Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
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RUDDICK CORPORATION
(Exact name of registrant as specified in its charter)
NORTH CAROLINA 56-0905940
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2000 TWO FIRST UNION CENTER
CHARLOTTE, N.C. 28282
(Address of Principal Executive Offices)
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RUDDICK CORPORATION 1995 COMPREHENSIVE STOCK OPTION PLAN
(Full title of the Plan)
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DONALD B. WILLIFORD
SECRETARY
RUDDICK CORPORATION
2000 TWO FIRST UNION CENTER
CHARLOTTE, NORTH CAROLINA 28282
(Name and address of agent for service)
(704) 372-5404
(Telephone number, including area code, of agent for service)
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COPY TO:
ANNE F. TEAM
SMITH HELMS MULLISS & MOORE, L.L.P.
POST OFFICE BOX 31247
CHARLOTTE, NORTH CAROLINA 28231
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF
THIS REGISTRATION STATEMENT.
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CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED
TITLE OF EACH MAXIMUM MAXIMUM
CLASS OF AMOUNT TO OFFERING AGGREGATE AMOUNT OF
SECURITIES TO BE PRICE PER OFFERING REGISTRATION
BE REGISTERED REGISTERED SHARE (1) PRICE (1) FEE
- ------------- ---------- --------- --------- ------------
Common Stock 600,000 $13.6875 $8,212,500 $2,489
shares
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(1) Estimated solely for the purpose of calculating
the registration fee and computed according to
Rule 457(h) under the Securities Act of 1933, as
amended, based on the price of the Common Stock of
which options granted pursuant to the Plan may be
exercised.
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PART I. INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents constituting the Prospectus of Ruddick
Corporation (the "Registrant") with respect to this Registration
Statement in accordance with Rule 428 promulgated pursuant to the
Securities Act of 1933, as amended (the "Securities Act"), are
kept on file at the offices of the Registrant. The Registrant
will provide without charge to participants in the Plan
referenced herein, on the written or oral request of any such
person, a copy of any or all of the documents constituting the
Prospectus. Written requests for such copies should be directed
to the Secretary, Ruddick Corporation, 2000 Two First Union
Center, Charlotte, North Carolina 28282. Telephone requests may
be directed to (704) 372-5404.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with the
Securities and Exchange Commission (the "Commission") are
incorporated by reference herein and in the Prospectus
constituting a part of this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for
the year ended September 29, 1996 filed pursuant to Section
13 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act");
(b) The Registrant's Quarterly Reports on Form 10-Q
for the quarters ended December 31, 1995, March 31, 1996 and
June 30, 1996, filed pursuant to Section 13 of the Exchange
Act; and
(c) The description of the Registrant's Common Stock
contained in its Registration Statement filed under the
Exchange Act, as amended by all subsequent amendments and
reports filed for the purpose of updating such description.
All documents filed by the Registrant with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange
Act subsequent to the effectiveness of this Registration
Statement and prior to the filing of a post-effective amendment
hereto, which either indicates that all securities offered hereto
have been sold or deregisters all securities then remaining
unsold shall be deemed to be incorporated by reference in this
Registration Statement and the Prospectus and to be a part hereof
and thereof from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be
incorporated by reference herein or therein shall be deemed to be
modified or superseded for purposes of this Registration
Statement and the Prospectus to the extent that a statement
contained herein or therein or in any other subsequently filed
document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this
Registration Statement or the Prospectus.
The Registrant will provide without charge to each person to
whom the Prospectus constituting a part of this Registration
Statement is delivered, on the written or oral request of any
such person, a copy of any or all of the documents incorporated
herein and in the Prospectus by reference (other than exhibits to
such documents which are not specifically incorporated by
reference in such documents). Written requests for such copies
should be directed to the Secretary, Ruddick Corporation, 2000
Two First Union Center, Charlotte, North Carolina 28282.
Telephone requests may be directed to (704) 372-5404.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
There are no provisions in the Registrant's Restated
Articles of Incorporation, and no contracts between the
Registrant and its directors and officers nor resolutions adopted
by the Registrant, relating to indemnification. The Registrant's
Restated Articles of Incorporation prevent the recovery by the
Registrant of monetary damages against its directors. However,
in accordance with the provisions of the North Carolina Business
Corporation Act (the "Act"), the Registrant's Bylaws provide
that, in addition to the indemnification of directors and
officers otherwise provided by the Act, the Registrant shall,
under certain circumstances, indemnify its directors, executive
officers and certain other designated officers against any and
all liability and litigation expense, including reasonable
attorneys' fees, arising out of their status or activities as
directors and officers, except for liability or litigation
expense incurred on account of activities that were at the time
known or reasonably should have been known by such director or
officer to be clearly in conflict with the best interests of the
Registrant. Pursuant to such Bylaws and as authorized by
statute, the Registrant maintains insurance on behalf of its
directors and officers against liability asserted against such
persons in such capacity whether or not such director or officers
have the right to indemnification pursuant to the Bylaws or
otherwise.
