MapleSignal, Inc. has historically paid annual dividends, but this year the board decided not to declare one because it wants to fund a new product line. The corporation is profitable and solvent. A minority shareholder...
Citations: Model Business Corporation Act shareholder approval and appraisal principles, NCBE MEE Business Associations outline
...e worked for the corporation and received modest salaries plus annual dividends. After a dispute, Ana caused the board to terminate Ben's employment, stop all dividends, and increase Ana's salary by $180,000. The corpora...
Citations: General controlling-shareholder fiduciary-duty principles, NCBE MEE Business Associations outline
...wants to collect a personal judgment by taking the LP's delivery vans and voting the limited partner's interest to sell the business. What is the creditor's usual remedy against the limited partner's interest? The chargi...
Citations: Uniform Limited Partnership Act principles
...olio of rental cabins. Its certificate lists Marco as general partner and Nia as limited partner. Nia sold "all my interest in Luna Ventures LP" to Olive. Marco did not consent to admit Olive as a substitute limited part...
Citations: Uniform Limited Partnership Act principles
...r loan. The creditor wants to collect by taking partnership equipment and voting the debtor partner's interest to force a sale of the business. What is the creditor's usual remedy against the partner's partnership intere...
Citations: Uniform Partnership Act and Revised Uniform Partnership Act principles
...t consent to admitting the investor as a partner. The investor now demands the right to vote on ordinary business decisions and inspect confidential customer files. Which statement is most accurate? The buyer of a partne...
Citations: Uniform Partnership Act and Revised Uniform Partnership Act principles
...are a dividend. A shareholder sues to force a dividend solely because dividends were paid in prior years. Which statement is most accurate? The correct answer states the ordinary shareholder dividend rule. Model Business...
Citations: Model Business Corporation Act distribution principles
...l under the partnership agreement. The former limited partner then demands direct title to 20 percent of the LP's equipment and claims the right to sign a new customer contract for the LP because she still expects future...
Citations: Uniform Limited Partnership Act principles
...l five CellHome directors. First, VoltGrid caused CellHome to suspend dividends for two years so CellHome could build a testing lab. The policy applied equally to all shareholders, and the board minutes describe a need t...
Citations: NCBE MEE Business Associations outline, NCBE July 2019 MEE controlling-shareholder analysis
...other two members refused to admit Investor as a member. Investor demands to vote on a new lease, inspect RiverDock's customer contracts, and receive any distributions that would have gone to Sloane. Separately, a judgm...
Citations: Revised Uniform Limited Liability Company Act principles
...rail LLC is manager-managed. Its operating agreement states: "Members and managers may own outside businesses, but all company transactions must be conducted in good faith." The agreement does not specifically address co...
Citations: Revised Uniform Limited Liability Company Act principles, NCBE MEE Business Associations outline
Maya and Theo planned to open a meal-prep business as HarvestBox LLC. Before any filing, Maya signed a six-month kitchen lease "for HarvestBox LLC, by Maya, organizer." She told the landlord that the LLC paperwork would...
Citations: Revised Uniform Limited Liability Company Act principles, NCBE MEE Business Associations outline
...s shareholders, a board of directors, officers, employees, creditors, and customers. A student asks who generally has legal authority to manage or direct the corporation's business and affairs. Which statement is most ac...
Citations: Model Business Corporation Act principles
A member-managed LLC operates a small landscaping business. One member signs a routine contract to buy mulch for current jobs. Which statement best describes the member's authority? The correct answer states the ordinary...
Citations: Revised Uniform Limited Liability Company Act principles
...rs want to form a business in which one person will manage operations and another will contribute capital without taking part in day-to-day management. They ask what is generally required to create a limited partnership...
Citations: Uniform Limited Partnership Act principles
Lee and Morgan orally agreed to run a small kayak-rental business as co-owners. Lee contributed $80,000 in cash. Morgan contributed $20,000 in cash and worked full time managing rentals. They never discussed profit share...
Citations: Uniform Partnership Act and Revised Uniform Partnership Act principles
...lly to launch a furniture-restoration business. One contributed tools and workshop space, and the other handled customer acquisition and restoration work. They split net profits equally, jointly approved major jobs, and...
Citations: Uniform Partnership Act and Revised Uniform Partnership Act principles
...a five-member board. Its bylaws require three directors for a quorum and majority approval of directors present at a meeting. The corporation's chief operating officer has signed ordinary supply contracts up to $250,000...
Citations: NCBE MEE Business Associations outline, Model Business Corporation Act board-action principles
Shareholder Mira sent the board of Finch Motors, Inc. a written demand asking the corporation to sue three directors for approving a self-interested parts contract. The board formed a two-director committee to investigat...
Citations: Model Business Corporation Act derivative proceeding principles, NCBE MEE Business Associations outline
Beacon Frame, Inc. has 1,000 shares outstanding. Olivia owns 80 shares. The board approved a three-year supply contract with a company owned by two directors. Olivia alleges that the contract price was far above market a...
Citations: NCBE MEE Business Associations outline, Model Business Corporation Act derivative proceeding principles
BrightFarm, Inc. has a nine-member board. Its bylaws allow committees and provide that five directors constitute a quorum. The board created a three-member compensation committee and authorized it to "recommend executive...
Citations: NCBE MEE Business Associations outline, Model Business Corporation Act board committee and meeting principles
A corporation proposes to sell its only factory and all operating equipment to a competitor, leaving the corporation with cash and no operating business. Which statement best describes shareholder rights in the transacti...
Citations: Model Business Corporation Act asset-sale and appraisal principles
A board forms a three-director committee to handle financing matters. The committee signs a merger agreement even though the board resolution authorized the committee only to evaluate financing proposals and report back...
Citations: Model Business Corporation Act committee principles
A corporation owns one factory and all of its manufacturing equipment. Its president signs a contract to sell the factory, equipment, customer list, and trade name to a competitor. The sale is outside the ordinary course...
Citations: Model Business Corporation Act principles
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