Alabama § 10A-1-6.22 General Scope of Permissive Indemnification

Alabama Statutes

§ 10A-1-6.22 — General Scope of Permissive Indemnification

Alabama § 10A-1-6.22

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-1-6.22 (General Scope of 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-1-6.22 (2026).

Text

(a)Except as otherwise provided by subsection (d) and subject to subsection (b), an enterprise may indemnify a governing person, former governing person, or delegate against a judgment, penalty, settlement, or fine, including an excise or similar tax or an excise tax assessed against the person regarding an employee benefit plan, and against reasonable expenses actually incurred by the person in connection with a proceeding.

(b)Indemnification under this chapter of a person who is found liable to the enterprise or is found liable because the person improperly received a personal benefit:

(1)is limited to reasonable expenses actually incurred by the person in connection with the proceeding; and

(2)may not be made in relation to a proceeding in which the person has been found liable for:

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(a) Except as otherwise provided by subsection (d) and subject to subsection (b), an enterprise may indemnify a governing person, former governing person, or delegate against a judgment, penalty, settlement, or fine, including an excise or similar tax or an excise tax assessed against the person regarding an employee benefit plan, and against reasonable expenses actually incurred by the person in connection with a proceeding.
(b) Indemnification under this chapter of a person who is found liable to the enterprise or is found liable because the person improperly received a personal benefit:
(1) is limited to reasonable expenses actually incurred by the person in connection with the proceeding; and
(2) may not be made in relation to a proceeding in which the person has been found liable for:
(A) willful or intentional misconduct in the performance of the person’s duty to the enterprise;
(B) breach of the person’s duty of loyalty owed to the enterprise; or
(C) an act or omission not committed in good faith that constitutes a breach of a duty owed by the person to the enterprise.
(c) A governing person, former governing person, or delegate is considered to have been found liable in relation to a claim, issue, or matter only if the liability is established by an order, including a judgment or decree of a court, and all appeals of the order are exhausted or foreclosed by law.
(d) Notwithstanding any other provision of this chapter, an enterprise may not indemnify or advance expenses to a person if the indemnification or advancement conflicts with a restriction in the enterprise’s governing documents.