New Hampshire Indemnification of Corporate Director

• Category: Corporations - Officers and Employees
• State: Multi-State
• Control #: US-13374BG
• Format: Word; Rich Text

Description

Indemnification is where the company reimburses a director or officer for the attorneys' fees and costs, and potentially judgments, incurred in connection with claims arising out of the director's or officer's service to the company. New Hampshire Indemnification of Corporate Director refers to the legal provisions and protections offered to corporate directors in the state of New Hampshire. Under these provisions, corporations have the ability to indemnify their directors for expenses, liabilities, and legal costs incurred while carrying out their duties as corporate directors. The primary purpose of New Hampshire's indemnification laws is to protect corporate directors from personal financial liability resulting from their actions or decisions made in good faith while serving the corporation. This indemnification aims to encourage individuals to take up directorship roles by mitigating the risks associated with such positions. New Hampshire recognizes two types of indemnification for corporate directors: mandatory indemnification and permissive indemnification. 1. Mandatory Indemnification: According to New Hampshire Revised Statutes §293-A:8.51, a director is entitled to mandatory indemnification if they were successful in defending against any proceeding or if they acted in good faith while performing their duties and reasonably believed that their actions were in the best interests of the corporation. In such cases, the corporation is obligated to provide indemnification to the director. 2. Permissive Indemnification: Permissive indemnification is applicable in situations where the director does not meet the criteria for mandatory indemnification, but the corporation's board of directors or shareholders determine that indemnification is appropriate. This determination usually occurs after a case-by-case evaluation of the director's actions and circumstances. Both mandatory and permissive indemnification cover various costs incurred by directors, including legal fees, court costs, judgments, settlements, and even certain out-of-pocket expenses. However, it is essential to note that New Hampshire's indemnification laws may not cover instances where a director is found liable for willful misconduct, bad faith, or intentional violation of the law. New Hampshire's indemnification provisions also permit corporations to advance expenses to directors before the final disposition of a proceeding, ensuring that directors can access necessary funds to defend themselves promptly. It is crucial for corporate directors to familiarize themselves with New Hampshire's indemnification laws, as they provide valuable protections against personal liability when fulfilling their duties. However, directors should also understand the limitations and exceptions to indemnification, particularly in cases involving egregious misconduct. Seeking legal advice is recommended to fully comprehend the applicability and nuances of New Hampshire's indemnification of corporate directors.

New Hampshire Indemnification of Corporate Director refers to the legal provisions and protections offered to corporate directors in the state of New Hampshire. Under these provisions, corporations have the ability to indemnify their directors for expenses, liabilities, and legal costs incurred while carrying out their duties as corporate directors. The primary purpose of New Hampshire's indemnification laws is to protect corporate directors from personal financial liability resulting from their actions or decisions made in good faith while serving the corporation. This indemnification aims to encourage individuals to take up directorship roles by mitigating the risks associated with such positions. New Hampshire recognizes two types of indemnification for corporate directors: mandatory indemnification and permissive indemnification. 1. Mandatory Indemnification: According to New Hampshire Revised Statutes §293-A:8.51, a director is entitled to mandatory indemnification if they were successful in defending against any proceeding or if they acted in good faith while performing their duties and reasonably believed that their actions were in the best interests of the corporation. In such cases, the corporation is obligated to provide indemnification to the director. 2. Permissive Indemnification: Permissive indemnification is applicable in situations where the director does not meet the criteria for mandatory indemnification, but the corporation's board of directors or shareholders determine that indemnification is appropriate. This determination usually occurs after a case-by-case evaluation of the director's actions and circumstances. Both mandatory and permissive indemnification cover various costs incurred by directors, including legal fees, court costs, judgments, settlements, and even certain out-of-pocket expenses. However, it is essential to note that New Hampshire's indemnification laws may not cover instances where a director is found liable for willful misconduct, bad faith, or intentional violation of the law. New Hampshire's indemnification provisions also permit corporations to advance expenses to directors before the final disposition of a proceeding, ensuring that directors can access necessary funds to defend themselves promptly. It is crucial for corporate directors to familiarize themselves with New Hampshire's indemnification laws, as they provide valuable protections against personal liability when fulfilling their duties. However, directors should also understand the limitations and exceptions to indemnification, particularly in cases involving egregious misconduct. Seeking legal advice is recommended to fully comprehend the applicability and nuances of New Hampshire's indemnification of corporate directors.