Exam 35: Management Structure

If shareholders agree to vote in a specified manner for the election or removal of directors, this is known as:

Which of the following is the effect of the business judgment rule regarding the liability of officers and directors?

Shares in a publicly held corporation typically are:

Arthur is a shareholder of Sigma Corp. He has evidence to suggest that its president/CEO has allowed the corporation to engage in acts that are ultra vires. Based upon this evidence, Arthur contacts an attorney and sues the corporation on behalf of the corporation. The lawsuit Arthur has filed is known as a(n):

The shareholders elect the key corporate officers.

George is a shareholder in the Muncy Kempf Corporation. He learns of insider trading by one of the directors and wants to sue the corporation on behalf of the corporation and its shareholders. A shareholder cannot sue the corporation to enforce a right belonging to the corporation.

Officers and directors of a corporation owe to the corporation the subordination of their self-interest to the interest of the corporation and owe constant loyalty to the corporation. This duty is the:

A shareholder may not vote without being at the shareholder meeting.

Determining the names of other shareholders in order to communicate with them about corporate affairs is a "proper purpose" for a shareholder to inspect the books and records of a corporation.

Morales, president of Tradewind Industries, Inc., would have actual implied authority to:

The board of directors is delegated the power to manage the business of the corporation, which includes:

Directors are elected at the annual meeting of shareholders.

Assuming no special provision in the articles of incorporation, special shareholder meetings may be called by:

Federal statutes prohibit officers and directors from purchasing or selling shares of their corporation's stock without adequately disclosing all material facts in their possession that may affect the stock's actual or potential value.

Only the board of directors may approve fundamental changes in the corporation.

A shareholder may bring a derivative suit on behalf of the corporation and any recovery usually goes to the corporation's treasury, or a shareholder may bring a direct suit to enforce a claim he has against the corporation based on his ownership of shares and any recovery goes to the shareholder plaintiff.

The officers and the directors are fiduciaries of the corporation, but the business judgment rule will not preclude liability on officers and directors for honest mistakes of judgment.

Directors have the power to bind the corporation when acting individually rather than as a board.

Voting trusts generally are effective for only one year.

A proxy is effective until the shareholder revokes it.