Exam 20: Corporations

Shareholders are not personally liable for the debts of a corporation.

A simple majority vote of the shares represented at a shareholders' meeting is usually required to pass resolutions.

The board of directors hires officers to run the daily business of a corporation.

Shareholders can elect and remove the directors of the corporation.

One of the key advantages of the corporate form is the unlimited liability of its owners.

Ernst is a director of Fine Art Dealers, Inc. Ernst is trained in art valuation. Fine Art makes several purchases in which it pays too much for artwork. Ernst approves all the transactions without reading the details. Ernst is most likely liable for breach of

Dante and Eden want to form and do business as Farm-to-Fork Restaurant Corporation. Its existence depends generally on

Rita and Susan want to form and do business as Trips & Travel Agency, Inc. They will serve as the firm's directors and officers, and will initially hold all of the stock in the company. A corporation is owned by

With preemptive rights, shareholders preempt the decisions of directors and officers with respect to corporate policy.

Tech Talent & Personnel, Inc., is a corporation. Tech Talent's implied powers enable it to

Ben incorporates his app products business as Clickology, Inc. Under most state corporation statutes, Clickology can have

Rob owns Solar Fuel Corporation. Rob uses Solar Fuel's funds to pay his personal expenses, creates Thermal Power Corporation to engage in the same business as Solar Fuel, transfers Solar Fuel's assets to Thermal Power, and petitions Solar Fuel into bankruptcy. This most likely warrants

Holly is a director of International Gourmet Spices, Inc. As a director, with respect to the corporation, Holly is

The corporation is a creature of the common law.

A corporation possesses the same right of access to the courts as a natural person.

Refer to Fact Pattern 20-1. Ray's suit is a shareholder's

There are never any important consequences if the procedures for incorporation are not followed precisely.

Clive, Domina, and Elgar are the first directors on the board of Face x Face Corporation, a social media host. Subsequent directors are elected by a majority vote of Face x Face's

Some state statutes allow corporations to set a quorum for a meeting of the board of directors at less than a majority of the directors.

Ida, Jerzy, and Kit are the directors of Liberty Convenience Stores, Inc. Liberty has nine officers and forty-six shareholders. Dividends are ordered by the firm's