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16 Cards in this Set
- Front
- Back
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Dif between corp and partnership
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Partnership is not sp entity from owners. Owners J&S liable for acts of others.
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Corp v. limited partnership
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Same as partnershiop except limited partners liability is limited to the share they invested.
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What type of reationships can result from incorrect corporate formation? (4)
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Partnership
Creditor-Debtor - between the supplier of capital and user of the capital Emplyer employee relationship/principal agent Trustee-Beneficiary |
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What type of duty do promoters have before corpro is established? What do they owe to outside investors?
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JOint venturers
Fidicuary duty |
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Three wasy cororations adopt precorp K's
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1. Express
2. Implied (accept benefits with full knowlege of the K's existance.) 3. ALter ego - when corp takes over completely the assets of an unicorporated predecessor and becmes the alter ego. |
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Content of he certificate of incorporation
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1. Name
2. Purpose of corp (catch-all allowed 3. County where office located 4. AUthorized share and description 5. Desidntation of sec of state 6. Registered agent (optional) 7. DUration if not perpetual 8. Limitation on director's liabilty 9. |
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De facto corporations can be shown by (3)
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1. Colorable Compliance wiht the corporation statute
2. Good faith 3. Use of the corporate privelage |
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Standart to pierce corporate veil (5)
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Prevent fraud and achieve equity
1. Agency or instrumentality (shareholders dominate) 2.Dummy Cororation 3. Illegality/Evasion - but could use for somthing that individuals cannot do 4. Parent/subsidiary 5. Professional service corporation - liable while rendering professional services |
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When are the three situations where ultra vires is applicable in ny?
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1. Damages against officer or director for unauthorized act
2. Attorney Generl prpoceeding - to anul corp or enjoin it 3. Injunction by shareholders to prevent unauthorized transfer or activity by corp a. necessary parties - if the ct seeks to enjoin a k, all parties must be names b. ct can enjoin if it seems equitable |
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WHo may use a proxy?
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Any shareholder entitled to vote at a meeting may do a proxy.
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How long do proxy's last?
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11 months unless otherwise provided
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When is proxy irrevocable?
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If it states it is irrevocable and one of the following:\
1. Pledgee (one who olds the shares as security for an oblication) 2. A person who has agreed to buy the shares 3. A creditor of the corporation 4. aN Officer whose employment contract calls for such proxy OR 5. Pledge designation by or under a voting agreement under BCL 620(a) |
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WHen is an irrevocable proxy terminated?
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1. THe pledge is redeemed, the corporate credit is repaid, the pereod of employmetn has ended or the voting agreement has terminated.
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When do shareholders have a fiduciary duty?
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IF a shareholder has a control position in a companythey owa a duty of good faith.
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In a closely held corporation, when may a BOD confer some of teh duties usually associated withe the BOD to a manager or the like?
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In NY - this can be done when:
1. The provision is in teh certificate of incorporation 2. ALl incorporators or shareholders of record have authorized the provision 3. All subsequent shareholders have notice and consent in writing and 4. NO shares listed on an exchange. |
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What is the business judgment rule
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Cts won't second guess the business judgmehnt of the board members as long as
1. good faith 2. based on the facts known at that time. |
