Which of the Following Class of Stock Is Not Allowed

question 121

Multiple Choice

Which of the following class of stock is not allowed to be used in a section 351 transaction?

• A) Voting common stock
• B) Voting preferred stock
• C) Nonvoting preferred stock
• D) All of the above classes of stock can be used in a section 351 transaction.

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Definitions:

Objective Standard

A legal benchmark that uses a reasonable person's perspective to evaluate an individual's actions or decisions in a given situation.

Condition Subsequent

A condition in a contract that, upon occurrence, terminates the contract or an obligation within the contract.

Real Estate Contracts

Legally binding agreements related to the purchase, sale, lease, or exchange of real property.

Substantial Performance

A legal concept that occurs when a party has completed the major obligations of a contract, entitling them to payment.