{"data":{"id":"us-ky/krs-271b.8-300","jurisdiction":"us-ky","citation":"KRS 271B.8-300","heading":"General standards for directors -- Directors of a public benefit","body":"corporation.\n(1) A  director shall discharge his duties as a director, including his duties as a\nmember  of a committee:\n(a) In good faith;\n(b) On  an informed basis; and\n(c) In a manner  he honestly believes to be in the best interests of the\ncorporation.\n(2) A director shall be considered to discharge his duties on an informed basis if\nhe makes, with the care an ordinarily prudent person in a like position would\nexercise under similar circumstances, inquiry into the business and affairs of\nthe corporation, or into a particular action to be taken or decision to be made.\n(3) In discharging his duties a director shall be entitled to rely on information,\nopinions, reports, or statements, including financial statements and other\nfinancial data, if prepared or presented by:\n(a) One  (1) or more officers or employees of the corporation whom  the\ndirector honestly believes to be reliable and competent in the matters\npresented;\n(b) Legal counsel, public accountants, or other persons as to matters the\ndirector honestly believes are within the person's professional or expert\ncompetence; or\n(c) A committee of the board of directors of which he is not a member, if the\ndirector honestly believes the committee merits confidence.\n(4) A  director shall not be considered to be acting in good faith if he has\nknowledge  concerning the matter in question that makes  reliance otherwise\npermitted by subsection (3) of this section unwarranted.\n(5) In addition to any other limitation on a director's liability for monetary damages\ncontained in any provision of the corporation's articles of incorporation adopted\nin accordance with subsection (2)(d) of KRS  271B.2-020, any action taken as a\ndirector, or any failure to take any action as a director, shall not be the basis for\nmonetary damages or injunctive relief unless:\n(a) The director has breached or failed to perform the duties of the director's\noffice in compliance with this section; and\n(b) In the case of an action for monetary damages, the breach or failure to\nperform constitutes willful misconduct or wanton or reckless disregard for\nthe best interests of the corporation and its shareholders.\n(6) A  person bringing an action for monetary damages  under this section shall\nhave the burden of proving by clear and convincing evidence the provisions of\nsubsection (5)(a) and (b) of this section, and the burden of proving that the\nbreach or failure to perform was the legal cause of damages  suffered by the\ncorporation.\n(7) Nothing in this section shall eliminate or limit the liability of any director for any\nact or omission occurring prior to July 15, 1988.\n(8) In a public benefit corporation:\n(a) The board of directors shall manage  or direct the business and affairs of\nthe public benefit corporation in a manner that balances the pecuniary\ninterests of the stockholders, the best interests of those materially\naffected by the corporation's conduct, and the specific public benefit or\npublic benefits identified in its articles of incorporation;\n(b) A director of the public benefit corporation shall not, by virtue of the public\nbenefit provisions set forth in the corporation's articles of incorporation,\nhave any duty to any person on account of any interest of the person in\nthe  public benefit or public benefits identified in the articles of\nincorporation or on account of any interest materially affected by the\ncorporation's conduct;\n(c) With  respect to a decision implicating the balance requirement in\nparagraph (a) of this subsection, a director shall act in conformity with\nsubsection (1) of this section; and\n(d) The articles of incorporation of a public benefit corporation may include a\nprovision that any disinterested failure to satisfy this subsection shall not\nconstitute an act or omission not in good faith or a breach of the duty of\nloyalty.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45781","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:53:19Z","sha256":"7ac47d5c98642a79f258f4faff132d1f17ada6d7fb80310a218cc89dec491e44","source_id":"us-ky","stale":false,"prev":"us-ky/krs-271b.8-250","next":"us-ky/krs-271b.8-310"},"notice":"GroundRules: Original legal text. Not legal advice."}