LGS 200- Abigail Hammond- Exam 3Chapters
16, 17,& 18 Updated questions with correct
solved answers.
A general partner can be dissociated from a limited partnership in what ways? - CORRECT ANSWER✅✅-
Bankruptcy
- Retirement
- Death
- Mental Incompetence
A limited partnership cannot be dissolved by a limited partner's what? - CORRECT ANSWER✅✅-
Bankruptcy (unless it causes the bankruptcy of the firm)
- Death
- Assignment of interest (right to receive distributions)
A partner can be dissociated from a partnership in how many ways? - CORRECT ANSWER✅✅5
A share of common stock gives the owner a proportionate interest in the corporation with regard to
what? - CORRECT ANSWER✅✅1. Control
2. Earnings
3. Net assets
Agency Concepts and Partnership Law - CORRECT ANSWER✅✅When two or more persons agree to do
business as partners, their relationship is similar to an agency relationship
Alien Corporation - CORRECT ANSWER✅✅A corporation formed in another country but doing business
in the US
,Are foreign investors allowed to become LLC members? - CORRECT ANSWER✅✅Yes, so organizing as an
LLC enables a business to attract investors from other countries
Are partners bound by fiduciary ties? - CORRECT ANSWER✅✅Yes, this means they are required to act
primarily in the best interest of one another
Are the termination provisions more in favor of the franchisor or the franchisee? - CORRECT
ANSWER✅✅The franchisor
Articles of a partnership - CORRECT ANSWER✅✅A written agreement that sets forth each partner's
rights and obligations with respect to the partnership
Articles of Incorporation - CORRECT ANSWER✅✅The document that is filed with the appropriate state
official, usually the secretary of state, when a business is incorporated and that contains basic
information about the corporation
Articles of Organization - CORRECT ANSWER✅✅The document that is filed with the appropriate state
official, usually the secretary of state, when an LLC is formed and that contains basic information about
the business
Benefit Corporation - CORRECT ANSWER✅✅A type of for-profit corporation, available by statue in a
number of states, that seeks to have a material positive impact on society
Benefit Corporations Differ: Accountability - CORRECT ANSWER✅✅Shareholders of a benefit
corporation determine wether the company has achieved a material positive impact
Benefit Corporations Differ: Purpose - CORRECT ANSWER✅✅The purpose of a benefit corporation is to
benefit the public as a whole
Benefit Corporations Differ: Transparency - CORRECT ANSWER✅✅A benefit corporation must issue an
annual benefit report on its overall social and environments performance that uses a recognized third-
party standard to asses its performance
- The report must be: delivered to the shareholders, posted on a public website
,Board of Directors' Meetings - CORRECT ANSWER✅✅- The board of directors conducts business by
holding formal meetings with recorded minutes
- The dates are usually established in the articles or bylaws
- Most states allow directors to participate in board of directors
- Normally a majority of the board of directors constitutes a quorum
Bond - CORRECT ANSWER✅✅A security that evidences a corporate (or government) debt
Business Judgement Rule - CORRECT ANSWER✅✅A rule under which courts will not hold corporate
officers and directors liable for honest mistakes of judgement and bad business decisions that were
made in good faith
Buy-Sell Agreements - CORRECT ANSWER✅✅Both general and limited partners can agree ahead of
time on how the partnership's assets will be valued and divided if the partnership dissolves
Buyout Price - CORRECT ANSWER✅✅The amount payable to a partner on his/her dissociation from a
partnership, based on the amount distributable to that partner if the firm were would up on that date,
and offset by any damages from wrongful dissociation
Bylaws - CORRECT ANSWER✅✅The internal rules of management adopted by a corporation at its first
organizational meeting
Can a corporation be a partner in a partnership? - CORRECT ANSWER✅✅Yes, the UPA's definition of
"person" includes corporations
Can a court order an LLC to be dissolved when the members have engaged in illegal or oppressive
conduct or when it is no longer feasible to carry the business on? - CORRECT ANSWER✅✅Yes
Can a limited partnership be dissolved by a court decree? - CORRECT ANSWER✅✅yes
, Can a LLC be held liable for any loss or injury caused by the wrongful acts or omissions of its members? -
CORRECT ANSWER✅✅Yes
Can a LLC choose to be taxed as either a partnership or a corporation? - CORRECT ANSWER✅✅Yes, if
the LLC has two or more members
Can buy-sell agreements help the partners avoid dispute? - CORRECT ANSWER✅✅Yes
Can not holding required corporation meetings lead to piercing the veil? - CORRECT ANSWER✅✅Yes
Cases usually deal with the duty of loyalty typically involve one or more of what? - CORRECT
ANSWER✅✅1. Competing with the corporation
2. Usurping of a corporate opportunity
3. Pursuing an interest that conflicts with that of the corporation
4. Using information that is not available to the public to make a profit trading securities
5. Authorizing a corporate transaction that is detrimental to minority shareholders
6. Selling control over the corporation
Certificate of Limited Partnership - CORRECT ANSWER✅✅The document that must be filed with a
designated state official to form a limited partnership
Charging Order - CORRECT ANSWER✅✅An order granted by a court to a judgement creditor that
entitles the creditor to attach a partner's interest in the partnership
Close Corporation - CORRECT ANSWER✅✅A corporation whose shareholders are limited to a small
group of persons, often family members
Commingle - CORRECT ANSWER✅✅To put fund or goods together into one mass so that they are mixed
to such a degree that they no longer have separate identities
16, 17,& 18 Updated questions with correct
solved answers.
