§ 7-1.2-801 - Board of directors.
SECTION 7-1.2-801
§ 7-1.2-801 Board of directors. – (a) Except as may be otherwise provided in this chapter or in the articles ofincorporation, the business and affairs of a corporation are managed by a boardof directors. Directors need not be residents of this state or shareholders ofthe corporation unless the articles of incorporation or bylaws require it. Thearticles of incorporation or bylaws may prescribe other qualifications fordirectors. The board of directors has authority to fix the compensation ofdirectors unless otherwise provided in the articles of incorporation.
(b) A director shall discharge his duties as a director,including his duties as a member of a committee:
(1) In good faith;
(2) With the care that a person in a like position wouldreasonably believe appropriate under similar circumstances; and
(3) In a manner he or she reasonably believes to be in thebest interests of the corporation.
(c) In discharging his or her duties, a director is entitledto rely on information, opinions, reports, or statements, including financialstatements and other financial data, if prepared or presented by:
(1) One or more officers or employees of the corporation whomthe director reasonably believes to be reliable and competent in the matterspresented;
(2) Legal counsel, public accountants, or other persons as tomatters the director reasonably believes are within the person's professionalor expert competence; or
(3) A committee of the board of directors of which he or sheis not a member if the director reasonably believes the committee meritsconfidence.
(d) A director is not acting in good faith if he or she hasknowledge concerning the matter in question that makes reliance otherwisepermitted by subsection (c) unwarranted.
(e) A director is not liable for any action taken as adirector, or any failure to take any action, if he or she performed the dutiesof his or her office in compliance with this section.
(f) For the purposes of subsections (b) through (e),"corporation" also includes any financial institution, insurance company,public utility or other quasi-public corporation having purposes enumerated asexceptions to this chapter in § 7-1.2-301 and the provisions ofsubsections (b) through (e) of this section are applicable to the directors ofthat corporation.