(1) A corporation may not indemnify a director under section 7-109-102 unless authorized in the specific case after a determination has been made that indemnification of the director is permissible in the circumstances because the director has met the standard of conduct set forth in section 7-109-102. A corporation shall not advance expenses to a director under section 7-109104 unless authorized in the specific case after the written affirmation and undertaking required by section 7-109-104 (1)(a) and (1)(b) are received.
(2) The determinations required by subsection (1) of this section must be made:
If there are two or more disinterested directors, by the board of directors by a majority vote of all the disinterested directors, a majority of whom constitute a quorum for this purpose, or by a majority vote of a committee of the board of directors appointed by such a vote, which committee consists of two or more disinterested directors;
By independent legal counsel selected in the manner specified in subsection (2)(a) ofthis section or, if there are fewer than two disinterested directors, by independent legal counsel selected by a majority vote of the full board of directors; or
By the shareholders, but shares owned by or voted under the control of a directorwho at the time is not a disinterested director may not be voted on the determination.
(3) Authorization of indemnification and an advance of expenses must be made in the same manner as the determination that indemnification or an advance of expenses is permissible; except that, if the determination that indemnification or an advance of expenses is permissible is made by independent legal counsel, authorization of indemnification and an advance of expenses must be made by the body that selected the counsel.
Source: L. 93: Entire article added, p. 792, § 1, effective July 1, 1994. L. 2019: Entire section amended, (SB 19-086), ch. 166, p. 1939, § 42, effective July 1, 2020.