reglab/statecodes huggingface dataset:
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-805. Terms of directors generally

35-14-805. Terms of directors generally.
(1) The terms of the initial directors of a corporation expire at the first shareholders' meeting at which directors are elected.
(2) The terms of all other directors expire at the next or, if their terms are staggered in accordance with 35-14-806, at the applicable second or third annual shareholders' meeting following their election, except to the extent:
(a) provided in 35-14-1022 if a bylaw electing to be governed by that section is in effect; or
(b) a shorter term is specified in the articles of incorporation in the event of a director nominee failing to receive a specified vote for election.
(3) A decrease in the number of directors does not shorten an incumbent director's term.
(4) The term of a director elected to fill a vacancy expires at the next shareholders' meeting at which directors are elected unless the bylaws state that a director elected or appointed to fill a vacancy is elected or appointed for the unexpired term of the director's predecessor in office.
(5) Except to the extent otherwise provided in the articles of incorporation or under 35-14-1022 if a bylaw electing to be governed by that section is in effect, despite the expiration of a director's term, the director continues to serve until the director's successor is elected and qualifies or there is a decrease in the number of directors.
History: En. Sec. 97, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-806. Staggered terms for directors

35-14-806. Staggered terms for directors.
The articles of incorporation may provide for staggering the terms of directors by dividing the total number of directors into two or three groups, with each group containing half or one-third of the total, as near as may be practicable. In that event, the terms of directors in the first group expire at the first annual shareholders' meeting after their election, the terms of the second group expire at the second annual shareholders' meeting after their election, and the terms of the third group, if any, expire at the third annual shareholders' meeting after their election. At each annual shareholders' meeting held subsequently, directors are elected for a term of 2 years or 3 years, as the case may be, to succeed those whose terms expire.
History: En. Sec. 98, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-807. Resignation of directors

35-14-807. Resignation of directors.
(1) A director may resign at any time by delivering a written notice of resignation to the board of directors or its chair or to the secretary.
(2) A resignation is effective as provided in 35-14-141(9) unless the resignation provides for a delayed effectiveness, including effectiveness determined on a future event or events. A resignation that is conditioned on failing to receive a specified vote for election as a director may provide that it is irrevocable.
History: En. Sec. 99, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-808. Removal of directors by shareholders

35-14-808. Removal of directors by shareholders.
(1) The shareholders may remove one or more directors with or without cause unless the articles of incorporation provide that directors may be removed only for cause.
(2) If a director is elected by a voting group of shareholders, only the shareholders of that voting group may participate in the vote to remove that director.
(3) A director may be removed if the number of votes cast to remove exceeds the number of votes cast not to remove the director, except to the extent the articles of incorporation or bylaws require a greater number. However, if cumulative voting is authorized, a director may not be removed if, in the case of a meeting, the number of votes sufficient to elect the director under cumulative voting is cast against removal and, if action is taken by less than unanimous written consent, voting shareholders entitled to the number of votes sufficient to elect the director under cumulative voting do not consent to the removal.
(4) A director may be removed by the shareholders only at a meeting called for the purpose of removing the director, and the meeting notice must state that removal of the director is the purpose of the meeting.
History: En. Sec. 100, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-809. Removal of directors by judicial proceeding

35-14-809. Removal of directors by judicial proceeding.
(1) The district court of the county where a corporation's principal office is located or, if its principal office is not located in this state, of the first judicial district may remove a director from office or may order other relief, including barring the director from reelection for a period prescribed by the court, in a proceeding commenced by or in the right of the corporation if the court finds that:
(a) the director engaged in fraudulent conduct with respect to the corporation or its shareholders, grossly abused the position of director, or intentionally inflicted harm on the corporation; and
(b) considering the director's course of conduct and the inadequacy of other available remedies, removal or other relief would be in the best interests of the corporation.
(2) A shareholder proceeding on behalf of the corporation under subsection (1) of this section must comply with all of the requirements of 35-14-740 through 35-14-747 except 35-14-741(1).
History: En. Sec. 101, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-810. Vacancy -- board of directors

