§ 722 — Authorization for indemnification of directors and officers

New York § 722

• Jurisdiction: New York
• Law BSC: Business Corporation
• Art. 7: Directors and Officers

Text

§ 722. Authorization for indemnification of directors and officers.\n (a) A corporation may indemnify any person made, or threatened to be\nmade, a party to an action or proceeding (other than one by or in the\nright of the corporation to procure a judgment in its favor), whether\ncivil or criminal, including an action by or in the right of any other\ncorporation of any type or kind, domestic or foreign, or any\npartnership, joint venture, trust, employee benefit plan or other\nenterprise, which any director or officer of the corporation served in\nany capacity at the request of the corporation, by reason of the fact\nthat he, his testator or intestate, was a director or officer of the\ncorporation, or served such other corporation, partnership, joint\nventure, trust, employee benefit plan or other enterprise in any\ncapacity, against judgments, fines, amounts paid in settlement and\nreasonable expenses, including attorneys' fees actually and necessarily\nincurred as a result of such action or proceeding, or any appeal\ntherein, if such director or officer acted, in good faith, for a purpose\nwhich he reasonably believed to be in, or, in the case of service for\nany other corporation or any partnership, joint venture, trust, employee\nbenefit plan or other enterprise, not opposed to, the best interests of\nthe corporation and, in criminal actions or proceedings, in addition,\nhad no reasonable cause to believe that his conduct was unlawful.\n (b) The termination of any such civil or criminal action or proceeding\nby judgment, settlement, conviction or upon a plea of nolo contendere,\nor its equivalent, shall not in itself create a presumption that any\nsuch director or officer did not act, in good faith, for a purpose which\nhe reasonably believed to be in, or, in the case of service for any\nother corporation or any partnership, joint venture, trust, employee\nbenefit plan or other enterprise, not opposed to, the best interests of\nthe corporation or that he had reasonable cause to believe that his\nconduct was unlawful.\n (c) A corporation may indemnify any person made, or threatened to be\nmade, a party to an action by or in the right of the corporation to\nprocure a judgment in its favor by reason of the fact that he, his\ntestator or intestate, is or was a director or officer of the\ncorporation, or is or was serving at the request of the corporation as a\ndirector or officer of any other corporation of any type or kind,\ndomestic or foreign, of any partnership, joint venture, trust, employee\nbenefit plan or other enterprise, against amounts paid in settlement and\nreasonable expenses, including attorneys' fees, actually and necessarily\nincurred by him in connection with the defense or settlement of such\naction, or in connection with an appeal therein, if such director or\nofficer acted, in good faith, for a purpose which he reasonably believed\nto be in, or, in the case of service for any other corporation or any\npartnership, joint venture, trust, employee benefit plan or other\nenterprise, not opposed to, the best interests of the corporation,\nexcept that no indemnification under this paragraph shall be made in\nrespect of (1) a threatened action, or a pending action which is settled\nor otherwise disposed of, or (2) any claim, issue or matter as to which\nsuch person shall have been adjudged to be liable to the corporation,\nunless and only to the extent that the court in which the action was\nbrought, or, if no action was brought, any court of competent\njurisdiction, determines upon application that, in view of all the\ncircumstances of the case, the person is fairly and reasonably entitled\nto indemnity for such portion of the settlement amount and expenses as\nthe court deems proper.\n (d) For the purpose of this section, a corporation shall be deemed to\nhave requested a person to serve an employee benefit plan where the\nperformance by such person of his duties to the corporation also imposes\nduties on, or otherwise involves services by, such person to the plan or\nparticipants or beneficiaries of the plan; excise taxes assessed on a\nperson with respect to an employee benefit plan pursuant to applicable\nlaw shall be considered fines; and action taken or omitted by a person\nwith respect to an employee benefit plan in the performance of such\nperson's duties for a purpose reasonably believed by such person to be\nin the interest of the participants and beneficiaries of the plan shall\nbe deemed to be for a purpose which is not opposed to the best interests\nof the corporation.\n