with
interest, computed at the Company's average cost of funds for
short-term borrowings, accrued from the date of payment of such
expense to the date Indemnitee receives reimbursement
therefor.
(7)
A Indemnifiable
Event
@ shall
mean any event or occurrence related to the fact that Indemnitee is
or was a director, officer, employee, agent or fiduciary of the
Company, or is or was serving at the request of the Company as a
director, officer, employee, trustee, agent or fiduciary of another
corporation of any type or kind, domestic or foreign, partnership,
joint venture, trust, employee benefit plan or other enterprise, or
by reason of anything done or not done by Indemnitee in any such
capacity. Without limitation of any indemnification provided
hereunder, an Indemnitee serving (i) another corporation,
partnership, joint venture or trust of which 20 percent or more of
the voting power or residual economic interest is held, directly or
indirectly, by the Company, or (ii) any employee benefit plan of
the Company or any entity referred to in clause (i), in any
capacity shall be deemed
|
