2011 Montana Code Annotated
TITLE 35. CORPORATIONS, PARTNERSHIPS, AND ASSOCIATIONS
CHAPTER 1. BUSINESS CORPORATIONS
Part 4. Directors and Officers
35-1-456. Determination and authorization of indemnification.

35-1-456. Determination and authorization of indemnification. (1) A corporation may not indemnify a director under 35-1-452 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 35-1-452.
(2) The determination must be made:
(a) by the board of directors by majority vote of a quorum consisting of directors not at the time parties to the proceeding;
(b) if a quorum cannot be obtained under subsection (2)(a), by majority vote of a committee designated by the board of directors, in which designated directors who are parties may participate, consisting solely of two or more directors not at the time parties to the proceeding;
(c) by special legal counsel:
(i) selected by the board of directors or its committee in the manner prescribed in subsection (2)(a) or (2)(b); or
(ii) if a quorum of the board of directors cannot be obtained under subsection (2)(a) and a committee cannot be designated under subsection (2)(b), selected by majority vote of the full board of directors in which selected directors who are parties may participate; or
(d) by the shareholders, but shares owned by or voted under the control of directors who are at the time parties to the proceeding may not be voted on the determination.
(3) Authorization of indemnification and evaluation as to reasonableness of expenses must be made in the same manner as the determination that indemnification is permissible, except that if the determination is made by special legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses must be made by those entitled under subsection (2)(c) to select counsel.

History: En. Sec. 104, Ch. 368, L. 1991.