Question: A, B, C, and D are the only shareholders in a close corporation in an MBCA state. A owns 30 percent of the stock. Bowns

A, B, C, and D are the only shareholders in a
A, B, C, and D are the only shareholders in a close corporation in an MBCA state. A owns 30 percent of the stock. Bowns 30 percent of the stock C owns 20 percent of the stock. Downs 20 percent of the stock. Each serves as a director (there are only four directors). All four work for the corporation but none draws a salary, because the four agreed orally that none of them would ever receive a salary for working for the corporation. At a duly called board meeting, A, B, and C voted for A to receive a salary for his work for the corporation D voted against paying A any salary, but the resolution passed D challenges the action of paying a salary to A. Answers A-E A D will win because A, B, and C breached a valid shareholder agreement B D will win because salary decisions require unanimous director approval C A will win as long as the salary A will receive is fair to the corporation, because shareholders cannot enter agreements restricting management authority O D A will win unless D can convince a court to pierce the corporate veil, E A will win, as long as the salary A will receive is fair to the corporation, because shareholder agreements to restrict management authority must be in writing

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