This Special Project Note on indemnification and the succeeding Special Project Note on insurance are intended to offer practical advice to practitioners with corporate clients. All fifty states have passed indemnification statutes that establish the scope and terms under which a corporation may, and in some cases must, indemnify its directors and officers. Legal counsel should test the scope of a particular indemnification statute by determining what standards must be met, what procedures must be followed, and what expenses may be indemnified under the relevant state statute. If a particular indemnification statute is not limited to the alternatives specified therein, counsel should determine what additional indemnity is available.
To illustrate the analysis necessary to address these issues,this Special Project Note focuses on four representative indemnification statutes--the Delaware Corporation Act, the California Corporation Act, the New York Corporation Act, and the Revised Model Business Corporation Act (Revised Model Act or Revised MBCA)--with an emphasis on the recent amendments to the Delaware and New York statutes. Part II of this Special Project Note examines statutory provisions that make indemnification mandatory. Part III analyzes provisions that authorize permissive indemnification. Finally, Part IV discusses additional methods of providing indemnification protection for corporate directors and officers, such as through charter amendments, by-law provisions, or individual contracts.
Robert P. McKinney,
Protecting Corporate Directors and Officers: Indemnification,
40 Vanderbilt Law Review
Available at: https://scholarship.law.vanderbilt.edu/vlr/vol40/iss3/8