In addition to the above-described provisions,
Sections 55-8-50 through 55-8-58 of the Act contain provisions
prescribing the extent to which directors and officers shall or
may be indemnified. Section 55-8-51 of the Act permits a
corporation, with certain exceptions, to indemnify a present or
former director against liability if (i) he conducted himself in
good faith, (ii) he reasonably believed (x) that his conduct in
his official capacity with the corporation was in its best
interests and (y) in all other cases his conduct was at least not
opposed to the corporation's best interest, and (iii) in the case
of any criminal proceeding, he had no reasonable cause to believe
his conduct was unlawful. A corporation may not indemnify a
director in connection with a proceeding by or in the right of
the corporation in which the director was adjudged liable to the
corporation or in connection with a proceeding charging improper
personal benefit to him in which he was adjudged liable on such
basis. The above standard of conduct is determined by the Board
of Directors, or a committee thereof, special legal counsel or
the shareholders as prescribed in Section 55-8-55 of the Act.
Sections 55-8-52 and 55-8-56 of the Act require a
corporation to indemnify a director or officer in the defense of
any proceeding to which he was a party because of his capacity as
a director or officer against reasonable expenses when he is
wholly successful in his defense, unless the articles of
incorporation provide otherwise. Upon application, the court may
order indemnification of the director or officer if he is
adjudged fairly and reasonably so entitled under Section 55-8-54.
Section 55-8-56 allows a corporation to indemnify and advance to
an officer, employee or agent who is not a director to the same
extent as a director or as otherwise set forth in the
corporation's articles of incorporation or bylaws or by a
resolution of the board of directors.
In addition, Section 55-8-57 permits a corporation to
provide for indemnification of directors, officers, employees or
agents, in its articles of incorporation or bylaws or by contract
or resolution, against liability in various proceedings and to
purchase and maintain insurance policies on behalf of these
individuals.
THE FOREGOING IS ONLY A GENERAL SUMMARY OF CERTAIN ASPECTS
OF NORTH CAROLINA LAW DEALING WITH INDEMNIFICATION OF DIRECTORS
AND OFFICERS AND DOES NOT PURPORT TO BE COMPLETE. IT IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE RELEVANT STATUTES
WHICH CONTAIN DETAILED SPECIFIC PROVISIONS REGARDING THE
CIRCUMSTANCES UNDER WHICH AND THE PERSON FOR WHOSE BENEFIT
INDEMNIFICATION SHALL OR MAY BE MADE AND ACCORDINGLY ARE SET
FORTH IN EXHIBIT 99.2 HERETO AND INCORPORATED HEREIN BY
REFERENCE.
ITEM 8. EXHIBITS.
The following exhibits are filed with or incorporated by
reference in this Registration Statement.
EXHIBIT NO. DESCRIPTION OF EXHIBIT
5.1 Opinion of Smith Helms Mulliss & Moore, L.L.P., as
to legality of securities to be registered.
23.1 Consent of Smith Helms Mulliss & Moore, L.L.P.
(included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP, independent
certified public accountants.
24.1 Power of Attorney and Certified Resolution.
99.1 Ruddick Corporation 1995 Comprehensive Stock
Option Plan, incorporated herein by reference to
Exhibit 10.1 of the Registrant's Quarterly Report
on Form 10-Q for the quarterly period ended June
30, 1996 (Commission File No. 1-6905).
99.2 Provisions of North Carolina law relating to
indemnification.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts
or events arising after the effective date of the
Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease
in volume of securities offered (if the total dollar
value of securities offered would not exceed that which
was registered) and any deviation from the low or high
end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no
more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration
Statement;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration
Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii)
do not apply if the Registration Statement is on Form S-3 or
Form S-8, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section
13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new Registration Statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be
deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of
the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the
Securities Act of 1933, the Registrant certifies that it has
reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Charlotte,
North Carolina, on December 31, 1996.
