Item 6.
Indemnification of
Directors and Officers.
The
North Carolina Business Corporation Act (“NCBCA”)
provides for indemnification by a corporation of its officers,
directors, employees and agents, and any person who is or was
serving at the corporation’s request as a director, officer,
employee or agent of another entity or enterprise or as a trustee
or administrator under an employee benefit Plans, against liability
and expenses, including reasonable attorneys’ fees, in any
proceeding (including without limitation a proceeding brought by or
on behalf of the corporation itself) arising out of their status as
such or their activities in any of the foregoing
capacities.
Permissible
indemnification. Under the NCBCA, a corporation may, but is
not required to, indemnify any such person against liability and
expenses incurred in any such proceeding, provided such person
conducted himself or herself in good faith and (i) in the case of
conduct in his or her official capacity, reasonably believed that
his or her conduct was in the corporation’s best interests,
and (ii) in all other cases, reasonably believed that his or her
conduct was at least not opposed to the corporation’s best
interests; and, in the case of a criminal proceeding, where he or
she had no reasonable cause to believe his or her conduct was
unlawful. However, a corporation may not indemnify such person
either in connection with a proceeding by or in the right of the
corporation in which such person was adjudged liable to the
corporation, or in connection with any other proceeding charging
improper personal benefit to such person (whether or not involving
action in an official capacity) in which such person was adjudged
liable on the basis that personal benefit was improperly
received.
Mandatory
indemnification. Unless limited by the corporation’s
charter, the NCBCA requires a corporation to indemnify a director
or officer of the corporation who is wholly successful, on the
merits or otherwise, in the defense of any proceeding to which such
person was a party because he or she is or was a director or
officer of the corporation against reasonable expenses incurred in
connection with the proceeding.
Advance for
expenses. Expenses
incurred by a director, officer, employee or agent of the
corporation in defending a proceeding may be paid by the
corporation in advance of the final disposition of the proceeding
as authorized by the board of directors of the specific case, or as
authorized by the charter or bylaws or by any applicable resolution
or contract, upon receipt of an undertaking by or on behalf of such
person to repay amounts advanced unless it ultimately is determined
that such person is entitled to be indemnified by the corporation
against such expenses.
Court-ordered
indemnification. Unless otherwise provided in the
corporation’s charter, a director or officer of the
corporation who is a party to a proceeding may apply for
indemnification to the court conducting the proceeding or to
another court of competent jurisdiction. On receipt of an
application, the court, after giving any notice the court deems
necessary, may order indemnification if it determines either (i)
that the director or officer is entitled to mandatory
indemnification as described above, in which case the court also
will order the corporation to pay the reasonable expenses incurred
to obtain the court-ordered indemnification, or (ii) that the
director or officer is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances, whether
or not such person met the requisite standard of conduct or was
adjudged liable to the corporation in connection with a proceeding
by or in the right of the corporation or on the basis that personal
benefit was improperly received in connection with any other
proceeding so charging (but if adjudged so liable, indemnification
is limited to reasonable expenses incurred).
Voluntary
indemnification. In addition to and separate and apart from
“permissible” and “mandatory”
indemnification described above, a corporation may, by charter,
bylaw, contract, or resolution, indemnify or agree to indemnify any
one or more of its directors, officers, employees or agents against
liability and expenses in any proceeding (including any proceeding
brought by or on behalf of the corporation itself) arising out of
their status as such or their activities in any of the foregoing
capacities. However, the corporation may not indemnify or agree to
indemnify a person against liability or expenses he may incur on
account of activities which were at the time taken, known or
believed by such person to be clearly in conflict with the best
interests of the corporation. Any provision in a
corporation’s charter or bylaws or in a contract or
resolution may include provisions for recovery from the corporation
of reasonable costs, expenses and attorney’s fees in
connection with the enforcement of rights to indemnification
granted therein and may further include provisions establishing
reasonable procedures for determining and enforcing such
rights.
Parties entitled to
indemnification. The NCBCA defines “director” to
include ex-directors and the estate or personal representative of a
director. Unless its charter provides otherwise, a corporation may
indemnify and advance expenses to an officer, employee or agent of
the corporation to the same extent as to a director and also may
indemnify and advance expenses to an officer, employee or agent who
is not a director to the extent, consistent with public policy, as
may be provided in its charter or bylaws, by general or specific
action of its board of directors, or by contract.
Indemnification by
Peoples. Peoples’ bylaws provide for indemnification
of its directors and officers to the fullest extent permitted by
applicable law against liability and litigation expense arising out
of such status or activities in such capacity. Peoples’
articles of incorporation provide that, to the fullest extent
provided by the NCBCA, no director or former director shall be
personally liable to Peoples or any of its shareholders or
otherwise for monetary damages for breach of any duty as a
director.
