(a)

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Terms Used In Tennessee Code 48-58-509

  • Bylaws: means the code or codes of rules (other than the charter) adopted pursuant to chapters 51-68 of this title for the regulation or management of the affairs of the corporation irrespective of the name or names by which such rules are designated. See Tennessee Code 48-51-201
  • Charter: includes amended and restated charters and articles of merger. See Tennessee Code 48-11-201
  • Contract: A legal written agreement that becomes binding when signed.
  • 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.
  • Defendant: In a civil suit, the person complained against; in a criminal case, the person accused of the crime.
  • Directors: means natural persons, designated in the charter or bylaws or elected or appointed by the incorporators, and their successors and natural persons elected or appointed to act as members of the board, irrespective of the names or titles by which such persons are described. See Tennessee Code 48-51-201
  • Employee: includes an officer but not a director. See Tennessee Code 48-11-201
  • 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
  • Interest: means either or both of the following rights under the organic law of an unincorporated entity:
    (A) The right to receive distributions from the entity either in the ordinary course or upon liquidation. See Tennessee Code 48-11-201
  • Proceeding: includes civil suit and criminal, administrative, and investigatory action. See Tennessee Code 48-202-101
(1) The indemnification and advancement of expenses granted pursuant to, or provided by, chapters 51-68 of this title shall not be deemed exclusive of any other rights to which a director or officer seeking indemnification or advancement of expenses may be entitled, whether contained in chapters 51-68 of this title, the charter, or the bylaws or, when authorized by such charter or bylaws, in a resolution of members, a resolution of directors, or an agreement providing for such indemnification; provided, that no indemnification may be made to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes the director’s or officer’s liability:

(A) For any breach of the duty of loyalty to the corporation or its members;
(B) For acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;
(C) For a director’s or officer’s conflicting interest transaction under part 7 of this chapter; or
(D) Under § 48-58-302.
(2) Nothing contained in chapters 51-68 of this title shall affect any rights to indemnification to which corporate personnel, other than directors and officers, may be entitled by contract or otherwise under law. If the charter limits indemnification or advancement for expenses, indemnification and advancement for expenses are valid only to the extent consistent with the charter.
(b) This part does not limit a corporation’s power to pay or reimburse expenses incurred by a director in connection with appearing as a witness in a proceeding at a time when the director has not been made a named defendant or respondent to the proceeding.
(c) This part does not limit a corporation’s power to indemnify, advance expenses to, or provide or maintain insurance on behalf of an employee, agent, or volunteer.
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