RUDDICK CORPORATION
By: /s/ JOHN W. COPELAND
-----------------------------
John W. Copeland
President
Pursuant to the requirements of the Securities Act of 1933
this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ JOHN W. COPELAND President and December 31, 1996
- ------------------------- Director
John W. Copeland (Principal
Executive Officer)
/s/RICHARD N. BRIGDEN Vice President- December 31, 1996
- ------------------------- Finance
Richard N. Brigden (Principal
Financial Officer)
/s/DOUGLAS A. STEPHENSON Treasurer December 31, 1996
- ------------------------- (Principal
Douglas A. Stephenson Accounting Officer)
THOMAS M. BELK * Director December 31, 1996
- -------------------------
Thomas M. Belk
EDWIN B. BORDEN, JR. * Director December 31, 1996
- -------------------------
Edwin B. Borden, Jr.
ALAN T. DICKSON * Director December 31, 1996
- -------------------------
Alan T. Dickson
R. STUART DICKSON * Director December 31, 1996
- -------------------------
R. Stuart Dickson
BEVERLY F. DOLAN * Director December 31, 1996
- -------------------------
Beverly F. Dolan
RODDEY DOWD, SR * Director December 31, 1996
- -------------------------
Roddey Dowd, Sr.
JAMES E. S. HYNES * Director December 31, 1996
- -------------------------
James E. S. Hynes
HUGH L. McCOLL, JR. * Director December 31, 1996
- -------------------------
Hugh L. McColl, Jr.
E. C. WALL, JR. * Director December 31, 1996
- -------------------------
E. C. Wall, Jr.
*By: /s/ JOHN W. COPELAND
----------------------
John W. Copeland
Attorney-in-Fact
<PAGE>
EXHIBIT INDEX
SEQUENTIAL
EXHIBIT NO. DESCRIPTION OF EXHIBIT PAGE NO.
5.1 Opinion of Smith Helms
Mulliss & Moore, L.L.P., as
to legality of securities
to be registered.
23.1 Consent of Smith Helms
Mulliss & Moore, L.L.P.
(included in Exhibit 5.1)
23.2 Consent of Arthur Andersen
LLP, independent certified
public accountants.
24.1 Power of Attorney and
Certified Resolution.
99.1 Ruddick Corporation 1995
Comprehensive Stock Option
Plan, incorporated herein
by reference to Exhibit
10.1 of the Registrant's
Quarterly Report on Form
10-Q for the quarterly
period ended June 30, 1996
(Commission File No. 1-6905).
99.2 Provisions of North
Carolina law relating to
indemnification.
SMITH HELMS MULLISS & MOORE, L.L.P.
Attorneys at Law
214 North Church Street
Charlotte, North Carolina 28202
(704) 343-2000
December 31, 1996
Ruddick Corporation
2000 Two First Union Center
Charlotte, North Carolina 28282
Re: Registration Statement on Form S-8
600,000 Shares of Common Stock
Gentlemen:
In connection with the possible offering and sale from time to time of
all or a portion of 600,000 shares of the Common Stock of Ruddick Corporation
(the "Shares"), upon the terms and conditions set forth in the Registration
Statement on Form S-8 (the "Registration Statement") filed on December 31,
1996 by the registrant with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, we are of the opinion that when (a) the
Registration Statement shall become effective and (b) the Shares have been
sold upon the terms and conditions set forth in the Registration Statement,
the Shares will be validly authorized and legally issued, fully paid and non-
assessable.
We hereby consent to the filing of a copy of this opinion as Exhibit
5.1 of the Registration Statement.
Very truly yours,
SMITH HELMS MULLISS & MOORE, L.L.P.
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-8 of our reports dated
October 24, 1996, included in Ruddick Corporation and subsidiaries Form 10-K
for the year ended September 29, 1996. It should be noted that we have not
audited any financial statements of Ruddick Corporation subsequent to
September 29, 1996 or performed any audit procedures subsequent to the date
of our report.
Charlotte, North Carolina,
December 30, 1996.
ARTHUR ANDERSEN, LLP
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of Ruddick Corporation
( Ruddick ) and the several undersigned Officers and Directors thereof whose
signatures appear below hereby makes, constitutes and appoints John W.
