Alabama § 10A-1-6.21 Permissive Indemnification

Alabama Statutes

§ 10A-1-6.21 — Permissive Indemnification

Alabama § 10A-1-6.21

JurisdictionAlabama

Title 10AAlabama Business and Nonprofit Entities Code

Ch. 1General Provisions

Art. 6Indemnification and Insurance

Div. CPermissive Indemnification and Advancement of Expenses

This text of Alabama § 10A-1-6.21 (Permissive Indemnification) is published on Counsel Stack Legal Research, covering Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Ala. Code § 10A-1-6.21 (2026).

Text

(a)An enterprise may indemnify a governing person, former governing person, or delegate who was, is, or is threatened to be made a respondent in a proceeding to the extent permitted by Section 10A-1-6.22 if it is determined in accordance with Section 10A-1-6.23 that:

(1)the person:

(A)acted in good faith; and

(B)reasonably believed:

(i)in the case of conduct in the person’s official capacity that the person’s conduct was in the enterprise’s best interests; and

(ii)in all other cases, that the person’s conduct was not opposed to the enterprise’s best interests; and

(C)in the case of a criminal proceeding, did not have a reasonable cause to believe the person’s conduct was unlawful;

(2)with respect to expenses, the amount of expenses is reasonable; and

(3)indemnification should be p

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(a) An enterprise may indemnify a governing person, former governing person, or delegate who was, is, or is threatened to be made a respondent in a proceeding to the extent permitted by Section 10A-1-6.22 if it is determined in accordance with Section 10A-1-6.23 that:
(1) the person:
(A) acted in good faith; and
(B) reasonably believed:
(i) in the case of conduct in the person’s official capacity that the person’s conduct was in the enterprise’s best interests; and
(ii) in all other cases, that the person’s conduct was not opposed to the enterprise’s best interests; and
(C) in the case of a criminal proceeding, did not have a reasonable cause to believe the person’s conduct was unlawful;
(2) with respect to expenses, the amount of expenses is reasonable; and
(3) indemnification should be paid.
(b) Action taken or omitted by a governing person or delegate with respect to an employee benefit plan in the performance of the person’s duties for a purpose reasonably believed by the person to be in the interests of the participants in and beneficiaries of the plan is for a purpose that is not opposed to the best interests of the enterprise.
(c) Action taken or omitted by a delegate to another enterprise for a purpose reasonably believed by the delegate to be in the interest of the other enterprise or its owners or members is for a purpose that is not opposed to the best interests of the enterprise.
(d) A person does not fail to meet the standard under subsection (a)(1) solely because of the termination of a proceeding by:
(1) judgment;
(2) order;
(3) settlement;
(4) conviction; or
(5) a plea of nolo contendere or its equivalent.