The Ajax Corporation Issues Bonds That Pay a Minimum of 6

question 4

Multiple Choice

The Ajax Corporation issues bonds that pay a minimum of 6% interest but that can pay more if corporate earnings reach certain specified levels. The holder of the bond may exchange it for stock of the corporation. This bond would be a:

• A) callable income bond.
• B) convertible participating bond.
• C) convertible unsecured bond.
• D) convertible secured bond.

Identify examples of breach of fiduciary duty and understand the consequences of such breaches.

Understand the legal implications of pre-incorporation contracts and the process of their ratification by the corporation.

Recognize pre-emptive rights of shareholders and how they protect shareholders’ interests.

Understand the significance of disclosing conflicts of interest in corporate governance.

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Definitions:

Hispanics

A demographic group often referring to people with cultural ties to Spanish-speaking countries, particularly those from Latin America and Spain.

African Americans

A racial or ethnic group in the United States with ancestry from any of the black racial groups of Africa.

Efficiency Wages

Efficiency wages are higher-than-market wages paid by employers to increase worker productivity, morale, and retention, reducing turnover and shirking.

Less Pleasant

A term that could describe a job or task seen as undesirable or lower in terms of comfort and enjoyment.