Copeland, Richard N. Brigden and Douglas A. Stephenson, and each of them
acting individually, its and his true and lawful attorneys, with full power to
act without the other and with full power of substitution, to execute, deliver
and file in its and his name and on its and his behalf, and in each of the
undersigned Officer s and Director s capacity or capacities as shown below,
(a) a Registration Statement on Form S-8 (or other appropriate form) with
respect to the registration under the Securities Act of 1933, as amended (the
Securities Act ), of 600,000 shares of the Common Stock of Ruddick for sale
from time to time by Ruddick to various of its key employees and directors
pursuant to the exercise of options granted under the Ruddick Corporation 1995
Comprehensive Stock Option Plan, and any and all amendments, including any and
all post-effective amendments, to the foregoing and any and all documents in
support thereof or supplemental thereto, and (b) such registration statements,
petitions, applications, consents to service of process or other instruments,
and any and all amendments or supplements to the foregoing and any and all
documents in support thereof or supplemental thereto, as may be necessary or
advisable to qualify or register the securities covered by said Registration
Statement under such state or other securities laws, regulations and
requirements as may be applicable; and each of Ruddick and said Officers and
Directors hereby grants to said attorneys, and to each of them, full power and
authority to do and perform each and every act and thing whatsoever as said
attorneys or attorney may deem necessary or advisable to carry out fully the
intent of this power of attorney to the same extent and with the same effect
as Ruddick might or could do, and as each of said Officers and Directors might
or could do personally in his capacity or capacities as aforesaid, and each of
Ruddick and said Officers and Directors hereby ratifies and confirms all acts
and things which said attorneys or attorney might do or cause to be done by
virtue of this power of attorney and its or his signature as the same may be
signed by said attorneys or attorney, or either of them, to any or all of the
following (and/or any and all amendments and supplements to any or all
thereof): such Registration Statement under the Securities Act, and all such
registration statements, petitions, applications, consents to service of
process and other instruments, and any and all amendments to the foregoing and
any and all documents in support thereof or supplemental thereto, under such
securities laws, regulations and requirements as may be applicable.
IN WITNESS WHEREOF, Ruddick Corporation has caused this power of
attorney to be signed on its behalf, and each of the undersigned Officers and
Directors of the Corporation in the capacity or capacities noted has hereunto
set his hand on the date indicated.
RUDDICK CORPORATION
By: /S/ JOHN W. COPELAND
John W. Copeland
President
Dated: November 16, 1995
Signature Title Date
/S/ JOHN W. COPELAND President and Director November 16, 1995
John W. Copeland (Principal Executive Officer)
/S/ RICHARD N. BRIGDEN Vice President-Finance November 16, 1995
Richard N. Brigden (Principal Financial Officer)
/S/ DOUGLAS A. STEPHENSON Treasurer (Principal November 16, 1995
Douglas A. Stephenson Accounting Officer)
/S/ THOMAS M. BELK Director November 16, 1995
Thomas M. Belk
/S/ EDWIN B. BORDEN, JR. Director November 16, 1995
Edwin B. Borden, Jr.
/S/ ALAN T. DICKSON Director November 16, 1995
Alan T. Dickson
/S/ R. STUART DICKSON Director November 16, 1995
R. Stuart Dickson
/S/ BEVERLY F. DOLAN Director November 16, 1995
Beverly F. Dolan
/S/ RODDEY DOWD, SR. Director November 16, 1995
Roddey Dowd, Sr.
/S/ JAMES E. S. HYNES Director November 16, 1995
James E. S. Hynes
/S/ HUGH L. McCOLL, JR. Director November 16, 1995
Hugh L. McColl, Jr.
/S/ E. C. WALL, JR. Director November 16, 1995
E. C. Wall, Jr.
PROVISIONS OF NORTH CAROLINA BUSINESS CORPORATION ACT
REGARDING INDEMNIFICATION
"SECTION 55-8-50. POLICY STATEMENT AND DEFINITIONS.
(a) It is the public policy of this State to enable corporations
organized under this Chapter to attract and maintain responsible, qualified
directors, officers, employees and agents, and, to that end, to permit
corporations organized under this Chapter to allocate the risk of personal
liability of directors, officers, employees and agents through indemnification
and insurance as authorized in this Part.
(b) Definitions in this Part:
(1) 'Corporation' includes any domestic or foreign corporation
absorbed in a merger which, if it had a separate existence
had continued, would have had the obligation or power to
indemnify its directors, officers, employees, or agents, so
that a person who would have been entitled to receive or
request indemnification from such corporation if its
separate existence had continued shall stand in the same
position under this Part with respect to the surviving
corporation.
