Indemnification Is Good, But Advancement Is Even Better: Make Sure You Know The Difference And Level The Playing Field From The Start
Corporate officers and directors frequently find themselves involved in complex legal proceedings in which they face exposure merely by reason of the fact that they served as an officer or director. In such proceedings, the legal expenses incurred by the officer/director can be devastatingly massive, such that it would be unfair to require them to pay those expenses, personally, out of pocket. As such, companies regularly agree to indemnify their officers/directors for all such expenses after the fact. But the commitment to indemnify officers/directors after the fact is sometimes insufficient. In too many instances, the cash requirements of funding a legal defense can be so oppressive that it is an almost illusory benefit for the officer/director to be able to seek indemnification after the fact. So, with increasing frequency, companies commit to pay such expenses in advance.
Indemnification and Advancement Together Further Important Policy Goals
Advancement provisions further important policy objectives that provide benefits to not only officers/directors, but also the companies that employ such individuals. Indemnification “encourages corporate service by capable individuals by protecting their personal financial resources from depletion by the expenses they incur during…litigation that results by reason of that service.” But the right to indemnification is usually contingent on the outcome of the suit brought against the officer/director. Indeed, most indemnification provisions contain language similar in substance and form to the following: The officer/director shall not be entitled to indemnification with regard to any claim as to which the officer/director is found liable.
Most would agree that carve-out is logical. On the one hand, it makes sense that a corporate employer should indemnify those of its officers/directors who have been wrongly accused of something that they did not do. On the other hand, it makes little sense that a corporate employer should indemnify those of its officers/directors who are found liable for having breached duties owed to their employer in their capacity as an officer/director.
As a result, the right to indemnification cannot be established with finality until after the officer/director has prevailed on the merits. But of course, that cannot be determined until the litigation has come to a close. Hence, the right to (potential) indemnification cannot protect officers/directors from the potentially crushing cash-flow obligations necessary to fund a defense.
But that is where advancement comes into play. Advancement has been defined as “an especially important corollary to indemnification as an inducement for attracting capable individuals into corporate service.” That is so because “[a]dvancement provides corporate officials with immediate interim relief from the personal out-of-pocket financial burden of paying the significant on-going expenses inevitably involved with investigations and legal proceedings.”
Indemnification and Advancement Are Distinct Legal Concepts
Indemnification and advancement work in tandem to provide benefits to corporate employers and their employees alike, but they are not the same thing. Rather, “the right to indemnification and the right to advancement are distinct.” Indeed, the law recognizes that “[t]he advancement of legal fees does not ipso facto mean that defendant companies will have to indemnify the plaintiffs.”
As noted above, the right to indemnification requires success on the merits. In stark contrast, advancement does not require an evaluation of the merits — because “[t]he right to advancement is not dependent on the right to indemnification.” Rather, “[t]he value of the right to advancement is that it is granted or denied while the underlying action is pending.” As such, “[t]he advancement of legal fees should be seen as a decision to advance credit and does not in any way affect the underlying action.”
The decision to advance legal expenses, thus, does not necessarily represent an irreversible flow of funds. Rather, by accepting payments expressly recognized merely as an “advancement,” the receiving party necessarily acknowledges that the right to keep those payments depends on whether the underlying conduct is properly subject to indemnification. But if it ultimately is determined that the officer/director engaged in conduct that is not properly subject to indemnification, then the recipient is obligated to repay the funds advanced by the company. That, however, is to be decided only after the parties have had a full opportunity to litigate the merits — which has nothing to do with the threshold issue of whether the officer/director is entitled to advancement in the first instance.
In light of the foregoing, courts are mindful not to conflate an analysis of whether advancement is proper with an analysis of whether indemnification is proper, because to do so would blur the distinct purpose of advancement provisions. Indeed, courts consistently (and properly) reject the judicial-economy based argument “that it is more efficient to try claims for advancement simultaneous with the trial of the same lawsuits for which the corporate official is seeking provisional payment of his litigation expenses.” That type of so-called efficiency would result “in an unacceptable cost: the effective elimination of the separate right of advancement.”
