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HomeCorporations CodeCh. 23§ 2306 Corporate Indemnification Rules

§ 2306 Corporate Indemnification Rules

Corporations Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 2306 Corporate Indemnification Rules

This law says a company can promise to cover costs for people after the law starts, even if the problem happened before the law, and old company rules won’t stop that promise unless they clearly say they do.

Key Takeaways

  • •Indemnification can apply to events that happened before the law’s start date.
  • •The rule in Section 317 controls any new indemnification promises after the law begins.
  • •Existing articles or bylaws don’t limit this unless they clearly state they do.

Example

A corporation wants to pay a director’s legal fees for a lawsuit that began before the new law took effect.

Because of this law, the corporation can still agree to pay those fees after the law starts, unless its original bylaws specifically say it can’t.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 2306 Corporate Indemnification Rules

Section 317 of the new law governs any proposed indemnification by a corporation after the effective date, whether the events upon which the indemnification is based occurred before or after the effective date. Any statement relating to indemnification contained in the articles or bylaws of a corporation on the effective date shall not be construed as limiting the indemnification permitted by Section 317 unless it is expressly stated as so intended. (Added by Stats. 1975, Ch. 682.)

Last verified: January 10, 2026

Key Terms

Section 317indemnificationeffective datearticles or bylaws

Related Statutes

  • § 2300 Corporations Code Effective Dates
  • § 2301 Corporate Law Effective Date
  • § 2302.1 Bylaws Amendment Exemption
  • § 2307 Share Certificate Statement Rules
  • § 2308 Shareholder Distribution Rules

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Corporations Code. Section 2306.
View Official Source