Question 7. Who wins?

LittleCorp, Inc., has started to create a lot of buzz in the technology industry. BigCorp has indicated some interest in purchasing LittleCorp. LittleCorp has three shareholders: Tyler, Inez, and Paulo. Tyler and Inez both want to sell to BigCorp, but Paulo doesn’t want to. Thus, Tyler and Inez hatch an ingenious plan: they will call a special meeting of LittleCorp’s shareholders. They send out a notice to all of the shareholders stating that the purpose of the special meeting is to consider expanding the number of directors from three to four, knowing that Paulo doesn’t care about that issue. When the meeting comes, Paulo doesn’t show up, and Tyler and Inez vote to sell LittleCorp to BigCorp. When Paulo finds out what happened, he sues in court to stop the sale. Who wins?

A. Paulo wins because he did not consent to the sale of LittleCorp to BigCorp.

B. Tyler and Inez win because Paulo failed to show up for a properly called special meeting of shareholders, so he must accept the consequences of that meeting.

C. Tyler and Inez win because they hold more shares, and thus more votes, than Paulo.

D. Paulo wins because Tyler and Inez took an action at a special shareholders meeting that was not listed on the notice of meeting.

Правильный ответ:

D. Paulo wins because Tyler and Inez took an action at a special shareholders meeting that was not listed on the notice of meeting.

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