South Carolina 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. The South Carolina Indemnification of Corporate Director refers to a legal provision that provides protection and financial security to directors of corporations operating in South Carolina. This provision aims to ensure that directors can carry out their duties without fear of personal liability for their actions and decisions while acting within the scope of their roles. Under South Carolina law, there are different types of indemnification available to corporate directors, namely: 1. Indemnification by the Corporation: In this type, the corporation is permitted to indemnify directors against any expenses, judgments, fines, or amounts paid in settlement, including attorney's fees incurred in connection with legal proceedings. The corporation may provide such indemnification if the director acted in good faith and in a manner he or she reasonably believed to be in the best interests of the corporation or, in the case of criminal proceedings, if the director had no reasonable cause to believe their conduct was unlawful. 2. Indemnification by Court Order: Directors may also seek indemnification through a Court order. If a director is successful in defending a legal proceeding, the court may order the corporation to reimburse the director for costs and expenses incurred, including attorney's fees. 3. Advancement of Expenses: Directors in South Carolina may request the corporation to advance their reasonable expenses in defending a legal proceeding before its final disposition. This allows directors to access funds necessary to cover legal fees and costs during the litigation process. 4. Scope and Limitations: It is important to note that indemnification is subject to certain limitations and exceptions, primarily when directors are found liable for their intentional misconduct, fraud, or unlawful gain. Additionally, indemnification is typically limited to the extent of the director's actual and reasonable expenses, making it crucial for directors to act responsively and within the bounds of their fiduciary duties. In summary, the South Carolina Indemnification of Corporate Director is a legal provision designed to protect and safeguard directors, enabling them to fulfill their duties without the fear of personal liability. These indemnification options include indemnification by the corporation, indemnification by Court order, advancement of expenses, and indemnification subject to certain limitations.

The South Carolina Indemnification of Corporate Director refers to a legal provision that provides protection and financial security to directors of corporations operating in South Carolina. This provision aims to ensure that directors can carry out their duties without fear of personal liability for their actions and decisions while acting within the scope of their roles. Under South Carolina law, there are different types of indemnification available to corporate directors, namely: 1. Indemnification by the Corporation: In this type, the corporation is permitted to indemnify directors against any expenses, judgments, fines, or amounts paid in settlement, including attorney's fees incurred in connection with legal proceedings. The corporation may provide such indemnification if the director acted in good faith and in a manner he or she reasonably believed to be in the best interests of the corporation or, in the case of criminal proceedings, if the director had no reasonable cause to believe their conduct was unlawful. 2. Indemnification by Court Order: Directors may also seek indemnification through a Court order. If a director is successful in defending a legal proceeding, the court may order the corporation to reimburse the director for costs and expenses incurred, including attorney's fees. 3. Advancement of Expenses: Directors in South Carolina may request the corporation to advance their reasonable expenses in defending a legal proceeding before its final disposition. This allows directors to access funds necessary to cover legal fees and costs during the litigation process. 4. Scope and Limitations: It is important to note that indemnification is subject to certain limitations and exceptions, primarily when directors are found liable for their intentional misconduct, fraud, or unlawful gain. Additionally, indemnification is typically limited to the extent of the director's actual and reasonable expenses, making it crucial for directors to act responsively and within the bounds of their fiduciary duties. In summary, the South Carolina Indemnification of Corporate Director is a legal provision designed to protect and safeguard directors, enabling them to fulfill their duties without the fear of personal liability. These indemnification options include indemnification by the corporation, indemnification by Court order, advancement of expenses, and indemnification subject to certain limitations.