Shareholders of Barney Slaney, Inc., brought a derivative suit against the corporation's board of directors for failing to supervise adequately the corporation's loan officers, who made several high-risk loans to substandard borrowers. Almost 40 percent of the high-risk borrowers defaulted on the loans, resulting in a loss of $55 million to Barney Slaney. The directors asked the corporation to advance to them the cost of legal fees for defending themselves against the charges. Under what conditions may the corporation make advances of legal fees to the directors?
Answer to relevant QuestionsWallace owned 50.25 percent of the shares of Capital Credit & Collection Service, Inc. (CCCS), with Jones and Gaarde each owning 24.8 percent. Those three shareholders also constituted the board of directors. At a directors' ...For 22 consecutive years, Marston Corporation, a steel producer, has paid a quarterly dividend to its common shareholders. The annual dividend amount has ranged from 1 percent to 4 percent of the market price of Marston's ...Mickie Wenwoods, an outstanding collegiate golfer, graduates from college and decides to turn professional. To finance her effort to qualify for the LPGA Tour and to cover the cost of travel, housing, food, and a caddy, ...Michael Broudo and other investors purchased stock in Dura Pharmaceuticals, Inc., on the public securities market between April 15, 1997, and February 24, 1998. During this period, they allege that Dura or its officers made ...Scioto Memorial Hospital Association, Inc., planned the construction of Richmond Place, a 170-unit retirement center in Lexington, Kentucky. Scioto hired Price Waterhouse to review the work of the architect, the financial ...
Post your question