The Directors of ABC Corporation Have Voted to Form a Strategic

question 7

Multiple Choice

The directors of ABC Corporation have voted to form a strategic alliance with Atlas Supplies Ltd.,a corporation owned by a block of ABC's shareholders.They plan to pay a premium over the market rate for the services of Atlas in recognition of their close relationship.Which statement best describes this situation?

• A) The directors have entered into a self dealing contract.
• B) The directors have breached their duty of competence.
• C) The directors have breached their fiduciary duties by favouring on particular group of shareholders.
• D) The directors have mis used a corporate opportunity.

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