If the Board Delegates to a Committee Its Duty to Select

question 9

Multiple Choice

If the board delegates to a committee its duty to select a new company president:

• A) the committee must be approved by the shareholders.
• B) the committee may exercise all the authority of the board.
• C) the members of that committee may be responsible individuals other than board members.
• D) the committee must consist of board members and may be authorized unless otherwise provided by the articles of incorporation or bylaws.
• E) the non-committee directors are relieved of liability for acts of the committee.

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Definitions:

Noncompetition Clause

A provision in a contract that prohibits an individual from competing with their former employer for a certain period after leaving the company.

Unduly Burdensome

Imposing an excessive load, effort, or demand, considered unreasonable under the circumstances.

Illegal Contract

A contract that is void and unenforceable from the outset because it involves or pertains to an illegal act.

Criminal Violation

An act that breaches a statute and is punishable by the government through fines, imprisonment, or other penalties.