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REG (Becker) > R7: Agency / Bankruptcy > Flashcards

R7: Agency / Bankruptcy Flashcards

1
Q

Events that terminate actual authority

A
  1. Death
  2. Incapacity of the principal
  3. Discharge in bankruptcy of the principal
  4. Failure to acquire necessary license
  5. Destruction of the subject matter
  6. Subsequent illegality
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2
Q

Agency power can arise through:

A
  • Grant of actual authority
  • Apparent authority/estoppel
  • Ratification
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3
Q

Duties of Principal to Agent

A
  • Compensation (unless agreed to free)

- Reimbursement

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4
Q

Chapter 7 okay for individuals if:

A

Avg monthly income for past 6 months < or = state median
Net monthly income X 60 < 7,025
Net monthly income X 60 < 25% of unused claims

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5
Q

Who may petition a debtor involuntary into BK?

A
  • Debtor owes at least $14,425 in unsecured, undisputed debt.
  • Fewer than 12 creditors: at least 1 creditor with at least $14,425 may file
  • 12 or more creditors: at least 3 creditors with at least $14,425 in aggregate may file
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6
Q

Which debts are not discharged in Chapter 7/11 BK?

A 
"WAFTED"
Willful and malicious injury
Alimony
Fraud / Fines
Taxes
Educational loans / Embezzlement
Debts
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7
Q

Order in which creditors are paid:

A
  1. Secured claimants
  2. Priority claimants (SAG WEG CTI)
  3. General creditors who filed their claims on time
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8
Q

Order of priority claimants to be paid (paid after secured claimants and before general creditors)

A

“SAG WEG CTI”

  1. support obligations to spouse/children
  2. administrative expenses of BK proceeding
  3. gap creditors
  4. wages up to $11,725 for each employee if earned 180 days prior to filing
  5. employee BP contributions up to $11,725 for each employee reduced by wages
  6. grain farmers/fishermen claims up to $5,775
  7. consumer deposits up to $2,600
  8. tax claims
  9. injury claims
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9
Q

Define automatic stay

A
  • automatic injunction that halts actions of creditors to collect debts from a debtor who has declared BK.
  • does not apply to: criminal prosecutions, paternity suits or alimony.
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10
Q

Define Chapter 7 bankruptcy

A

Voluntary or involuntary liquidation of a debtor’s estate. May be I, P, C

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11
Q

Define Chapter 9 bankruptcy

A

Municipal debt adjustment

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12
Q

Define Chapter 11 bankruptcy

A

Voluntary or involuntary debt reorganization (no liquidation). May be I, P, C

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13
Q

Define Chapter 13 bankruptcy

A

Voluntary adjustments of debts of individuals with regular income. Debtor pays all or portion of debt over 3-5 years. Individual only.

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14
Q

List securities exempt from registration requirements under Section 3 of 1933 Act

A 
Securities issued by: "BRINGS"
Banks
Regulated common carriers (railroads)
Insurance policies
Not for profits
Government
Short-term commercial paper
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15
Q

What are the general conditions of Regulation D - private offering exemption (transaction exemption)

A

No advertising, immediate resale prohibited, and notify SEC within 15 days after first sale.

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16
Q

Define Rule 504 under Regulation D - private offering exemption.

A

$1M limit, no limits on type or # of purchasers

17
Q

Define Rule 505 under Regulation D - private offering exemption.

A

$5M limit,
Sell to accredited - no limit, no disclosure,
Sell to unaccredited - limit to 35, disclose AFS

18
Q

Define Rule 506 under Regulation D - private offering exemption.

A

No $ limit,
Sell to accredited - no limit, no disclosure,
Sell to unaccredited - limit to 35, sophisticated, disclose AFS

19
Q

Section 11 requirements to sue

A 
To sue, must prove "LAM"
Loss suffered
Acquired the stock
Material misstatement/omission
Need not prove intent (scienter), negligence, reliance
20
Q

What does the 1934 Act cover?

A
  1. subsequent trading (after IPO)
  2. reporting provisions
  3. anti fraud provisions
21
Q

Which companies must register their securities per 1934 Act?

A
  1. traded on national exchange

2. have at least 500 shareholders AND more than $10M in assets

22
Q

Under the 1933 and 1934 Acts which reports must be filed?

A

10K - annually 60/90 days within YE
10Q - quarterly 40/45 days within YE
8K - 4 days after major change

23
Q

In addition to reporting companies, who must report to SEC/Issuer/Exchange under 1934 Act?

A 
"Report 5% TIP"
5% or more owners
Tender offers
Insiders
Proxy solicitations/statements
24
Q

Rule 10b-5 of 1934 Act requirements to sue

A 
"MAIDS"
Misrepresentation of material fact
Actual justifiable reliance 
Induce to rely
Damages
Scienter
25
Q

who may not file for Chapter 7 BK?

A 
No "RIBS"
railroads
insurance co
banks
savings institutions
26
Q

who may not file for Chapter 11 reorganizations?

A 
No "BIBS"
brokers
insurance co
banks
savings institution

REG (Becker) (9 decks)

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