The board of directors of Meckes Corporation, at a regular meeting of the board, entered into a contract with Peter, one of the directors. The agreement called for the sale of a retail store the corporation operated to Peter. There were 12 board members, 10 of whom were present at the meeting. Nine directors, including Peter, voted in favor of the contract and one voted against it. In view of these facts, which of the following is correct?

Question

Quizplus · Accepted Answer

Directors and officers are not prohibited from entering into transactions with the corporation. At one time, courts held that such deals were voidable by the corporation, but today the majority of courts hold them voidable only if unfair to the corporation.

The Board of Directors of Meckes Corporation, at a Regular