1. a. What characteristics of the corporate form make it particularly desirable as a business entity?
b. Particularly undesirable?
c. Do S corporations share those characteristics?
2. What are the two ends of the capital spectrum?
3. a. What property rights are associated with common stock?
b. Does preferred stock have all of these rights?
Federal securities laws impose broad restrictions on the transfer of stock, as will be seen in Part Three of this chapter. Beyond these (and analogous state) laws, no statutory restrictions are generally imposed on stock transfers. It is not uncommon, however, for dispositions to be restricted by contract. For example, an employment contract might require that corporate stock granted to an employee be held until the employee leaves the company.