304-C:116 Indemnification. –
I. Except as provided in paragraph II, and subject to such standards and restrictions, if any, as are set forth in its operating agreement, a limited liability company may, and shall have the power to, indemnify any member or manager or other person made a party to a proceeding or threatened to be made a named defendant or respondent in a proceeding because the member, manager, or other person acted on behalf of the limited liability company, against liability for a judgment, settlement, penalty, fine, including an excise tax assessed with respect to an employee benefit plan, or reasonable expenses incurred with respect to a proceeding, if:
(a) The member, manager, or person conducted himself or herself in accordance with contractual good faith; and
(b) The member, manager, or person reasonably believed his or her conduct was not opposed to the best interest of the limited liability company.
II. A limited liability company may not indemnify a member, manager, or other person under paragraph I:
(a) In connection with a proceeding by or in the right of the limited liability company in which the person was judged liable to the limited liability company; or
(b) In connection with any other proceeding charging the person with a breach of the duty of loyalty, whether or not involving action on behalf of the limited liability company, in which the person was adjudged liable for the breach.