Fact Pattern 41-3A (Questions A19-A20 apply)
Atlantic Corporation's articles of incorporation prohibit a sale of its assets with?out a vote of the board of directors.Atlantic's officers sell some assets to Pacific Company without notice to the board.The officers also fail to pay Atlantic's taxes on time,and some Atlantic funds are not accounted for.
-Refer to Fact Pattern 41-3A.With respect to Atlantic's share?holders,this conduct is most likely
A)not oppressive because it is undertaken by Atlantic's officers.
B)oppressive because Atlantic's directors may be personally liable.
C)oppressive because Atlantic's shareholders may be personally liable.
D)oppressive because it departs from the standards of fair dealing.

Question

Quizplus · Accepted Answer

The conduct of Atlantic's officers in selling assets without the board's approval, failing to pay taxes on time, and not accounting for funds may be considered oppressive to the shareholders as it departs from the standards of fair dealing. Shareholders have a reasonable expectation that their investments will be managed in a lawful and responsible manner, and the officers' actions may have a negative impact on the value of their shares. Therefore, the shareholders may seek a remedy for oppression under corporate law.

Fact Pattern 41-3A (Questions A19-A20 Apply)