All sections · Part VII: Directors · Sub-Part VI: Indemnification and insurance
159 Indemnification
(1) Subject to subsection (2) and its memorandum or articles, a company may
indemnify against all expenses, including legal fees, and against all
judgments, fines and amounts paid in settlement and reasonably incurred
in connection with legal, administrative or investigative proceedings any
person who —
(a) is or was a party or is threatened to be made a party to any
threatened, pending or completed proceedings, whether civil,
criminal, administrative or investigative, by reason of the fact
that the person is or was a director of the company; or
(b) is or was, at the request of the company, serving as a director of,
or in any other capacity is or was acting for, another body
corporate or a partnership, joint venture, trust or other enterprise.
(2) Subsection (1) does not apply to a person referred to in that subsection
unless the person acted honestly and in good faith and in what he believed
to be in the best interests of the company and, in the case of criminal
proceedings, the person had no reasonable cause to believe that his
conduct was unlawful.
(3) For the purposes of subsection (2), a director acts in the best interests of
the company if he acts in the best interests of —
(a) the company‘s parent; or
(b) a member or members of the company,
in either case, in the circumstances specified in section 145(1), (2) or (3),
as the case may be.
(4) The termination of any proceedings by any judgment, order, settlement,
conviction or the entering of a nolleprosequi does not, by itself, create a
presumption that the person did not act honestly and in good faith and
with a view to the best interests of the company or that the person had
reasonable cause to believe that his conduct was unlawful.
(5) Expenses, including legal fees, incurred by a director in defending any
legal, administrative or investigative proceedings may be paid by the
company in advance of the final disposition of such proceedings upon
receipt of an undertaking by or on behalf of the director to repay the
amount if it shall ultimately be determined that the director is not entitled
to be indemnified by the company in accordance with subsection (1).
(6) Expenses, including legal fees, incurred by a former director in defending
any legal, administrative or investigative proceedings may be paid by the
company in advance of the final disposition of such proceedings upon
receipt of an undertaking by or on behalf of the former director to repay
the amount if it shall ultimately be determined that the former director is
not entitled to be indemnified by the company in accordance with
subsection (1) and upon such other terms and conditions, if any, as the
company deems appropriate.
(7) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section is not exclusive of any other rights to
which the person seeking indemnification or advancement of expenses
may be entitled under any agreement, resolution of members, resolution
of disinterested directors or otherwise, both as to acting in the person‘s
official capacity and as to acting in another capacity while serving as a
director of the company.
(8) If a person referred to in subsection (1) has been successful in defence of
any proceedings referred to in subsection (1), the person is entitled to be
indemnified against all expenses, including legal fees, and against all
judgments, fines and amounts paid in settlement and reasonably incurred
by the person in connection with the proceedings.
(9) A company shall not indemnify a person in breach of subsection (2) and
any indemnity given in breach of that section is void and of no effect.
indemnify against all expenses, including legal fees, and against all
judgments, fines and amounts paid in settlement and reasonably incurred
in connection with legal, administrative or investigative proceedings any
person who —
(a) is or was a party or is threatened to be made a party to any
threatened, pending or completed proceedings, whether civil,
criminal, administrative or investigative, by reason of the fact
that the person is or was a director of the company; or
(b) is or was, at the request of the company, serving as a director of,
or in any other capacity is or was acting for, another body
corporate or a partnership, joint venture, trust or other enterprise.
(2) Subsection (1) does not apply to a person referred to in that subsection
unless the person acted honestly and in good faith and in what he believed
to be in the best interests of the company and, in the case of criminal
proceedings, the person had no reasonable cause to believe that his
conduct was unlawful.
(3) For the purposes of subsection (2), a director acts in the best interests of
the company if he acts in the best interests of —
(a) the company‘s parent; or
(b) a member or members of the company,
in either case, in the circumstances specified in section 145(1), (2) or (3),
as the case may be.
(4) The termination of any proceedings by any judgment, order, settlement,
conviction or the entering of a nolleprosequi does not, by itself, create a
presumption that the person did not act honestly and in good faith and
with a view to the best interests of the company or that the person had
reasonable cause to believe that his conduct was unlawful.
(5) Expenses, including legal fees, incurred by a director in defending any
legal, administrative or investigative proceedings may be paid by the
company in advance of the final disposition of such proceedings upon
receipt of an undertaking by or on behalf of the director to repay the
amount if it shall ultimately be determined that the director is not entitled
to be indemnified by the company in accordance with subsection (1).
(6) Expenses, including legal fees, incurred by a former director in defending
any legal, administrative or investigative proceedings may be paid by the
company in advance of the final disposition of such proceedings upon
receipt of an undertaking by or on behalf of the former director to repay
the amount if it shall ultimately be determined that the former director is
not entitled to be indemnified by the company in accordance with
subsection (1) and upon such other terms and conditions, if any, as the
company deems appropriate.
(7) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section is not exclusive of any other rights to
which the person seeking indemnification or advancement of expenses
may be entitled under any agreement, resolution of members, resolution
of disinterested directors or otherwise, both as to acting in the person‘s
official capacity and as to acting in another capacity while serving as a
director of the company.
(8) If a person referred to in subsection (1) has been successful in defence of
any proceedings referred to in subsection (1), the person is entitled to be
indemnified against all expenses, including legal fees, and against all
judgments, fines and amounts paid in settlement and reasonably incurred
by the person in connection with the proceedings.
(9) A company shall not indemnify a person in breach of subsection (2) and
any indemnity given in breach of that section is void and of no effect.
