§ 55-8-42. Standards of conduct for officers. - North Carolina Statutes

§55‑8‑42.  Standards of conduct for officers.

(a)        An officer withdiscretionary authority shall discharge his duties under that authority:

(1)        In good faith;

(2)        With the care anordinarily prudent person in a like position would exercise under similar circumstances;and

(3)        In a manner hereasonably believes to be in the best interests of the corporation.

(b)        In discharging hisduties an officer is entitled to rely on information, opinions, reports, orstatements, including financial statements and other financial data, ifprepared or presented by:

(1)        One or more officersor employees of the corporation whom the officer reasonably believes to bereliable and competent in the matters presented; or

(2)        Legal counsel,public accountants, or other persons as to matters the officer reasonablybelieves are within their professional or expert competence.

(c)        An officer is notentitled to the benefit of subsection (b) if he has actual knowledge concerningthe matter in question that makes reliance otherwise permitted by subsection(b) unwarranted.

(d)        An officer is notliable for any action taken as an officer, or any failure to take any action,if he performed the duties of his office in compliance with this section.

(e)        An officer may beentitled to indemnification against liability and expenses pursuant to Part 5of Article 8 of this Chapter. (1955, c. 1371, s. 1; 1989,c. 265, s. 1.)