Ch. 47

Question 1

1. Are Owners
2. They vote to elect directors sometimes officers
3. they vote to authorize some types of extraordinary actions

Answer 1

ShareHolders

Question 2

elect directors approve bylaws approve shareholder resolutions

Answer 2

Ordinary Matters

Question 3

File bankruptcy, sell majority divisions, merger, consolidations, and non regular major decisions

Answer 3

Extra Ordinary Matters

Question 4

Number of shareholders necessary to conduct a valid meeting

Answer 4

Quorum

Question 5

1. have oversight and policy level authority
2. are fiduciaries
3. directors hire and supervise officers

Answer 5

Directors powers

Question 6

Qualification of directors

Answer 6

1. establish by statute, articles of incorporation or bylaws

Question 7

actions against directors are normally based upon a violation of fiduciary duties

Answer 7

directors as fiduciaries

Question 8

*Protects directors from personal liability from their negligent acts or omissions in exercising corporate governance

Answer 8

Business Judgement Rule

Question 9

1. Responsible for the day-to-day management of the corporation
2. are fiduciaries and agents
3. officers report to the board of directors

Answer 9

Responsibilities of Officers

Question 10

corporate officers can be held criminally liable under some federal and state statutes, this doctrine can be applied when the responsible officer fails to follow appropriate regulations
toxic waste example

Answer 10

Responsible Officer Doctrine

Question 11

Liability to third persons

Answer 11

directors and officers generally not liable

Question 12

Exceptions to officers and directors not being liable to third persons

Answer 12

1. personal tortious actions
2. fraud
3. securities act of 1937 governs exchange of traded stock