Exam 40: Corporate Directors, Officers, and Shareholders

Dane is a director of Eco Packing Company. Dane's rights, as a director, do not include a right to

Shareholders must approve fundamental changes affecting a corporation.

Directors can delegate work to corporate officers and employees.

Bea transfers shares of stock that she owns in Coin Laundry Corporation to Dick. A shareholders' meeting takes place before his ownership is entered in the firm's stock book. A vote at the meeting can be cast by

Corporate officers can normally be removed by the board of directors without cause.

For shareholders to act during a shareholders' meeting, a quorum must be present.

Cumulative voting refers to the accumulation of proposals presented annually for a shareholders' vote.

Shareholders are personally liable for the debts of a corporation.

Any individual director can act as an agent to bind the corporation.

The minimum number of members of a body of officials that must be present for business to be validly transacted is a quorum.​

When the corporation is harmed by the actions of a third party, the directors can bring a lawsuit in the name of the corporation against that party.

Donatello is a director and officer of Enzio's Pizza Corporation. Donatello selects an ad campaign that consumers find offensive-a marketing decision that results in a dramatic decrease in profits for the firm and its shareholders. The shareholders accuse Donatello of breaching his fiduciary duty to the corporation. What is Donatello's best defense against this accusation? Later, a resolution comes before Enzio's board to expand its menu to compete with Fabio's Pasta Palace Restaurants Inc. Donatello is a director and shareholder of Fabio's. What is Donatello's responsibility in this situation?