13.1-879.1 - Court orders for advances, reimbursement or indemnification. - Virginia Statutes

§ 13.1-879.1. Court orders for advances, reimbursement or indemnification.

A. An individual who is made a party to a proceeding because he is a directorof the corporation may apply to a court for an order directing thecorporation to make advances or reimbursement for expenses, or to provideindemnification. Such application may be made to the court conducting theproceeding or to another court of competent jurisdiction.

B. The court shall order the corporation to make advances, reimbursement, orboth, for expenses or to provide indemnification if it determines that thedirector is entitled to such advances, reimbursement or indemnification andshall also order the corporation to pay the director's reasonable expensesincurred to obtain the order.

C. With respect to a proceeding by or in the right of the corporation, thecourt may (i) order indemnification of the director to the extent of thedirector's reasonable expenses if it determines that, considering all therelevant circumstances, the director is entitled to indemnification eventhough he was adjudged liable to the corporation and (ii) also order thecorporation to pay the director's reasonable expenses incurred to obtain theorder of indemnification.

D. Neither (i) the failure of the corporation, including its board ofdirectors, its independent legal counsel and its members, to have made anindependent determination prior to the commencement of any action permittedby this section that the applying director is entitled to receive advances,reimbursement, or both, nor (ii) the determination by the corporation,including its board of directors, its independent legal counsel and itsmembers, that the applying director is not entitled to receive advancesand/or reimbursement or indemnification shall create a presumption to thateffect or otherwise of itself be a defense to that director's application foradvances for expenses, reimbursement or indemnification.

(1987, cc. 59, 257; 2007, c. 925.)