A general partner can be dissociated from a limited partnership in what ways? - CORRECT ANSWER✅✅-
Bankruptcy
- Retirement
- Death
- Mental Incompetence
A limited partnership cannot be dissolved by a limited partner's what? - CORRECT ANSWER✅✅-
Bankruptcy (unless it causes the bankruptcy of the firm)
- Death
- Assignment of interest (right to receive distributions)
A partner can be dissociated from a partnership in how many ways? - CORRECT ANSWER✅✅5
A share of common stock gives the owner a proportionate interest in the corporation with regard to
what? - CORRECT ANSWER✅✅1. Control
2. Earnings
3. Net assets
Agency Concepts and Partnership Law - CORRECT ANSWER✅✅When two or more persons agree to do
business as partners, their relationship is similar to an agency relationship
Alien Corporation - CORRECT ANSWER✅✅A corporation formed in another country but doing business
in the US
,Are foreign investors allowed to become LLC members? - CORRECT ANSWER✅✅Yes, so organizing as an
LLC enables a business to attract investors from other countries
Are partners bound by fiduciary ties? - CORRECT ANSWER✅✅Yes, this means they are required to act
primarily in the best interest of one another
Are the termination provisions more in favor of the franchisor or the franchisee? - CORRECT
ANSWER✅✅The franchisor
Articles of a partnership - CORRECT ANSWER✅✅A written agreement that sets forth each partner's
rights and obligations with respect to the partnership
Articles of Incorporation - CORRECT ANSWER✅✅The document that is filed with the appropriate state
official, usually the secretary of state, when a business is incorporated and that contains basic
information about the corporation
Articles of Organization - CORRECT ANSWER✅✅The document that is filed with the appropriate state
official, usually the secretary of state, when an LLC is formed and that contains basic information about
the business
Benefit Corporation - CORRECT ANSWER✅✅A type of for-profit corporation, available by statue in a
number of states, that seeks to have a material positive impact on society
Benefit Corporations Differ: Accountability - CORRECT ANSWER✅✅Shareholders of a benefit
corporation determine wether the company has achieved a material positive impact
Benefit Corporations Differ: Purpose - CORRECT ANSWER✅✅The purpose of a benefit corporation is to
benefit the public as a whole
Benefit Corporations Differ: Transparency - CORRECT ANSWER✅✅A benefit corporation must issue an
annual benefit report on its overall social and environments performance that uses a recognized third-
party standard to asses its performance
- The report must be: delivered to the shareholders, posted on a public website
,Board of Directors' Meetings - CORRECT ANSWER✅✅- The board of directors conducts business by
holding formal meetings with recorded minutes
- The dates are usually established in the articles or bylaws
- Most states allow directors to participate in board of directors
- Normally a majority of the board of directors constitutes a quorum
Bond - CORRECT ANSWER✅✅A security that evidences a corporate (or government) debt
Business Judgement Rule - CORRECT ANSWER✅✅A rule under which courts will not hold corporate
officers and directors liable for honest mistakes of judgement and bad business decisions that were
made in good faith
Buy-Sell Agreements - CORRECT ANSWER✅✅Both general and limited partners can agree ahead of
time on how the partnership's assets will be valued and divided if the partnership dissolves
Buyout Price - CORRECT ANSWER✅✅The amount payable to a partner on his/her dissociation from a
partnership, based on the amount distributable to that partner if the firm were would up on that date,
and offset by any damages from wrongful dissociation
Bylaws - CORRECT ANSWER✅✅The internal rules of management adopted by a corporation at its first
organizational meeting
Can a corporation be a partner in a partnership? - CORRECT ANSWER✅✅Yes, the UPA's definition of
"person" includes corporations
Can a court order an LLC to be dissolved when the members have engaged in illegal or oppressive
conduct or when it is no longer feasible to carry the business on? - CORRECT ANSWER✅✅Yes
Can a limited partnership be dissolved by a court decree? - CORRECT ANSWER✅✅yes
, Can a LLC be held liable for any loss or injury caused by the wrongful acts or omissions of its members? -
CORRECT ANSWER✅✅Yes
Can a LLC choose to be taxed as either a partnership or a corporation? - CORRECT ANSWER✅✅Yes, if
the LLC has two or more members
Can buy-sell agreements help the partners avoid dispute? - CORRECT ANSWER✅✅Yes
Can not holding required corporation meetings lead to piercing the veil? - CORRECT ANSWER✅✅Yes
Cases usually deal with the duty of loyalty typically involve one or more of what? - CORRECT
ANSWER✅✅1. Competing with the corporation
2. Usurping of a corporate opportunity
3. Pursuing an interest that conflicts with that of the corporation
4. Using information that is not available to the public to make a profit trading securities
5. Authorizing a corporate transaction that is detrimental to minority shareholders
6. Selling control over the corporation
Certificate of Limited Partnership - CORRECT ANSWER✅✅The document that must be filed with a
designated state official to form a limited partnership
Charging Order - CORRECT ANSWER✅✅An order granted by a court to a judgement creditor that
entitles the creditor to attach a partner's interest in the partnership
Close Corporation - CORRECT ANSWER✅✅A corporation whose shareholders are limited to a small
group of persons, often family members
Commingle - CORRECT ANSWER✅✅To put fund or goods together into one mass so that they are mixed
to such a degree that they no longer have separate identities