35-14-810. Vacancy -- board of directors.
(1) Unless the articles of incorporation provide otherwise, if a vacancy occurs on a board of directors, including a vacancy resulting from an increase in the number of directors:
(a) the shareholders may fill the vacancy;
(b) the board of directors may fill the vacancy; or
(c) if the directors remaining in office are less than a quorum, they may fill the vacancy by the affirmative vote of a majority of all the directors remaining in office.
(2) If the vacant office was held by a director elected by a voting group of shareholders, only the holders of shares of that voting group are entitled to vote to fill the vacancy if it is filled by the shareholders, and only the remaining directors elected by that voting group, even if less than a quorum, are entitled to fill the vacancy if it is filled by the directors.
(3) A vacancy that will occur at a specific later date, by reason of a resignation effective at a later date under 35-14-807(2) or otherwise, may be filled before the vacancy occurs, but the new director may not take office until the vacancy occurs.
History: En. Sec. 102, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-811. Compensation of directors

35-14-811. Compensation of directors.
Unless the articles of incorporation or bylaws provide otherwise, the board of directors may fix the compensation of directors.
History: En. Sec. 103, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-820. Meetings

35-14-820. Meetings.
(1) The board of directors may hold regular or special meetings in or out of this state.
(2) Unless restricted by the articles of incorporation or bylaws, any or all directors may participate in any meeting of the board of directors through the use of any means of communication by which all directors participating may simultaneously hear each other during the meeting. A director participating in a meeting by this means is considered to be present in person at the meeting.
(3) If requested by a director, minutes of any regular or special meeting must be prepared and be distributed to each director.
History: En. Sec. 104, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-821. Action without meeting

35-14-821. Action without meeting.
(1) Except to the extent that the articles of incorporation or bylaws require that action by the board of directors be taken at a meeting, action required or permitted by this chapter to be taken by the board of directors may be taken without a meeting if each director signs a consent describing the action to be taken and delivers it to the corporation.
(2) Action taken under this section is the act of the board of directors when one or more consents signed by all the directors are delivered to the corporation. The consent may specify a later time as the time at which the action taken is to be effective. A director's consent may be withdrawn by a revocation signed by the director and delivered to the corporation before delivery to the corporation of unrevoked written consents signed by all the directors.
(3) A consent signed under this section has the effect of action taken at a meeting of the board of directors and may be described in that manner in any document.
History: En. Sec. 105, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-822. Notice of meeting

35-14-822. Notice of meeting.
(1) Unless the articles of incorporation or bylaws provide otherwise, regular meetings of the board of directors may be held without notice of the date, time, place, or purpose of the meeting.
(2) Unless the articles of incorporation or bylaws provide for a longer or shorter period, special meetings of the board of directors must be preceded by at least 2 days' notice of the date, time, and place of the meeting. The notice need not describe the purpose of the special meeting unless required by the articles of incorporation or bylaws.
History: En. Sec. 106, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-823. Waiver of notice

35-14-823. Waiver of notice.
(1) A director may waive any notice required by this chapter, the articles of incorporation, or the bylaws before or after the date and time stated in the notice. Except as provided by subsection (2), the waiver must be in writing, be signed by the director entitled to the notice, and be delivered to the corporation for filing by the corporation with the minutes or corporate records.
(2) A director's attendance at or participation in a meeting waives any required notice to the director of the meeting unless the director, at the beginning of the meeting or promptly upon arrival, objects to holding the meeting or transacting business at the meeting and does not after objecting vote for or assent to action taken at the meeting.
History: En. Sec. 107, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-824. Quorum and voting

35-14-824. Quorum and voting.
(1) Unless the articles of incorporation or bylaws provide for a greater or lesser number or unless otherwise expressly provided in this chapter, a quorum of a board of directors consists of a majority of the number of directors specified in or fixed in accordance with the articles of incorporation or bylaws.
(2) The quorum of the board of directors specified in or fixed in accordance with the articles of incorporation or bylaws may not consist of less than one-third of the specified or fixed number of directors.
(3) If a quorum is present when a vote is taken, the affirmative vote of a majority of directors present is the act of the board of directors unless the articles of incorporation or bylaws require the vote of a greater number of directors or unless otherwise expressly provided in this chapter.
(4) A director who is present at a meeting of the board of directors or a committee when corporate action is taken is considered to have assented to the action taken unless:
(a) the director objects, at the beginning of the meeting or promptly upon arrival, to holding it or transacting business at the meeting;
(b) the dissent or abstention from the action taken is entered in the minutes of the meeting; or
(c) the director delivers written notice of the director's dissent or abstention to the presiding officer of the meeting before its adjournment or to the corporation immediately after adjournment of the meeting. The right of dissent or abstention is not available to a director who votes in favor of the action taken.
History: En. Sec. 108, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-825. Committees of board

