Question

Bay City Merchants Corporation has six shareholders, four of whom are members of the same family. All of Bay City's shareholders agree in writing to operate without shareholders' meetings. Under the Revised Model Business Corporation Act, this most likely warrants

a. no penalties or sanctions.
b. the imposition of a fine on Bay City.
c. the imprisonment of Bay City's shareholders.
d. the piercing of Bay City's corporate veil.

Answer 1

A) no penalties or sanctions.

Step-by-step explanation:

As long as Bay City Merchants operate correctly and there is no wrong doing or fraud committed, then there should be no problem if they decide to work without shareholders' meetings. Of course if problems start to occur, then a shareholder can request that this policy is changed. If problems are really severe and involve unethical or illegal practices, then the corporate veil would be pierced.