(2) 'Director' means an individual who is or was a director of a
corporation or an individual who, while a director of a
corporation, is or was serving at the corporation's request
as a director, officer, partner, trustee, employee, or agent
of another foreign or domestic corporation, partnership,
joint venture, trust, employee benefit plan, or other
enterprise. A director is considered to be serving an
employee benefit plan at the corporation's request if his
duties to the corporation also impose duties on, or
otherwise involve services by, him to the plan or to
participants in or beneficiaries of the plan. 'Director'
includes, unless the context requires otherwise, the estate
or personal representative of a director.
(3) 'Expenses' means expenses of every kind incurred in
defending a proceeding, including counsel fees.
(4) 'Liability' means the obligation to pay 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.
(4a) 'Officer', 'employee', or 'agent' includes, unless the
context requires otherwise, the estate or personal
representations of a person who acted in that capacity.
(5) '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 individual other than a
director, as contemplated in G.S. 55-8-56, the office in a
corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on behalf
of the corporation. 'Official capacity' does not include
service for any other foreign or domestic corporation or any
partnership, joint venture, trust, employee benefit plan, or
other enterprise.
(6) 'Party' includes an individual who was, is, or is threatened
to be made a named defendant or respondent in a proceeding.
(7) 'Proceeding' means any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal,
administrative, or investigative and whether formal or
informal.
SECTION 55-8-51. AUTHORITY TO INDEMNIFY.
(a) Except as provided in subsection (d), a corporation may indemnify
an individual made a party to a proceeding because he is or was a director
against liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed (i) in the case of conduct in his
official capacity with the corporation, that his conduct was
in its best interests; and (ii) in all other cases, that his
conduct was at least not opposed to its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable
cause to believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for
a purpose he reasonably believed to be in the interests of the participants in
and beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a) (2) (ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction, or upon a plea of no contest or its equivalent is not, of itself,
determinative that the director did not meet the standard of conduct described
in this section.
(d) A corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in
his official capacity, in which he was adjudged liable on
the basis that personal benefit was improperly received by
him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation that is concluded without a
final adjudication on the issue of liability is limited to reasonable expenses
incurred in connection with the proceeding.
(f) The authorization, approval or favorable recommendation by the
board of directors of a corporation of indemnification, as permitted by this
section, shall not be deemed an act or corporate transaction in which a
director has a conflict of interest, and no such indemnification shall be void
or voidable on such ground.
SECTION 55-8-52. MANDATORY INDEMNIFICATION.
Unless limited by its articles of incorporation, a corporation shall
indemnify a director who was wholly successful, on the merits or otherwise, in
the defense of any proceeding to which he was a party because he is or was a
director of the corporation against reasonable expenses incurred by him in
connection with the proceeding.
SECTION 55-8-53. ADVANCE FOR EXPENSES.
Expenses incurred by a director in defending a proceeding may be paid by
the corporation in advance of the final disposition of such proceeding as
authorized by the board of directors in the specific case or as authorized or
required under any provision in the articles of incorporation or bylaws or by
any applicable resolution or contract upon receipt of an undertaking by or on
behalf of the director to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified by the corporation against
such expenses.
SECTION 55-8-54. COURT-ORDERED INDEMNIFICATION.
Unless a corporation's articles of incorporation provide otherwise, a
director of the corporation who is a party to a proceeding may apply for
indemnification to the court conducting the proceeding or to another court of
competent jurisdiction. On receipt of an application, the court after giving
any notice the court considers necessary may order indemnification if it
determines:
(1) The director is entitled to mandatory indemnification under
G.S. 55-8-52, in which case the court shall also order the
corporation to pay the director's reasonable expenses
incurred to obtain court-ordered indemnification; or
(2) The director is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances,
whether or not he met the standard of conduct set forth in
G.S. 55-8-51 or was adjudged liable as described in G.S.
55-8-51(d), but if he was adjudged so liable his
indemnification is limited to reasonable expenses incurred.
SECTION 55-8-55. DETERMINATION AND AUTHORIZATION OF INDEMNIFICATION.
(a) A corporation may not indemnify a director under G.S. 55-8-51
unless authorized in the specific case after a determination has been made
that indemnification of the director is permissible in the circumstances
because he has met the standard of conduct set forth in G.S. 55-8-51.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under subdivision (1), by
majority vote of a committee duly designated by the board of
directors (in which designation directors who are parties
may participate), consisting solely of two or more directors
not at the time parties to the proceeding;
(3) By special legal counsel (i) selected by the board of
directors or its committee in the manner prescribed in
subdivision (1) or (2); or (ii) if a quorum of the board of
directors cannot be obtained under subdivision (1) and a
committee cannot be designated under subdivision (2),
selected by majority vote of the full board of directors (in
which selection directors who are parties may participate);
or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the
proceeding may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same manner as the
determination that indemnification is permissible, except that if the
determination is made by special legal counsel, authorization of
indemnification and evaluation as to reasonableness of expenses shall be made
by those entitled under subsection (b)(3) to select counsel.