35-14-825. Committees of board.
(1) Unless this chapter, the articles of incorporation, or the bylaws provide otherwise, a board of directors may establish one or more board committees composed exclusively of one or more directors to perform functions of the board of directors.
(2) The establishment of a board committee and appointment of members to it must be approved by the greater of:
(a) a majority of all the directors in office when the action is taken; or
(b) the number of directors required by the articles of incorporation or bylaws to take action under 35-14-824 unless, in either case, this chapter or the articles of incorporation provide otherwise.
(3) Sections 35-14-820 through 35-14-824 apply to board committees and their members.
(4) A board committee may exercise the powers of the board of directors under 35-14-801 to the extent specified by the board of directors or in the articles of incorporation or bylaws, except that a board committee may not:
(a) authorize or approve distributions except according to a formula or method, or within limits, prescribed by the board of directors;
(b) approve or propose to shareholders action that this chapter requires to be approved by shareholders;
(c) fill vacancies on the board of directors or, subject to subsection (5), on any board committees;
(d) adopt, amend, or repeal bylaws;
(e) approve a plan of merger, including plans not requiring shareholder approval;
(f) authorize or approve reacquisition of shares except according to a formula or method prescribed by the board of directors; or
(g) authorize or approve the issuance of or sale or contract for sale of shares or determine the designation and relative rights, preferences, and limitations of a class or series of shares. However, the board of directors may authorize a committee or a senior executive officer of the corporation to do so within limits specifically prescribed by the board of directors.
(5) The board of directors may appoint one or more directors as alternate members of any board committee to replace any absent or disqualified member during the member's absence or disqualification. If the articles of incorporation, the bylaws, or the resolution creating the board committee so provide, the member or members present at any board committee meeting and not disqualified from voting may, by unanimous action, appoint another director to act in place of an absent or disqualified member during that member's absence or disqualification.
History: En. Sec. 109, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-826. Submission of matters for shareholder vote

35-14-826. Submission of matters for shareholder vote.
A corporation may agree to submit a matter to a vote of its shareholders even if, after approving the matter, the board of directors determines it no longer recommends the matter.
History: En. Sec. 110, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-830. Standards of conduct for directors

35-14-830. Standards of conduct for directors.
(1) Each member of the board of directors, when discharging the duties of a director, shall act:
(a) in good faith; and
(b) in a manner the director reasonably believes to be in the best interests of the corporation.
(2) The members of the board of directors or a board committee, when becoming informed in connection with their decisionmaking function or devoting attention to their oversight function, shall discharge their duties with the care that a person in a like position would reasonably believe appropriate under similar circumstances.
(3) In discharging board or board committee duties, a director shall disclose or cause to be disclosed to the other board or committee members information not already known by them but known by the director to be material to the discharge of their decisionmaking or oversight functions, except that disclosure is not required to the extent that the director reasonably believes that doing so would violate a duty imposed under law, a legally enforceable obligation of confidentiality, or a professional ethics rule.
(4) In discharging board or board committee duties, a director who does not have knowledge that makes reliance unwarranted is entitled to rely on the performance by any of the persons specified in subsection (6)(a) or (6)(c) to whom the board may have delegated, formally or informally by course of conduct, the authority or duty to perform one or more of the board's functions that are delegable under applicable law.
(5) In discharging board or board committee duties, a director who does not have knowledge that makes reliance unwarranted is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, prepared or presented by any of the persons specified in subsection (6).
(6) A director is entitled to rely, in accordance with subsection (4) or (5), on:
(a) one or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the functions performed or the information, opinions, reports, or statements provided;
(b) legal counsel, public accountants, or other persons retained by the corporation as to matters involving skills or expertise the director reasonably believes are matters:
(i) within the particular person's professional or expert competence; or
(ii) as to which the particular person merits confidence; or
(c) a board committee of which the director is not a member if the director reasonably believes the committee merits confidence.
History: En. Sec. 111, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-832. Director's liability for unlawful distributions