Insurance. The NCBCA
provides that a corporation may purchase and maintain insurance on
behalf of an individual who is or was a director, officer, employee
or agent to the corporation against certain liabilities incurred by
such persons, whether or not the corporation is otherwise
authorized under North Carolina law to indemnify such party.
Peoples currently maintains directors’ and officers’
insurance policies covering its directors and
officers.
Summary Only. The
foregoing is only a general summary of certain aspects of North
Carolina law dealing with indemnification of directors and officers
and does not purport to be complete. It is qualified in its
entirety by reference to the relevant statutes, Peoples’
articles of incorporation and bylaws, each as amended, which
contain detailed specific provisions regarding the circumstances
under which, and the person for whose benefit, indemnification
shall or may be made.
Item 9.
Undertakings.
(a)
The undersigned
Registrant hereby undertakes:
(1) To
file, during any period in which offers or sales are being made, a
post- effective amendment to this Registration
Statement:
(i) To
include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To
reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the foregoing,
any increase or decrease in the volume of securities offered (if
the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form
of a prospectus filed with the SEC pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth
in the “Calculation of Registration Fee” table in the
effective Registration Statement;
(iii) To
include any material information with respect to the Plans of
distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
Provided, however,
that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or
furnished to the SEC by the Registrant pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That,
for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To
remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
(4) That,
for the purpose of determining liability under the Securities Act
to any purchaser:
(i) If
the Registrant is relying on Rule 430B:
(A) Each
prospectus filed by the Registrant pursuant to Rule 424(b)(3) shall
be deemed to be part of the Registration Statement as of the date
the filed prospectus was deemed part of and included in the
Registration Statement; and
(B) Each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5)
or (b)(7) as part of a registration statement in reliance on Rule
430B relating to an offering made pursuant to Rule 415(a)(1)(i),
(vii) or (x) for the purpose of providing the information required
by section 10(a) of the Securities Act shall be deemed to be part
of and included in the Registration Statement as of the earlier of
the date such form of prospectus is first used after effectiveness
or the date of the first contract of sale of securities in the
offering described in the prospectus. As provided in Rule 430B, for
liability purposes of the issuer and any person that is at that
date an underwriter, such date shall be deemed to be a new
effective date of the Registration Statement relating to the
securities in the Registration Statement to which that prospectus
relates, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof. Provided,
however, that no statement made in a registration statement or
prospectus that is part of the Registration Statement or made in a
document incorporated or deemed incorporated by reference into the
Registration Statement or prospectus that is part of the
Registration Statement will, as to a purchaser with a time of
contract of sale prior to such effective date, supersede or modify
any statement that was made in the Registration Statement or
prospectus that was part of the Registration Statement or made in
any such document immediately prior to such effective date;
or
(ii) If
the Registrant is subject to Rule 430C, each prospectus filed
pursuant to Rule 424(b) as part of a registration statement
relating to an offering, other than registration statements relying
on Rule 430B or other than prospectus filed in reliance on Rule
430A, shall be deemed to be part of and included in the
Registration Statement as of the date it is first used after
effectiveness. Provided, however, that no statement made in a
registration statement or prospectus that is part of the
Registration Statement or made in a document incorporated or deemed
incorporated by reference into the Registration Statement or
prospectus that is part of the Registration Statement will, as to a
purchaser with a time of contract of sale prior to such first use,
supersede or modify any statement that was made in the Registration
Statement or prospectus that was part of the Registration Statement
or made in any such document immediately prior to such date of
first use.
(5) That,
for the purpose of determining liability of the Registrant under
the Securities Act to any purchaser in the initial distribution of
the securities, the undersigned Registrant undertakes that in a
primary offering of securities of the undersigned Registrant
pursuant to this Registration Statement, regardless of the
underwriting method used to sell the securities to the purchaser,
if the securities are offered or sold to such purchaser by means of
any of the following communications, the undersigned Registrant
will be a seller to the purchaser and will be considered to offer
or sell such securities to such purchaser:
(i) Any
preliminary prospectus or prospectus of the undersigned Registrant
relating to the offering required to be filed pursuant to Rule
424;
(ii) Any
free writing prospectus relating to the offering prepared by or on
behalf of the undersigned Registrant or used or referred to by the
undersigned Registrant;
(iii) The
portion of any other free writing prospectus relating to the
offering containing material information about the undersigned
Registrant or its securities provided by or on behalf of the
undersigned Registrant; and
(iv) Any
other communication that is an offer in the offering made by the
undersigned Registrant to the purchaser.
(b)
The undersigned
Registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the
Registrant’s annual report pursuant to Section 13(a) or 15(d)
of the Exchange Act (and, where applicable, each filing of an
employee benefit plans’ annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(h)
Insofar as
indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that
a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a
director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with
the securities being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.