Applied Optoelectronics, Inc. (NASDAQ: AAOI) announced that its Board of Directors approved an updated indemnification agreement on August 18, 2026, according to a press release statement.

The company plans to enter into the updated agreement with its current directors and certain executive officers, replacing existing indemnification agreements. The company also intends to extend the agreement to future directors and executive officers.

The updated agreement provides that the company will indemnify each covered individual to the fullest extent permitted by its bylaws and applicable law. It also covers the advancement of expenses, including attorneys' fees, incurred in connection with proceedings arising from an individual's service as a director or executive officer.

The company stated the updates are intended to reflect current market indemnification practices and its governance documents, and to provide greater clarity regarding indemnification and advancement rights. The agreement also includes provisions related to directors' and officers' liability insurance coverage.