                                 CODE OF VIRGINIA

COURT ORDERS FOR ADVANCE, REIMBURSEMENT, OR INDEMNIFICATION (§ 13.1-700.1)

A. An individual who is a party to a proceeding because he is a director of the
corporation may apply for indemnification or an advance of expenses to the court
conducting the proceeding or to another court of competent jurisdiction. After
receipt of an application and after giving any notice it considers necessary,
the court shall:

   1. Order indemnification if the court determines that the director is entitled
   to mandatory indemnification under &#xA7; 13.1-698;

   2. Order indemnification or advance for expenses if the court determines that
   the director is entitled to indemnification or advance for expenses pursuant
   to a provision authorized by &#xA7; 13.1-704; or

   3. Order indemnification or advance for expenses if the court determines, in
   view of all the relevant circumstances, that it is fair and reasonable (i) to
   indemnify the director or (ii) to advance expenses to the director, even if,
   in the case of clause (i) or (ii), the director has not met the relevant
   standard of conduct set forth in subsection A of &#xA7; 13.1-697, failed to
   comply with &#xA7; 13.1-699, or was adjudged liable in a proceeding referred
   to in subsection D of &#xA7; 13.1-697, but if the director was adjudged so
   liable, indemnification shall be limited to expenses incurred in connection
   with the proceeding.

B. If the court determines that the director is entitled to indemnification
under subdivision A 1 or to indemnification or advance for expenses under
subdivision A 2, it shall also order the corporation to pay the director&#8217;s
expenses incurred in connection with obtaining court-ordered indemnification or
advance for expenses. If the court determines that the director is entitled to
indemnification or advance for expenses under subdivision A 3, it may also order
the corporation to pay the director&#8217;s expenses to obtain court-ordered
indemnification or advance for expenses.

C. Neither (i) the failure of the corporation, including its board of directors,
its independent legal counsel and its shareholders, to have made a determination
prior to the commencement of any action permitted by this section that the
applying director is entitled to receive an advance, reimbursement, or
indemnification nor (ii) the determination by the corporation, including its
board of directors, its independent legal counsel and its shareholders, that the
applying director is not entitled to receive an advance, reimbursement, or
indemnification shall create a presumption to that effect or otherwise of itself
be a defense to that director&#8217;s application for an advance for expenses,
reimbursement, or indemnification.

HISTORY: 1987, cc. 59, 257; 2005, c. 765; 2019, c. 734.