SECTION 55-8-56. INDEMNIFICATION OF OFFICERS, EMPLOYEES, AND AGENTS.
Unless a corporation's articles of incorporation provide otherwise:
(1) An officer of the corporation is entitled to mandatory
indemnification under G.S. 55-8-52, and is entitled to apply
for court-ordered indemnification under G.S. 55-8-54, in
each case to the same extent as a director;
(2) The corporation may indemnify and advance expenses under
this Part to an officer, employee, or agent of the
corporation to the same extent as to a director; and
(3) A corporation may also indemnify and advance expenses to an
officer, employee, or agent who is not a director to the
extent, consistent with public policy, that may be provided
by its articles of incorporation, bylaws, general or
specific action of its board of directors, or contract.
SECTION 55-8-57. ADDITIONAL INDEMNIFICATION AND INSURANCE.
(a) In addition to and separate and apart from the indemnification
provided for in G.S. 55-8-51, 55-8-52, 55-8-54, 55-8-55 and 55-8-56, a
corporation may in its articles of incorporation or bylaws or by contract or
resolution indemnify or agree to indemnify any one or more of its directors,
officers, employees, or agents against liability and expenses in any
proceeding (including without limitation a proceeding brought by or on behalf
of the corporation itself) arising out of their status as such or their
activities in any of the foregoing capacities; provided, however, that a
corporation may not indemnify or agree to indemnify a person against liability
or expenses he may incur on account of his activities which were at the time
taken known or believed by him to be clearly in conflict with the best
interests of the corporation. A corporation may likewise and to the same
extent indemnify or agree to indemnify any person who, at the request of the
corporation, is or was serving as a director, officer, partner, trustee,
employee, or agent of another foreign or domestic corporation, partnership,
joint venture, trust or other enterprise or as trustee or administrator under
an employee benefit plan. Any provision in any articles of incorporation,
bylaw, contract, or resolution permitted under this section may include
provisions for recovery from the corporation of reasonable costs, expenses,
and attorneys' fees in connection with the enforcement of rights to
indemnification granted therein and may further include provisions
establishing reasonable procedures for determining and enforcing the rights
granted therein.
(b) The authorization, adoption, approval, or favorable recommendation
by the board of directors of a public corporation of any provision in any
articles of incorporation, bylaw, contract or resolution, as permitted in this
section, shall not be deemed an act or corporate transaction in which a
director has a conflict of interest, and no such articles of incorporation or
bylaw provision or contract or resolution shall be void or voidable on such
grounds. The authorization, adoption, approval, or favorable recommendation
by the board of directors of a nonpublic corporation of any provision in any
articles of incorporation, bylaw, contract or resolution, as permitted in this
section, which occurred on prior to July 1, 1990, shall not be deemed an act
or corporate transaction in which a director has a conflict of interest, and
no such articles of incorporation, bylaw provision, contract or resolution
shall be void or voidable on such grounds. Except as permitted in G.S.
55-8-31, no such bylaw, contract, or resolution not adopted, authorized,
approved or ratified by shareholders shall be effective as to claims made or
liabilities asserted against any director prior to its adoption,
authorization, or approval by the board of directors.
(c) A corporation may purchase and maintain insurance on behalf of an
individual who is or was a director, officer, employee, or agent of the
corporation, or who, while a director, officer, employee, or agent of the
corporation, is or was serving at the request of the corporation as a
director, officer, partner, trustee, employee, or agent of another foreign or
domestic corporation, partnership, joint venture, trust, employee benefit
plan, or other enterprise, against liability asserted against or incurred by
him in that capacity or arising from his status as a director, officer,
employee, or agent, whether or not the corporation would have power to
indemnify him against the same liability under any provision of this Chapter.
SECTION 55-8-58. APPLICATION OF PART.
(a) If articles of incorporation limit indemnification or advance for
expenses, indemnification and advance for expenses are valid only to the
extent consistent with the articles.
(b) This Part does not limit a corporation's power to pay or reimburse
expenses incurred by a director in connection with his appearance as a witness
in a proceeding at a time when he has not been made a named defendant or
respondent to the proceeding.
(c) This Part shall not affect rights or liabilities arising out of
acts or omissions occurring before July 1, 1990."
