1. Answer the following:

a. What is a quorum of the board of directors for purposes of conducting corporate business?

What do most states and the RMBCA say with regard to what constitutes a quorum?

b. The directors of Schmalley’s Inc. can’t decide whether to declare a dividend, so the board appoints a committee consisting of the president of the corporation, the vice-president of the corporation, and the treasurer to decide whether to pay a dividend. If the committee wants to declare a dividend, the directors say the officers can pay it immediately before the next board meeting. Is this permissible delegation of corporate authority? Explain.

2.

a) Action Corporation purchases all of the assets of the Bell Corporation for cash. After the purchase, a creditor of the Bell Corporation asserts that by buying the assets of the Bell Corporation, Action has automatically assumed all of Bell’s obligations. Is he correct? Explain.

b) Dicton Corporation is merged into the Crag Corporation. One of Dicton’s creditors was not paid before the merger occurred. The creditor demands payment from the board of directors of the Crag Corporation. The board says that because the Dicton Corporation no longer exists, they have no obligation to the creditor. Who is right? Explain your answer.

Answer rating: 100% (QA)

1 a A quorum is generally a body that conducts the business of a corporation This body protects the ... View the full answer