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UTAH STATUTES AND CODES
7-7-17 - Indemnification of directors, officers, and employees.
7-7-17. Indemnification of directors, officers, and employees.
A person who is made a party in or threatened by any action, suit or proceeding, judicialor administrative, civil or criminal, by reason of his or her being or having been a director, officeror employee of an association shall be indemnified or reimbursed by the association forreasonable expenses, including attorney fees, actually incurred by him or her in connection withthat action, suit or proceeding, instituted or threatened, except that no person need be soindemnified or reimbursed, and a person may be required to return any advancement orallowance for indemnification which may have been made by the association in advance of finaldisposition, in relation to such an action, suit or proceeding in which and to the extent that hefinally is adjudicated to have been guilty of a breach of good faith, to have been negligent in theperformance of his duties or to have committed an action or failed to perform a duty for whichthere is a common law or a statutory liability; though a person may be indemnified or reimbursedfor: (1) amounts paid in compromise or settlement of any action, suit or proceeding, includingreasonable expenses incurred in connection therewith, or (2) reasonable expenses including finesand penalties, incurred in connection with a criminal or civil action, suit or proceeding in whichthe person has been adjudicated guilty, negligent or liable, if it is determined by the board ofdirectors that the person was acting in good faith and in what he believed to be the best interestsof the association and without knowledge that the action was illegal, and if the indemnification orreimbursement is approved at an annual or special meeting of the members or stockholders by amajority of the votes eligible to be cast. Amounts paid to the association, whether pursuant tojudgment or settlement, by any person within the meaning of this section may not be indemnifiedor reimbursed in any case.
A person who is made a party in or threatened by any action, suit or proceeding, judicialor administrative, civil or criminal, by reason of his or her being or having been a director, officeror employee of an association shall be indemnified or reimbursed by the association forreasonable expenses, including attorney fees, actually incurred by him or her in connection withthat action, suit or proceeding, instituted or threatened, except that no person need be soindemnified or reimbursed, and a person may be required to return any advancement orallowance for indemnification which may have been made by the association in advance of finaldisposition, in relation to such an action, suit or proceeding in which and to the extent that hefinally is adjudicated to have been guilty of a breach of good faith, to have been negligent in theperformance of his duties or to have committed an action or failed to perform a duty for whichthere is a common law or a statutory liability; though a person may be indemnified or reimbursedfor: (1) amounts paid in compromise or settlement of any action, suit or proceeding, includingreasonable expenses incurred in connection therewith, or (2) reasonable expenses including finesand penalties, incurred in connection with a criminal or civil action, suit or proceeding in whichthe person has been adjudicated guilty, negligent or liable, if it is determined by the board ofdirectors that the person was acting in good faith and in what he believed to be the best interestsof the association and without knowledge that the action was illegal, and if the indemnification orreimbursement is approved at an annual or special meeting of the members or stockholders by amajority of the votes eligible to be cast. Amounts paid to the association, whether pursuant tojudgment or settlement, by any person within the meaning of this section may not be indemnifiedor reimbursed in any case.
Amended by Chapter 378, 2010 General Session
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