8-KMaterial AgreementsExhibits & Filings

Cheniere Energy, Inc. 8-K Report, Material Agreement (Dec 19, 2008)

Filed December 19, 2008For Securities:LNG

Summary

Cheniere Energy, Inc. (LNG) filed an 8-K report on December 18, 2008, disclosing a material definitive agreement. The Board of Directors approved a standard form of Indemnification Agreement for all of its directors. This agreement aims to protect directors by covering expenses and claims incurred while acting on behalf of the company. The Indemnification Agreement provides broad protection for directors, covering actions taken in their official capacity, with specific limitations such as excluding claims where the director did not act in good faith or acted unlawfully. The agreement also ensures that the indemnification will be provided to the extent permitted by law and the company's governing documents, with the scope of coverage not being less than what was in existence at the time of the agreement. This move is designed to ensure the company can attract and retain qualified individuals to serve on its Board of Directors by mitigating personal legal and financial risks associated with their roles.

Key Highlights

  • 1Cheniere Energy's Board of Directors approved a standard form of Indemnification Agreement for all directors.
  • 2The agreement is designed to indemnify directors for expenses and claims arising from their service to the company.
  • 3Indemnification covers actions taken or not taken on behalf of Cheniere Energy as a director, officer, employee, agent, or fiduciary.
  • 4The agreement outlines specific exclusions, including claims brought by the director (with exceptions), Section 16(b) violations, bad faith conduct, unlawful criminal conduct, and judgments against the director.
  • 5Indemnification will be provided to the maximum extent permitted by Delaware law, the company's charter, and bylaws.
  • 6The scope of indemnification will not be reduced from existing levels and may be expanded if legally permissible.
  • 7This filing indicates a proactive step by Cheniere Energy to enhance director protections and governance.

Frequently Asked Questions

The main purpose of the Indemnification Agreement is to protect Cheniere Energy's directors from personal financial loss by covering expenses and claims they may incur as a result of their service to the company. This aims to ensure the company can attract and retain qualified board members by mitigating the personal risks associated with their duties.

Yes, the agreement specifies several situations where indemnification would generally not be provided. These include claims brought by the director themselves (unless approved or successful on the merits), violations of Section 16(b) of the Securities Exchange Act of 1934, actions not taken in good faith or reasonably believed to be in the company's best interest, reasonable belief of unlawful conduct in criminal proceedings, or if the director is adjudged liable to the Company.

The agreement aims to provide indemnification to the extent permitted by law, the company's certificate of incorporation, and bylaws. It also states that the scope of coverage will not be less than what is currently in existence and may be expanded if by law the scope of coverage is expanded after the agreement's date. This suggests it formalizes and potentially broadens protections within legal limits.

The Board of Directors approved the form of Indemnification Agreement on December 17, 2008. While the filing reports an event date of December 16, 2008, and was filed on December 18, 2008, the approval date for the agreement itself was December 17, 2008.