CH. 15 T/F
"Piercing the corporate veil" means revealing to shareholders the internal rules of corporate management.
F
A business incorporated in one state has an automatic right to do business in any other state.
F
A director is elected by a majority vote of the other members of the board.
F
A promoter is not personally liable for a preincorporation contract.
F
A shareholder is not an "owner" of a corporation.
F
A stock warrant is a distribution of corporate profits or income.
F
A voting trust is an illegal restraint of shareholders' power.
F
An incorporator must have an interest in a corporation to file its articles of incorporation.
F
Any change in shareholders affects the continued existence of a corporation.
F
Any power expressly set out in the bylaws of a corporation is ultra vires.
F
Corporate bylaws must be approved by the appropriate state official before the corporation's first organizational meeting.
F
Cumulative voting refers to the accumulation of proposals presented annually for a shareholders' vote.
F
Directors are rarely compensated and cannot set their own compensation.
F
For action to be taken during a shareholders' meeting, a forum must be present.
F
In determining which form of business organization is most appropriate, the prime consideration is what would look good on the firm's Web site.
F
No state permits a corporate board to have fewer than three directors.
F
Preemptive rights entitle shareholders to bring a derivative suit against the corpora¬tion.
F
Professionals can avoid liability for their acts of malpractice simply by incorporating as a professional corporation.
F
Shareholders own a corporation and the right to manage it.
F
Shares issued for more than fair market value are known as watered stock.
F
The "minimum contacts" rule determines in which state a corporation should be incorporated.
F
There is a uniform body of national corporate law.
F
To vote their shares, shareholders must attend a shareholders' meeting and vote in person.
F
Unlike a director, an officer is not expected to be informed on corporate matters.
F
When a corporation is dissolved, its assets are distributed to its shareholders in proportion to the prices paid for the shares owned by each.
F
A business that holds itself out as being a corporation may not be able to deny corporate status, even if it makes no attempt to incorporate.
T
A corporation has perpetual existence in most states unless stated other¬wise in the ar¬ti¬cles of incorporation.
T
A corporation's internal management structure is described in its articles or bylaws.
T
A shareholder in a professional corporation can be liable for malpractice arising from the rendering of professional services.
T
Damages awarded in a shareholder's derivative suit go into the corporation's treasury.
T
Directors are required to exercise a reasonable amount of supervision over the corporate officers.
T
Express powers of a corporation can be found in the law of the state of incorporation.
T
Incorporators can appoint a corporation's first board of directors.
T
Only certain funds are legally available for paying dividends.
T
The law of the state of in¬corporation may restrict the implied powers of a corporation.
T
