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This entry was published on 2014-09-22
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SECTION 7022
Other provisions affecting indemnification of directors and officers
Banking (BNK) CHAPTER 2, ARTICLE 15, TITLE 7
§ 7022. Other provisions affecting indemnification of directors and
officers. 1. All expenses incurred in defending a civil or criminal
action or proceeding which are advanced by the corporation under
subdivision three of section seven thousand twenty or allowed by a court
under subdivision three of section seven thousand twenty-one shall be
repaid in case the person receiving such advancement or allowance is
ultimately found, under the procedure set forth in this article, not to
be entitled to indemnification or, where indemnification is granted, to
the extent the expenses so advanced by the corporation or allowed by the
court exceed the indemnification to which he is entitled.

2. No indemnification, advancement or allowance shall be made under
this article in any circumstance where it appears:

(a) That the indemnification would be inconsistent with a provision of
the organization certificate, a by-law, a resolution of the board or of
the stockholders, an agreement or other proper corporate action, in
effect at the time of the accrual of the alleged cause of action
asserted in the threatened or pending action or proceeding in which the
expenses were incurred or other amounts were paid, which prohibits or
otherwise limits indemnification; or

(b) If there has been a settlement approved by the court, that the
indemnification would be inconsistent with any condition with respect to
indemnification expressly imposed by the court in approving the
settlement.

3. If any expenses or other amounts are paid by way of indemnification
otherwise than by court order or action by the stockholders, the
corporation shall, not later than the next annual meeting of
stockholders unless such meeting is held within three months from the
date of such payment, and, in any event, within fifteen months from the
date of such payment, mail to its stockholders of record at the time
entitled to vote for the election of directors a statement specifying
the persons paid, the amounts paid, and the nature and status at the
time of such payment of the litigation or threatened litigation.

4. If any action with respect to indemnification of directors and
officers is taken by way of amendment of the by-laws, resolution of
directors, or by agreement, then the corporation shall, not later than
the next annual meeting of shareholders, unless such meeting is held
within three months from the date of such action and, in any event
within fifteen months from the date of such action, mail to its
shareholders of record at the time entitled to vote for the election of
directors a statement specifying the action taken.

5. No payment of indemnification, advancement or allowance under this
article shall be made unless a notice has been filed with the
superintendent, not less than thirty days prior to such payment,
specifying the persons to be paid, the amounts to be paid, the manner in
which such payment was authorized, and the nature and status at the time
of the notice of the litigation or threatened litigation.