MT Bar Business Organizations 3

Question 1

Under Montana's LLC Act, a member-managed LLC has authority to bind the LLC when:

Accepted Answer

A member acts in the ordinary course of business

Answer

In a member-managed Montana LLC, each member is an agent of the LLC for the purpose of conducting its ordinary business, and acts within that scope bind the LLC.

Question 2

Shareholders in a Montana corporation exercise their control primarily through:

Accepted Answer

Voting at annual and special meetings on major corporate matters

Answer

Shareholders exercise control by voting at meetings — electing directors, approving fundamental changes, and acting on other matters requiring shareholder approval.

Question 3

In a Montana general partnership, a partner's dissociation (withdrawal) causes:

Accepted Answer

Either buyout of the partner's interest or continuation of the partnership by remaining partners

Answer

Under Montana's Revised Uniform Partnership Act, dissociation of a partner triggers either a buyout of their interest or, in certain circumstances, dissolution of the partnership.

Question 4

Under Montana securities law, an exemption from registration under the Montana Securities Act is available for:

Accepted Answer

Isolated non-issuer transactions not involving a public offering

Answer

Montana's Securities Act exempts isolated non-issuer transactions (secondary market trades not involving a distribution) from registration requirements.

Question 5

Under Montana corporate law, a derivative action allows a shareholder to sue:

Accepted Answer

On behalf of the corporation for wrongs done to the corporation when the board refuses to act

Answer

A derivative suit allows a shareholder to sue on the corporation's behalf when the directors improperly refuse to pursue a claim the corporation should bring.

MT Bar - Montana Bar Exam Practice Test

MT Bar - Montana Bar Exam Practice Test

MT Bar Business Organizations 3