Ohio Code § 3964.177

§ 3964.177.

(A) If a protected cell captive insurance company enters into an agreement with respect

to a protected cell of the protected cell captive insurance company, the directors

shall ensure that both of the following are met: (1) The other party to the transaction knows, or ought reasonably to know, that the protected

cell captive insurance company is acting with respect to a particular protected cell. (2) The minutes of any meeting of directors held with regard to the agreement clearly

record the fact that the protected cell captive insurance company was entering into

the agreement with respect to the protected cell in question and that the obligation

imposed by division (A)(1) of this section has been, or will be, complied with. (B) If a protected cell captive insurance company fails to comply with division (A) of

this section, then both of the following shall apply: (1) The directors of the protected cell captive insurance company shall be personally

liable for the liabilities of the protected cell captive insurance company and the

protected cell under the act, matter, deed, agreement, contract, instrument, or arrangement

that was executed, notwithstanding any provisions to the contrary in the protected

cell's organizational documents or in any contract with the protected cell captive

insurance company or otherwise. (2)(a) The directors of the protected cell captive insurance company shall have a right

of indemnity, in the case of a matter on behalf of or attributable to a protected

cell, against the assets of the protected cell, unless the directors were fraudulent,

reckless, negligent, or acted in bad faith. (b) The directors shall have a right of indemnity against the general assets of the protected

cell captive insurance company, in the case of a matter not on behalf of or attributable

to a protected cell. (C) Notwithstanding division (B)(1) of this section, a court may relieve a director of

all or part of the personal liability required under division (B)(1) of this section

if the director can demonstrate either of the following to the satisfaction of the

court: (1) The director was not aware of the circumstances giving rise to the liability and

therefore was not fraudulent, reckless, or negligent and did not act in bad faith. (2) The director expressly objected, and exercised the rights available to the director,

whether by way of voting power or otherwise, to try to prevent the circumstances giving

rise to the liability. (D) If, pursuant to division (C) of this section, a court relieves a director of all

or part of the director's personal liability under division (B)(1) of this section,

the court may order that the liability in question instead be met from the assets

of the protected cell or the general assets of the protected cell captive insurance

company as the court finds appropriate. (E) Any provision in the organizational document of a captive insurance company or any

other contractual provision under which the protected cell captive insurance company

may be liable shall be void if it purports to indemnify the directors of a protected

cell captive insurance company despite fraudulent, negligent, reckless, bad faith,

or other conduct that would otherwise exempt them from indemnification by virtue of

division (B)(2)(a) of this section. (F) The duties of a director of a protective cell captive insurance company under this

chapter shall be in addition to and not in lieu of, those under any other applicable

law.