Guam § 28822 - Indemnification of Officers, Directors, Employees and Agents;

§ 28822. Indemnification of Officers, Directors, Employees and Agents;

Insurance.

(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.

(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 Superior Court of Guam or

the court in which such action or suit was brought shall determine upon

COL372014

18 GCA BUSINESS STRUCTURE & FUNCTION

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 Superior Court of Guam or such

other court shall deem proper.

(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.

(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.

(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 directors and officers or other

employees and agents may be so paid upon such terms and conditions, if

any, as the corporation deems appropriate.

COL372014

18 GCA BUSINESS STRUCTURE & FUNCTION

(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.

(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.

(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.

(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

COL372014

18 GCA BUSINESS STRUCTURE & FUNCTION

manner "not opposed to the best interests of the corporation" as referred to in

this section.

(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.

(k) The Superior Court of Guam 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 bylaw, agreement,

vote of stockholders or disinterested directors, or otherwise. The Superior

Court of Guam may summarily determine a corporation’s obligation to

advance expenses (including attorneys’ fees).

----------

SUBARTICLE B

DIRECTORS’ CONFLICTING INTEREST TRANSACTIONS