Montana Code 35-14-856. Indemnification of officers
35-14-856. Indemnification of officers. (1) A corporation may indemnify and advance expenses under 35-14-850 through 35-14-859 to an officer who is a party to a proceeding because the person is an officer:
Terms Used In Montana Code 35-14-856
- Contract: A legal written agreement that becomes binding when signed.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Indemnification: In general, a collateral contract or assurance under which one person agrees to secure another person against either anticipated financial losses or potential adverse legal consequences. Source: FDIC
- Person: includes a corporation or other entity as well as a natural person. See Montana Code 1-1-201
(a)to the same extent as a director; and
(b)if the person is an officer but not a director, to any further extent provided by the articles of incorporation or the bylaws or by a resolution adopted or a contract approved by the board of directors or shareholders, except for:
(i)liability in connection with a proceeding by or in the right of the corporation other than for expenses incurred in connection with the proceeding; or
(ii)liability arising out of conduct that constitutes:
(A)receipt by the officer of a financial benefit to which the officer is not entitled;
(B)an intentional infliction of harm on the corporation or the shareholders; or
(C)an intentional violation of criminal law.
(2)Subsection (1)(b) applies to an officer who is also a director if the officer is made a party to the proceeding based on an act or omission solely as an officer.
(3)An officer who is not a director is entitled to mandatory indemnification under 35-14-852 and may apply to a court under 35-14-854 for indemnification or an advance for expenses, in each case to the same extent to which a director may be entitled to indemnification or advance for expenses under those sections.