§ 501B.27 — Reimbursement — indemnification — advancement of expenses

Iowa § 501B.27

• Jurisdiction: Iowa
• Title XII: BUSINESS ENTITIES
• Ch. 501B: REVISED UNIFORM UNINCORPORATED NONPROFIT ASSOCIATION ACT

Text

1. Except as otherwise provided in the governing principles, an unincorporated nonprofit
association shall reimburse a member, manager, employee, or volunteer for authorized
expenses reasonably incurred in the course of the member’s, manager’s, employee’s, or
volunteer’s activities on behalf of the association.
2. An unincorporated nonprofit association may indemnify a member, manager,
employee, or volunteer for any debt, obligation, or other liability incurred in the course of
the member’s, manager’s, employee’s, or volunteer’s activities on behalf of the association if
the person seeking indemnification has complied with section 501B.18 or 501B.23, or other
law, as applicable. Governing principles in a record may broaden or limit indemnification.
3. If a person is made or threatened to be made a party in an action based on that
person’s activities on behalf of an unincorporated nonprofit association and the person
makes a request in a record to the association, a majority of the disinterested managers
may approve in a record advance payment, or reimbursement, by the association, of all or a
part of the reasonable expenses, including attorney fees and costs, incurred by the person
before the final disposition of the proceeding. To be entitled to an advance payment or
reimbursement, the person must state in a record that the person has a good faith belief
that the criteria for indemnification in subsection 2 have been satisfied and that the person
will repay the amounts advanced or reimbursed if the criteria for payment have not been
satisfied. Governing principles in a record may broaden or limit the advance payments or
reimbursements.
4. An unincorporated nonprofit association may purchase insurance on behalf of a
member, manager, employee, or volunteer for liability asserted against or incurred by the
member, manager, employee, or volunteer in the capacity of a member, manager, employee,
or volunteer whether or not the association has authority under this chapter to reimburse,
indemnify, or advance expenses to the member, manager, employee, or volunteer against
the liability.
§501B.27, REVISED UNIFORM UNINCORPORATED NONPROFIT ASSOCIATION ACT 8
5. Therightsofreimbursement,indemnification,andadvancementofexpensesunderthis
sectionapplytoaformermember,manager,employee,orvolunteerforanactivityundertaken
on behalf of the unincorporated nonprofit association while a member, manager, employee,
or volunteer.