Advancement Presents a Very Simple and Straightforward Analysis
Suits against officers/directors are often complicated and fact intensive. But that is not so with regard to the narrow, threshold issue of advancement. That analysis typically is simple and straightforward. While advancement provisions obviously can vary, and each case will turn on the language of the specific provision at issue, a typical advancement provision will set forth a few straightforward, clear, and unambiguous procedural prerequisites. Usually, the only issue vis-a-vis an officer/director’s entitlement to advancement is whether those procedural prerequisites have been satisfied. But issues pertaining to the alleged misconduct forming the basis of the claims in the underlying litigation simply are not relevant.
Typically, advancement provisions will contain just two simple procedural prerequisites. First, the officer/director must show that he or she has been named in a proceeding by reason of the fact that he or she is or was an officer/director of the company. Second, the officer/director must provide what is commonly referred to as an “undertaking” — i.e., a written statement promising to repay all funds advanced if it ultimately is determined that the officer/director is not entitled to indemnification. Neither prerequisite requires an in-depth analysis.
First, whether an officer/director has been sued “by reason of the fact” that he or she is or was an officer/director obviously turns on the allegations pleaded in the underlying suit. But the allegations pleaded usually leave little room for debate. If the officer/director is sued for having breached duties owed in his or her capacity as an officer/director, then it follows that the officer/director was sued “by reason of the fact” that he or she is or was an officer/director. Hence, an officer/director seeking advancement usually can satisfy this prerequisite simply by referring to the allegations of the complaint. The standard is not a lofty one.
Second, whether an officer/director has provided an “undertaking” is objective. The officer/director seeking advancement either provided an “undertaking” as required per the governing documents — or the officer/director did not. But again, this determination can be made without reference to any extraneous facts or law.
Advancement Is Properly Determined via Summary Proceedings
Caselaw uniformly acknowledges that advancement issues are properly to be decided via summary proceedings. In part, that is so because the issue of whether the officer/director has satisfied the contractual prerequisites presents such a simple and straightforward analysis. In part, that is so because courts endeavor to advance the policy underpinnings that advancement provisions are intended to promote, which is to provide an interim cost-shifting mechanism.
For example, in DeLucca v. KKAT Management, LLC, 2006 WL 224058 (Del. Ch. 2006), the Delaware Court of Chancery held it was proper to order the advancement of fees based on a motion for judgment on the pleadings. In pertinent part, the court explained why it was proper to decide the matter on a purely paper record: “Advancement cases are particularly appropriate for resolution on a paper record, as they principally involve the question of whether claims pled in a complaint against a party…trigger a right to advancement under the terms of a corporate instrument.”
The bottom line is that the advancement of fees must be made promptly if it is to have any value at all. An officer’s or director’s defense is undeniably impaired by a corporation’s denial of advancement, and even mere delay can be prejudicial. As the Delaware Supreme Court has explained: “Clearly, to be of any value to the executive or director, advancement must be made promptly, otherwise its benefit is forever lost because the failure to advance fees affects the counsel the director may choose and litigation strategy that the executive or director will be able to afford.”
Most Defenses Are Inapposite to the Narrow Issue of Advancement
Faced with the prospect of having to fund the defense of its adversary, many employers will argue that advancement cannot be required until the court has a full and fair opportunity to adjudicate the company’s affirmative defenses. The law, however, is quite clear that affirmative defenses that speak to the merits pose no obstacle to a claim for advancement. Nevertheless, corporate employers still persist in raising myriad defenses that almost always fail to derail a request for advancement. Some of the more commonly invoked defenses — and the reasons they cannot defeat a request for advancement — are as follows.
• Allegations of Gross Negligence or Willful Misconduct — In many instances, the corporate employer will allege that the officer/director engaged in gross negligence or willful misconduct. Based on such allegations, the corporate employer will argue the officer/director engaged in disqualifying conduct and, therefore, is entitled to neither indemnification nor advancement. But as explained above, the conduct of the officer/director is relevant only to the issue of indemnification (which concerns the underlying merits), but not to the issue of advancement (which does not concern the underlying merits).
