OFFICER AND DIRECTOR INDEMNIFICATION AGREEMENT

FORM OF OFFICER AND DIRECTOR INDEMNIFICATION AGREEMENT





This agreement, made and entered into as of the __th day of ___________, 1998 ("Agreement"), by and between CyberShop International, Inc., a Delaware corporation (the "Corporation"), and ______________ ("Indemnitee"):





WHEREAS, highly competent persons are becoming more reluctant to serve as directors, officers or in other capacities unless they are provided with adequate protection through insurance or adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the Corporation; and



WHEREAS, the current difficulty of obtaining adequate insurance and the uncertainties relating to indemnification have increased the difficulty of attracting and retaining such persons; and



WHEREAS, the Board of Directors of the Corporation has determined that the inability to attract and retain such persons is detrimental to the best interests of the Corporation's stockholders and that the Corporation should act to assure such persons that there will be increased certainty of such protection in the future; and



WHEREAS, it is reasonable, prudent and necessary for the Corporation contractually to obligate itself to indemnify such persons to the fullest extent permitted by applicable law so that they will serve or continue to serve the Corporation free from undue concern that they will not be so indemnified; and



WHEREAS, Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Corporation on the condition that Indemnitee be so indemnified;



NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Corporation and Indemnitee do hereby covenant and agree as follows:



ARTICLE I





For purposes of this Agreement, the following terms shall have the meaning given here:



1.01 "Board" means the Board of Directors of the Corporation.





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1.02 "Change in Control" means a change in control of the Corporation occurring after the Effective Date (as defined herein) of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934 (the "Act"), whether or not the Corporation is then subject to such reporting requirement; provided, however, that, without limitation, such a Change in Control shall be deemed to have occurred if after the Effective Date (i) any "person" (as such term is used in Sections 13(d) and 14(d) of the Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Act), directly or indirectly, of securities of the Corporation representing 20% or more of the combined voting power of the Corporation's then outstanding securities without the prior approval of at least two-thirds of the members of the Board in office immediately prior to such person attaining such percentage interest; (ii) the Corporation is a party to a merger, consolidation, sale of assets or other reorganization, or a proxy contest, as a consequence of which members of the Board in office immediately prior to such transaction or event constitute less than a majority of the Board thereafter; or (iii) during any period of two consecutive years, individuals who at the beginning of such period constituted the Board (including for this purpose any new director whose election or nomination for election by the Corporation's stockholders was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of such period) cease for any reason to constitute at least a majority of the Board.



1.03 "Corporate Status" describes the status of a person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation, as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or enterprise.



1.04 "Disinterested Director" means a director of the Corporation who is not a party to, as of any time of determination thereof, the Proceeding (as defined herein) in respect of which indemnification is sought by the Indemnitee.



1.05 "Effective Date" means the date a registration statement filed with the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, registering securities issued by the Corporation, is effective.



1.06 "Enterprise" shall mean the Corporation and any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was serving at the request of the Corporation as a director, officer, employee or agent.



1.07 "Expenses" shall include but not be limited to all reasonable attorneys' fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types actually and reasonably incurred by him in connection with prosecuting, defending, preparing to prosecute or defend, investigating, or being or preparing to be a witness in a Proceeding.





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1.08 "Good Faith" shall mean Indemnitee having acted in good faith and in a manner Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Corporation, and, with respect to any criminal Proceeding, having had no reasonable cause to believe Indemnitee's conduct was unlawful.



1.09 "Independent Counsel" means a law firm, or a member of a law firm, that is experienced in matters of corporate law and neither presently is, nor in the past five years has been, retained to represent: (i) the Corporation or Indemnitee in any matter material to either such party, or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term "Independent Counsel" shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Corporation or Indemnitee in an action to determine Indemnitee's rights under this Agreement.



1.10 "Proceeding" includes any threatened, pending or completed action, suit, arbitration, alternate dispute resolution mechanism, investigation, administrative hearing or any other threatened, pending or completed proceeding whether civil, criminal, administrative or investigative, other than one initiated by Indemnitee. For purposes of the foregoing sentence, a "Proceeding" shall not be deemed to have been initiated by Indemnitee where Indemnitee seeks pursuant to Article VIII of this Agreement to enforce Indemnitee's rights under this Agreement or his rights to indemnification under the Certificate of Incorporation or Bylaws of the Corporation or Delaware law, or were Indemnitee seeks to enforce any rights he may have under any directors' and officers' liability insurance policy maintained by the Corporation.



ARTICLE II



Term of Agreement



This Agreement shall continue until and terminate upon the later of: (i) 10 years after the date that Indemnitee shall have ceased to serve as a director, officer, employee and/or agent of the Enterprise; or (ii) the final termination of all Proceedings commenced prior to the date referred to in (i) above in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of any Proceeding commenced by Indemnitee pursuant to Article VIII of this Agreement relating thereto.



ARTICLE III



Services by Indemnitee, Notice of Proceedings



3.01 Services. Indemnitee agrees to serve as a director and/or officer of the Corporation. Indemnitee may at any time and for any reason resign from such position.





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3.02 Notice of Proceeding. Indemnitee agrees promptly to notify the Corporation in writing upon being served with any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder.



ARTICLE IV





4.01 In General. In connection with any Proceeding, the Corporation shall indemnify, and advance Expenses to, Indemnitee as provided in this Agreement and to the fullest extent permitted by applicable law in effect on the date hereof and to such greater extent as applicable law may thereafter from time to time permit.



4.02 Proceedings Other Than Proceedings by or in the Right of the Corporation. Indemnitee shall be entitled to the rights of indemnification provided in this Section 4.02 if, by reason of Indemnitee's Corporate Status, Indemnitee was or is, or is threatened to be made, a party to any Proceeding, other than a Proceeding by or in the right of the Corporation. Indemnitee shall be indemnified against Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee or on Indemnitee's behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in Good Faith.



4.03 Proceedings by or in the Right of the Corporation. Indemnitee shall be entitled to the rights of indemnification provided in this Section 4.03 if, by reason of Indemnitee's Corporate Status, Indemnitee was or is, or is threatened to be made, a party to any Proceeding brought by or in the right of the Corporation to procure a judgment in its favor. Indemnitee shall be indemnified against Expenses, judgments, fines and amounts paid in settlement, actually and reasonably incurred by Indemnitee or on Indemnitee's behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in Good Faith. Notwithstanding the foregoing, no such indemnification shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been adjudged to be liable to the Corporation, unless and only to the extent that the Court of Chancery of the State of Delaware or the court in which such Proceeding shall have been brought determines that, despite the adjudication of liability but in view of all the circumstances of the case, the Indemni tee is fairly and reasonably entitled to indemnity for such portion of the settled amount, Expenses, judgments, ...