Exam 37: Fundamental Changes of Corporations

MATCHING Part VII Matching Match each statement with the correct term below.a.One whose profits must be used exclusively for charitable, educational, or scientific purposes.b.One created under the laws of a given state.c.One created under the laws of any other state or jurisdiction.d.Person who takes the preliminary steps to organize a corporation.e.Person who agrees to purchase stock in a corporation.f.Rules governing a corporation's internal management.g.One formed in substantial compliance with the incorporation statute and the required organizational procedure.h.One not formed in compliance with the statute but recognized for most purposes as a corporation.i.Prevents a person from raising the question of a corporation's existence.j.One created to administer a unit of local civil government.k.Contractual right to purchase from a corporation shares of a specified class or classes.l.Source of capital creating no ownership interest and involving the corporation's promise to repay funds loaned to it.m.A type of debt security.n.Unsecured bonds; have only the obligation of the corporation behind them.o.Condition the payment of interest to some extent on corporate earnings.p.Bonds subject to redemption.q.Eligible corporation electing under the Internal Revenue Code to be taxed as a partnership.r.Shares are owned by large number of people and are widely traded.s.May be exchanged for other securities.t.Claims against a corporation's general assets and also a lien on specific property.u.Basic organizational document of a corporation; charter.v.Shares reacquired by a corporation.w.Opportunity to purchase a pro rata share of new stock offerings.x.Source of capital creating an ownership interest in the corporation.y.A corporation's exercise of the right to repurchase its own shares. -redemption

Dissolution of a corporation does not terminate its existence, and does not require that it liquidate its assets.

Match each statement with the correct term below.a.An association of two or more persons to carry on as co-owners a business for profit.b.Unincorporated business association composed of persons who combine their resources to carry out a particular business enterprise, usually of short duration, for profit.c.An unincorporated organization of two or more persons doing business in a state other than the one in which it was formed.d.Total money and property contributed by the partners for use by the partnership; represents the partners' equity in the partnership.e.Duty of utmost loyalty, fairness, and good faith owed by partners to each other and to the partnership.f.Duty owed by partners to manage the partnership affairs without gross negligence, reckless conduct, intentional misconduct, or knowing violation of the law.g.Imposes partnership duties and liabilities on a non-partner who has either represented himself or consented to be represented as a partner.h.Any partner's ceasing to be associated with the carrying on of the business.i.Judicial lien that may be obtained against a partner's transferable interest in a partnership.j.Completing unfinished business, collecting debts, and distributing assets to contributors and partners; also called liquidation.k.A situation in which the RUPA requires a partnership to wind up and terminate; under the UPA, a change in the relation of partners caused by any partner's ceasing to be associated in the carrying on of the business.l.A general partnership that, by making a statutorily required filing, limits liability of its partners.m.A partnership formed by two or more persons under the laws of a state and having one or more general partners and one or more limited partners.n.An unincorporated business organization, created under state statute, that provides limited liability to all of its owners and permits all of its members to participate in management.o.Right of one person to choose her business partners. -charging order

Shareholders do not have vested property rights resulting from provisions in the articles of incorporation.

MATCHING Part VII Matching Match each statement with the correct term below.a.One whose profits must be used exclusively for charitable, educational, or scientific purposes.b.One created under the laws of a given state.c.One created under the laws of any other state or jurisdiction.d.Person who takes the preliminary steps to organize a corporation.e.Person who agrees to purchase stock in a corporation.f.Rules governing a corporation's internal management.g.One formed in substantial compliance with the incorporation statute and the required organizational procedure.h.One not formed in compliance with the statute but recognized for most purposes as a corporation.i.Prevents a person from raising the question of a corporation's existence.j.One created to administer a unit of local civil government.k.Contractual right to purchase from a corporation shares of a specified class or classes.l.Source of capital creating no ownership interest and involving the corporation's promise to repay funds loaned to it.m.A type of debt security.n.Unsecured bonds; have only the obligation of the corporation behind them.o.Condition the payment of interest to some extent on corporate earnings.p.Bonds subject to redemption.q.Eligible corporation electing under the Internal Revenue Code to be taxed as a partnership.r.Shares are owned by large number of people and are widely traded.s.May be exchanged for other securities.t.Claims against a corporation's general assets and also a lien on specific property.u.Basic organizational document of a corporation; charter.v.Shares reacquired by a corporation.w.Opportunity to purchase a pro rata share of new stock offerings.x.Source of capital creating an ownership interest in the corporation.y.A corporation's exercise of the right to repurchase its own shares. -income bonds

The attorney general of the state of incorporation may bring a court action to dissolve a corporation if the corporation obtained its charter through fraud.