35-14-832. Director's liability for unlawful distributions.
(1) A director who votes for or assents to a distribution in excess of what may be authorized and made pursuant to 35-14-640(1) or 35-14-1409(1) is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating 35-14-640(1) or 35-14-1409(1) if the party asserting liability establishes that when taking the action the director did not comply with 35-14-830.
(2) A director held liable under subsection (1) for an unlawful distribution is entitled to:
(a) contribution from every other director who could be held liable under subsection (1) for the unlawful distribution; and
(b) recoupment from each shareholder of the pro rata portion of the amount of the unlawful distribution the shareholder accepted knowing the distribution was made in violation of 35-14-640(1) or 35-14-1409(1).
(3) A proceeding to enforce:
(a) the liability of a director under subsection (1) is barred unless it is commenced within 2 years after the date:
(i) on which the effect of the distribution was measured under 35-14-640(5) or (7);
(ii) as of which the violation of 35-14-640(1) occurred as the consequence of disregard of a restriction in the articles of incorporation; or
(iii) on which the distribution of assets to shareholders under 35-14-1409(1) was made; or
(b) contribution or recoupment under subsection (2) is barred unless it is commenced within 1 year after the liability of the claimant has been finally adjudicated under subsection (1).
History: En. Sec. 113, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-840. Officers

35-14-840. Officers.
(1) A corporation has the officers described in its bylaws or appointed by the board of directors in accordance with the bylaws.
(2) The board of directors may elect individuals to fill one or more offices of the corporation. An officer may appoint one or more officers if authorized by the bylaws or the board of directors.
(3) The bylaws or the board of directors shall assign to an officer responsibility for maintaining and authenticating the records of the corporation required to be kept under 35-14-1601(1).
(4) The same individual may simultaneously hold more than one office in a corporation.
History: En. Sec. 114, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-841. Functions of officers

35-14-841. Functions of officers.
Each officer has the authority and shall perform the functions set forth in the bylaws or, to the extent consistent with the bylaws, the functions prescribed by the board of directors or by direction of an officer authorized by the board of directors to prescribe the functions of other officers.
History: En. Sec. 115, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-842. Standards of conduct for officers

35-14-842. Standards of conduct for officers.
(1) An officer, when performing in an official capacity, has the duty to act:
(a) in good faith;
(b) with the care that a person in a like position would reasonably exercise under similar circumstances; and
(c) in a manner the officer reasonably believes to be in the best interests of the corporation.
(2) The duty of an officer includes the obligation:
(a) to inform the superior officer to whom or the board of directors or the board committee to which the officer reports of information about the affairs of the corporation known to the officer within the scope of the officer's functions and known to the officer to be material to the superior officer, board, or committee; and
(b) to inform the officer's superior officer, another appropriate person within the corporation, or the board of directors, or a board committee of any actual or probable material violation of law involving the corporation or any material breach of duty to the corporation by an officer, employee, or agent of the corporation that the officer believes has occurred or is likely to occur.
(3) In discharging the officer's duties, an officer who does not have knowledge that makes reliance unwarranted is entitled to rely on:
(a) the performance of properly delegated responsibilities by one or more employees of the corporation whom the officer reasonably believes to be reliable and competent in performing the responsibilities delegated; or
(b) information, opinions, reports, or statements, including financial statements and other financial data, prepared or presented by one or more employees of the corporation whom the officer reasonably believes to be reliable and competent in the matters presented or by legal counsel, public accountants, or other persons retained by the corporation as to matters involving skills or expertise the officer reasonably believes are matters:
(i) within the particular person's professional or expert competence; or
(ii) as to which the particular person merits confidence.
(4) An officer is not liable to the corporation or its shareholders for any decision to take or not to take action or any failure to take any action as an officer if the duties of the office are performed in compliance with this section. Whether an officer who does not comply with this section has liability will depend in each instance on applicable law, including those principles of 35-14-831 that have relevance.
History: En. Sec. 116, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-843. Resignation and removal of officers

35-14-843. Resignation and removal of officers.
(1) An officer may resign at any time by delivering a written notice to the corporation. A resignation is effective as provided in 35-14-141(9) unless the notice provides for delayed effectiveness, including effectiveness determined on a future event or events. If effectiveness of a resignation is stated to be delayed and the board of directors or the appointing officer accepts the delay, the board of directors or the appointing officer may fill the pending vacancy before the delayed effectiveness, but the new officer may not take office until the vacancy occurs.
(2) An officer may be removed at any time with or without cause by:
(a) the board of directors;
(b) the appointing officer unless the bylaws or the board of directors provides otherwise; or
(c) any other officer if authorized by the bylaws or the board of directors.
(3) In this section, "appointing officer" means the officer, including any successor to that officer, who appointed the officer resigning or being removed.
History: En. Sec. 117, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-844. Contract rights of officers

