Hawaii Indemnification Agreement between corporation and its directors regarding method for determining whether standards for indemnification have been met

• Category: Corporations - Public - Indemnification
• State: Multi-State
• Control #: US-CC-17-158
• Format: Word; Rich Text

Description

17-158 17-158 . . . Indemnification Agreement between corporation and its directors and/or officers including future directors and officers containing detailed provisions relating to method for determining whether standards for indemnification or reimbursement have been met and making corporation responsible for all costs of determining whether a person is entitled to indemnification or reimbursement regardless of whether person is ultimately found to be entitled to indemnification Hawaii Indemnification Agreement: A Detailed Description and Types of Agreements for Determining Compliance with Indemnification Standards Introduction: In Hawaii, the Indemnification Agreement serves as a crucial legal document between a corporation and its directors. It outlines the terms and conditions for providing indemnification to directors, ensuring they are protected in various legal situations. This detailed description provides valuable insights into the Hawaii Indemnification Agreement, including the methods for determining compliance with indemnification standards. Additionally, different types of Indemnification Agreements specific to Hawaii will also be covered. Detailed Description: 1. Purpose of the Agreement: The primary objective of the Hawaii Indemnification Agreement is to provide directors with indemnification, ensuring their essential roles in corporate decision-making are safeguarded. It establishes a contractual relationship between the corporation and its directors, offering protection against legal actions resulting from their duties as directors. 2. Core Provisions of the Agreement: a. Indemnification Scope: The agreement defines the specific scenarios in which the corporation will indemnify directors, such as legal proceedings arising from lawsuits, regulatory actions, or investigations related to corporate matters. b. Standard of Conduct: The agreement outlines the standard of conduct expected from directors to be eligible for indemnification. It often includes adherence to state and federal laws, compliance with the corporation's bylaws, acting in good faith, and prioritizing the interests of the corporation and its shareholders. c. Advancement of Expenses: The agreement specifies whether the corporation will advance legal expenses to directors before the final determination of their entitlement to indemnification, helping to alleviate financial burdens during legal proceedings. d. Method for Determining Compliance: A crucial aspect of the Indemnification Agreement is defining the method for determining whether a director meets the necessary standards for indemnification. Hawaii provides the following methods: i. Board Determination: This approach involves a majority vote of the corporation's disinterested directors or the presence of legal counsel in deciding whether indemnification is warranted. It may also consider the advice of independent experts when determining compliance. ii. Independent Legal Counsel: This method allows directors to seek advice and representation from independent legal counsel regarding their eligibility for indemnification. The counsel's opinion on compliance with the indemnification standards holds significant weight in the final determination. iii. Shareholder Determination: In certain cases, the corporation's shareholders may have the authority to determine compliance with indemnification standards. This approach involves obtaining a majority vote from disinterested shareholders to decide on the eligibility. Types of Hawaii Indemnification Agreements: 1. Standard Indemnification Agreement: This type of agreement provides a comprehensive framework for indemnification between a corporation and its directors. It includes the core provisions mentioned earlier and adopts one of the methods for determining compliance, typically the Board Determination. 2. Indemnification Agreement with Independent Legal Counsel: In situations where directors prefer an additional layer of protection, this agreement allows them to engage independent legal counsel for advice and representation. The counsel's opinion plays a pivotal role in determining compliance with indemnification standards. Conclusion: The Hawaii Indemnification Agreement is a vital tool for providing directors with important legal protections. With carefully drafted provisions and a clear method for determining compliance, this agreement ensures directors can confidently fulfill their roles without undue concern over legal repercussion. By understanding the types and intricacies of the Hawaii Indemnification Agreement, corporations can navigate the complexities of indemnification while safeguarding their directors' interests.

Hawaii Indemnification Agreement: A Detailed Description and Types of Agreements for Determining Compliance with Indemnification Standards Introduction: In Hawaii, the Indemnification Agreement serves as a crucial legal document between a corporation and its directors. It outlines the terms and conditions for providing indemnification to directors, ensuring they are protected in various legal situations. This detailed description provides valuable insights into the Hawaii Indemnification Agreement, including the methods for determining compliance with indemnification standards. Additionally, different types of Indemnification Agreements specific to Hawaii will also be covered. Detailed Description: 1. Purpose of the Agreement: The primary objective of the Hawaii Indemnification Agreement is to provide directors with indemnification, ensuring their essential roles in corporate decision-making are safeguarded. It establishes a contractual relationship between the corporation and its directors, offering protection against legal actions resulting from their duties as directors. 2. Core Provisions of the Agreement: a. Indemnification Scope: The agreement defines the specific scenarios in which the corporation will indemnify directors, such as legal proceedings arising from lawsuits, regulatory actions, or investigations related to corporate matters. b. Standard of Conduct: The agreement outlines the standard of conduct expected from directors to be eligible for indemnification. It often includes adherence to state and federal laws, compliance with the corporation's bylaws, acting in good faith, and prioritizing the interests of the corporation and its shareholders. c. Advancement of Expenses: The agreement specifies whether the corporation will advance legal expenses to directors before the final determination of their entitlement to indemnification, helping to alleviate financial burdens during legal proceedings. d. Method for Determining Compliance: A crucial aspect of the Indemnification Agreement is defining the method for determining whether a director meets the necessary standards for indemnification. Hawaii provides the following methods: i. Board Determination: This approach involves a majority vote of the corporation's disinterested directors or the presence of legal counsel in deciding whether indemnification is warranted. It may also consider the advice of independent experts when determining compliance. ii. Independent Legal Counsel: This method allows directors to seek advice and representation from independent legal counsel regarding their eligibility for indemnification. The counsel's opinion on compliance with the indemnification standards holds significant weight in the final determination. iii. Shareholder Determination: In certain cases, the corporation's shareholders may have the authority to determine compliance with indemnification standards. This approach involves obtaining a majority vote from disinterested shareholders to decide on the eligibility. Types of Hawaii Indemnification Agreements: 1. Standard Indemnification Agreement: This type of agreement provides a comprehensive framework for indemnification between a corporation and its directors. It includes the core provisions mentioned earlier and adopts one of the methods for determining compliance, typically the Board Determination. 2. Indemnification Agreement with Independent Legal Counsel: In situations where directors prefer an additional layer of protection, this agreement allows them to engage independent legal counsel for advice and representation. The counsel's opinion plays a pivotal role in determining compliance with indemnification standards. Conclusion: The Hawaii Indemnification Agreement is a vital tool for providing directors with important legal protections. With carefully drafted provisions and a clear method for determining compliance, this agreement ensures directors can confidently fulfill their roles without undue concern over legal repercussion. By understanding the types and intricacies of the Hawaii Indemnification Agreement, corporations can navigate the complexities of indemnification while safeguarding their directors' interests.