Lamitz organizes her information technology ("IT") business as a corporation, named TekServ, Inc., which is organized under the laws of Indiana. TekServ has a client, Gramon Associates, in Franklin, Kentucky. On behalf of TekServ, Lamitz sells IT hardware and software to Gramon. Lamitz drives a vehicle owned by TekServ to Gramon's place of business in Kentucky to deliver the hardware and software and to set up Gramon's IT system. The set up in Kentucky takes three days. TekServ has no other clients in Kentucky and has no other contacts with Kentucky

Is TekServ required to qualify to do business in Kentucky? Why or why not?

Banana Computers, Inc., a quickly growing start-up founded roughly 10 years ago by a few friends, had a gaming software division that never turned a profit and started to rack up significant losses.For instance, in the final two quarters of 2010 it lost $10 million and $18.5 million, respectively.Banana's board is considering selling the division, which it thinks has a value of at most $400 million.E-Gaming & Arts Co. ("EGA") has proffered the highest bid as of June 2011, despite that the division had been generally known to be up for bid since December 2009.EGA's bid was $300 million.As a result, Banana's board must decide whether to sell the division to EGA for that price.

The Banana board voted to sell the division to EGA for $300 million.A year and a half after the sale, the assets that were part of the division Banana sold to EGA are generating a $200 million in annualized profit for EGA and were recently valued at around $1 billion.Des Gruntled, a shareholder of Banana, on behalf of the corporation, recently sued the board of directors, claiming the board sold the division for too little money.What steps did the board need to be sure to take prior to selling the division to EGA to ensure that it will prevail in the lawsuit by Des?

Lamitz is the only shareholder of TekServ. She decides to merge TekServ with an IT business owned by two IT professionals that she respects. A new corporation, TKS, Inc., will be created to own the merged businesses. Lamitz and the other two professionals want to be the only members of the board of directors of TKS, Inc. Each wants to own 20% of the equity of TKS.

Forty percent of the equity of TKS will be issued to a venture capital firm that will provide additional financing. The venture capital firm is willing to let the three IT professionals be the only directors, provided the business is profitable and the venture capital firm receives at least a 5% return on its investment each year.

In addition, the three IT professionals and the venture capital firm plan for TKS to go public or be purchased by a larger IT firm within three years. However, the three IT professionals want to control absolutely whether TKS will go public or be purchased.

They need to draft the articles of incorporation for TKS to create an ownership control structure that is best for all of the shareholders. Because this is a new corporation, they are not constrained by the existing structure of TekServ.

How should the venture capitalist's shares be structured in terms of class and rights?