47-17-21. Indemnification of directors, officers, agents, and employees against liability under certain circumstances. Except as otherwise provided in § 47-17-22, a cooperative may indemnify a director, officer, agent, or employee who is a party to a proceeding by reason of being a director, officer, agent, or employee, against liability incurred in the proceeding if the director, officer, agent, or employee:

(1) Acted in good faith; and

(2) Reasonably believed:

(a) In the case of conduct in an official capacity, that the conduct was in the best interests of the cooperative; and

(b) In all other cases, that the conduct was at least not opposed to the best interests of the cooperative; and

(3) In the case of any criminal proceeding, had no reasonable cause to believe the conduct was unlawful.

A cooperative may also, except as provided in § 47-17-22, indemnify a director, officer, agent, or employee who is a party to a proceeding against liability incurred in the proceeding if the director, officer, agent, or employee engaged in conduct for which broader indemnification has been made permissible or obligatory under a provision of the articles of incorporation.

The conduct of a director, officer, agent, or employee with respect to an employee benefit plan for a purpose the director, officer, agent, or employee reasonably believed to be in the interests of the participants in, and the beneficiaries of, the plan is conduct that satisfies the requirement of subsection (2)(b).

The termination of a proceeding by judgment, order, settlement, or conviction, or upon a plea of nolo contendere or its equivalent, is not, of itself, determinative that the director, officer, agent, or employee did not meet the relevant standard of conduct described in this section.

Source: SL 2007, ch 260, § 4; SL 2009, ch 232, § 4.