35-14-844. Contract rights of officers.
(1) The election or appointment of an officer does not itself create contract rights.
(2) An officer's removal does not affect the officer's contract rights, if any, with the corporation. An officer's resignation does not affect the corporation's contract rights, if any, with the officer.
History: En. Sec. 118, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-850. Definitions -- indemnification and advance for expenses

35-14-850. Definitions -- indemnification and advance for expenses.
For the purposes of 35-14-850 through 35-14-859, unless the context clearly requires otherwise, the following definitions apply:
(1) "Corporation" includes any domestic or foreign predecessor entity of a corporation in a merger or other transaction in which the predecessor's existence ceased upon consummation of the transaction.
(2) "Director" means an individual who is or was a director of a corporation or who, while a director of the corporation, is or was serving at the corporation's request as a director, officer, manager, partner, trustee, employee, or agent of another entity or an employee benefit plan. A director is considered to be serving an employee benefit plan at the corporation's request if the individual's duties to the corporation also impose duties on, or otherwise involve services by, the individual to the plan or to participants in or beneficiaries of the plan. The term includes, unless the context requires otherwise, the estate or personal representative of a director.
(3) "Liability" means the obligation to pay a judgment, a settlement, a penalty, a fine, including an excise tax assessed with respect to an employee benefit plan, or expenses incurred with respect to a proceeding, including attorney fees.
(4) "Officer" means an individual who is or was an officer of a corporation or who, while an officer of the corporation, is or was serving at the corporation's request as a director, officer, manager, partner, trustee, employee, or agent of another entity or employee benefit plan. An officer is considered to be serving an employee benefit plan at the corporation's request if the individual's duties to the corporation also impose duties on or otherwise involve services by the individual to the plan or to participants in or beneficiaries of the plan. The term includes, unless the context requires otherwise, the estate or personal representative of an officer.
(5) (a) "Official capacity" means:
(i) when used with respect to a director, the office of director in a corporation; and
(ii) when used with respect to an officer as contemplated in 35-14-856, the office in a corporation held by the officer.
(b) The term does not include service for any other domestic or foreign corporation or any joint venture, trust, employee benefit plan, or other entity.
(6) "Party" means an individual who was, is, or is threatened to be made a defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, arbitrative, or investigative and whether formal or informal.
History: En. Sec. 119, Ch. 271, L. 2019; amd. Sec. 7, Ch. 34, L. 2021.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-851. Permissible indemnification

35-14-851. Permissible indemnification.
(1) Except as otherwise provided in this section, a corporation may indemnify an individual who is a party to a proceeding because the individual is a director against liability incurred in the proceeding if:
(a) (i) the director acted in good faith; and
(ii) the director reasonably believed:
(A) in the case of conduct in an official capacity, that the conduct was in the best interests of the corporation; and
(B) in all other cases, that the conduct was at least not opposed to the best interests of the corporation; and
(iii) in the case of a criminal proceeding, the director had no reasonable cause to believe the conduct was unlawful; or
(b) the director engaged in conduct for which broader indemnification has been made permissible or obligatory under a provision of the articles of incorporation as authorized by 35-14-202(2)(e).
(2) A director's conduct with respect to an employee benefit plan for a purpose the director 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 (1)(a)(ii)(B).
(3) 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.
(4) Unless ordered by a court under 35-14-854(1)(c), a corporation may not indemnify a director:
(a) 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 of conduct under subsection (1); or
(b) in connection with any proceeding with respect to conduct for which the director was adjudged liable on the basis of receiving a financial benefit to which the director was not entitled, regardless of whether it involved action in the director's official capacity.
History: En. Sec. 120, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-852. Mandatory indemnification

35-14-852. Mandatory indemnification.
A corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the director was a party because the director was a director of the corporation against expenses incurred by the director in connection with the proceeding.
History: En. Sec. 121, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-853. Advance for expenses

