Mecklenburg North Carolina Indemnification of Corporate Director

• Category: Corporations - Officers and Employees
• State: Multi-State
• County: Mecklenburg
• 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. Mecklenburg North Carolina Indemnification of Corporate Director refers to the legal provisions and protections granted to directors of corporations operating within Mecklenburg County, North Carolina. This indemnification primarily aims to shield corporate directors from personal liability for their actions and decisions made in good faith while acting within their authorized capacities. Under Mecklenburg North Carolina law, there are generally two types of indemnification available to corporate directors: 1. Mandatory Indemnification: According to the North Carolina Business Corporation Act (NC BCA), a corporation is required to indemnify any director who is successful on the merits or otherwise in defense of any proceeding, whether civil, criminal, administrative, or investigative. However, this indemnification is subject to certain conditions, such as the director must have acted in good faith and in a manner reasonably believed to be in the best interests of the corporation. 2. Permissive Indemnification: In addition to mandatory indemnification, Mecklenburg North Carolina law also allows corporations to provide permissive indemnification to their directors. This means that a corporation can choose to indemnify its directors, even if they do not meet the conditions set forth in the mandatory indemnification provisions. Permissive indemnification may be granted by the corporation's articles of incorporation, bylaws, a resolution of the board of directors, or by an agreement between the corporation and the director. The purpose of Mecklenburg North Carolina Indemnification of Corporate Director is to encourage individuals to serve as directors by protecting them from personal financial harm resulting from their corporate responsibilities. It reinforces the notion that directors should not be deterred from making important decisions in the best interests of the corporation due to fears of personal liability. It is important to note that the specific provisions and requirements for indemnification may vary based on the corporation's governing documents and applicable state laws. Therefore, directors and corporations should consult legal professionals familiar with Mecklenburg North Carolina corporate law to ensure compliance and determine the extent of indemnification coverage available.

Mecklenburg North Carolina Indemnification of Corporate Director refers to the legal provisions and protections granted to directors of corporations operating within Mecklenburg County, North Carolina. This indemnification primarily aims to shield corporate directors from personal liability for their actions and decisions made in good faith while acting within their authorized capacities. Under Mecklenburg North Carolina law, there are generally two types of indemnification available to corporate directors: 1. Mandatory Indemnification: According to the North Carolina Business Corporation Act (NC BCA), a corporation is required to indemnify any director who is successful on the merits or otherwise in defense of any proceeding, whether civil, criminal, administrative, or investigative. However, this indemnification is subject to certain conditions, such as the director must have acted in good faith and in a manner reasonably believed to be in the best interests of the corporation. 2. Permissive Indemnification: In addition to mandatory indemnification, Mecklenburg North Carolina law also allows corporations to provide permissive indemnification to their directors. This means that a corporation can choose to indemnify its directors, even if they do not meet the conditions set forth in the mandatory indemnification provisions. Permissive indemnification may be granted by the corporation's articles of incorporation, bylaws, a resolution of the board of directors, or by an agreement between the corporation and the director. The purpose of Mecklenburg North Carolina Indemnification of Corporate Director is to encourage individuals to serve as directors by protecting them from personal financial harm resulting from their corporate responsibilities. It reinforces the notion that directors should not be deterred from making important decisions in the best interests of the corporation due to fears of personal liability. It is important to note that the specific provisions and requirements for indemnification may vary based on the corporation's governing documents and applicable state laws. Therefore, directors and corporations should consult legal professionals familiar with Mecklenburg North Carolina corporate law to ensure compliance and determine the extent of indemnification coverage available.