A short-form merger:

If Able Corporation purchases all of the stock of Beta Corporation rather than all of its assets, there is now a change in Beta Corporation's legal status.

If a purchaser of all of a corporation's assets continues the seller's product line, some courts impose upon the purchaser strict tort liability for defects in products previously manufactured by the seller corporation.

Match each statement with the correct term below.a.Each shareholder having one vote for each share owned; directors elected by a plurality of votes.b.Authorization to vote another's shares at a shareholder meeting.c.Right of a dissenter to receive fair value of his shares.d.Alter a corporation's basic structure; charter amendments, mergers, dissolution.e.Entitles each shareholder to give one candidate as many votes as the number of directors to be elected multiplied by the number of shares owned.f.Minimum number necessary to be present at a meeting in order to transact business.g.Brought by shareholder on behalf of the corporation to enforce a right belonging to the corporation.h.Brought by a shareholder against the corporation based upon his ownership of shares.i.Permission under the Revised Act for a corporation to change its state of incorporation.j.Fiduciary obligation of faithfulness; subordination of self-interest.k.Device designed to concentrate corporate control in one or more persons by transferring voting rights to them.l.The combination of assets of two or more corporations into one of the corporations.m.Permission under the Revised Act for a business entity to change its form to another type of entity.n.Precludes imposing liability on directors and officers for honest mistakes in judgment if they act in good faith with due care.o.A general invitation to all the shareholders of a target company to sell their shares at a specified price. -voting trust

Management buyouts commonly make extensive use of borrowed funds.

Match each statement with the correct term below.a.Each shareholder having one vote for each share owned; directors elected by a plurality of votes.b.Authorization to vote another's shares at a shareholder meeting.c.Right of a dissenter to receive fair value of his shares.d.Alter a corporation's basic structure; charter amendments, mergers, dissolution.e.Entitles each shareholder to give one candidate as many votes as the number of directors to be elected multiplied by the number of shares owned.f.Minimum number necessary to be present at a meeting in order to transact business.g.Brought by shareholder on behalf of the corporation to enforce a right belonging to the corporation.h.Brought by a shareholder against the corporation based upon his ownership of shares.i.Permission under the Revised Act for a corporation to change its state of incorporation.j.Fiduciary obligation of faithfulness; subordination of self-interest.k.Device designed to concentrate corporate control in one or more persons by transferring voting rights to them.l.The combination of assets of two or more corporations into one of the corporations.m.Permission under the Revised Act for a business entity to change its form to another type of entity.n.Precludes imposing liability on directors and officers for honest mistakes in judgment if they act in good faith with due care.o.A general invitation to all the shareholders of a target company to sell their shares at a specified price. -merger

A sale of substantially all of the assets of a corporation that is in the ordinary course of business of the corporation will not require shareholder approval.

Match each statement with the correct term below.a.Each shareholder having one vote for each share owned; directors elected by a plurality of votes.b.Authorization to vote another's shares at a shareholder meeting.c.Right of a dissenter to receive fair value of his shares.d.Alter a corporation's basic structure; charter amendments, mergers, dissolution.e.Entitles each shareholder to give one candidate as many votes as the number of directors to be elected multiplied by the number of shares owned.f.Minimum number necessary to be present at a meeting in order to transact business.g.Brought by shareholder on behalf of the corporation to enforce a right belonging to the corporation.h.Brought by a shareholder against the corporation based upon his ownership of shares.i.Permission under the Revised Act for a corporation to change its state of incorporation.j.Fiduciary obligation of faithfulness; subordination of self-interest.k.Device designed to concentrate corporate control in one or more persons by transferring voting rights to them.l.The combination of assets of two or more corporations into one of the corporations.m.Permission under the Revised Act for a business entity to change its form to another type of entity.n.Precludes imposing liability on directors and officers for honest mistakes in judgment if they act in good faith with due care.o.A general invitation to all the shareholders of a target company to sell their shares at a specified price. -fundamental changes

The state may bring an action for involuntary dissolution of a company if the corporation has not paid its annual franchise tax.

Which of the following statements about corporate dissolution is INCORRECT?

Discuss what happens to a corporation after dissolution and what protection is afforded creditors of the corporation.

A corporation may acquire all of the assets, including goodwill, of another corporation and combine them with its own through:

In a purchase or lease of all or substantially all of the assets of another corporation, the purchaser or lessee corporation simply acquires ownership or control of additional physical assets of the other corporation.

Jasmine owns a controlling interest in the Hardwick Company.Explain her responsibilities if she wants to privately sell her interest.