Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

FL Bar Exam Flashcards- MBE > Business Associations - Corporations > Flashcards

Business Associations - Corporations Flashcards

(90 cards)

Start Studying
1
Q

Nature of Corporate Entity

A

separate from shareholders, may exercise rights through agents

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Advantage of Corporate Form

A

(1) limited liability of shareholders (2) centralized management (3) continuity of existence (4) ease of transferring ownership (5) access to capital through sale of shares

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Taxation

A

earnings to shareholders pay double tax

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Small Business Tax Exception

A

Subchapter S of IRS Code, taxes income directly to shareholders in proportion to ownership

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Corp Obligations to State

A

Must file an Annual Report

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Annual Report Contents

A
  1. Corp Name
  2. Date of incorporation
  3. Address of principal office
  4. Federal employer ID #
  5. Names and business street addresses of its principal officers and directors
  6. Address of its registered office and name of its registered agent
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Political Contributions

A

within limits to candidates, not as free as individuals

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Corporate Liabilities

A

(1) contracts (2) torts committed by agency (3) punitive damages if intentionally or gross negligence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Ultra Vires Doctrine

A

defense by corporation ABOLISH but for (1) shareholder derivative suit against corp to enjoin performance (2) corp may sue officers to recover past acts

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Articles of Incorporation MUST include

A

(1) name (2) # of shares (3) preemptive rights (4) registered office (5) registered agent (6) names and addresses of incorporators (7) address of principal office

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Articles MAY include

A

(1) number of directors (2) par value (3) personal liability of shareholders (4) initial purpose (5) any other provisions

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

When does Corporation start existing?

A

Upon filing of articles of incorporation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Organizational Meeting

A

(1) 3 days notice (2) state time and place (3) can be waived with written consent

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Bylaws

A

board of directions adopt initial bylaws unless otherwise said

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

De jure corporation

A

follow all mandatory requirements but not a corp

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

De facto incorporation

A

good faith attempt to follow but not enough to be a corp

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Corporation by Estoppel

A

creates liability for people wronged by fake corps

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Personal Liability for Defective Incorporation

A

all members personally liable

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Piercing the Corporate Veil

A

court will disregard corp. status and hold active shareholders jointly and severally liable if (1) alter ego (2) thin capitalization (3) deep rock (4) subsidiary corp

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Alter Ego Doctrine

A

corp is alter ego of shareholders and used as a conduit. FL law REQUIRES showing of improper conduct

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Thin capitalization

A

a corp must have capital to meet reasonably foreseeable needs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Deep Rock Doctrine

A

in bankruptcy proceedings, capital contributions are loans

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Subsidiary Corp

A

parent corp liable for debts if inadequately capitalized, intermingles, or not distinct