As such, it should come as no surprise that countless courts have recognized that the alleged nature of the underlying conduct — no matter how egregious — cannot be permitted to serve as a defense to a claim for advancement because that would defeat the very purpose for which funds are to be advanced in the first place. As one court explained:
Corporate advancement practice has an admittedly maddening aspect. At the time that an advancement dispute ripens, it is often the case that the corporate board has drawn harsh conclusions about the integrity and fidelity of the corporate official seeking advancement. The board may well have a firm basis to believe that the official intentionally injured the corporation. It therefore is reluctant to advance funds for his defense, fearing that the funds will never be paid back and resisting the idea of seeing further depletion of corporate resources at the instance of someone perceived to be a faithless fiduciary.
But, to give effect to this natural human reaction as public policy would be unwise….That result would make the promise made to [the officer]…an illusory one.
Numerous other courts have echoed the same sentiment. In DeLucca, the corporate employer alleged that the officer employee had plotted to form a venture that would compete with the corporation and usurp the company’s most lucrative relationships. As such, the corporate-plaintiff was aghast at the prospect of having to advance funds to such an individual. But to that, the court explained: [T]he right to advancement does not go away simply because the entity from which advancement is sought is alleging that the plaintiff has committed perfidious acts against it. Indeed, it is precisely in the circumstance when a business official is accused of serious wrongdoing that the right to advancement is critical, as that right secures the funds for the official to defend herself.
And in Morgan v. Grace, 2003 WL 22461916 (Del. Ch. 2003), the court noted that notwithstanding the “admittedly maddening aspect” of advancing legal funds to one accused of wrongdoing against the company, the advancement of funds is regularly required.
With regard to the issue of advancement, it just does not matter whether the officer/director really is a scoundrel (as alleged by the corporate employer) or the claims are frivolous (as argued by the officer/director). That is an issue for another day. But until then, the corporate employer is obligated to advance funds so that the officer/director can afford a proper defense.
• The Undertaking Is Insufficient — Corporate employers sometimes attempt to challenge the sufficiency of the “undertaking” provided by the officer/director — whereby the officer/director has promised to repay all funds advanced if it ultimately is determined that the officer/director is not entitled to indemnification. That is particularly so in those instances in which the “undertaking” is provided without any collateral or other security; where the officer/director lacks assets sufficient to honor the undertaking; or in which the officer/director is allegedly engaged in attempts to dissipate or otherwise shield assets — all rendering the undertaking ineffective and meaningless. But unless the advancement provision in question specifically addresses these issues, this challenge is off the mark.
There is, of course, nothing that precludes a corporate employer from drafting its own corporate documents in such a way as to mandate that the “undertaking” required thereunder must be a secured undertaking — i.e., one tendered with sufficient collateral or security. And when a corporation takes care to insert such language, it may rest assured that all funds advanced in fact would be repaid if, after the close of all the evidence, it ultimately is determined by the trier of fact that the officer/director is not entitled to indemnification. But in those instances in which the corporate employer fails to insert language requiring that the undertaking be secured, courts uniformly refuse to insert such language into the contract drafted by the parties.
For example, in Reddy v. Electronic Data Systems Corp., 2002 WL 1358761 (Del. Ch. 2002), the operative language provided that expenses must be advanced “upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation….” There was no express language that referred to any collateral or security requirements. And in the absence of such language, the court held the provision could not be read to require an actual ability to repay all funds previously advanced: [C]orporations may specify by bylaw or contract the terms and conditions upon which employees and agents may receive advancement, which could include an undertaking and more onerous pre-requisites to advancement. Having been accorded the freedom to craft its bylaws as it wished, [the company] cannot point to its own drafting failures as a defense to [the employee’s] advancement claim….If it chose, [the company] could have conditioned former employees’ advancement rights on an undertaking, proof of an ability to repay, or even the posting of a secured bond. But it did not do so.
Corporate employers are free to insert language that conditions advancement on the provision of a secured undertaking; but there are consequences if they fail to do so. Indeed, Florida law is well settled that courts may not insert themselves into the long-ago drafting process to insert new language to fit the corporate employer’s present purposes.
The Officer/Director Waited Too Long — The corporate employer often will argue that the officer/director waited too long to seek advancement. This challenge is dressed up in many different forms — including waiver, laches, and estoppel. But it usually is not even necessary to delve into the elements of those defenses. That is so because the prototypical advancement provision contains but a single timing consideration — i.e., words to the effect that the request must be made in advance of such proceeding’s final disposition. Provided that is the case (and provided that the officer/director in fact has requested advancement in advance of the proceeding’s final disposition), then it is fundamentally improper for the corporate employer to argue the advancement provision somehow mandates that a request for advancement be made prior to some undefined time or event. And in such instances, it would be equally wrong for a court to inject itself into the drafting process and insert an additional timeliness requirement (for the benefit of the corporate employer) that the corporate employer failed to insert when drafting its own documents.
• The Corporate Employer Needs To Take Discovery — Another argument frequently advanced by corporate employers is that they need to take discovery before the court can determine whether the officer/director is entitled to advancement. But that is often just an attempt to delay the proceedings. As noted above, the only thing the court must determine to decide the issue of advancement is whether the officer/director has satisfied the procedural prerequisites set forth in the controlling corporate documents. As noted above, those prerequisites are usually twofold. First, the officer/director must show that he or she was sued by reason of the fact that he or she served as an officer/director. Second, the officer/director must provide an undertaking that is in conformity with the controlling corporate documents.
It is hard to envision a scenario in which discovery would be necessary to shed light on either issue. The first almost always can be determined just by reference to the allegations of the complaint. And the second is even more straightforward — i.e., the request for advancement is either accompanied by proof of a sufficient undertaking or it is not. But in both instances, there is nothing else to discover.
• “Fees on Fees” Incurred in Pursuit of Advancement also Are Recoverable — Rather than just advance the funds to which officers/directors are entitled, corporate employers often endeavor to make the fight over advancement as expensive and burdensome as possible, thereby forcing the officer/director to incur a small fortune in fees and costs just to obtain the advancement that should have been paid at the outset. The corporate employers then buttress their determined opposition to requests for advancement by arguing that even if the officer/director prevails on his or her claim for advancement, all fees and expenses incurred in pursuit of advancement — i.e., “fees on fees” — are not properly subject to advancement or otherwise recoverable. But it makes little sense that a corporate employer should be permitted to render the right to advancement illusory by making it so expensive to pursue that it becomes cost prohibitive. Fortunately, caselaw recognizes the fundamental unfairness of that proposition.
One of the leading cases on this subject is Stifel Financial Corp. v. Cochran, 809 A.2d 555 (Del. 2002). In Stifel, a former corporate officer brought suit seeking indemnification for legal expenses incurred in various civil and criminal actions brought against him. The trial court held that the former officer was entitled to indemnification, but he was not entitled to be reimbursed for the expenses he incurred in bringing suit for indemnification. The former officer then appealed that ruling to the Delaware Supreme Court.
The Delaware high court began by noting that indemnification is “intended to be remedial in nature.” The court further noted that “[a]n attorney representing a former director who is being denied statutorily authorized indemnification must seek compensation from his client or remain uncompensated, a result ‘inimical to the interests’ of the former director and contrary to the express purpose of [the statute] to protect directors from personal liability for corporate expenses.” The court added “that the indemnification statute should be broadly interpreted to further the goals it was enacted to achieve.” The court then described those policy goals as follows:
The invariant policy of Delaware legislation on indemnification is to “promote the desirable end that corporate officials will resist what they consider unjustified suits and claims, secure in the knowledge that their reasonable expenses will be borne by the corporation they have served if they are vindicated.” Beyond that, its larger purpose is “to encourage capable men to serve as corporate directors, secure in the knowledge that expenses incurred by them in upholding their honesty and integrity as directors will be borne by the corporation they serve.”
