Corporations and Partnerships Flashcards
In VA, what’s the statutory cap on director liability in a proceeding brought by a corporation or shareholders?
In Virginia, in any proceeding brought by or in the right of a corporation or brought by or on behalf of shareholders of the corporation, there is a statutory cap on director liability that limits a director’s liability for money damages to the greater of $100,000 or the cash compensation received by the director during the 12-month period immediately preceding the conduct for which liability was imposed. In addition, the corporation, in its articles of incorporations or bylaws, may reduce or eliminate director liability, but cannot increase it.
However, neither cap is applicable with respect to willful misconduct or a knowing violation of criminal law.
In VA, how can a new member join a manager-managed LLC?
A person may become a member of a manager-managed LLC if a majority of the managers of the LLC consent.
In VA, if 4 people form a partnership and only contributed capital, and profits are split unevenly among the 4, does each partner have equal management rights?
each partner has equal management rights even if the partners do not share equally in the partnership’s profits.
Partnerships: what’s a quorum?
Majority.
There are 20 members on a corporation’s board of directors. Thirteen directors are present for a vote on a resolution.
Unless the bylaws or articles of incorporation state otherwise, what is the minimum number of directors who must vote for the resolution in order for it to pass?
7! It’s a majority of those present, as long as they constitute a quorum.
How much notice for a corporation’s meeting with shareholders?
Notice for a meeting must generally be given no less than 10 days or no more than 60 days before the meeting date.
Must the notice for the annual meeting state the purpose?
No. Only the notice for special meetings must state the meeting’s purpose unless the articles of incorporation require the notice of the annual meeting to state its purposes
When can a VA shareholder inspect minutes of the board of directors’ meetings, corporate accounting records, and a list of shareholders?
for some corporate records (e.g., minutes of the board of directors’ meetings, corporate accounting records, and the list of shareholders of record), the shareholder must have been a shareholder for at least six months or must be the record owner or beneficial owner of at least five percent of the outstanding shares.
How does a VA shareholder inspect and copy corporate documents?
In Virginia, certain shareholders have the right to inspect and copy corporate documents, so long as the shareholder sends a signed written request at least 10 business days in advance and has a proper purpose for doing so. A proper purpose is defined as one that relates to the shareholder’s interest in the company. The shareholder may only inspect and copy the records at the corporation’s main office during business hours.
In VA, how much notice does a shareholder get of annual and special meetings?
Shareholders must be given written notice of an annual or special meeting no less than 10 days and no more than 60 days before the meeting date.
In VA, how does a shareholder waive meeting notice requirements?
A shareholder may waive notice either in writing or by attending the meeting. However, a shareholder may attend a meeting to object to the lack of notice or defective notice if the objection is made at the beginning of the meeting. In such a case, the shareholder’s attendance at the meeting will not be a waiver of the improper notice.
In VA, what is the duty of loyalty owed by a partner?
Under the duty of loyalty, a partner is required to refrain from the following activities: (i) competing with the partnership business; (ii) advancing an interest adverse to the partnership; and (iii) usurping a partnership opportunity, or otherwise using partnership property or business to derive a personal benefit without notifying the partnership.
In VA, what is the duty of care owed by a partner?
Under the duty of care, a partner is required to refrain from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of the law.
In VA, is a partner entitled to be paid for their work for the partnership?
A partner is not entitled to remuneration for services performed for the partnership, though an exception exists when the partner renders services in winding up the business of the partnership.
In VA, how many partners must approve an ordinary course of business decision?
A majority of the partners must approve a decision as to a matter in the ordinary course of the partnership’s business, such as a distribution of partnership profits.
