Item 6.
Indemnification
of Directors and Officers
Maryland General Corporation Law
Under the Maryland General Corporation Law
(the “MGCL”), a corporation may include in its charter a provision limiting the liability of its directors and officers
to the corporation and its stockholders for money damages except for liability resulting from (a) actual receipt of an improper
benefit or profit in money, property or services or (b) active and deliberate dishonesty that is established by a final judgment
and is material to the cause of action.
The MGCL requires corporations (unless the
charter provides otherwise) to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense
of any proceeding to which he or she is made or threatened to be made a party by reason of his or her service in that capacity.
The MGCL permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties,
fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made
or threatened to be made a party by reason of their service in those or other capacities unless it is established that:
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the act or omission of the director or officer was material to the matter giving rise to the proceeding and (a) was committed
in bad faith or (b) was the result of active and deliberate dishonesty;
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the director or officer actually received an improper personal benefit in money, property or services; or
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in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was
unlawful.
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Under the MGCL, a corporation may not indemnify
a director or officer in a suit by or in the right of the Company in which the director or officer was adjudged liable to the corporation
or in a suit in which the director or officer was adjudged liable on the basis that personal benefit was improperly received. A
court may order indemnification if it determines that the director or officer is fairly and reasonably entitled to indemnification,
even though the director or officer did not meet the prescribed standard of conduct or was adjudged liable on the basis that personal
benefit was improperly received. However, indemnification for an adverse judgment in a suit by or in the right of the corporation,
or for a judgment of liability on the basis that personal benefit was improperly received, is limited to expenses.
In addition, the MGCL permits a corporation
to advance reasonable expenses to a director or officer upon receipt of:
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a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct
necessary for indemnification by the Company; and
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a written undertaking by the director or officer or on the director's or officer's behalf to repay the amount paid or reimbursed
by the corporation if it is ultimately determined that the director or officer did not meet the standard of conduct.
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Articles of Incorporation
The Company’s Articles of Incorporation
(the “Charter”) contains a provision that eliminates the liability of our directors and officers to the maximum extent
permitted by Maryland law.
The Charter authorizes the Company to obligate
itself to the maximum extent permitted by Maryland law in effect from time to time, to indemnify and, without requiring a preliminary
determination of the ultimate entitlement to indemnification, pay or reimburse reasonable expenses in advance of final disposition
of a proceeding to:
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any present or former director or officer of the Company who is made or threatened to be made a party to, or witness in, a
proceeding by reason of his or her service in that capacity; or
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any individual who, while a director or officer of the Company and at its request, serves or has served as a director, officer,
trustee, member, manager or partner of another corporation, real estate investment trust, limited liability company, partnership,
joint venture, trust, employee benefit plan or any other enterprise and who is made or threatened to be made a party to, or witness
in, the proceeding by reason of his or her service in that capacity.
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The Charter also permits the Company to
indemnify and advance expenses to any individual who served a predecessor of the Company in any of the capacities described above
and any employee or agent of the Company or a predecessor of the Company.
Bylaws
The Company’s Bylaws obligate the
Company to the maximum extent permitted by Maryland law in effect from time to time to indemnify and, without requiring a preliminary
determination of the ultimate entitlement to indemnification, pay or reimburse reasonable expenses in advance of final disposition
of a proceeding to:
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any present or former director or officer of the Company who is made or threatened to be made a party to, or witness in, a
proceeding by reason of his or her service in that capacity; or
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any individual who, while a director or officer of the Company and at its request, serves or has served as a director, officer,
trustee, member, manager or partner of another corporation, real estate investment trust, limited liability company, partnership,
joint venture, trust, employee benefit plan or any other enterprise and who is made or threatened to be made a party to, or witness
in, the proceeding by reason of his or her service in that capacity.
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The Company’s Bylaws also permit the
Company to indemnify and advance expenses to any individual who served a predecessor of the Company in any of the capacities described
above and any employee or agent of the Company or a predecessor of the Company.
Agreement
The Company has entered into separate indemnification
agreements with each of its directors and officers. These agreements require the Company, among other things, to indemnify such
persons against certain liabilities that may arise by reason of their status or service as directors or officers (other than liabilities
arising from actions not taken in good faith or in a manner the indemnitee believed to be opposed to the best interests of the
Company), to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified.
Securities and Exchange Commission Position
on Certain Indemnification
The Company’s Articles of Incorporation obligate the Company
to indemnify its directors and officers to the fullest extent permitted under Maryland law. The Maryland General Corporation Law
(the “MGCL”) requires corporations (unless the charter provides otherwise) to indemnify a director or officer who has
been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made or threatened to be made
a party by reason of his or her service in that capacity. The MGCL permits a corporation to indemnify its present and former directors
and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them
in connection with any proceeding to which they may be made or threatened to be made a party by reason of their service in those
or other capacities. The person being indemnified must have not acted in bad faith or with active and deliberate dishonesty, actually
received an improper personal benefit in money, property or services, or must have not had reasonable cause to believe that the
act or omission was unlawful.
Insofar as indemnification for liabilities
arising under the Securities Act of 1933, as amended (the “Securities Act”), may be permitted to the Company’s
directors, officers or persons controlling the Company pursuant to the provisions contained in the Company’s articles of
incorporation, bylaws, Colorado law or otherwise, the Company has been informed that, in the opinion of the SEC, such indemnification
is against public policy as expressed in the Securities Act and is therefore unenforceable. If a claim for indemnification against
such liabilities, other than the payment by the Company of expenses incurred or paid by one of its directors, officers or controlling
persons in the successful defense of any action, suit, or proceeding, is asserted by such director, officer or controlling person,
the Company will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by the Company is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of this issue.