The court, thus, held that it would “eschew narrow construction” of the indemnification statute when that would “disserve” the foregoing policy objectives. Moreover, the court inferred that all doubts should be resolved in favor of awarding fees for the costs of pursuing indemnification because “without an award of attorneys’ fees for the indemnification suit itself, indemnification would be incomplete,” and “[t]here is no compelling reason to deprive claimants of full indemnification….” Finally, the court concluded that there is nothing unfair about the foregoing:
Allowing indemnification for the expenses incurred by a director in pursuing his indemnification rights gives recognition to the reality that the corporation itself is responsible for putting the director through the process of litigation. Further, giving full effect to [the statute] prevents a corporation from using its “deep pockets” to wear down a former director, with a valid claim to indemnification, through expensive litigation. Finally, corporations will not be unduly punished by this result. They remain free to tailor their indemnification bylaws to exclude “fees on fees,” if that is a desirable goal.
Since Stifel, myriad courts have relied upon it to conclude that officers/directors are entitled to recover “fees on fees” incurred in the course of pursuing a contractual right to advancement.
That, of course, makes perfect sense. Indeed, it would be antithetical to the very concept of advancement if a deep-pocketed employer could force a former employee seeking advancement to pay meaningful attorneys’ fees out-of-pocket just to obtain the advancement to which they are otherwise entitled. There is nothing to keep corporate employers from drafting an advancement provision that forecloses the recovery of fees on fees. But if they do not, then “fees on fees” incurred in the successful pursuit of advancement are properly recoverable.
Advancement Provisions Must Be Enforced as Written
Advancement proceedings are becoming increasingly common. The script in such proceedings is quite predictable. After a request for advancement is made, the corporate employer being asked to advance legal expenses frequently tries to ignore the language of its own documents. One court explained this recurring phenomenon as follows: [T]his is yet another case in which defendants in an advancement case seek to escape the consequences of their own contractual freedom. Regretting the broad grant of mandatory advancement they forged on a clear day, they seek to have the judiciary ignore the plain language of their contracts and generate an after-the-fact judicial contract that reflects their current preference. But it is not the job of a court to relieve sophisticated parties of the burdens of contracts they wish they had drafted differently but in fact did not. Rather, it is the court’s job to enforce the clear terms of contracts.
The law, however, commands that when advancement provisions are drafted, advancement provisions must be honored. As the same court explained:
Time and again, this court…has pointed out that sage businesspersons who wish to avoid situations like this must exercise the contractual freedom afforded to them. .. to delimit the circumstances in which they are obligated to advance funds to, or ultimately indemnify, employees and other officials. There is no requirement that advancement provisions be written broadly or in a mandatory fashion. But when an advancement provision is, by its plain terms, expansively written and mandatory, it will be enforced as written.
The bottom line is that indemnification is good. But advancement is better. Practitioners who know the difference can level the playing field right from the start.
 While contractual advancement provisions are becoming more and more common in Florida, the majority of case law on this subject arises out of Delaware. See Richard A. Rossman et al., A Primer on Advancement of Defense Costs: The Rights and Duties of Officers and Corporations, 85 U. Det. Mercy L. Rev. 29 (2007) (hereinafter referred to as A Primer on Advancement). Delaware is, of course, widely regarded as “the Mother” of corporate law. See Kamen v. Kemper Fin. Serv., Inc., 908 F.2d 1338, 1343 (7th Cir. 1990), rev’d on other grounds, Kamen v. Kemper Fin. Services, Inc., 500 U.S. 90 (1991); see also Stephen A. Radin, “Sinners Who Find Religion”: Advancement of Litigation Expenses to Corporate Officials Accused of Wrongdoing, 25 Rev. Litig. 