The indemnification policy, contained in the
College Bylaws, Article X, states:

Each employee of the College acting within the scope of his or her employment in good faith and in a manner reasonably believed by such person to be lawful and in the best interest of the College, shall, in accordance with the provisions of Section 714 of Title 13-B of the Maine Revised Statutes as in effect on January 1, 1989, be indemnified against all expenses, including attorneys' fees, judgments, fines and amounts paid in settlement, actually and necessarily incurred by such Trustee, officer, employee or agent in connection with the defense of any action, suit or proceeding to which he or she has been made a party by reason of being or having been such Trustee, officer, employee or agent. This indemnification policy shall be for the benefit of the persons described herein while serving the capacity described, as well as after the termination of such service, with respect to actions taken while serving in such capacity and shall extend to their heirs and to their personal representatives.

The provisions of that Bylaw are subject to the following procedures:

1. In order to apply for protection and benefits under the indemnification policy, an employee or agent (hereinafter collectively referred to as "employee") shall: (a) as soon as the employee becomes aware of a substantial possibility of an action for which he or she may seek defense and/or indemnification, notify the Administrative Vice President or, if a faculty member, the Dean of Faculty, in writing; (b) not discuss the subject of the action with anyone other than those authorized by the President, Administrative Vice President or Dean of Faculty; (c) provide to the College, and only to the College, all pertinent information, including detailed information about the act or failure to act that is the subject of the action; and (d) sign an agreement promising to reimburse the College for any expenses incurred on behalf of the employee if it should ultimately be determined by the Board of Trustees that the employee is not entitled to indemnification.

2. In order for an employee to be eligible for defense and/or indemnification the employee must apply to the College prior to incurring the expenses to be reimbursed or otherwise acting in connection with an action. Application after incurring expenses to be reimbursed or otherwise acting in connection with the action may be grounds for denial of the application if such has prejudiced the employee's case or increased the cost of defense in any way.

3. The President of the College shall determine whether the action appears to be covered by the indemnification policies and procedure and, if so, shall either select an attorney to represent the employee or agree to the reimbursement or reasonable legal expenses incurred by the employee. An adverse determination by the President may be appealed to the Executive Committee of the Board of Trustees. The decision of the Executive Committee of the Board of Trustees shall be final, ultimately determinative, and not subject to judicial or other review.

4. An employee shall not be entitled to reimbursement for legal defense expenses or for any judgments, fines, or amounts paid in settlement of any action, suit, or proceedings if the acts or omissions alleged constitute willful misconduct, gross negligence, or recklessness.

5. An employee shall cooperate fully in the defense of the action. Any unreasonable failure to provide full information or to cooperate in the defense of the action shall be reason for denial of defense and/or indemnification expenses.

6. Determination of any action, suit, or proceeding by judgment, order, or conviction adverse to an employee, or by settlement or plea of nolo contendere or its equivalent, shall not of itself create a presumption that the employee did not act in good faith in the reasonable belief that his or her action was in the best interest of the College (or, with respect to any criminal action or proceeding, that the person had reasonable cause to believe that his or her conduct was unlawful). In the case of such adverse determination, the Trustees of the College, by majority vote of a quorum consisting of Trustees who were not a party to such action, suit, or proceeding shall, in accordance with Subsection 3 of Section 714 of Title 13-B of the Maine Revised Statutes, authorize the reimbursement of the employee for legal expenses and any related judgments, fines, or settlements if a majority of the Trustees believe that the employee acted within the scope of his or her employment, in good faith, and in a manner reasonably believed to be lawful and in the best interest of the College, and that the action or omission did not involve willful misconduct, gross negligence, or recklessness. In the case of an employee with regard to whose indemnification the Trustees are deliberating, the employee shall be given the opportunity to present his or her position to the Board orally and/or in writing through one, several, or all of the following: the employee, an attorney or other personal representative of the employee, or a member of his or her profession (if any) undertaking to clarify for the Trustees, from the viewpoint of the profession, the elements relevant to the Trustees' consideration of whether the employee's actions are indemnifiable. The decision of the Board of Trustees in this regard, as well as in regard to any dispute concerning the interpretation or application of any of the provisions of this Article, shall be final, ultimately determinative, and not subject to judicial or other review.

7. "Scope of employment" for the purpose of Article X of the Bylaws may include uncompensated service to the College (such as student or outside referee evaluations of teaching or scholarship of Colby faculty or Colby programs) and includes employee participation in and/or direction of such off-campus student activities as field trips, data gathering, COOT trips, group trips in the United States and abroad, and the operation of foreign center programs. However, "scope of employment" does not normally include writing for publication, publishing, off-campus professional activities (other than those specified above), consulting or business activities. Nevertheless, the College may, in its sole discretion and on a case-by-case basis, following the procedures set forth in paragraphs 1. and 3. above, decide whether and to what extent to extend protection for such activities. The College will normally not extend such protection if the activities involved compensation for those activities by a person or entity other than the College, compensation that exceeds reasonable expenses.

8. The protection of this policy shall extend only to actions in which the employee is a defendant or proposed defendant, and shall not extend to actions that an employee affirmatively initiates or proposes to initiate against any other persons or entities or to defense and/or indemnification of an employee in any proceeding within the College.

9. The protection of this policy shall not extend to actions or omissions while an employee is on an unpaid leave of absence from the College, although exceptions may be made at the College's sole discretion where an employee on leave is engaged in activities that are an extension of his or her College activities.

10. The protection of this policy shall not extend to medical or other professional liability with respect to which employees are protected under any professional liability insurance program.

11. The employee shall notify the College at the time he or she applies for protection and benefits under this policy of any personal or other insurance coverage that may be available to provide defense and/or indemnification. The College may require the employee to exhaust any available benefits under such insurance before providing benefits under this policy.

12. The employee shall also notify the College at the time he or she applies for protection and benefits under this policy if any other entity may be obligated or able to defend and/or indemnify the employee because of the connection the employee had with such entity related to the allegations that have given rise to the action. The College may require the employee to exhaust any available benefits from such entity (or its insurers) before providing benefits under this policy.

13. If requested by the College, the employee shall produce proof of any such alternative sources of protection described in paragraphs 11. and 12., or lack thereof.

14. If the employee wishes to file a counterclaim, he or she shall follow the procedures set forth herein, and if approved, any net judgment in favor of the employee shall first be paid to the College as reimbursement for indemnification payments made, until repaid in full, the remainder to the employee. If not approved, all costs and recoveries in connection with the counterclaim shall be that of the employee.

15. The College's indemnification policy and procedures shall not limit any right of indemnification existing independently thereof.