A Direct Interlocking Directorate Occurs When Two Corporations Have Directors

question 37

True/False

A direct interlocking directorate occurs when two corporations have directors who also serve on the board of a third firm, such as a bank.

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Definitions:

Cumulative Voting

A voting system used in elections of directors of some companies, allowing shareholders to allocate their votes in any manner they choose among the candidates.

Shares Voting

The process by which shareholders vote on company decisions and board member elections based on the number of shares they hold.

Directors

Individuals elected by shareholders to manage a corporation's affairs and make significant business decisions.

Typical Dissolution

The common process of legally dissolving a business or partnership, involving settling debts and distributing remaining assets.