251 (2006) (referring to Delaware as “the Mother Court of corporate law”). And particular to the subject of this article, courts have recognized that Delaware is the undisputed leader when it comes to the issue of advancement. See, e.g., Int’l Airport Ctrs., LLC v. Citrin, 455 F.3d 749, 752 (7th Cir. 2006) (J. Posner noting that the law of advancement is “a Delaware specialty”); see also In re Aguilar, 344 S.W.3d 41, 45 (Tex. App. 2011) (“[T]he courts of Delaware have addressed advancement on numerous occasions.”). As such, it should come as no surprise that Florida courts regularly turn to Delaware when it comes to issues of corporate law, including advancement. See, e.g., Int’l Ins. Co. v. Johns, 847 F.2d 1447, 1459 n. 22 (11th Cir. 1989) (“Florida courts have relied upon Delaware corporate law to establish their own corporate doctrines”); United States v. Florida W. Intern. Airways, Inc. 853 F. Supp. 2d 1209, 1234 n. 35 (S.D. Fla. 2012) (noting that “courts often look to Delaware’s rich abundance of corporate law for guidance”); Williams v. Stanford, 977 So. 2d 722, 727-28 (Fla. 1st DCA 2008) (recognizing that Florida courts regularly consult Delaware cases on matters of corporate law); Fed. Deposit Ins. Corp. as Receiver for Wakulla Bank v. Dodson, 2014 WL 11511068, *7 (N.D. Fla. 2014) (“We rely with confidence upon Delaware law to construe Florida Court corporate law.”). Notably, the current version of the Florida Business Corporation Act contains a provision that provides for permissive advancement. See Fla. Stat. §607.0850(6). So, too, does the Florida Revised Limited Liability Company Act. See Fla. Stat. §605.0408(3). The focus of this article, however, concerns mandatory advancement provisions that parties knowingly choose to incorporate in their corporate documents. As such, the foregoing Florida statutes are not discussed in any greater detail over the balance of this article.
 See, e.g., Homestore v. Tafeen, 888 A.2d 204, 208 (Del. 2005) (“[M]ost Delaware corporations do adopt advancement provisions as an inducement which promotes the same salutary public policy that is served by indemnification: attracting the most capable people into corporate service. Although advancement provides an individual benefit to corporate officials, it is actually a desirable underwriting of risk by the corporation in anticipation of greater corporate-wide rewards for its shareholders.”) (internal quotations and citations omitted).
 Homestore, 888 A.2d at 211.
 Id. (“The right to indemnification cannot be established…until after the defense to legal proceedings has been successful on the merits or otherwise.”) (internal quotations omitted).
 Kaung v. Cole Nat. Corp., 884 A.2d 500, 509 (Del. 2005) (“Whether a corporate officer has a right to indemnification is a decision that must necessarily await the outcome of the…litigation.”).
 Homestore, 888 A.2d at 211.
 Id. (emphasis added); see also A Primer on Advancement at 30 (noting the “right to advancement…is an important component of executive compensation.”).
 See, e.g., Homestore, 888 A.2d at 212 (“Although the right to indemnification and advancement are correlative, they are separate and distinct legal actions.”).
 Morgan v. Grace, 2003 WL 22461916 at *3 (Del. Ch. 2003).
 Id. at n. 21.
 See, e.g., Homestore, 888 A.2d at 212 (indemnification requires success on the merits).
 Id. at 212.
 Morgan, 2003 WL 22461916 at *1.
 Reddy v. Electronic Data Systems Corp., 2002 WL 1358761 at * 5 (Del. Ch. 2002) (“If his conduct is not the proper subject of indemnification. .. [the officer] must repay the funds advanced to him by the corporation.”).
 See, e.g., DeLucca v. KKAT Management, LLC, 2006 WL 224058 at *13 (Del. Ch. 2005) (“If, in the end, [the officer] is found liable for implementing an intentional scheme to harm [the companies] by intentionally breaching her contractual and fiduciary duties and by concealing her conduct from them, she will be required to repay the funds advanced to her by [the companies].”).
 See, e.g., Reddy, 2002 WL 1358761 at *5 (explaining that the recipient of funds advanced by the corporation is obligated to repay those funds if it ultimately is determined that the underlying conduct does not trigger the obligation to provide indemnification).
 Morgan, 2003 WL 22461916 at *2.
 Reddy, 2002 WL 1358761 at *9.
