Indemnification
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14 Indemnification:
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14.1 Actions Against the Association:
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| The Association
shall indemnify any person who was or is a party or is threatened
to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in
the right of the Association) by reason of the fact that he or
she is or was a director, trustee, officer, or agent of the
Association or of a predecessor association, or is or was serving
at the request of the Association or of a predecessor association
as a director, trustee, officer, or agent of another association,
partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by
him or her in connection with such action, suit or proceeding if
he or she acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests
of the Association, and with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct
was unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not of itself create a
presumption that the person did not act in good faith and in a
manner in which he or she reasonably believed to be in or not
opposed to the best interests of the Association, and with
respect to any criminal action or proceeding had reasonable cause
to believe that his or her conduct was unlawful. |
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14.2 Actions By or In the Right of the Association:
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| The
Association shall indemnify any person who was or is threatened
to be made a party to any threatened, pending or completed action
or suit by or in the right of the Association to procure a
judgment in its favor by reason of the fact that he or she is or
was a Director, trustee, officer, or agent of the Association, or
is or was serving at the request of the Association or of a
predecessor association as a Director, trustee, officer, or agent
of another association, partnership, joint venture, trust or
other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him or her in connection with
the defense or settlement of such action or suit if he or she
acted in good faith and in a manner he or she reasonably believed
to be in or not opposed to the best interests of the Association
and except that no indemnification shall be made in respect to
any claim, issue or matter as to which such person shall have
been adjudged to be liable for negligence or misconduct in the
performance of his or her duty to the Association unless and only
to the extent that the court in which such action or suit was
brought shall determine upon application that, despite the
adjudication of liability but in view of all circumstances of the
case, such person is fairly and reasonably entitled to indemnity
for such expenses which such court shall deem proper.
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14.3 Expenses Paid:
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| To the extent that a Director,
trustee, officer, or agent of the Association has been successful
on the merits or otherwise in defense of any action, suit or
proceeding referred to in Sections 14.1 and 14.2, or in defense
of any claim, issue or matter therein, he or she shall be
indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by him or her in connection therewith.
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14.4 Authorization:
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| Any indemnification under Section 14.1
and 14.2 (unless ordered by a court) shall be made by the
Association only as authorized in the specific case upon a
determination that indemnification of the Director, trustee,
officer, or agent is proper in the circumstances because he or
she has met the applicable standard of conduct set forth in
Sections 14.1 and 14.2. Such determination shall be made
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| (a) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or
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| (b) if such quorum is not obtainable, or even if obtainable, a quorum of disinterested directors so directs, in independent legal counsel in a written opinion, or
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14.5 Advance Payment:
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| Expenses (including attorneys' fees)
incurred in defending a civil or criminal action, suit or
proceeding may be paid by the Association in advance of the final
disposition of such action, suit or proceeding as authorized in
the manner provided in Section 14.4 upon receipt of an
undertaking by or on behalf of the Director, trustee, officer, or
agent to repay such amount unless it shall ultimately be
determined that he or she is entitled to be indemnified by the
Association as authorized in this section.
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14.6 Non-exclusive Right:
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The indemnification provided by
this Article shall not be deemed exclusive of any other rights to
which those indemnified may be entitled under any bylaw,
agreement, vote of member groups disinterested directors, or
otherwise, both as to action in his or her official capacity and
as to action in another capacity while holding such office, and
shall continue as to a person who has ceased to be a Director,
trustee, officer or agent of the Association. |