§714. Indemnification of officers, directors, employees and agents; insurance








1. Power to indemnify. 
A corporation shall have power to indemnify, or if so provided in the bylaws shall
in all cases indemnify, any person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that he is
or was a director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against expenses,
including attorneys' fees, judgments, fines and amounts paid in settlement actually
and reasonably incurred by him in connection with such action, suit or proceeding;
provided that no indemnification shall be provided for any person with respect to
any matter as to which he shall have been finally adjudicated in any action, suit
or proceeding not to have acted in good faith in the reasonable belief that his action
was in the best interests of the corporation or, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order or conviction adverse
to such person, or by settlement or plea of nolo contendere or its equivalent, shall
not of itself create a presumption that such person did not act in good faith in the
reasonable belief that his action was in the best interests of the corporation, and,
with respect to any criminal action or proceeding, had reasonable cause to believe
that his conduct was unlawful.


[
1977, c. 525, §13 (NEW)
.]








2. Indemnity against expenses. 
Any provision of subsections 1 or 3 to the contrary notwithstanding, to the extent
that a director, officer, employee or agent of a corporation has been successful on
the merits or otherwise in defense of any action, suit or proceeding referred to in
subsection 1, or in defense of any claim, issue or matter therein, he shall be indemnified
against expenses, including attorneys' fees, actually and reasonably incurred by him
in connection therewith. The right to indemnification granted by this subsection may
be enforced by a separate action against the corporation, if an order for indemnification
is not entered by a court in the action, suit or proceeding wherein he was successful
on the merits or otherwise.


[
1977, c. 525, §13 (NEW)
.]








3. Indemnity made by corporation. 
Any indemnification under subsection 1, unless ordered by a court or required by
the bylaws, shall be made by the corporation only as authorized in the specific case
upon a determination that indemnification of the director, officer, employee or agent
is proper in the circumstances because he has met the applicable standard of conduct
set forth in subsection 1. Such determination shall be made by the board of directors
by a majority vote of a quorum consisting of directors who were not parties to such
action, suit or proceeding, or if such a quorum is not obtainable, or even if obtainable,
if a quorum of disinterested directors so directs, by independent legal counsel in
a written opinion. Such a determination, once made by the board of directors may not
be revoked by the board of directors, and upon the making of such determination by
the board of directors, the director, officer, employee or agent may enforce the indemnification
against the corporation by a separate action notwithstanding any attempted or actual
subsequent action by the board of directors.


[
1981, c. 470, Pt. A, §31 (AMD)
.]








4. Expenses incurred in civil or criminal action. 
Expenses incurred in defending a civil or criminal action, suit or proceeding may
be paid by the corporation in advance of the final disposition of such action, suit
or proceeding as authorized by the board of directors in the manner provided in subsection
3 upon receipt of an undertaking by or on behalf of the director, officer, employee
or agent to repay such amount, unless it shall ultimately be determined that he is
entitled to be indemnified by the corporation as authorized in this section.


[
1977, c. 525, §13 (NEW)
.]








5. Provisions of indemnification. 
The indemnification provided by this section shall not be deemed exclusive of any
other rights to which those indemnified may be entitled under any bylaw, agreement,
vote of disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall continue
as to a person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a person.
A right to indemnification required by the bylaws may be enforced by a separate action
against the corporation, if an order for indemnification has not been entered by a
court in any action, suit or proceeding in respect to which indemnification is sought.


[
1979, c. 541, Pt. A, §134 (AMD)
.]








6. Power to purchase and maintain insurance. 
A corporation shall have power to purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other enterprise
against any liability asserted against him and incurred by him in any such capacity,
or arising out of his status as such, whether or not the corporation would have the
power to indemnify him against such liability under this section.


[
1977, c. 525, §13 (NEW)
.]





SECTION HISTORY

1977, c. 525, §13 (NEW).
1979, c. 541, §A134 (AMD).
1981, c. 470, §A31 (AMD).