Item 6. |
Indemnification of Directors and Officers. |
Section 145 of the Delaware General Corporation Law authorizes a corporations board of directors to grant, and authorizes a court to award,
indemnity to officers, directors, and other corporate agents.
The Registrants amended and restated certificate of incorporation contains provisions
that limit the liability of its directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, the Registrants directors will not be personally liable to the Registrant or its stockholders for monetary damages
for any breach of fiduciary duties as directors, except liability for the following:
|
|
|
any breach of their duty of loyalty to the Registrant or its stockholders; |
|
|
|
any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;
|
|
|
|
unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of
the Delaware General Corporation Law; or |
|
|
|
any transaction from which they derived an improper personal benefit. |
Any amendment to, or repeal of, these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission, or claim that
occurred or arose prior to that amendment or repeal. If the Delaware General Corporation Law is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of the Registrants
directors will be further limited to the greatest extent permitted by the Delaware General Corporation Law.
In addition, the Registrants amended
and restated bylaws provide that the Registrant will indemnify, to the fullest extent permitted by law, any person who is or was a party or is threatened to be made a party to any action, suit, or proceeding by reason of the fact that he or she is
or was one of the Registrants directors or officers or is or was serving at the Registrants request as a director or officer of another corporation, partnership, joint venture, trust, or other enterprise. The Registrants amended
and restated bylaws provide that the Registrant may indemnify to the fullest extent permitted by law any person who is or was a party or is threatened to be made a party to any action, suit, or proceeding by reason of the fact that he or she is or
was one of the Registrants employees or agents or is or was serving at the Registrants request as an employee or agent of another corporation, partnership, joint venture, trust, or other enterprise. The Registrants amended and
restated bylaws also provide that the Registrant must advance expenses incurred by or on behalf of a director or officer in advance of the final disposition of any action or proceeding, subject to limited exceptions.
Further, the Registrant has entered into indemnification agreements with each of its directors and executive officers that may be broader than the specific
indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements require the Registrant, among other things, to indemnify its directors and executive officers against liabilities that may arise by reason
of their status or service. These indemnification agreements also require the Registrant to advance all expenses incurred by the directors and executive officers in investigating or defending any such action, suit, or proceeding. The Registrant
believes that these agreements are necessary to attract and retain qualified individuals to serve as directors and executive officers.
The limitation of
liability and indemnification provisions in the Registrants amended and restated certificate of incorporation, amended and restated bylaws, and the indemnification agreements that the Registrant has entered into with its directors and
executive officers may discourage stockholders from bringing a lawsuit against the Registrants directors and executive officers for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against the
Registrants directors and executive officers, even though an action, if successful, might benefit the Registrant and other stockholders. Further, a stockholders investment may be adversely affected to the extent that the Registrant pays
the costs of settlement and damage awards against directors and executive officers as required by these indemnification provisions.