North Carolina HB 388: Amend Business Corporations Act.

Bill Text

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025

SESSION LAW 2025-33
HOUSE BILL 388

*H388-v-6*
AN ACT TO AMEND THE NORTH CAROLINA BUSINESS CORPORATIONS ACT, AS
RECOMMENDED BY THE NORTH CAROLINA BAR ASSOCIATION, TO
AUTHORIZE THE PROBATE OF A CERTIFIED COPY OF AN ATTESTED WRITTEN
WILL THAT HAS BEEN STORED BY AN ATTORNEY AS AN ELECTRONIC
RECORD, TO MODIFY THE EMERGENCY VIDEO SUNSETS, TO MAKE UPDATES
TO THE ELECTIVE SHARE STATUTES, TO UPDATE STATUTES RELATING TO
TRUST ADMINISTRATION, AND TO MAKE REVISIONS TO THE YEAR'S
ALLOWANCE STATUTES.

The General Assembly of North Carolina enacts:

PART I. PROVIDE FOR OFFICER EXCULPATION
SECTION 1. G.S. 55-2-02 reads as rewritten:
"§ 55-2-02. Articles of incorporation.
...
(b) The articles of incorporation may set forth any provision that under this Chapter is
required or permitted to be set forth in the bylaws, and may also set forth any or all of the
following:
(1) The names and addresses of the individuals who are to serve as the initial
directors.
(2) Provisions not inconsistent with law regarding (i) the purpose or purposes for
which the corporation is organized; (ii) managing the business and regulating
the affairs of the corporation; (iii) defining, limiting, and regulating the powers
of the corporation, its board of directors, and shareholders; (iv) a par value for
authorized shares or classes of shares; (v) the imposition of personal liability
on shareholders for the debts of the corporation to a specified extent and upon
specified conditions; and (vi) any limitation on the duration of the corporation.
(3) A provision limiting or eliminating the personal liability of any director
arising out of an action whether by or in the right of the corporation or
otherwise for monetary damages for breach of any duty as a director. director
or limiting or eliminating the personal liability of any officer arising out of an
action for monetary damages for breach of any duty as an officer. No such
provision shall be effective with respect to (i) acts or omissions that the
director or officer at the time of such the breach knew or believed were clearly
in conflict with the best interests of the corporation, (ii) in the case of a
director, any liability under G.S. 55-8-33, (iii) any transaction from which the
director or officer derived an improper personal benefit, or (iv) acts or
omissions occurring prior to the date the provisions provision became
effective. effective, or (v) in the case of an officer, any claim by or in the right
of the corporation. As used herein, in this subdivision, the term "improper
personal benefit" does not include a director's reasonable compensation or
other reasonable incidental benefit for or on account of his the director's

Page 2 Session Law 2025-33 House Bill 388
service as a director, officer, employee, independent contractor, attorney, or
consultant of the corporation. A provision permitted by this Chapter in the
articles of incorporation, bylaws, or a contract or resolution indemnifying or
agreeing to indemnify a director against personal liability shall be is fully
effective whether or not there is a provision in the articles of incorporation
limiting or eliminating personal liability.
(4) A provision limiting or eliminating any duty of a director, an officer, or any
other person, to offer the corporation the right to have or participate in one or
more specific classes or categories of business opportunities, prior to the
pursuit or taking of the opportunity by the director, officer, or other person.
(c) The articles of incorporation need not set forth any of the corporate powers
enumerated in this Chapter.
(d) Articles of incorporation filed to effect the conversion of another business entity
pursuant to Article 11A of this Chapter shall also include the statements required by
G.S. 55-11A-03(a).
(e) For purposes of subdivision (b)(3) of this section, unless the articles of incorporation
otherwise provide, "officer" means an individual appointed in accordance with G.S. 55-8-40 as
(i) president, chief executive officer, chief operating officer, chief financial officer, chief legal
officer, secretary, controller, treasurer, or chief accounting officer of the corporation and (ii) any
officer of the corporation designated by resolution of the board of directors as an officer for
purposes of subdivision (b)(3) of this section. The board of directors may from time to time by
resolution determine that one or more of the officers designated by resolution of the board in
accordance with this subsection is no longer an officer for purposes of subdivision (b)(3) of this
section, but no such resolution is effective as to an officer, or any act or omission of the officer,
prior to the adoption of that resolution."

PART II. CLARIFY PROVISIONS FOR EMERGENCY BYLAWS AND EMERGENCY
POWERS
SECTION 2.(a) G.S. 55-2-07 reads as rewritten:
"§ 55-2-07. Emergency bylaws.
(a) Unless the articles of incorporation provide otherwise, the board of directors of a
corpora