 See Morgan, 2003 WL 22461916 at *1 (“[T]he relevant question turns on the application of the terms of the corporate instruments setting forth the purported right to advancement and the pleadings in the proceedings for which advance is sought.”); Kaung, 884 A.2d at 509 (explaining that in advancement proceedings, the scope properly is limited to determining “the issue of entitlement according to the corporation’s advancement provisions and not to issues regarding the movant’s alleged conduct in the underlying litigation”); see also A Primer on Advancement at 33 (“[I]f the corporation has unconditionally promised that it will provide advancement of defense costs, then the officer need only adhere to certain procedural requirements.”).
 See Perconti v. Thornton Oil Corp., 2002 WL 982419 at *6-7 (Del. Ch. 2003); Reddy, 2002 WL 1358761 at *5-6; Homestore, 888 A.2d at 206-207; Thompson v. Orix USA Corp., 2016 WL 3226933 at *4-5 (Del. Ch. 2016).
 See, e.g., Homestore, 888 A.2d at 213 (“[I]n order for one to be deemed a party to a proceeding ‘by reason of the fact’ of one’s corporate position,” all that is required is a “‘causal connection or nexus’ between the underlying proceeding and ‘the corporate…capacity.’”).
 DeLucca, 2006 WL 224058 at *6 (emphasis added); see also Reddy, 2002 WL 1358761 at *9 (explaining that persons seeking advancement should be entitled to have their claims adjudicated in a summary fashion); Kaung, 884 A.2d at *509 (explaining that an advancement action is a summary proceeding and the scope should be “limited to determining the issue of entitlement according to the corporation’s advancement provisions and not to issues regarding the movant’s alleged conduct in the underlying litigation”); Charney v. American Apparel, 2015 WL 5313769 at *5 (Del. Ch. 2015) (“[T]he use of summary judgment is particularly appropriate in advancement disputes because the controversy is typically limited to a legal question: whether the underlying proceeding trigger[s] a right to advancement under the terms of the corporate instrument.”) (internal quotations and citations omitted); Senior Tour Players 207 Management Co. v. Golftown, 853 A.2d 124, 126 (Del. Ch. 2004) (“Summary judgment is an appropriate way to resolve advancement disputes.”).
 See A Primer on Advancement at 47, n. 102.
 See id. at 47, n. 103.
 Homestore v. Tafeen, 886 A.2d 502, 505 (Del. 2005).
 See Trascent Management Consulting, LLC v. Bouri, 2016 WL 6947014, *1 (Del. 2016); Adweiss LLLP v. Daum, 2016 WL 6778383, *1-2 (Fla. 3d DCA 2016).
 See, e.g., James River Management Co., Inc. v. Kehoe, 674 F. Supp. 2d 745, 750 (E.D. Va. 2009) (“Delaware case law is replete with insider trading cases in which executives’ expenses are advanced despite allegations of defrauding the corporation…of millions of dollars.”).
 Reddy, 2002 WL 1358761 at *5-6.
 DeLucca, 2006 WL 224058 at *11.
 Morgan, 2003 WL 22461916 at *2, n. 18.
 Reddy, 2002 WL 1358761 at *3.
 Id. at *4 (emphasis added).
 See S. Crane Rentals, Inc. v. City of Gainesville, 429 So. 2d 771, 774 (Fla. 1st DCA 1983) (where “a contract is simply silent as to a particular matter, courts should not, under the guise of construction, impose on the parties contractual rights and duties which they themselves omitted”); see also Stuyvesant Ins. Co. v. Butler, 314 So. 2d 567, 573, n. 11 (Fla. 1975) (“Courts may not, under the guise of contract interpretation, make a new contract for the parties.”); Curtiss-Wright Corp. v. Exhaust Parts, Inc., 144 So. 2d 822, 823 (Fla. 3d DCA 1962) (“A court cannot, under the guise of construction, make a new contract for the parties.”).
 Moreover, requiring a trial to determine the boundaries of some vague, amorphous timeliness requirement not set forth in the actual corporate documents before the corporate employer is required to advance the funds that the officer/director so desperately needs to defend himself would be antithetical to the purpose the advancement provision is intended to advance (i.e., a gap-filling procedure that requires the corporation, and not the officer/director, to shoulder the interim expense of litigation).
