414D-164 Determination and authorization of indemnification. (a) A corporation may not indemnify a director under section 414D-160 unless authorized in the specific case after a determination has been made that the director has met the standard of conduct set forth in section 414D-160.

(b) The determination shall be made by the board of directors by majority vote of a quorum consisting of directors who are not at the time parties to the proceeding.

(c) The determination shall be made by majority vote of a committee duly designated by the board of directors (in which designation directors who are parties may participate) consisting solely of two or more directors not at the time parties to the proceeding if a quorum cannot be obtained under subsection (b).

(d) The determination shall be made by special legal counsel selected by:

(1) The board of directors or its committee in the manner prescribed in subsection (b) or (c); or

(2) Majority vote of the full board (in which selection directors who are parties may participate) if a quorum of the board cannot be obtained under subsection (b) and a committee cannot be designated under subsection (c).

(e) The determination shall be made by the members but directors who are at the time parties to the proceeding may not vote on the determination.

(f) Authorization of indemnification and evaluation as to reasonableness of expenses shall be made in the same manner as the determination that indemnification is permissible, except that if the determination is made by special legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses shall be made by those entitled under subsection (d) to select counsel. [L 2001, c 105, pt of 1; am L 2002, c 130, 56]

 

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