Mod 25 Wrong Answers Flashcards Preview

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Flashcards in Mod 25 Wrong Answers Deck (18):

Corporations and limited partnerships may only be created...

Pursuant of state statutes


Normally, both the Articles of Incorporation and a Certificate of
Limited Partnership must be...

Filed with the Secretary of State


Limited partners do not...

Do not owe fiduciary duties to the partnership


The basic concept of a promoter is one who...

Forms a corporation with the goal of the corporation eventually
coming into existence


Promoters are not...



Promoters are not agents, since there is...

No principal yet, thus have no authority to bind future corporations
To contracts


A corporation may resell treasury stock without regard to...

Par value


An owner who purchased treasury shares for less than par value will...

Not have any liability beyond actual investment


An owner of common stock who paid less than par value for stock purchased in connection with an original issue of shares is...

Contingently liable in many states to creditors for difference
between amount paid and par value


A person who signs a contract and says to be an agent when they are not is...



Under the Revised Model Business Corporation Act, a corporation is authorized to indemnify its officers for...5

1 expenses
2 attorney fees
3 judgements
4 fines
5 and amounts paid in settlement to stockholders


Under the Revised Model Business Corporation Act, a corporation is authorized to indemnify its officers for expenses, attorney fees, judgements, fines and amounts paid in settlement incurred in a suit by stockholder's when liability is a result of...

Officers good faith, nonnegligent actions on behalf of best interest
Of the corporation


The Articles of Incorporation may be amended by...

But not by who?

The shareholders vote, but not by the board of directors


When a company pays cash and buys 90% or more of the target's shares, it...2

1 Has control of the target stock

2 and can accomplish short form merger of the target into the


When rights of individual shareholders may be adversely affected, the shareholder is given the right to dissent and...

2) this is true even when...

Receive FV payment for their shares

2) shareholder has voting rights and have been outvoted


When a shareholder has preference rights being abolished or an
Acquisition of their stock has occurred...

The shareholder has right to dissent because this affects their
Stock's fair value


Shareholders have the right to inspect...

the corporate records if done in good faith for proper purpose


An new issuance of stock cannot...

Be forced by shareholders

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