190

LAWS OF MARYLAND

Ch. 24

(1)   THE STATE SHALL INDEMNIFY EVERY PERSON WHO IS
MADE, OR IS THREATENED TO BE MADE, A PARTY TO ANY ACTION,
SUIT, OR PROCEEDING INCLUDING ADMINISTRATIVE AND
INVESTIGATIVE PROCEEDINGS BECAUSE OF HIS SERVICE IN A
FIDUCIARY CAPACITY TO THIS PENSION SYSTEM, IN ACCORDANCE
WITH AND SUBJECT TO THIS SECTION.

(2)   (A) IN THIS SECTION, "SERVICE IN A FIDUCIARY
CAPACITY," MEANS THE EXERCISE OF ANY DISCRETIONARY AUTHORITY
OR CONTROL CONCERNING:

(I)   THE MANAGEMENT OR ADMINISTRATION OF
THIS PENSION SYSTEM; OR

(II)  THE MANAGEMENT OR DISPOSITION OF THE
ASSETS OF THIS SYSTEM.

(B) "SERVICE IN A FIDUCIARY CAPACITY" INCLUDES:

(I)   MEMBERSHIP ON THE BOARD OF TRUSTEES
OF THIS PENSION SYSTEM;

(II)  MEMBERSHIP ON THE ADVISORY INVESTMENT
COMMITTEE; AND

(III) SERVICE AS INVESTMENT ADMINISTRATOR
OR ON HIS STAFF.

(3)   IF, WITH RESPECT TO A CIVIL, ADMINISTRATIVE, OR
INVESTIGATIVE ACTION, SUIT, OR PROCEEDING, THE PERSON ACTED
IN GOOD FAITH AND IN A MANNER HE REASONABLY BELIEVED TO BE
IN OR NOT OPPOSED TO THE BEST INTEREST OF THIS PENSION
SYSTEM, AND, WITH RESPECT TO A CRIMINAL ACTION, HAD NO
REASONABLE CAUSE TO BELIEVE HIS CONDUCT WAS UNLAWFUL, THEN
INDEMNIFICATION SHALL BE AGAINST THOSE EXPENSES, INCLUDING
REASONABLE ATTORNEY'S FEES, JUDGMENTS, FINES, AND ACCOUNTS
PAID IN SETTLEMENT THAT ACTUALLY AND REASONABLY WERE
INCURRED BY HIM IN CONNECTION WITH THE PROCEEDING.

(4)   THE TERMINATION OF ANY SUIT OR PROCEEDING, IN ANY
MANNER, OF ITSELF, DOES NOT CREATE A PRESUMPTION THAT THE
PERSON DID NOT ACT IN GOOD FAITH AND IN A MANNER HE
REASONABLY BELIEVED TO BE IN OR NOT OPPOSED TO THE BEST
INTEREST OF THIS PENSION SYSTEM, AND WITH RESPECT TO A
CRIMINAL ACTION OR PROCEEDING, HAD REASONABLE CAUSE TO
BELIEVE THAT HIS CONDUCT WAS UNLAWFUL.

(5)   INDEMNIFICATION MAY NOT BE MADE:

(I)   WITH RESPECT TO ANY SUIT, CLAIM, OR MATTER
AS TO WHICH THE PERSON IS ADJUDGED TO BE LIABLE FOR GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT IN THIS SYSTEM; OR

(II)  FOR AN INDEPENDENT CONTRACTOR WHO PROVIDES
SERVICES TO THIS PENSION SYSTEM.