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What can a director of a corporation do to fulfill the director's fiduciary duties when entering into a transaction with the corporation?
Prior to entering into the transaction, the director should disclose all material facts and his/her personal interest in the transaction to the other directors. After full disclosure, the director should require that the transaction be negotiated and approved by a special committee of the board consisting solely of the disinterested directors and then approved or ratified by a majority of the board and shareholders. It is also helpful if the transaction is fundamentally fair to the corporation.
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