Montana Code 35-14-854. Court-ordered indemnification and advance for expenses
35-14-854. Court-ordered indemnification and advance for expenses. (1) A director who is a party to a proceeding because the person is a director may apply for indemnification or an advance for expenses to the court conducting the proceeding or to another court of competent jurisdiction. After receipt of an application and after giving any notice it considers necessary, the court shall:
Terms Used In Montana Code 35-14-854
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Indemnification: In general, a collateral contract or assurance under which one person agrees to secure another person against either anticipated financial losses or potential adverse legal consequences. Source: FDIC
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Person: includes a corporation or other entity as well as a natural person. See Montana Code 1-1-201
(a)order indemnification if the court determines that the director is entitled to mandatory indemnification under 35-14-852;
(b)order indemnification or advance for expenses if the court determines that the director is entitled to indemnification or advance for expenses pursuant to a provision authorized by 35-14-858(1); or
(c)order indemnification or advance for expenses if the court determines, in view of all the relevant circumstances, that it is fair and reasonable to indemnify the director or to advance expenses to the director even if, in either case, the director has not met the relevant standard of conduct set forth in 35-14-851(1), has failed to comply with 35-14-853, or was adjudged liable in a proceeding referred to in 35-14-851(4)(a) or (4)(b). If the director was adjudged liable in a proceeding referred to in 35-14-851(4), indemnification is limited to expenses incurred in connection with the proceeding.
(2)If the court determines that the director is entitled to indemnification under subsection (1)(a) or to indemnification or advance for expenses under subsection (1)(b), it shall also order the corporation to pay the director’s expenses incurred in connection with obtaining court-ordered indemnification or advance for expenses. If the court determines that the director is entitled to indemnification or advance for expenses under subsection (1)(c), it may also order the corporation to pay the director’s expenses incurred to obtain court-ordered indemnification or advance for expenses.