40. If a corporation has fewer than fifty (50) shareholders, the Revised Model Business Corporation Act (RMBCA) allows companies to _____.

A. have as few as three (3) corporate directors

B. have as few as five (5) corporate directors

C. have as few as seven (7) corporate directors

D. eliminate the board of directors altogether

E. choose not to file articles of incorporation

43. In a hostile takeover, what does the term "going private" reference?

A. The non-disclosure of information related to the corporate takeover

B. A confiscatory taking

C. A poison pill

D. An initial public offering

E. A leveraged buyout

44. Nails. Mona and her friends Jack and Bobby, all United States citizens, want to open a nail salon in Tennessee. They would all like to avoid personal liability for debts of the business and for wrongful acts of each other. They would also like to avoid taxation as much as possible. Mona is in favor of a corporation and asks if there is any problem with that form of business. Jack and Bobby say that they want to receive profit distributions and that they are concerned about excessive taxation with a corporation. Jack and Bobby urged the formation of a partnership even in the face of personal liability. Mona did some research and suggested an S corporation to Jack and Bobby. Would the proposed business qualify as an S corporation if it were incorporated in Delaware?

A. Yes, if only a single class of shares is issued.

B. Yes, if more than a single class of shares is issued.

C. No, because a business must operate as a regular corporation for at least two years before converting to an S corporation.

D. No, because a business must operate as a partnership for at least two years before converting to an S corporation and because it must be incorporated under the state law of the location of the principal place of business.

E. No, because there must be at least 100 shareholders involved.