Common use of Derivative Action Clause in Contracts

Derivative Action. If an eligible proceeding is brought against the Director by or on behalf of the Corporation or by or on behalf of an associated corporation, the Corporation shall not: 4.2.1. indemnify the Director under section 2.2.1 in respect of the proceeding; or 4.2.2. pay the expenses of the Director under section 2.2.2 or section 7.1 if the Director was not wholly successful, on the merits or otherwise, in the outcome of the proceeding or was not substantially successful on the merits in the outcome of the proceeding.