Item 20. Indemnification of Directors
and Officers.
Our Certificate of Incorporation
will provide that all of our directors, officers, employees and agents shall be entitled to be indemnified by us to the fullest extent
permitted by Section 145 of the Delaware General Corporation Law (“DGCL”). Section 145 of the Delaware General Corporation
Law concerning indemnification of officers, directors, employees and agents is set forth below.
Section 145. Indemnification of
officers, directors, employees and agents; insurance.
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(a) |
A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person 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 or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that the person’s conduct was unlawful. |
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(b) |
A corporation shall have power to indemnify any person
who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of
the corporation to procure a judgment in its favor by reason of the fact that the person 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 or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred
by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless
and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled
to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
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(c) |
To the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of this section, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith. |
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(d) |
Any indemnification under subsections (a) and (b) of this section (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of this section. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, or (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (4) by the stockholders. |
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(e) |
Expenses (including attorneys’ fees) incurred by an officer or director in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this section. Such expenses (including attorneys’ fees) incurred by former officers and directors or other employees and agents may be so paid upon such terms and conditions, if any, as the corporation deems appropriate. |
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(f) |
The indemnification and advancement of expenses provided by, or granted pursuant to, the other subsections of this section shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office. A right to indemnification or to advancement of expenses arising under a provision of the certificate of incorporation or a bylaw shall not be eliminated or impaired by an amendment to such provision after the occurrence of the act or omission that is the subject of the civil, criminal, administrative or investigative action, suit or proceeding for which indemnification or advancement of expenses is sought, unless the provision in effect at the time of such act or omission explicitly authorizes such elimination or impairment after such action or omission has occurred. |
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(g) |
A corporation shall have power to purchase and maintain insurance on behalf of any 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 or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify such person against such liability under this section. |
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(h) |
For purposes of this section, references to “the corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under this section with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. |
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(i) |
For purposes of this section, references to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on a person with respect to any employee benefit plan; and references to “serving at the request of the corporation” shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the corporation” as referred to in this section. |
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(j) |
The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. |
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(k) |
The Court of Chancery is hereby vested with exclusive jurisdiction to hear and determine all actions for advancement of expenses or indemnification brought under this section or under any by law, agreement, vote of stockholders or disinterested directors, or otherwise. The Court of Chancery may summarily determine a corporation’s obligation to advance expenses (including attorneys’ fees). |
Insofar as indemnification for
liabilities arising under the Securities Act may be permitted to our directors, officers, and controlling persons pursuant to the foregoing
provisions, or otherwise, we have 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 of expenses incurred or paid by a director, officer or controlling person in a successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will,
unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to the 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.
In accordance with Section 102(b)(7)
of the DGCL, our amended and restated certificate of incorporation, will provide that no director shall be personally liable to us or
any of our stockholders for monetary damages resulting from breaches of their fiduciary duty as directors, except to the extent such limitation
on or exemption from liability is not permitted under the DGCL. The effect of this provision of our amended and restated certificate of
incorporation is to eliminate our rights and those of our stockholders (through stockholders’ derivative suits on our behalf) to
recover monetary damages against a director for breach of the fiduciary duty of care as a director, including breaches resulting from
negligent or grossly negligent behavior, except, as restricted by Section 102(b)(7) of the DGCL. However, this provision does not limit
or eliminate our rights or the rights of any stockholder to seek non-monetary relief, such as an injunction or rescission, in the event
of a breach of a director’s duty of care.
If the DGCL is amended to authorize
corporate action further eliminating or limiting the liability of directors, then, in accordance with our Certificate of Incorporation,
the liability of our directors to us or our stockholders will be eliminated or limited to the fullest extent authorized by the DGCL, as
so amended. Any repeal or amendment of provisions of our Certificate of Incorporation limiting or eliminating the liability of directors,
whether by our stockholders or by changes in law, or the adoption of any other provisions inconsistent therewith, will (unless otherwise
required by law) be prospective only, except to the extent such amendment or change in law permits us to further limit or eliminate the
liability of directors on a retroactive basis.
Our Certificate of Incorporation
will also provide that we will, to the fullest extent authorized or permitted by applicable law, indemnify our current and former officers
and directors, as well as those persons who, while directors or officers of our corporation, are or were serving as directors, officers,
employees or agents of another entity, trust or other enterprise, including service with respect to an employee benefit plan, in connection
with any threatened, pending or completed proceeding, whether civil, criminal, administrative or investigative, against all expense, liability
and loss (including, without limitation, attorney’s fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in
settlement) reasonably incurred or suffered by any such person in connection with any such proceeding.
Notwithstanding the foregoing,
a person eligible for indemnification pursuant to our Certificate of Incorporation will be indemnified by us in connection with a proceeding
initiated by such person only if such proceeding was authorized by our board of directors, except for proceedings to enforce rights to
indemnification.
The right to indemnification which
will be conferred by our Certificate of Incorporation is a contract right that includes the right to be paid by us the expenses incurred
in defending or otherwise participating in any proceeding referenced above in advance of its final disposition, provided, however, that
if the DGCL requires, an advancement of expenses incurred by our officer or director (solely in the capacity as an officer or director
of our corporation) will be made only upon delivery to us of an undertaking, by or on behalf of such officer or director, to repay all
amounts so advanced if it is ultimately determined that such person is not entitled to be indemnified for such expenses under our amended
and restated certificate of incorporation or otherwise.
The rights to indemnification and
advancement of expenses will not be deemed exclusive of any other rights which any person covered by our Certificate of Incorporation
may have or hereafter acquire under law, our amended and restated certificate of incorporation, our bylaws, an agreement, vote of stockholders
or disinterested directors, or otherwise.
Any repeal or amendment of provisions
of our Certificate of Incorporation affecting indemnification rights, whether by our stockholders or by changes in law, or the adoption
of any other provisions inconsistent therewith, will (unless otherwise required by law) be prospective only, except to the extent such
amendment or change in law permits us to provide broader indemnification rights on a retroactive basis, and will not in any way diminish
or adversely affect any right or protection existing at the time of such repeal or amendment or adoption of such inconsistent provision
with respect to any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent provision. Our Certificate
of Incorporation will also permit us, to the extent and in the manner authorized or permitted by law, to indemnify and to advance expenses
to persons other that those specifically covered by our amended and restated certificate of incorporation.
Our bylaws include the
provisions relating to advancement of expenses and indemnification rights consistent with those which will be set forth in our
Certificate of Incorporation. In addition, our bylaws provide for a right of indemnity to bring a suit in the event a claim for
indemnification or advancement of expenses is not paid in full by us within a specified period of time. Our bylaws also permit us to
purchase and maintain insurance, at our expense, to protect us and/or any director, officer, employee or agent of our corporation or
another entity, trust or other enterprise against any expense, liability or loss, whether or not we would have the power to
indemnify such person against such expense, liability or loss under the DGCL.
Any repeal or amendment of provisions
of our bylaws affecting indemnification rights, whether by our board of directors, stockholders or by changes in applicable law, or the
adoption of any other provisions inconsistent therewith, will (unless otherwise required by law) be prospective only, except to the extent
such amendment or change in law permits us to provide broader indemnification rights on a retroactive basis, and will not in any way diminish
or adversely affect any right or protection existing thereunder with respect to any act or omission occurring prior to such repeal or
amendment or adoption of such inconsistent provision.
