{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/13.1-697.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/13.1-697.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/13.1-697.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/13.1-697.html"}],"law_id":64034,"edition_id":1,"section_id":64034,"structure_id":15231,"section_number":"13.1-697","catch_line":"Authority to indemnify","history":"Code 1950, \u00a7 13.1-3.1; 1968, c. 570; 1975, c. 500; 1979, c. 99; 1985, c. 522; 2005, c. 765; 2019, c. 734.","full_text":"A\n\nExcept as provided in subsection D, a corporation may indemnify an individual who is a party to a proceeding because the individual is or was a director against liability incurred in the proceeding if:1\n\nThe director:\n\t\t\t\ta. Conducted himself in good faith; and\n\t\t\t\tb. Believed:1\n\nIn the case of conduct in his official capacity with the corporation, that his conduct was in its best interests; and2\n\nIn all other cases, that his conduct was at least not opposed to its best interests; and\n\t\t\t\t\tc. In the case of any criminal proceeding, he had no reasonable cause to believe his conduct was unlawful; or2\n\nThe director engaged in conduct for which broader indemnification has been made permissible or obligatory as authorized by subsection C of § 13.1-704.B\n\nA director’s conduct with respect to an employee benefit plan for a purpose he believed to be in the interests of the participants in and beneficiaries of the plan is conduct that satisfies the requirement of subdivision A 1 b (2).C\n\nThe 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 did not meet the relevant standard of conduct described in this section.D\n\nUnless ordered by a court under subsection C of \u00a7 13.1-700.1 or broader indemnification has been made permissible or obligatory as authorized by subsection C of \u00a7 13.1-704, a corporation may not indemnify a director under this section:1\n\nIn connection with a proceeding by or in the right of the corporation except for expenses incurred in connection with the proceeding if it is determined that the director has met the relevant standard under subsection A; or2\n\nIn connection with any other proceeding charging improper personal benefit to the director, whether or not involving action in his official capacity, in which he was adjudged liable on the basis that personal benefit was improperly received by him.","order_by":null,"text":{"0":{"id":233184,"text":"Except as provided in subsection D, a corporation may indemnify an individual who is a party to a proceeding because the individual is or was a director against liability incurred in the proceeding if:","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"A1"},"1":{"id":233185,"text":"The director:\n\t\t\t\ta. Conducted himself in good faith; and\n\t\t\t\tb. Believed:","type":"section","prefixes":["A","1"],"prefix":"1","entire_prefix":"A1","prefix_anchor":"A1","level":2,"prior_prefix":"A","next_prefix":"A11"},"2":{"id":233186,"text":"In the case of conduct in his official capacity with the corporation, that his conduct was in its best interests; and","type":"section","prefixes":["A","1","1"],"prefix":"1","entire_prefix":"A11","prefix_anchor":"A11","level":3,"prior_prefix":"A1","next_prefix":"A12"},"3":{"id":233187,"text":"In all other cases, that his conduct was at least not opposed to its best interests; and\n\t\t\t\t\tc. In the case of any criminal proceeding, he had no reasonable cause to believe his conduct was unlawful; or","type":"section","prefixes":["A","1","2"],"prefix":"2","entire_prefix":"A12","prefix_anchor":"A12","level":3,"prior_prefix":"A11","next_prefix":"A2"},"4":{"id":233188,"text":"The director engaged in conduct for which broader indemnification has been made permissible or obligatory as authorized by subsection C of § 13.1-704.","type":"section","prefixes":["A","2"],"prefix":"2","entire_prefix":"A2","prefix_anchor":"A2","level":2,"prior_prefix":"A12","next_prefix":"B"},"5":{"id":233189,"text":"A director’s conduct with respect to an employee benefit plan for a purpose he believed to be in the interests of the participants in and beneficiaries of the plan is conduct that satisfies the requirement of subdivision A 1 b (2).","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A2","next_prefix":"C"},"6":{"id":233190,"text":"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 did not meet the relevant standard of conduct described in this section.