True/False
Indicate whether the sentence or statement is true
or false.
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1.
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A
director is always a trustee of a corporation.
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2.
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Directors have a right to compensation for their services.
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3.
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A
director's right of access to all corporate books and records is virtually absolute.
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4.
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An
officer is a fiduciary of a corporation.
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5.
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Directors are required to use a reasonable amount of supervision over the corporate
officers.
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6.
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Directors, but not officers, owe a duty of loyalty to their corporation.
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7.
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Directors may not use corporate funds for personal advantage.
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8.
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A
director who does not dissent on an issue at a board of directors' meeting is presumed to have
assented.
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9.
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A
contract between a director of a corporation and the corporation is always voidable at the option of
the corporation.
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10.
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The
business judgment rule makes a director liable for losses to the corporation in most
cases.
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11.
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The
business judgment rule immunizes officers from liability for poor decisions that were made in good
faith.
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12.
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Shareholders have legal title to corporate property.
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13.
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Shareholders may not vote to remove members of the board of directors.
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14.
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Shareholders' meetings must occur at least annually.
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15.
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Shareholders may not vote by proxy.
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16.
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Cumulative voting is a method of voting designed to allow minority shareholders
representation on the board of directors.
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17.
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Persons whose names appear on a corporation's shareholder records as owners are
not ordinarily entitled to vote.
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18.
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Shareholder voting agreements are invalid.
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19.
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The
ownership right to stock exists independently of the stock certificate.
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20.
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If a
stock certificate is lost or destroyed, the shareholder's ownership interest in the corporation is
not lost with it.
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21.
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Preemptive rights entitle shareholders to bring a derivative suit against the
corporation.
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22.
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Stock
warrants are transferable options to acquire a given number of shares from the corporation at a
stated price.
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23.
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Dividends may be paid from any corporate funds at the discretion of the
directors.
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24.
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Generally, shareholders must return illegal dividends only if they knew that the
dividends were illegal when they received them.
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25.
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A
corporation can refuse a shareholder's request to inspect corporate records.
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26.
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Shareholders have no right to inspect corporate books and records.
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27.
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When
shares are transferred, the new owner obtains the right to vote the shares before the new ownership
is recorded in corporate stock books.
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28.
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A
right of first refusal remains with a corporation indefinitely.
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29.
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When
shareholders are deadlocked, a court may order the dissolution of a corporation.
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30.
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Damages awarded in a shareholder's derivative suit are paid into the corporation's
treasury.
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31.
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A $10
issued par-value share that is sold initially for $8 is an example of watered stock.
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32.
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A $10
issued par-value share that is sold initially for $12 is an example of watered stock.
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33.
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Par-value shares do not have a specific face value.
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34.
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Shares issued by a corporation for less than their stated values are no-par
shares.
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35.
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A
shareholder that owns sufficient shares to exercise de facto control over a corporation will
be regarded as having a fiduciary duty to the minority shareholders.
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