 Stifel is not an “advancement” case, but rather a statutory indemnification case. Still, the logic of the court’s rationale is readily applicable to advancement proceedings. Indeed, as discussed below, myriad courts have cited to support Stifel to determine that “fees on fees” are recoverable in advancement proceedings.
 Stifel, 809 A.2d at 560.
 Id. at 561.
 Id. (internal citations omitted).
 Id. at 561-62.
 See, e.g., Jackson Walker LLP v. Spira Footwear, Inc., 2008 WL 2487256, *9 (Del. Ch. 2008) (“The same policy considerations justifying allowance of fees on fees for indemnification claims. .. equally support an award of fees for the successful prosecution of an advancement claim….”); see also Brady v. i2 Technologies, Inc., 2005 WL 3691286, *4 (Del. Ch. 2005) (relying upon Stifel to conclude that the former corporate executive “is entitled to receive reasonable expenses incurred in prosecuting the advancement action”); DeLucca v. KKAT Management, LLC, 2006 WL 224058 at *15 (Del. Ch. 2006) (explaining that “DeLucca is entitled to an award of litigation expenses for bringing this advancement action”); Holley v. Nipro Diagnostics, Inc., 2014 WL 7336411, *15 (Del. Ch. 2014) (holding the former officer “is entitled to 100% of the reasonable ‘fees on fees’ he incurred in this advancement proceeding”); Blankenship v. Alpha Appalachia Holdings, Inc., 2015 WL 3408255, *29 (Del. Ch. 2015) (awarding a former director “all his reasonable expenses incurred” in pursuing and obtaining advancement).
 Pre-judgment interest also is properly recoverable in advancement proceedings, with the pre-judgment interest to be computed from the date the party seeking advancement first demands an amount certain. See Citadel Holding Corp. v. Roven, 603 A.2d 818, 826 (Del. 1992) (holding director was entitled to advancement and prejudgment interest “computed from the date of demand”); Brady v. i2 Technologies Inc., 2005 WL 3691286 at *4 (Del. Ch. 2005) (holding former executive was entitled to advancement and prejudgment interest from the date of the demand); Homestore, Inc. v. Tafeen, 888 A.2d 204, 209 (Del. 2005) (affirming decision awarding advancement and prejudgment interest); Underbrink v. Warrior Energy Services, Corp., 2008 WL 2262316 at *19 (Del. Ch. 2008) (explaining that a party seeking advancement is entitled to interest from the date on which the party “specified the amount of reimbursement demanded”); O’Brien v. IAC / Interactive Corp., 2009 WL 2490845 at *10 (Del. Ch. 2009) (holding former executive is entitled to advancement and prejudgment interest at the legal rate); Fillip v. Centerstone Linen Services, LLC, 2013 WL 6671663 at *14 (Del. Ch. 2013) (noting that prejudgment interest typically is computed from the date an officer submitted a request that “quantified the demand for advancement”); Pontone v. Milso Industries Corp et al., 2014 WL 2439973 at *18 (Del. Ch. 2014) (“[A] party seeking advancement ‘is entitled to interest computed from the date of demand,’ defined as the date on which the party ‘specified the amount of reimbursement demanded and produced his written promise to pay.’”); Hyatt v. Al Jazeera America Holdings II, LLC 2016 WL 1301743 at *11 (Del. Ch. 2016) (holding that directors seeking advancement are entitled “to pre-judgment interest from the date on which their demand and undertakings were delivered”); Narayanan v. Sutherland Global Holdings Inc., 2016 WL 3682617 at *15 (Del. Ch. 2016) (holding that “[a] party seeking advancement is entitled to interest from the date on which the party ‘specified the amount of reimbursement demanded and produced his written promise to pay”); Davis v. EMSI Holding Company, 2017 WL 1732386 at *11 (Del. Ch. 2017) (holding that directors entitled to advancement “are entitled to prejudgment interest from the date on which they made their demand”).
 DeLucca, 2006 WL 224058 at *2.
 Id. at *13.
Contact Dimond Kaplan & Rothstein Today