chapter 37
What is an audit committee?
A committee of the board that is composed of outside directors that ais responsible for the oversight and internal audits of the corporation.
What is a record date?
A date specified in corporate bylaws that determines whether a shareholder may vote at a shareholders meeting.
What is a dividned?
A distribution of profits of the corporations to shareholders.
What is piercing the corporate veil? (alter ego)
A doctrine that says if a shareholder dominates a corporation and uses it for improper purpose, a court of equity can disregard the corporate entity and hold the shareholder personally liable for the corporation debts and obligations.
What is a special shareholders meeting?
A meeting of shareholders that may be called to consider and vote on important issues such as proposed merger or amending the articles.
What is an annual shareholders meeting?
A meeting of the shareholders of a corporation that must be held by the corporation to elect directos and to vote on matters.
What is an outside director?
A member of a board who is NOT an officer.
What is an inside director?
A member of the board who is also an officer for the corportation.
What is a supermajority voting requirement?
A requirement that has greater than majority of shares constitutes a quorum of the vote of the shareholders.
What is a derivative lawsuit?
A shareholder brings against an offending party on behalf of a corporation when the corporation fails to bring the lawsuit.
What is a proxy?
A shareholders authorizing of another person to vote the shareholders shares at the meeting in the event the shareholder is absent.
What is cumulative voting?
A system in which a shareholder can accumulate all of his or her votes and vote them all for one candidate or split them among several candidates.
What is straight voting?
A system in which each shareholder votes the number of shares he or she has.
What is a resolution?
A vote taken by the board of a corporation that authorizes certain actions to be taken on behalf of the corpoartion.
What is a stock dividend?
Additional shares of stock distributions as a dividend.
What is a shareholder voting agreement?
An agreement of two or more shareholders that stipulates how they will vote their shares.
What is a right of first refusal?
An agreement that requires a selling shareholder to offer his or her shares for sale to the other parties to the agreement before selling them to anyone else.
What is a buy sell agreement?
An agreement that requires selling shareholder to sell their shares to the other sharehodlers or to the corporation at the price specified in the agreement.
What is a voting trust?
An arrangement in which the shareholders transfer their stock certificates to a trustee who is empowered to vote the shares.
What is corporate electronic communications?
Modern method by which corporations communicate with shareholders, among directors, with regulatory agenices, and others.
What is a preemptive right?
Rights that give existing shareholders the option to subscribe to new share being issued in proportion to thier current owenership intrests.
What is a quorum to hold a meeting of shareholders?
The required number of shares that must be represented in persons or by proxy to hold a meeting. Majority= quorum