Exam 37: Corporate Governance and the Sarbanes-Oxley Act

Once declared,a cash or property dividend cannot be revoked.

When is the annual shareholder's meeting held?

________ are rights that give existing shareholders the option of subscribing to new shares being issued in proportion to their current ownership interests.

Bilkis Brans has 20,000 outstanding shares with four shareholders.Ester owns 9,000 shares,Mendez owns 4,000 shares,Judy owns 4,000 shares,and Aaron owns 3,000 shares.Assume that two directors of the corporation are to be elected from a potential pool of five candidates.Ester is in favor of Candidates 1 and 5,Mendez is in favor of Candidates 2 and 4,Judy is in favor of Candidates 4 and 3,and Aaron is in favor of Candidates 2 and 3.If the voting is done by straight voting,which two candidates are likely to win?

A director's failure to properly supervise a subordinate who causes a loss to the corporation would be considered a breach of the duty of care.

Courts will pierce the corporate veil if the corporation has been formed with sufficient capital.

Which of the following is true of stock dividends?

An arrangement in which the shareholders transfer their stock certificates to a trustee who is empowered to vote the shares is known as ________.

A corporation cannot ratify an unauthorized act committed by its corporate officer.

An agreement that requires selling shareholders to sell their shares to the other shareholders or to the corporation at the price specified in the agreement is referred to as a ________.

If a shareholder does not exercise his or her preemptive rights within the stated time,shares can then be sold to anyone.

A derivative lawsuit is brought by the board of directors on behalf of the corporation.

Which of the following is true of a shareholder voting agreement?

Usurping a corporate opportunity is a breach that can only be committed by a shareholder.

The record date for the declaration of dividends is set forth in the articles of incorporation.

________ is a doctrine that says if a shareholder dominates a corporation and uses it for improper purposes,a court can disregard the corporate entity and hold the shareholder personally liable for the corporation's debts and obligations.

What is self-dealing?

Inkilwas Corporation has 30,000 outstanding shares.A shareholders' meeting is duly called to amend the articles of incorporation,and 17,501 shares are represented at the meeting.If an Inkilwas Corporation amendment for its articles of incorporation is put to vote at this meeting,which of the following statements is true with respect to the passing of the amendment?

Explain the term of office for members of a corporate board of directors.

Shareholders do not have to attend a shareholders' meeting to vote.