Pottery Barn 2010 Annual Report Download - page 124

Provision W-S California W-S Delaware
Indemnification California law requires
indemnification when the indemnitee
has defended the action successfully
on the merits. Expenses incurred by an
officer or director in defending an
action may be paid in advance, if the
director or officer undertakes to repay
such amounts if it is ultimately
determined that he or she is not
entitled to indemnification. California
law authorizes a corporation to
purchase indemnity insurance for the
benefit of its officers, directors,
employees and agents whether or not
the corporation would have the power
to indemnify against the liability
covered by the policy.
California law permits a corporation to
provide rights to indemnification
beyond those provided therein to the
extent such additional indemnification
is authorized in the corporation’s
articles of incorporation. Thus, if so
authorized, rights to indemnification
may be provided pursuant to
agreements or bylaw provisions which
make mandatory the permissive
indemnification provided by California
law.
The California Articles authorize
indemnification to the fullest extent
permissible under California law.
Delaware law generally permits
indemnification of expenses, including
attorneys’ fees, actually and
reasonably incurred in the defense or
settlement of a derivative or third party
action, provided there is a
determination by a majority vote of a
disinterested quorum of the directors,
by independent legal counsel or by the
stockholders that the person seeking
indemnification acted in good faith and
in a manner reasonably believed to be
in the best interests of the corporation.
Without court approval, however, no
indemnification may be made in
respect of any derivative action in
which such person is adjudged liable
for negligence or misconduct in the
performance of his or her duty to the
corporation. Expenses incurred by an
officer or director in defending an
action may be paid in advance, if the
director or officer undertakes to repay
such amounts if it is ultimately
determined that he or she is not
entitled to indemnification. Delaware
law authorizes a corporation to
purchase indemnity insurance for the
benefit of its directors, officers,
employees and agents whether or not
the corporation would have the power
to indemnify against the liability
covered by the policy.
Delaware law permits a Delaware
corporation to provide indemnification
in excess of that provided by statute.
The Delaware Certificate authorizes
indemnification to the fullest extent
permissible under Delaware law.
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