Connecticut General Statutes 33-1119 – Advance for expenses
(a) A corporation may, before final disposition of a proceeding, advance funds to pay for or reimburse the reasonable expenses incurred in connection with the proceeding by an individual who is a party to the proceeding because that individual is a member of the board of directors if the director delivers to the corporation:
Terms Used In Connecticut General Statutes 33-1119
- 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
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Quorum: The number of legislators that must be present to do business.
(1) A written affirmation of the director’s good faith belief that the relevant standard of conduct described in § 33-1117 has been met by the director or that the proceeding involves conduct for which liability has been limited under a provision of the certificate of incorporation as authorized by subdivision (4) of subsection (b) of § 33-1026; and
(2) A written undertaking to repay any funds advanced if the director is not entitled to mandatory indemnification under § 33-1118 and it is ultimately determined under § 33-1120 or 33-1121 that the director has not met the relevant standard of conduct described in § 33-1117.
(b) The undertaking required by subdivision (2) of subsection (a) of this section must be an unlimited general obligation of the director but need not be secured and may be accepted without reference to the financial ability of the director to make repayment.
(c) Authorizations under this section shall be made:
(1) By the board of directors: (A) If there are two or more qualified directors, by a majority vote of all the qualified directors, a majority of whom shall for such purpose constitute a quorum, or by a majority of the members of a committee of two or more qualified directors appointed by such a vote; or (B) if there are fewer than two qualified directors, by the vote necessary for action by the board in accordance with subsection (c) of § 33-1100, in which authorization directors who are not qualified directors may participate; or
(2) By the members, but a member who is also a director who at the time is not a qualified director may not vote on the authorization.