Business Associations

This lesson examines the definition of a partnership. It highlights the definition of a partnership and how it differs from the sole proprietorship (the only other business organization that exists without first satisfying formal filing requirements).

This lesson integrates agency law and partnership law to develop an understanding of the authority partners possess to bind the partnership. The lesson explores the actual and apparent authority of partners and the possibility of inherent agency power in the partner context.

This lesson discusses the power that an agent (or apparent agent) has to affect the legal rights of the principal. In general, an agent or apparent agent may affect the principal's legal rights only to the extent that the agent possesses the authority or the power to do so. This lesson provides an introduction to the three basic types of authority -- actual authority, apparent authority, and inherent agency power.

This lesson introduces the federal and state securities laws regulating business finance. The lesson is designed for students taking Business Associations or Corporations, so the coverage is fairly basic; this lesson is not intended to be used by Securities Regulation students.

This lesson is intended to familiarize students with the Business Judgment Rule, an essential component of corporate governance.

This lesson is the first of two designed to familiarize you with aspects of shareholders' derivative litigation and the role played by the business judgment rule. This lesson focuses on demand upon the board of directors. In most states, shareholders are required to make demand upon the board of directors before they can proceed with a derivative suit. The board's response to that demand is reviewed under the business judgment rule. This lesson will take you through the operation of the rule at this critical stage in derivative litigation.

This lesson focuses on the Special Litigation Committee. It is recommended that you complete the first lesson (The Business Judgment Rule in Shareholder Derivative Litigation I: Demand Upon the Board) before beginning this one.

This lesson teaches the Capital Asset Pricing Model. It begins by discussing risk and its control by diversification, and how betas measure the risk of diversified portfolios.

The lesson is designed to guide the student through the CAPM in detail as part of a Corporate Finance or Mergers & Acquisitions course. In courses that do not cover the CAPM in detail, such as Business Association courses or Securities Regulation, this lesson can be used as further study or for skimming.

This lesson tries to explain Coasean irrelevance (which is often known as the "Coase Theorem").

This lesson focuses on state corporation law restrictions on distributions to shareholders. It does not cover restrictions on distributions arising from other sources, such as contractual restrictions, the law of fraudulent conveyance, or federal bankruptcy law.

This lesson examines a subset of the fiduciary obligations of directors and officers--their duty of loyalty to the corporation--the Corporate Opportunity Doctrine.

This lesson will familiarize students with the "Unocal Doctrine", a standard of judicial review under Delaware law. The Unocal doctrine applies to a board's defensive conduct when opposing a hostile takeover and attempting to prevent a change of corporate control.

This lesson will familiarize students with the "Revlon" and "Blasius" doctrines, standards of judicial review under Delaware law. The Revlon doctrine applies to board actions taken when a change of control or sale of the corporation is inevitable. The Blasius doctrine applies when a board has acted with the primary purpose of interfering with a shareholder vote.

This lesson examines the creation of the employer/employee relationship (formerly master/servant relationship) in agency law and contrasts that relationship with the status of independent contractor. The lesson provides an opportunity to think about why the distinction is important and how to tell whether a given relationship rises to the level of being an employer/employee relationship or is merely an independent contractor relationship.

This is the first in a series of three lessons on limited liability companies. It provides a comparative overview of unincorporated entities such as sole proprietorships, partnerships, and limited liability companies (LLCs), and incorporated entities including S and C corporations.

This lesson introduces the student to agency relationships and explores the following questions: Why are agency relationships formed? Who are the parties to an agency relationship? What elements are required to form an agency relationship? and What are the consequences of forming an agency relationship?

This lesson will provide students with an introduction to the federal regulation of proxy solicitation.

This lesson focuses on basic concepts and terminology and addresses issues contained in what are called the legal capital provisions of corporate codes. You will encounter equity capitalization, par value, capital, capital surplus and earned surplus accounts in a balance sheet.

This is the third part of five related lessons concerning the issuance of securities by a corporation.

This is the fourth part of five related lessons concerning the issuance of securities by a corporation. This lesson deals with the amount of consideration used to pay for equity securities.

This lesson is the FINAL lesson in a FIVE part series dealing with the ways a corporation is financed, that is, the ways in which a company raises money to pay for its ongoing operations. BEFORE beginning this lesson, you should have completed ALL of the previous lessons and have mastered the concepts introduced in each of the previous lessons. This lesson builds on those earlier lessons. The FIRST lesson in the series is called Types of Securities, Corp27.

This lesson discusses judicial review of director's conflicting interest transactions under subchapter F of chapter 8 of the revised Model Business Corporation Act. The definition of "director's conflicting interest transaction" is not discussed; that is dealt with in a companion lesson, What is a Director's Conflicting Interest Transaction? The two lessons may be done in either order.

Ordinarily, when an agent acts on behalf of a principal the legal rights of the principal are affected, but the agent is not personally liable to third persons with whom he or she has dealt. This lesson looks at those somewhat unusual situations where the agent may be personally liable to third persons.

This lesson introduces the student to the management and financial rights of partners of an ongoing partnership. Other lessons cover the information and indemnification rights of partners and the rights of partners during the process of dissolving a partnership. Before starting this lesson, students should have completed the basic lessons on partnership formation.