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B","next_prefix":"D"},"7":{"id":233191,"text":"Unless ordered by a court under subsection C of \u00a7 13.1-700.1 or broader indemnification has been made permissible or obligatory as authorized by subsection C of \u00a7 13.1-704, a corporation may not indemnify a director under this section:","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"D1"},"8":{"id":233192,"text":"In connection with a proceeding by or in the right of the corporation except for expenses incurred in connection with the proceeding if it is determined that the director has met the relevant standard under subsection A; or","type":"section","prefixes":["D","1"],"prefix":"1","entire_prefix":"D1","prefix_anchor":"D1","level":2,"prior_prefix":"D","next_prefix":"D2"},"9":{"id":233193,"text":"In connection with any other proceeding charging improper personal benefit to the director, whether or not involving action in his official capacity, in which he was adjudged liable on the basis that personal benefit was improperly received by him.","type":"section","prefixes":["D","2"],"prefix":"2","entire_prefix":"D2","prefix_anchor":"D2","level":2,"prior_prefix":"D1"}},"ancestry":[{"id":15231,"edition_id":1,"name":"Indemnification","identifier":"10","label":"article","depth":3,"order_by":1,"parent_id":12983,"metadata":{},"date_created":"2026-06-26 03:53:12","date_modified":"2026-06-26 03:53:12","permalink":{"id":150265,"object_type":"structure","relational_id":15231,"identifier":"10","token":"13.1\/9\/10","url":"\/13.1\/9\/10\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12983,"edition_id":1,"name":"Virginia Stock Corporation Act","identifier":"9","label":"chapter","depth":2,"order_by":1,"parent_id":12744,"metadata":{},"date_created":"2026-06-26 03:44:06","date_modified":"2026-06-26 03:44:06","permalink":{"id":150163,"object_type":"structure","relational_id":12983,"identifier":"9","token":"13.1\/9","url":"\/13.1\/9\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12744,"edition_id":1,"name":"Corporations","identifier":"13.1","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:51","date_modified":"2026-06-26 03:43:51","permalink":{"id":147493,"object_type":"structure","relational_id":12744,"identifier":"13.1","token":"13.1","url":"\/13.1\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":83273,"structure_id":15231,"section_number":"13.1-696","catch_line":"Definitions","url":"\/13.1-696\/","token":"13.1\/9\/10\/13.1-696","metadata":false},{"id":64034,"structure_id":15231,"section_number":"13.1-697","catch_line":"Authority to indemnify","url":"\/13.1-697\/","token":"13.1\/9\/10\/13.1-697","metadata":false},{"id":69826,"structure_id":15231,"section_number":"13.1-698","catch_line":"Mandatory indemnification","url":"\/13.1-698\/","token":"13.1\/9\/10\/13.1-698","metadata":false},{"id":62700,"structure_id":15231,"section_number":"13.1-699","catch_line":"Advance for expenses","url":"\/13.1-699\/","token":"13.1\/9\/10\/13.1-699","metadata":false},{"id":80595,"structure_id":15231,"section_number":"13.1-700","catch_line":"Repealed","url":"\/13.1-700\/","token":"13.1\/9\/10\/13.1-700","metadata":false},{"id":57995,"structure_id":15231,"section_number":"13.1-700.1","catch_line":"Court orders for advance, reimbursement, or indemnification","url":"\/13.1-700.1\/","token":"13.1\/9\/10\/13.1-700.1","metadata":false},{"id":83208,"structure_id":15231,"section_number":"13.1-701","catch_line":"Determination and authorization of indemnification","url":"\/13.1-701\/","token":"13.1\/9\/10\/13.1-701","metadata":false},{"id":72780,"structure_id":15231,"section_number":"13.1-702","catch_line":"Advance for expenses and indemnification for officers","url":"\/13.1-702\/","token":"13.1\/9\/10\/13.1-702","metadata":false},{"id":59811,"structure_id":15231,"section_number":"13.1-703","catch_line":"Insurance","url":"\/13.1-703\/","token":"13.1\/9\/10\/13.1-703","metadata":false},{"id":70191,"structure_id":15231,"section_number":"13.1-704","catch_line":"Application of article","url":"\/13.1-704\/","token":"13.1\/9\/10\/13.1-704","metadata":false}],"previous_section":{"id":83273,"structure_id":15231,"section_number":"13.1-696","catch_line":"Definitions","url":"\/13.1-696\/","token":"13.1\/9\/10\/13.1-696","metadata":false},"next_section":{"id":69826,"structure_id":15231,"section_number":"13.1-698","catch_line":"Mandatory indemnification","url":"\/13.1-698\/","token":"13.1\/9\/10\/13.1-698","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/13.1-697\/","history_text":"

The record of this law\u2019s original creation isn\u2019t available online. It has been modified 6 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1968, chapter 570; in 1975, chapter 500; in 1979, chapter 99; in 1985, chapter 522; in 2005, chapter 765<\/a>; in 2019, chapter 734<\/a>.<\/p>","references":[{"id":57995,"section_number":"13.1-700.1","catch_line":"Court orders for advance, reimbursement, or indemnification","order_by":null,"url":"\/13.1-700.1\/"},{"id":83208,"section_number":"13.1-701","catch_line":"Determination and authorization of indemnification","order_by":null,"url":"\/13.1-701\/"},{"id":70191,"section_number":"13.1-704","catch_line":"Application of article","order_by":null,"url":"\/13.1-704\/"}],"refers_to":[{"id":57995,"section_number":"13.1-700.1","catch_line":"Court orders for advance, reimbursement, or indemnification","order_by":null,"url":"\/13.1-700.1\/"},{"id":70191,"section_number":"13.1-704","catch_line":"Application of article","order_by":null,"url":"\/13.1-704\/"}],"permalink":{"id":150271,"object_type":"law","relational_id":64034,"identifier":"13.1-697","token":"13.1\/9\/10\/13.1-697","url":"\/13.1-697\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/13.1-697\/","token":"13.1\/9\/10\/13.1-697","dublin_core":{"Title":"Authority to indemnify","Type":"Text","Format":"text\/html","Identifier":"\u00a7 