Question
42. Marjorie owns 1000 shares in Martina's business entity. Under certain circumstances, Marjorie's investment in the business will involve having the entity purchase her shares
42. Marjorie owns 1000 shares in Martina's business entity. Under certain circumstances, Marjorie's
investment in the business will involve having the entity purchase her shares at $30. What rights
are attached to Marjorie's shares?
a. redemption rights
b. preference rights
c. dividend rights
d. financial rights
43. Which of the following exempts entities from most of its requirements, provided the definition of
a private corporation is met?
a. corporate legislation
b. corporate law regulating winding up transactions
c. securities legislation
d. securities law regulating redemption on dissolution
44. ABC Inc. is issuing 10 000 new shares to raise money for its upcoming expansion. What is the
name for this type of financing?
a. debt financing
b. interim financing
c. equity financing
d. conditional financing
45. Which stakeholder has the most to gain if the corporation is profitable?
a. shareholders
b. bondholders
c. creditors
d. directors
47. Which of the following is one of the distinctions between shares and bonds?
a. Shares represent units of ownership, whereas bonds are debts owed by the corporation.
b. The issuance of bonds is not regulated by securities legislation, whereas the issuance of shares
is.
c. Bonds are unsecured, whereas shares are secured by the assets of the corporation.
d. Shares may be sold at securities exchanges, whereas bonds are never sold on securities
exchanges.
48. Which term refers to the document that a corporation must publish when offering securities to the
public?
a. NUANS report
b. offering memorandum
c. option memorandum
d. prospectus
49. What are the two distinct forms of corporate tort liability?
a. direct and indirect
b. primary and secondary
c. primary and vicarious
d. statutory and vicarious
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