As a director, what is my relationship to the corporation?

As a director, you have a fiduciary obligation to the corporation. By law, you are required to perform your duties as a director (1) in good faith, (2) in a manner you believe to be in the best interests of the corporation and its shareholders, and (3) with such care as an ordinarily prudent person in a similar position would use under similar circumstances. See Cal. Corp. Code § 309. This means, among other things, that you cannot enter into another business in competition with the corporation, and that you cannot take for yourself a business opportunity that is in the corporation’s line of activity and that the corporation is in a financial position to undertake for itself. Also, you can enter into a business transaction with the corporation only if certain conditions are satisfied, including that the transaction was ratified by the other, disinterested directors or shareholders, or that the transaction is just and reasonable as to the corporation. See Cal. Corp. Code § 310.