JV Investor Pty Ltd has four directors: Adderson, Boon and two nominees of Blue

Ltd, the company that owns the other 50% of the issued shares in JV Investor. JV

Investor has spent several million dollars on developing the new technology, but it is

not going well. The chief operating officer of JV Investor sent a report to its directors

explaining that there were cash flow difficulties, that rival technologies were emerging,

and that the prospects of JV Investor raising further capital by borrowing or further

equity injections from AMGL or Blue were limited. At a board meeting attended by

Boon and the two Blue nominees, the directors resolve to enter into an agreement with a German software firm to purchase some intellectual property that might assist the project. Adderson is away on holidays and does not attend the meeting. Have the

directors (or any of them) breached their statutory duty to prevent insolvent trading

by JV Investor?

Assume that the directors of JV Investor have

breached their duty to prevent insolvent trading. What consequences can follow?