10-3853. Advance for expenses
A. A corporation may pay for or reimburse the reasonable expenses incurred by a
director who is a party to a proceeding in advance of final disposition of the proceeding
if both of the following conditions exist:
1. The director furnishes to the corporation a written affirmation of the
director's good faith belief that the director has met the standard of conduct described
in section 10-3851 or that the proceeding involves conduct for which liability has been
eliminated under a provision of the articles of incorporation pursuant to section
10-3202, subsection B, paragraph 1.
2. The director furnishes the corporation with a written undertaking, executed
personally or on the director's behalf, to repay the advance if the director is not
entitled to mandatory indemnification under section 10-3852 and it is ultimately
determined that the director did not meet the standard of conduct.
B. The undertaking required by subsection A, paragraph 2 of this section is an
unlimited general obligation of the director but need not be secured and may be accepted
without reference to financial ability to make repayment.
C. Authorizations of payments under this section shall be made in a manner
consistent with section 10-3830 or 10-3842.
D. This section does not apply to advancement of expenses to or for the benefit of
an outside director. Advances to outside directors shall be made pursuant to section
10-3852.
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