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Questions and Answers
What is the purpose of the Delaware Statute in relation to Officers and the duty of care?
What is the purpose of the Delaware Statute in relation to Officers and the duty of care?
- To protect Outside Directors from negligence claims (correct)
- To impose stricter supervision of employees
- To hold Officers personally liable for negligence
- To require Officers to obtain D & O insurance
What is the primary purpose of D & O insurance?
What is the primary purpose of D & O insurance?
- To pay for employee salaries
- To cover legal defense fees and judgments (correct)
- To protect against natural disasters
- To provide liability coverage for intentional torts
What must a Director do to avoid personal liability if a decision proves to be disastrous?
What must a Director do to avoid personal liability if a decision proves to be disastrous?
- Dissent from the decision in writing (correct)
- Attend all board meetings
- Obtain D & O insurance
- Vote in favor of the decision
What is not typically covered by D & O insurance?
What is not typically covered by D & O insurance?
What is the purpose of filing a written dissent with the secretary before the meeting is adjourned?
What is the purpose of filing a written dissent with the secretary before the meeting is adjourned?
Why do larger companies often purchase D & O insurance?
Why do larger companies often purchase D & O insurance?
What is the term for an action that exceeds a corporation's express or implied powers?
What is the term for an action that exceeds a corporation's express or implied powers?
What is a prerequisite for a shareholder to file a derivative lawsuit?
What is a prerequisite for a shareholder to file a derivative lawsuit?
What is the purpose of a shareholder derivative lawsuit?
What is the purpose of a shareholder derivative lawsuit?
What is the timeframe within which a corporation must respond to a written demand made by a shareholder?
What is the timeframe within which a corporation must respond to a written demand made by a shareholder?
What is the term for the rights of a shareholder to purchase additional shares of a corporation?
What is the term for the rights of a shareholder to purchase additional shares of a corporation?
What is the term for a lawsuit filed by a shareholder to enforce a corporation's right against a third party?
What is the term for a lawsuit filed by a shareholder to enforce a corporation's right against a third party?
What is the primary purpose of Delaware's Statute, §102(b)(7)?
What is the primary purpose of Delaware's Statute, §102(b)(7)?
Which of the following is an exception to the limitations on directors' personal liability in Delaware's Statute, §102(b)(7)?
Which of the following is an exception to the limitations on directors' personal liability in Delaware's Statute, §102(b)(7)?
How does California's Statute differ from Delaware's Statute?
How does California's Statute differ from Delaware's Statute?
What is the consequence of an unexcused pattern of inattention under California's Statute?
What is the consequence of an unexcused pattern of inattention under California's Statute?
What is the primary duty of directors that is protected by the Business Judgment Rule?
What is the primary duty of directors that is protected by the Business Judgment Rule?
Which of the following is a limitation on the Business Judgment Rule?
Which of the following is a limitation on the Business Judgment Rule?
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