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A husband (John) and wife (Kim) lived in High Point, North Carolina. Kim invented a structural plank made completely of honey, birdseed. and a secret
A husband (John) and wife (Kim) lived in High Point, North Carolina. Kim invented a structural plank made completely of honey, birdseed. and a secret chemical combination in her garage. The plank could be used not only for ooring and wall application, but to build entire structures. John and Kim formed a company in 2017 called \"Perfect Planks, Inc.\" They held the company 51%? percent. They both were active in its management. They were able to secure nancing for the company and signed personal guaranties for the loan. which had a term of 15 years. They started out making just planks, even though they knew that they wanted to develop an entire line of building materials one day,. In 2017, the couple divorced. and Kim decided to sell her half of the company (mostly because she couldn't stand a minute more with John]. Neither John nor Perfect Planks had the money or the credit to buy her out, so she decided to sell 50 percent of her shares to one of the vendors of Perfect Planks, a company called \"Shaky Structures, LLC." She sold the other one percent of her shares to John. Shaky Structures is owned by 7 individuals. The percentage of ownership in the company is as follows: Harry has 30%. Jane has 30%, Nancy has 20%, Paul has 5%, Quentin has 5%, Robert has 5% and Steven has 5%. Kim nanced part of the deal and the Shaky Structures group borrowed money from Bankers-R-Us for the rest of the purchase price. ESSAY QUESTION 1: [a] if Perfect Planks is an S-corp, can Shaky Structures, LLC be a shareholder? if not, how would you advise the owners of Shaky Structures to hold their shares? (b) lf Perfect Planks had been a partnership, what issues might arise if Shaky Structures purchases Kim's interest? (c) Given all the owners of Perfect Planks after the sale of shares to Shaky Structures, what should the makeup of the board look like? {d} How can Kim know how much her part of the company is worth? What would you advise as far as how she structure the deal to protect herself in this transaction? What else would you advise Kim
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