35-14-853. Advance for expenses.
(1) A corporation may, before final disposition of a proceeding, advance funds to pay for or reimburse expenses incurred in connection with the proceeding by an individual who is a party to the proceeding because that individual is a director if the director delivers to the corporation a signed, written undertaking of the director to repay any funds advanced if:
(a) the director is not entitled to mandatory indemnification under 35-14-852; and
(b) it is ultimately determined under 35-14-854 or 35-14-855 that the director is not entitled to indemnification.
(2) The undertaking required by subsection (1) must be an unlimited general obligation of the director but need not be secured and may be accepted without reference to the financial ability of the director to make repayment.
(3) Authorizations under this section must be made:
(a) by the board of directors in the following manner:
(i) if there are two or more qualified directors, by a majority vote of all the qualified directors, a majority of whom for this purpose constitute a quorum, or
(ii) by a majority of the members of a committee consisting solely of two or more qualified directors appointed by a majority vote of all the qualified directors; or
(b) by special legal counsel:
(i) selected in the manner prescribed in subsection (3)(a); or
(ii) if there are fewer than two qualified directors, selected by the board of directors, in which directors who are not qualified directors may participate; or
(c) by the shareholders, but shares owned by or voted under the control of a director who at the time is not a qualified director may not be voted on the authorization.
History: En. Sec. 122, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-854. Court-ordered indemnification and advance for expenses

35-14-854. Court-ordered indemnification and advance for expenses.
(1) A director who is a party to a proceeding because the person is a director may apply for indemnification or an advance for 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:
(a) order indemnification if the court determines that the director is entitled to mandatory indemnification under 35-14-852;
(b) 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 35-14-858(1); or
(c) order indemnification or advance for expenses if the court determines, in view of all the relevant circumstances, that it is fair and reasonable to indemnify the director or to advance expenses to the director even if, in either case, the director has not met the relevant standard of conduct set forth in 35-14-851(1), has failed to comply with 35-14-853, or was adjudged liable in a proceeding referred to in 35-14-851(4)(a) or (4)(b). If the director was adjudged liable in a proceeding referred to in 35-14-851(4), indemnification is limited to expenses incurred in connection with the proceeding.
(2) If the court determines that the director is entitled to indemnification under subsection (1)(a) or to indemnification or advance for expenses under subsection (1)(b), it shall also order the corporation to pay the director'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 subsection (1)(c), it may also order the corporation to pay the director's expenses incurred to obtain court-ordered indemnification or advance for expenses.
History: En. Sec. 123, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-855. Determination and authorization of indemnification

35-14-855. Determination and authorization of indemnification.
(1) A corporation may not indemnify a director under 35-14-851 unless authorized for a specific proceeding after a determination has been made that indemnification is permissible because the director has met the relevant standard of conduct set forth in 35-14-851.
(2) The determination must be made:
(a) if there are two or more qualified directors, by the board of directors by a majority vote of all the qualified directors, a majority of whom for this purpose constitute a quorum, or by a majority of the members of a committee of two or more qualified directors appointed by a majority vote of all the qualified directors;
(b) by special legal counsel:
(i) selected in the manner prescribed in subsection (2)(a); or
(ii) if there are fewer than two qualified directors, selected by the board of directors, in which directors who are not qualified directors may participate; or
(c) by the shareholders, but shares owned by or voted under the control of a director who at the time is not a qualified director may not be voted on the determination.
(3) Authorization of indemnification must be made in the same manner as the determination that indemnification is permissible, except that if there are fewer than two qualified directors or if the determination is made by special legal counsel, authorization of indemnification must be made by those entitled to select special legal counsel under subsection (2)(b)(ii).
History: En. Sec. 124, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-856. Indemnification of officers

35-14-856. Indemnification of officers.
(1) A corporation may indemnify and advance expenses under 35-14-850 through 35-14-859 to an officer who is a party to a proceeding because the person is an officer:
(a) to the same extent as a director; and
(b) if the person is an officer but not a director, to any further extent provided by the articles of incorporation or the bylaws or by a resolution adopted or a contract approved by the board of directors or shareholders, except for:
(i) liability in connection with a proceeding by or in the right of the corporation other than for expenses incurred in connection with the proceeding; or
(ii) liability arising out of conduct that constitutes:
(A) receipt by the officer of a financial benefit to which the officer is not entitled;
(B) an intentional infliction of harm on the corporation or the shareholders; or
(C) an intentional violation of criminal law.
(2) Subsection (1)(b) applies to an officer who is also a director if the officer is made a party to the proceeding based on an act or omission solely as an officer.
(3) An officer who is not a director is entitled to mandatory indemnification under 35-14-852 and may apply to a court under 35-14-854 for indemnification or an advance for expenses, in each case to the same extent to which a director may be entitled to indemnification or advance for expenses under those sections.
History: En. Sec. 125, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-857. Insurance

