This can happen when a company becomes insolvent, wrongfully refuses to indemnify, or is otherwise prohibited from indemnifying
directors and officers.
Further, insurance carriers are now exposed to indemnifying
uncovered settlements and judgments if they wrongfully refuse to defend a claim.
party should determine whether it is a primary obligor to the taxing authority.
Following the decision of the court in November 2008 that MMI was liable they have been indemnifying
local authorities for claims as they fall due.
Federal and state laws prohibit a company from indemnifying
directors or officers for certain types of losses, such as settlements in shareholder derivative suits and actual violations of federal securities laws.
Some jurisdictions, including Delaware, preclude corporations from indemnifying
their directors or officers for any settlement reached in a shareholders' or derivative action or one brought directly by the corporation.
She said: 'Previously, a company was prohibited from indemnifying
its directors against liability arising from matters such as negligence or breach of trust.
* Amounts that are paid by an indemnitee in respect of an indemnifiable third-party claim (such as, consequential damages paid by an indemnitee to a third party should be recoverable against the indemnifying
party, even though recovery of consequential damages is otherwise prohibited).
We have to have to start with the fundamentals of indemnifying
OEMs because they indemnify their customers," Schwartz said.
"Subject to the limitations set forth in this Section, the Indemnifying
Party shall assume control of the defense of any Claim asserted by any third party ("Third Party Claim") and, in connection with such defense, shall appoint lead counsel for such defense, in each case at its expense.