Section 6026. Security for expenses in stockholders' derivative action brought in the right of the corporation to procure a judgment in its favor  


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  • In  any action specified in section six thousand twenty-five, if  the plaintiff or plaintiffs hold less than five percent of any class  of
      the   outstanding  shares  or  hold  a  beneficial  interest  in  shares
      representing less than five percent of any class of  such  shares,  then
      unless   the  shares  and  beneficial  interest  of  such  plaintiff  or
      plaintiffs have a fair value in excess of fifty  thousand  dollars,  the
      corporation  in  whose right such action is brought shall be entitled at
      any stage of the  proceedings  before  final  judgment  to  require  the
      plaintiff  or  plaintiffs  to give security for the reasonable expenses,
      including attorney's fees, which may be incurred  by  it  in  connection
      with  such  action  and  by  the  other  parties defendant in connection
      therewith for  which  the  corporation  may  become  liable  under  this
      article,  under  any  contract  or  otherwise  under  law,  to which the
      corporation shall have recourse in  such  amount  as  the  court  having
      jurisdiction of such action shall determine upon the termination of such
      action.  The amount of such security may thereafter from time to time be
      increased  or  decreased  in  the  discretion  of   the   court   having
      jurisdiction  of such action upon showing that the security provided has
      or may become inadequate or excessive.