This lesson examines the process of incorporation by allowing students to explore some typical articles of incorporation by clicking on hot spots. The lesson provides a guided tour through the various provisions of the articles of incorporation. The lesson also looks at what happens when the incorporation process is not carried out correctly.

This lesson deals with the dissociation of partners under the Revised Uniform Partnership Act (RUPA). It discusses the events that result in dissociation under Section 601 of the RUPA, whether dissociation is wrongful or not, and touches on the consequences of wrongful dissociation.

This lesson discusses the causes of dissolution of partnerships and the Article 7 buyout right under the Revised Uniform Partnership Act (RUPA). It also discusses the liability of a dissociated partner for partnership obligations and the liability of the partnership for the post-dissociation actions of the partner.

This is an introduction to the sharing of profits and losses by partners in a general partnership. The lesson has three parts: (1) a general introduction to the default rules concerning how partners share profits and losses; (2) a discussion of partnership accounts; and (3) a discussion of the distribution rules applicable when a partnership is dissolved and its business is wound up.

This lesson provides both a theoretical and practical overview of the piercing the corporate veil doctrine and related theories for imposing the obligations of corporations on other legal actors such as shareholders or related corporate entities.

This lesson provides an introduction to the doctrine of ratification. The lesson will cover what ratification is, why the doctrine developed, what acts can be ratified, who can ratify, how ratification occurs, and what are the legal effects of ratification. The lesson will also introduce you (or reintroduce you) to the related doctrine of adoption.

This lesson discusses sections 16(a) and 16(b) of the Securities Exchange Act of 1934. It begins with a discussion of the section 16(a) reporting requirement: who must file, what they must file, and when. It then proceeds with an element-by-element discussion of liability under section 16(b) for short-swing trading profits, including a brief introduction to the complexities introduced by derivative securities. It concludes with a discussion of enforcement issues: standing, limitations, and the right to attorneys' fees.

This lesson is a comprehensive discussion of shareholder agreements under section 7.32 of the Revised Model Business Corporation Act (RMBCA).

Under corporate law, shareholders dissatisfied with certain extraordinary transactions, such as corporate mergers, may dissent from those transactions and require the corporation to purchase the dissenters' shares for their fair value. This lesson discusses those rights, known as dissenter's or appraisal rights. The lesson covers both Delaware law and the Model Business Corporation Act and discusses what appraisal rights are, when those rights are available to shareholders, and the procedures for enforcing appraisal rights. It does not get into the difficult questions involved in actually valuing corporate shares, and it does not discuss procedural issues that arise in appraisal litigation.

This lesson examines when a shareholder's lawsuit against a corporation is derivative and when it is direct. It also examines why this distinction is important. Then, using the provisions of the Revised Model Business Corporation Act (RMBCA), this lesson examines the procedural requirements for bringing a derivative action.

This lesson examines shareholder inspection rights under RMBCA Chapter 16. In particular, it examines which documents a shareholder may inspect and the requirements for a shareholder to inspect. This lesson is a good opportunity to practice your statutory reading and interpretation skills.

This lesson discusses cumulative voting and how it differs from straight voting. It describes the mechanics of cumulative voting—how many votes each shareholder gets, how those votes may be cast, and how the result is determined. It also illustrates how cumulative voting can go awry if shareholders are not careful. Finally, it discusses several possible ways that a majority shareholder dissatisfied with cumulative voting may try to circumvent it.

This lesson introduces the student to the doctrine and processes involved in interpreting state and federal statutes. Statutes are a critical part of every substantive area of the law, so this is important background for every student, legal professional, lawyer and judge.

This lesson provides an overview of the historical significance of the ultra vires doctrine, its subsequent decline in importance, and its modern status.

This lesson is a brief introduction to the four major types of corporate acquisitions: mergers, compulsory share exchanges, sales of assets, and tender offers. It includes descriptions of different types of mergers: stock-for-stock mergers, cashout mergers, and triangular mergers. It also briefly explains multi-step transactions, such as tender offers followed by cashout mergers or sales of assets followed by dissolution of the selling corporation.

This is the first of a series of lessons dealing with issues concerning how a corporation raises the money it needs to operate its business. This lesson focuses on the types of securities a corporation may issue (debt and equity) and the reasons it may choose one or the other. The lesson also introduces students to the difference between common and preferred shares and identifies differences in the approaches of Delaware and of the Model Business Corporation Act. After completing the lesson, the student should know: 1. What a corporate security is; 2.

This is a lesson that introduces the basics of valuation. The lesson teaches about moving money through time using rates of interest or discount, and the use of rates and of price/earnings ratios to value businesses.

The lesson does not assume any economic knowledge. If you already know the basics of valuation, then you should switch to the lesson on the Capital Asset Pricing Model.

This lesson provides an introduction to voting trusts and voting agreements -- what they are, how they work, and why you might choose one over the other.

This lesson reviews the definition of "director's conflicting interest transaction" in Subchapter F of chapter 8 of the Revised Model Business Corporation Act. It focuses on the definition and does not discuss judicial review of director's conflicting interest transactions under Subchapter F. That is dealt with in a companion lesson, Judicial Review of Director's Conflicting Interest Transactions under the Model Business Corporation Act.