resources / Statutes / Nonprofit Corporations / §10-3854
Title 10 – Corporations and Associations
Chapter 31 – Directors and officers-nonprofit Corporations
Article 5 – Indemnification
- Unless a corporation’s articles of incorporation provide otherwise, a director of the corporation who is a party to a proceeding may apply for indemnification or an advance for expenses to the court conducting the proceeding or to another court of competent jurisdiction. On receipt of an application, the court after giving any notice the court considers necessary may order indemnification advances for expenses if it determines either:
- 1. The director is entitled to mandatory indemnification under section 10-3852, in which case the court shall also order the corporation to pay the director’s reasonable expenses incurred to obtain court ordered indemnification.
- 2. The director is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not the director met the standard of conduct set forth in section 10-3851 or was adjudged liable as described in section 10-3851, subsection D, but if the director was adjudged liable under section 10-3851, subsection D, indemnification is limited to reasonable expenses incurred.