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.
South Carolina Indemnification of Corporate Director
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Indemnification under Companies Act, 2013: While Section 201 of the erstwhile Companies Act, 1956 had restricted a company from indemnifying the directors of the company, the Companies Act, 2013 does not have any such restriction and therefore, directors can now be indemnified by companies against liabilities.
Indemnification is where the company reimburses the 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.
Indemnification. Indemnification is an undertaking by the company to defend the director and officer against the cost of certain claims, including legal fees, litigation awards and settlement costs.
C. § 145) gives Delaware corporations the power to indemnify any person who has been made a party to a proceeding "by reason of" that person's service to the corporation. This indemnification becomes mandatory if the person succeeds in that proceeding.
Any UK company can now indemnify any of its directors, and any director of a company in the same group, against damages, costs and interest awarded against him in civil proceedings brought by a third party, and against legal and other costs incurred in defending both civil and criminal proceedings if and when the
An Alberta corporation is not permitted to indemnify its directors for their actions if they have not acted honestly and in good faith with a view to the best interests of the corporation that is, if they have breached their fiduciary duty to the corporation.
Companies may indemnify directors against the legal and financial costs of proceedings brought by third parties. This does not extend to the legal costs of unsuccessful defence of criminal proceedings, fines imposed by criminal proceedings and fines imposed by regulatory bodies.
By statute, Delaware has established a minimum standard of conduct that, if met by a director or officer, permits a corporation to indemnify such director or officer pursuant to a charter or bylaw provision, an indemnification agreement with such D&O, or a resolution of the board or stockholders.
To indemnify means to compensate someone for his/her harm or loss. In most contracts, an indemnification clause serves to compensate a party for harm or loss arising in connection with the other party's actions or failure to act. The intent is to shift liability away from one party, and on to the indemnifying party.
Owners of corporations and limited liability companies can have statutory and contractual obligations to indemnify officers, directors, managers, and members for legal fees incurred in defending litigation.