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A B C D E F-H I J-L M N-O P Q-R S T U-Z Ultra vires A doctrine that limits corporate action to the ends and means stated in the articles of incorporation or corporation statute and validly approved by the corporation. Chapter 10.
Underwriter An investment banker that facilitates the public offering of a corporation's securities by buying securities from the issuer and reselling them to the investing public. Chapter 6.
Undisclosed principal A principal is undisclosed where a third party has no knowledge that the agent is acting on behalf of any principal. Chapter 4.
Unidentified principal A principal is unidentified where a third party knows that the agent is acting on behalf of a principal, but does not know the principal's identity. Chapter 4.
Units Stock and warrants sold as a package. Chapter 6.
Unocal test A standard of review that applies to a target board's defensive actions during a hostile takeover. It is intermediate in strictness between the business judgment rule and the entire fairness standard. It takes it name from Unocal Corp. v. Mesa Petroleum Co., 493 A.2d 946 (Del. 1985). Chapter 17.
Utility The economic and noneconomic worth of an asset to its owner. Chapter 3.
Value The economic worth of an investment to an owner. The wealth an asset will likely produce for its owner. Chapter 3.
Venture capital Money invested in non-public corporations by entities unconnected with the corporation with a view to preparing the corporation to go public. Chapter 6.
Vertical integration A combination of a business with its suppliers or customers. Chapter 2.
Vest The ability of an option holder to exercise the option. Chapter 6.
Vicarious liability A doctrine under which a principal is liable for an agent's torts. See Respondeat superior. Chapter 4.
Voidable preferences Corporate property transferred to certain corporate insiders within one year prior to the corporation's bankruptcy if the transfer was for an antecedent debt, had the effect of giving the insiders more than they would have received in bankruptcy, and was made while the corporation was insolvent. Voidable preferences may be recovered for the benefit of the corporation's creditors. Chapter 8.
Voting trusts Stock as to which (1) the voting rights are separated from the other attributes of ownership; (2) the voting rights granted are intended to be irrevocable for a definite period of time; and (3) the principal purpose of the grant of voting rights is to affect voting control of the corporation. Chapter 16.
Warrant A long-term option (i.e., over one year) to purchase securities. Chapter 6.
Waste An exchange of corporate assets for consideration so disproportionately small as to lie beyond the range at which any reasonable person might be willing to trade. Chapter 10 and Chapter 13.
Williamson test Test to determine whether a partnership interest is an investment contract and hence is a security. The test is whether (1) The agreement among the parties leaves so little management power in the investor's hands that the investor is analogous to a limited partner; or (2) the investor is so inexperienced and unknowledgeable in business affairs that he or she cannot intelligently exercise his or her managerial powers; or (3) the investor is so dependent upon some unique entrepreneurial or managerial talent of the promoter that the investor cannot replace the promoter or otherwise meaningfully exercise his or her managerial powers. See Williamson v. Tucker, 645 F.2d 404 (5th Cir. 1981). Chapter 18.
Working capital Cash needed to run a business on a day-to-day basis. Chapter 6. |