35-14-857. Insurance.
A corporation may purchase and maintain insurance on behalf of an individual who is a director or officer of the corporation or who, while a director or officer of the corporation, serves at the corporation's request as a director, officer, partner, trustee, employee, or agent of another domestic or foreign corporation or a joint venture, trust, employee benefit plan, or other entity against liability asserted against or incurred by the individual in that capacity or arising from the individual's status as a director or officer, regardless of whether the corporation would have power to indemnify or advance expenses to the individual against the same liability under 35-14-850 through 35-14-859.
History: En. Sec. 126, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-858. Variation by corporate action -- application

35-14-858. Variation by corporate action -- application.
(1) A corporation may, by a provision in its articles of incorporation or bylaws or in a resolution adopted or a contract approved by the board of directors or shareholders, obligate itself in advance of the act or omission giving rise to a proceeding to provide indemnification in accordance with 35-14-851 or advance funds to pay for or reimburse expenses in accordance with 35-14-853. An obligatory provision under this section satisfies the requirements for authorization referred to in 35-14-853(3) and 35-14-855(3). Any provision that obligates the corporation to provide indemnification to the fullest extent permitted by law obligates the corporation to advance funds to pay for or reimburse expenses in accordance with 35-14-853 to the fullest extent permitted by law unless the provision expressly provides otherwise.
(2) A right of indemnification or to advances for expenses created by 35-14-850 through 35-14-859 or under subsection (1) of this section and in effect at the time of an act or omission may not be eliminated or impaired with respect to the act or omission by an amendment of the articles of incorporation or bylaws or a resolution of the board of directors or shareholders adopted after the occurrence of the act or omission unless, in the case of a right created under subsection (1), the provision creating the right and in effect at the time of the act or omission explicitly authorizes the elimination or impairment after the act or omission has occurred.
(3) A provision pursuant to subsection (1) may not obligate the corporation to indemnify or advance expenses to a director of a predecessor of the corporation pertaining to conduct with respect to the predecessor unless otherwise expressly provided. A provision for indemnification or advance for expenses in the articles of incorporation or bylaws or a resolution of the board of directors or shareholders of a predecessor of the corporation in a merger or in a contract to which the predecessor is a party that exists at the time the merger takes effect is governed by 35-14-1107(1)(d).
(4) Subject to subsection (2), a corporation may, by a provision in its articles of incorporation, limit any of the rights to indemnification or advance for expenses created by or pursuant to 35-14-850 through 35-14-859.
(5) Sections 35-14-850 through 35-14-859 do not limit a corporation's power to pay or reimburse expenses incurred by a director or an officer in connection with appearing as a witness in a proceeding at a time when the director or officer is not a party.
(6) Sections 35-14-850 through 35-14-859 do not limit a corporation's power to indemnify, advance expenses to, or provide or maintain insurance on behalf of an employee or agent.
History: En. Sec. 127, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-859. Exclusivity

35-14-859. Exclusivity.
A corporation may provide indemnification or advance expenses to a director or an officer only as permitted by 35-14-850 through 35-14-859.
History: En. Sec. 128, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-861. Judicial action

35-14-861. Judicial action.
(1) A transaction effected or proposed to be effected by the corporation or by an entity controlled by the corporation may not be the subject of equitable relief or give rise to an award of damages or other sanctions against a director of the corporation in a proceeding by a shareholder or by or in the right of the corporation on the ground that the director has an interest respecting the transaction if it is not a director's conflicting interest transaction.
(2) A director's conflicting interest transaction may not be the subject of equitable relief or give rise to an award of damages or other sanctions against a director of the corporation in a proceeding by a shareholder or by or in the right of the corporation on the grounds that the director has an interest respecting the transaction if:
(a) directors' action respecting the transaction was taken in compliance with 35-14-862 at any time;
(b) shareholders' action respecting the transaction was taken in compliance with 35-14-863 at any time; or
(c) the transaction, judged according to the circumstances at the relevant time, is established to have been fair to the corporation.
History: En. Sec. 130, Ch. 271, L. 2019.