| ITEM 6. |
INDEMNIFICATION OF DIRECTORS AND OFFICERS. |
Subsection (a) of Section 14-2-851 of the Georgia
Business Corporation Code (the “GBCC”) provides that a corporation may indemnify an individual made a party to a proceeding because he or she is or was a director against liability incurred in the proceeding if: (a) such individual
conducted himself or herself in good faith; and (b) such individual reasonably believed: (i) in the case of conduct in his or her official capacity, that such conduct was in the best interests of the corporation; (ii) in all other
cases, that such conduct was at least not opposed to the best interests of the corporation; and (iii) in the case of any criminal proceeding, that the individual had no reasonable cause to believe such conduct was unlawful. Subsection
(d) of Section 14-2-851 of the GBCC provides that a corporation may not indemnify a director: (1) in connection with a proceeding by or in the right of
the corporation, except for reasonable expenses incurred in connection with the proceeding if it is determined that the director has met the relevant standard of conduct of
Section 14-2-851 of the GBCC; or (2) in connection with any proceeding with respect to conduct for which he or she was adjudged liable on the basis that
personal benefit was improperly received by him or her, whether or not involving action in his or her official capacity. Notwithstanding the foregoing, pursuant to
Section 14-2-854 of the GBCC, a court shall order a corporation to indemnify or give an advance for expenses to a director if such court determines the director is
entitled to indemnification under the indemnification provisions of the GBCC or if it determines that in view of all relevant circumstances, it is fair and reasonable, even if the director has not met the standard of conduct set forth in subsections
(a) and (b) of Section 14-2-851 of the GBCC, failed to comply with
Section 14-2-853 of the GBCC, or was adjudged liable in a proceeding referred to in paragraph (1) or (2) of subsection (d) of Section 14-2-851 of the GBCC, but if the director was adjudged so liable, the indemnification shall be limited to reasonable expenses incurred by the director in
connection with the proceeding.
Section 14-2-852 of
the GBCC provides that a corporation shall indemnify a director who was wholly successful in the defense of any proceeding to which the director was a party because he or she was a director of the corporation against reasonable expenses incurred by
the director in connection with the proceeding.
Subsection (a) of
Section 14-2-857 of the GBCC provides that a corporation may indemnify and advance expenses to an officer of the corporation who is a party to a proceeding because
he or she is an officer of the corporation: (1) to the same extent as a director; and (2) if he or she is not a director, to such further extent as may be provided by the articles of incorporation, the bylaws, a resolution of the board of
directors, or contract except for liability arising out of conduct that constitutes (a) appropriation, in violation of his or her duties, of any business opportunity of the corporation, (b) acts of omission which involve intentional
misconduct or a knowing violation of the law, (c) the types of liability set forth in Section 14-2-832 of the GBCC, or (d) receipt of an improper personal
benefit. Subsection (c) of Section 14-2-857 of the GBCC provides that an officer of the corporation who is not a director is entitled to mandatory
indemnification under Section 14-2-852 of the GBCC and may apply to a court under
Section 14-2-854 of the GBCC for indemnification or advances for expenses, in each case to the same extent to which a director may be entitled to indemnification or
advances for expenses under those provisions.
As permitted by the GBCC, the Registrant’s bylaws require it to indemnify any director
or officer who is party to a proceeding because he or she is or was a director or officer against liability incurred in such proceeding. The Registrant’s bylaws generally prohibit it from indemnifying any officer or director who is adjudged
liable to the Registrant or is subjected to injunctive relief in favor of the Registrant (a) for any appropriation, in violation of his or her duties, of any business opportunity of the Registrant, (b) for acts or omissions which involve
intentional misconduct or a knowing violation of law, (c) for the types of liability set forth in Section 14-2-832 of the GBCC, or (d) for any transaction
from which he or she received improper personal benefits. The Registrant’s bylaws require the Registrant, under certain circumstances, to advance expenses to its officers and directors who are parties to a proceeding for which indemnification
may be sought.
The Registrant’s bylaws also provide that the Registrant must advance expenses, as incurred, to its directors and
officers in connection with a legal proceeding, to the fullest extent permitted by Georgia law, subject to limited exceptions. These rights are deemed to have fully vested at the time the indemnitee assumes his or her position with the Registrant
and will continue as to an indemnitee who has ceased to be a director or officer and will inure to the benefit of the indemnitee’s heirs, executors and administrators.
Certain of the Registrant’s employee benefit plans provide indemnification of directors and other agents against certain claims arising
from the administration of such plans.
The Registrant also provides insurance from commercial carriers against certain liabilities
incurred by its directors and officers.
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