13.1-697","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Except as provided in subsection D, a corporation<\/span> may indemnify an individual<\/span> who is a party<\/span> to a proceeding<\/span> because the individual<\/span> is or was a director<\/span> against liability<\/span> incurred in the proceeding<\/span> if: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The director<\/span>:\n\t\t\t\ta. Conducted himself in good faith; and\n\t\t\t\tb. Believed: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> In the case of conduct in his official capacity<\/span> with the corporation<\/span>, that his conduct was in its best interests<\/span>; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> In all other cases, that his conduct was at least not opposed to its best interests<\/span>; and\n\t\t\t\t\tc. In the case of any criminal proceeding<\/span>, he had no reasonable cause to believe his conduct was unlawful; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The director<\/span> engaged in conduct for which broader indemnification has been made permissible or obligatory as authorized by subsection C of § 13.1-704<\/a>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> A director<\/span>’s conduct with respect to an employee benefit plan for a purpose he believed to be in the interests<\/span> of the participants in and beneficiaries of the plan is conduct that satisfies the requirement of subdivision A 1 b (2). <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> The termination of a proceeding<\/span> by judgment<\/span>, order<\/span>, settlement<\/span>, or conviction<\/span>, or upon a plea<\/span> of nolo contendere<\/span> or its equivalent, is not, of itself, determinative that the director<\/span> did not meet the relevant standard of conduct described in this section. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> Unless ordered by a court<\/span> under subsection C of \u00a7 13.1-700.1<\/a> or broader indemnification has been made permissible or obligatory as authorized by subsection C of \u00a7 13.1-704<\/a>, a corporation<\/span> may not indemnify a director<\/span> under this section: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> In connection with a proceeding<\/span> by or in the right of the corporation<\/span> except for expenses<\/span> incurred in connection with the proceeding<\/span> if it is determined that the director<\/span> has met the relevant standard under subsection A; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> In connection with any other proceeding<\/span> charging improper personal benefit to the director<\/span>, whether or not involving action in his official capacity<\/span>, in which he was adjudged liable on the basis that personal benefit was improperly received by him. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nAUTHORITY TO INDEMNIFY (\u00a7 13.1-697)\n\nA. Except as provided in subsection D, a corporation may indemnify an individual\nwho is a party to a proceeding because the individual is or was a director\nagainst liability incurred in the proceeding if:\n\n 1. The director:\n \t\t\t\ta. Conducted himself in good faith; and\n \t\t\t\tb. Believed:\n\n 1. In the case of conduct in his official capacity with the corporation,\n that his conduct was in its best interests; and\n\n 2. In all other cases, that his conduct was at least not opposed to its best\n interests; and\n \t\t\t\t\tc. In the case of any criminal proceeding, he had no reasonable cause\n to believe his conduct was unlawful; or\n\n 2. The director engaged in conduct for which broader indemnification has been\n made permissible or obligatory as authorized by subsection C of §\n 13.1-704.\n\nB. A director’s conduct with respect to an employee benefit plan for a\npurpose he believed to be in the interests of the participants in and\nbeneficiaries of the plan is conduct that satisfies the requirement of\nsubdivision A 1 b (2).\n\nC. The termination of a proceeding by judgment, order, settlement, or\nconviction, or upon a plea of nolo contendere or its equivalent, is not, of\nitself, determinative that the director did not meet the relevant standard of\nconduct described in this section.\n\nD. Unless ordered by a court under subsection C of \u00a7 13.1-700.1 or broader\nindemnification has been made permissible or obligatory as authorized by\nsubsection C of \u00a7 13.1-704, a corporation may not indemnify a director under\nthis section:\n\n 1. In connection with a proceeding by or in the right of the corporation\n except for expenses incurred in connection with the proceeding if it is\n determined that the director has met the relevant standard under subsection A;\n or\n\n 2. In connection with any other proceeding charging improper personal benefit\n to the director, whether or not involving action in his official capacity, in\n which he was adjudged liable on the basis that personal benefit was improperly\n received by him.\n\nHISTORY: Code 1950, \u00a7 13.1-3.1; 1968, c. 570; 1975, c. 500; 1979, c. 99; 1985,\nc. 522; 2005, c. 765; 2019, c. 734.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}