Incorporation Copy Formula Down

• Category: Corporations - Public - Indemnification
• State: Multi-State
• Control #: US-CC-17-102K
• Format: Word; Rich Text

Description

The proposals to amend the Certificate of Incorporation and By-laws focus on mitigating the personal liability of directors and enhancing indemnification provisions, responding to the increasing threats of litigation. The incorporation copy formula down enables companies to limit directors' monetary liability in breach of fiduciary duty cases, thus encouraging qualified individuals to serve. Specifically, the proposed amendment eliminates personal liability for damages unless acts are found to be in bad faith or involve intentional misconduct. The second proposal establishes a framework for indemnification against liabilities incurred during service to the corporation, addressing recent legal amendments in New York. Both proposals aim to attract and retain capable directors and officers amidst rising insurance costs and litigation risks, ensuring they are willing to make challenging decisions without the fear of personal financial loss. The proposals do not reduce their fiduciary duties but provide necessary protections to enhance governance. Although directors may benefit from these changes, the board emphasizes that such amendments serve the company's interests and shareholder welfare by securing experienced leadership.