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

Common stock

A

voting or non-voting, representing the residual ownership of corp

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Preferred stock
voting or non-voting, with a right to paid a fixed dividend ahead of common stock
26
Subscription Agreements
contract where subscriber agrees to purchase X amount of stock at a specified price. FL makes it IRREVOCABLE for 6 months
27
Consideration for Shares
FL allows promissory notes, cash, property, or promises amount determined by board
28
Shareholder Liability
may sue derisively if someone pays less than full consideration agreed
29
Doctrine of Equitable Contribution
all subscribers purchasing at the same time should pay same price
30
Securities Law
stocks and bonds must satisfy Securities Act of 1933
31
Non-exempt secutities
registration statement must be filed to SEC disclosing all material facts
32
Blue sky laws
impose standards governing the quality of securities sold, noes not require scienter, ONLY basis of relief if transaction has no IS commerce
33
Preemptive rights
shareholders have right to purchase new stock to maintain relative voting strength. In FL – NO EMPTIVE RIGHTS unless granted by articles, if granted may be waived
34
Repurchase of Shares Tests
(1) date money or other property is transferred or debt incurred by the corporation (2) the date the shareholder ceases to be a shareholder with respect to the squired shares
35
Financial Assets
UCC 8, FL adopted this, investment security may either certificated or uncertificated
36
Certificated Investment security
represented by an instrument issued in bearer or registered form
37
Uncertificated Investment Security
not represented by an instrument but registered on book maintained by the issuer
38
Contract/Modification of Investment Security
not subject to SoF
39
Issuer Defenses
limited, usually only if certificate issued is not genuine
40
True Owner of Investment Security
may reclaim from anyone EXCEPT protected purchaser (think PMM)
41
Restrictions on Transfer of Stock
enforced if REASONABLE
42
Specific Facts Doctrine
insiders must disclose facts of an unusual nature. FL doesn’t hold anyone liable to the corp for personal profits realized in trading on the basis of inside info
43
Federal Securities Law Section 16(b)
requires officers, directors, and 10% shareholders return to their corporation all profits from any purchase of shares within a SIX MONTH PERIOD
44
Publicly held Corp
(1) at least 2000 shareholders/500 not accredited investors and (2) $10 million in assets
45
Accredited Investors
include high income or net worth individuals and officers or directors of the issue
46
Rule 10b-5
(1) prohibits fraud and deceit (2) in connection with purchase or sale of any security (3) subject to min nexus with IS commerce (4) and a showing of scienter. Issue is adequate disclosure
47
Insider Trading Sanctions
SEC may sue persons illegally trading on the basis of insider information for an amount equal to three times their profit or loss avoided
48
Tender offers
public invitation to shareholders to sell their shares in the targeted corp, at premium over the market price
49
Williams Act
imposes anti-fraud and disclosure requirements on all tender offers involving more than 5% of a target’s stock
50
Promoter
undertakes to corm a corp and procure the necessary capital and other items
51
Incorporator
one who signs the articles of incorporation
52
Fiduciary Duty
must act in good faith and best interest of all investors
53
Contracts on Behalf of Corp
promoters remain liable on contracts they enter on behalf of corp, even after corp adopts K, promoter always personally liable unless novation
54
Expenses, Compensation, and Failure to Incorporate
promoter has NO right of action to recover, only for reasonable value of services rendered. If corp not formed – must return all money even if no wrong doing
55
Shareholder Powers
do not have power to control day-to-day management, but may given powers via articles
56
Shareholder Annual Meeting
must be held for election of director and other business, must be at least once w/13 months or shareholder may petition court
57
Shareholder Special Meetings
may be called for any appropriate purpose by board, holders of 1/10th of all outstanding voting shares. (1) must be notified in writing (2) need to know purpose (3) need 10 days in advance notice
58
Shareholder Voting
eligibility is determined by stock ownership of the record date, no more than 70 days before meeting
59
Shareholder Proxies
(1) may be appointed upon signing a form. (2) expires after 11 months unless stated otherwise. (3) revocable at pleasure of shareholder unless provided irrevocable.
60
Election of Directors
plurality vote unless articles state otherwise
61
Cumulative Voting
intended to aid minority shareholders in obtaining representation on board. Entitled to a number of votes= # of voting shares X # of directors. May cast votes for any one candidate or divide them
62
Shareholder rights to Dividends
shareholders cannot compel directors or declare dividends. Directors has discretion absent bad faith
63
Legality of Distribution Equity Test
distribution okay if corp will be able to pay its debts
64
Legality of Distribution - Balance Sheet or Bankruptcy Test
limited to amount by which total assets exceed the sum of total liabilities and liquidation preferences of preferred shares
65
Liability for Improper Dividends
Directors are liable for improperly paid amounts, Fl does not insulate directors from liability
66
Right to Inspect Books and Records
(1) absolute (2) for proper purpose
67
Grounds of Refusal of Inspection
(1) w/2 years offered a sale of list of shareholders of any corp or aided and abetted another (2) has improperly used any info secured through any prior examination of books (3) not acting in good faith (3) no proper purpose
68
Voting Trust
to irrevocably confer upon a trustee the right to vote their shares
69
Pooling Agreement
shareholders agree to share the shares a certain way
70
Close corporation Shareholder Agreement
authorizes to close corporations in range of agreement, will not hold them invalid, only applies when all shareholders consent
71
Fiduciary Duty of Shareholders
none, may act in personal interest. May not used power to defraud or oppress the minority
72
Shareholder Derivative Suits
enforce a corporate cause of action when BoD has not sought to enforce the corp’s rights
73
Dismissal of Shareholder Derivative Suit
1. Majority vote if independent directs 2. Majority vote of a committee 3. Panel of one or more individual persons appointed by the court
74
Board of Directors Removal
At any time with or without cause
75
Director and binding on extraordinary contracts
Cannnot unless authority to act: 1. Proper notice at directors meeting 2. Quorum 3. Makority directirs approved decision
76
Business Judgement Rule
Not personally liable to corp for breach of care. Standard is ordinarily prudent person
77
Invested Director
Okay as long as full disclosure of interest and approved by majority or K is fair
78
Corporate Opportunity Doctrine
Must inform the corp of business opportunities of which to take advantage
79
Fundamental corporate change voting
Majority of outstanding shares
80
Regular issue and shareholder voting
Quorum of majority votes cast at a meeting
81
Merger
One of the combining corporations remains in being and absorbs the other
82
Share exchange
1 corp acquires all of the outstanding shares of one or more of classes or series of another corp
83
Short form merger
Merging of a parents and a subsidiary of at least 80% owned by the parent and does not require shareholder approval
84
De facto merger
FL has no case law accepting or rejecting de facto merger
85
Appraisal rights not available to
Shares traded on national securities exchange OR has at least 2000 shareholders and the outstanding shares or class has a market value if at least $10 million
86
Dissolution
Legal termination of corp
87
Liquidation
Process of marshaling corps' assets
88
Voluntary dissolution
Notice must be given to all known creditors. In FL not filed until the liquidation has been conpleted
89
Involuntary Dissolution
1) irreparable injury or 2) shareholders at deadlick
90
Shareholders bringing involuntary dissolution
1) waste or misappropriation OR 2) directors acted illegally or fraudulently

FL Bar Exam Flashcards- MBE (20 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions