1. Directors\' meetings: A. are always required in order for the board to take a
ID: 451637 • Letter: 1
Question
1. Directors' meetings:
A. are always required in order for the board to take action
B. permit directors to cast up to three votes each
C. require a majority of directors to attend, in order for the Board's actions to be valid
D. are always called after reasonable notice to the directors
E. None of the above answers is correct.
2. The board of directors of Biggie Corporation at a regular meeting of the board entered into a contract with Wilbur, one of the directors. The contract called for Biggie to purchase some land from Wilbur. There were ten members on the board, eight of whom were present at the meeting. One of the directors present was Wilbur. All the other directors were disinterested in the transaction and not related to Wilbur. After a lengthy discussion, six directors voted in favor of the contract and two voted against it. Wilbur voted for the contract. Which of the following is true?
A. The contract becomes void if the corporation proves that the contract was unfair to it
B. The contract is valid since it was approved by a majority of a quorum of the board
C. The contract between Wilbur and the corporation is illegal and invalid
D. None of the above answers is correct.
Explanation / Answer
1) C. require a majority of directors to attend, in order for the Board's actions to be valid which is called as quorum.
2) B. The contract is valid since it was approved by a majority of a quorum of the board
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