Question

Which of the following sentences best describes the term quorum requirement during the election of a corporation's board of directors?

a.The maximum number of shares a director of a public corporation can own
b. The minimum age requirement of a corporation's board of directors
c. The minimum number of shareholders who must be present to hold a vote
d. The maximum number of shareholders required to consent to S corporation status

Answer 1

The term 'quorum requirement' refers to the minimum number of shareholders who must be present to hold a vote during the election of a corporation's board of directors.

Step-by-step explanation:

The term 'quorum requirement' refers to the minimum number of shareholders who must be present to hold a vote during the election of a corporation's board of directors. A quorum is necessary to ensure that there is a representative number of shareholders participating in the decision-making process. It prevents a small group of shareholders from making decisions on behalf of the entire corporation.

For example, if a quorum requirement is set at 50%, at least half of the shareholders must be present to hold a valid vote. If only 40% of the shareholders attend the meeting, the vote cannot take place.