Corps Updates

Question 1

Director Indemnity

Answer 1

Must if successful, can if good faith/didn’t think conduct was bad.

Question 2

S-Corp

Answer 2

Must be US Cit/RA; No more than 100 SH; No More than One Class of Stock

Question 3

Good Faith Incorporation

Answer 3

Treated as defacto corp if parties screwed up paperwork as long as good faith effort.

Question 4

Distributions

Answer 4

Capital Contributions Count toward total.

Question 5

Stock Splits are NOT ____

Answer 5

Distributions; Can occur even if finances are fucked.

Question 6

AoI Modification

Answer 6

Majority of QUORUM VOTE

Question 7

Voting Agreements - Who can

Answer 7

Shareholders can, Directors CANNOT

Question 8

Corp can have only _____ purpose

Answer 8

One

Question 9

Promoter Personal Liability

Answer 9

Promoters personally liable for contracts and formation doesn’t protect.

Question 10

Committees CANNOT

Answer 10

Cannot issue/sell/reacq shares unless board says so; fill vacancies on board or committees; do anything with bylaws

Question 11

Controlling Shareholder Nonsense

Answer 11

Controlling can be less than 51% IF math equals out. Do all math here.

Question 12

Committees & Auditors

Answer 12

Can select, oversee, and pay outside auditors.

Question 13

Director Voting Proxy

Answer 13

No. Can’t do it

Question 14

Merger Voting Req’s

Answer 14

Majority vote OF QUORUM

Question 15

Disso Timing

Answer 15

120 days, wind up can take however long it needs

Question 16

LLC - Articles Of ____

Answer 16

Organization

Question 17

LLC Losses & Profits - Contributions

Answer 17

Contribute more, lose more.

Question 18

New Share Types Rules

Answer 18

Each class gets independent vote and majority is needed FOR EACH.

Question 19

No-Preemptive Rights in _____ Months

Answer 19

Can’t exercise within 6 months of incorp

Question 20

PLLC Liability Nonsense

Answer 20

Being a shareholder doesn’t make them liable. Fucking up does.

Question 21

Professional Corp Rules

Answer 21

Everyone has to be same profession

Question 22

No duty of loyalty vio when:

Answer 22

Personal benefits disclosed, not illegal, at least two dirs vote yes who comprise majority of disinterested dirs.

Question 23

Shares require EITHER

Answer 23

Voting rights, or right to get paid first. Don’t need both at same time.

Question 24

Director Removal

Answer 24

ONLY shareholders can do it, Dirs can’t fuck over other ones.

Question 25

Committee Number of Peeps

Answer 25

At least One and same is a board member, not major shit.

Question 26

Director Special Meetings Don’t Need

Answer 26

to describe purpose

Question 27

Special Committee Creation Numbers

Answer 27

TOTAL majority to create/dump/appoint

Question 28

Special Rules for Merger (Getting around voting)

Answer 28

Corp survives merger, AoI unchanged, everyone holds same number of shares/rights

Question 29

Corporate Directors Criminal Liability

Answer 29

CANNOT indemnify if director had “reasonable cause” to believe their conduct was unlawful. - Criminal Case likely to instakill indemnity

Question 30

AoI Failure Timing

Answer 30

60 days

Question 31

Member Managed LLC Voting

Answer 31

Percentage ownership equals voting power.

Question 32

Quorum Voting Extra Jazz

Answer 32

Quorum needed for BOTH meeting AND voting. People can’t just pop smoke and leave to push a vote.

Question 33

Asset Transfer

Answer 33

Same as merger rules for voting

Question 34

OFFICER REMOVAL

Answer 34

Directors can do it unless bylaws say otherwise. Would remain liable for breach of contract.

Question 35

Corps Advancing Litigation Costs

Answer 35

Needs a vote by disinterested parties

Question 36

Outside Auditors CANNOT

Answer 36

be employed by the company

Question 37

Delayed Distros

Answer 37

Distros are fine if initial test even if later solvency is fucked. This is dumb.