An Indiana Indemnification Agreement between a corporation and its current and future directors is a legally binding contract that provides comprehensive protection to directors against any legal actions or liabilities arising from their role in the corporation. This agreement ensures that directors can carry out their duties diligently without the fear of personal financial loss or legal consequences. Under the Indiana Business Corporation Law, there are different types of indemnification agreements that can be established between a corporation and its directors. These include: 1. Indemnification Agreement for Current Directors: This type of agreement is specifically designed to protect the corporation's current directors. It outlines the corporation's obligation to indemnify directors against any expenses, judgments, fines, or liabilities incurred as a result of their service to the corporation. The agreement encompasses legal defense costs, settlements, and damages awarded in legal proceedings. 2. Indemnification Agreement for Future Directors: As the composition of a corporation's board of directors may change over time, it is essential to have an indemnification agreement in place for future directors as well. This agreement outlines the same protections and provisions as the one for current directors and ensures that individuals considering directorship roles are aware of the indemnification coverage that will be provided to them. Key components and relevant keywords to consider when drafting an Indiana indemnification agreement: 1. Indemnification Scope: Clearly define the extent of indemnification protection provided to directors, covering expenses, judgments, fines, and liabilities incurred in connection with their official duties. 2. Third-Party Claims: Outline situations where directors may face legal actions due to their affiliation with the corporation, such as shareholder lawsuits or regulatory investigations, and specify that they will be indemnified for such claims. 3. Advancement of Expenses: Specify that the corporation will advance legal expenses to directors promptly, including attorney fees, court costs, and related expenses, to ensure unfettered access to legal representation. 4. Standard of Conduct: Highlight the standard of conduct that directors must adhere to in order to be eligible for indemnification, such as acting in good faith, in the best interests of the corporation, and not being involved in intentional misconduct or gross negligence. 5. Procedures for Indemnification: Establish clear procedures for directors to request indemnification, including providing timely notice to the corporation, supplying relevant documentation, and outlining the corporation's review and approval process. 6. Indemnification Limitations: Specify any limitations or exceptions to indemnification coverage, such as instances where a director is found liable for willful misconduct or illegal activities. 7. Insurance Coverage: Address the corporation's commitment to obtaining and maintaining directors and officers liability insurance, which can complement the indemnification agreement by providing additional financial protections to directors. Overall, an Indiana Indemnification Agreement between a corporation and its directors is a crucial document for safeguarding the interests and responsibilities of directors. By offering comprehensive indemnification protections, corporations aim to attract and retain qualified directors to serve on their boards, while directors gain peace of mind, knowing that they will be protected from personal financial liabilities when acting in the best interests of the corporation.
Indiana Indemnification Agreement between corporation and its current and future directors
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FAQ
The Certificate of Incorporation (the ?Charter?) and the Bylaws (the ?Bylaws?) of the Company require indemnification of the officers and directors of the Company.
A company may, however, lend money to a director to fund the director's defence costs. Frequently, an indemnity will include a provision under which the company agrees to lend the director the amounts necessary to fund the director's defence costs.
Indemnification is, generally speaking, a reimbursement by a company of its Ds&Os for expenses or losses they have incurred in connection with litigation or other proceedings relating to their service to the company.
Section 145(b) empowers a corporation to indemnify its directors against expenses incurred in connection with the defense or settlement of an action brought by or in the right of the corporation, subject to the standard of conduct determination, and except that no indemnification may be made as to any claim to which ...
In the indemnification agreement, the corporation agrees to reimburse the director or officer for losses incurred in legal proceedings related to their service as a corporate director or officer to the maximum extent permitted by law.
A legal term that means one party agrees to compensate another party for loss or damage that has already occurred, or guarantees, through a contractual agreement, to repay another party for loss or damage that occurs in the future. Indemnification clauses are common in corporations and LLCs.
A director and officer indemnification agreement is a contract that allows executives to protect themselves from claims made against them while performing job. Indemnification means that in the event a lawsuit is filed against a company, the indemnified party is "held harmless" from claims.
The official must agree to pay back the funds received if it is found they are not entitled to indemnification. Advancement ensures that company officials have the resources to resist unjustified lawsuits without relieving them of responsibility for any bad faith conduct established.