Directors, Officers, and Shareholders：董事，职员，和股东.ppt

Chapter 38 Corporations – Directors, Officers, and Shareholders § 1: The Role of Directors Every corporation is governed by a board of directors that are elected by the shareholders. Individual directors are not agents of corporation, only the board itself can act as a “super-agent” and bind the corporation. A director can also be a shareholder, especially in closely-held corporations. Election of Directors Subject to statutory limitations, the number of directors is set forth in the articles of incorporation: Directors appointed at the first organizational meeting. In closely held companies, directors are generally the incorporators and/or the shareholders. Term of office is generally for one year. Director can be removed for cause (for failing to perform a required duty). Directors’ Meetings Directors hold meetings pursuant to bylaws with recorded minutes. Special meetings may be called with sufficient notice. Meetings require QUORUM (minimum number of directors to conduct official corporate business, usually majority). Each director generally has one vote. Rights of Directors Directors have the right to: Participate in corporate decisions and inspect corporate books and records. Compensation (usually a nominal sum) and indemnification. If a director is sued for acts as director, the corporation should guarantee reimbursement (indemnification) or purchase liability insurance to protect the board from personal liability. Directors’ Management Responsibilities Directors have general responsibility for all management decisions: All major corporate policies Appointment and removal of all corporate officers and their compensation. Financial decisions, including dividends and retained earnings. §2: Rights of Officers Officers serve at the pleasure of the Board of Directors but have fiduciary duties to company as well. Their employment relationships are generally governed by contract law and employment law. Officers may be terminated for cause. § 2: Role of Corpor