{"data":{"id":"us-nc/n.c.-gen.-stat.-55-8-42","jurisdiction":"us-nc","citation":"N.C. Gen. Stat. § 55-8-42","heading":"Standards of conduct for officers.","body":"(a)\tAn officer with discretionary authority shall discharge his duties under that authority:\n(1)\tIn good faith;\n(2)\tWith the care an ordinarily prudent person in a like position would exercise under similar circumstances; and\n(3)\tIn a manner he reasonably believes to be in the best interests of the corporation.\n(b)\tIn discharging his duties an officer is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:\n(1)\tOne or more officers or employees of the corporation whom the officer reasonably believes to be reliable and competent in the matters presented; or\n(2)\tLegal counsel, public accountants, or other persons as to matters the officer reasonably believes are within their professional or expert competence.\n(c)\tAn officer is not entitled to the benefit of subsection (b) if he has actual knowledge concerning the matter in question that makes reliance otherwise permitted by subsection (b) unwarranted.\n(d)\tAn officer is not liable for (i) any action taken as an officer, or any failure to take any action, if the officer performed the duties of the officer's office in compliance with this section or (ii) any failure to offer the corporation the right to have or participate in a business opportunity prior to the pursuit or taking of the opportunity by the officer or other person if the corporation's articles of incorporation include a provision authorized by G.S. 55-2-02(b)(4) and the procedures and approvals required by the provision, if any, were complied with or obtained prior to the pursuit or taking of the opportunity by the officer or other person.\n(e)\tAn officer may be entitled to indemnification against liability and expenses pursuant to Part 5 of Article 8 of this Chapter. (1955, c. 1371, s. 1; 1989, c. 265, s. 1; 2018-45, s. 12.)","path":["Chapter 55. North Carolina Business Corporation Act.","Article 8. Directors and Officers.","Part 4. Officers."],"source_url":"https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_55/GS_55-8-42.html","current_through":"S.L. 2026-30","vintage":"","retrieved_at":"2026-08-27T18:05:57Z","sha256":"a36ffa0e9ef9ea45be506c39ca1ce2409251c726753f2faba5e2439ca8a24dce","source_id":"us-nc","stale":false,"prev":"us-nc/n.c.-gen.-stat.-55-8-41","next":"us-nc/n.c.-gen.-stat.-55-8-43"},"notice":"GroundRules: Original legal text. Not legal advice."}