273A.120 Reimbursement -- Indemnification -- Advancement -- Insurance.

345 words·~2 min read·/ky/chapter-273a/273a-120

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(1)Except as otherwise provided in the governing principles, an unincorporated

nonprofit association shall reimburse a member or manager for authorized expenses

reasonably incurred in the course of the member's or manager's activities on behalf

of the association.

(2)An unincorporated nonprofit association may indemnify a member or manager for

any debt, obligation, or other liability incurred in the course of the member's or

manager's activities on behalf of the association if the person seeking

indemnification has complied with KRS 273A.075 and 273A.100, as applicable.

Governing principles in a record may broaden or limit indemnification.

(3)If a person is made or threatened to be made a party in an action based on that

person's activities on behalf of an unincorporated nonprofit association and the

person makes a request in a record to the association, a majority of the disinterested

managers may approve in a record advance payment, or reimbursement, by the

association, of all or a part of the reasonable expenses, including attorney's fees and

costs, incurred by the person before the final disposition of the proceeding. To be

entitled to an advance payment or reimbursement, the person shall state in a record

that the person has a good faith belief that the criteria for indemnification in

subsection

(2)of this section have been satisfied and that the person will repay the

amounts advanced or reimbursed if the criteria for payment have not been satisfied.

The governing principles in a record may broaden or limit the advance payments or

reimbursements.

(4)An unincorporated nonprofit association may purchase insurance on behalf of a

member or manager for liability asserted against or incurred by the member or

manager in the capacity of a member or manager, whether or not the association has

authority under this chapter to reimburse, indemnify, or advance expenses to the

member or manager against the liability.

(5)The rights of reimbursement, indemnification, and advancement of expenses under

this section apply to a former member or manager for an activity undertaken on

behalf of the unincorporated nonprofit association while a member or manager.