LOCATION3rd Fl Reserve
Call No. KF1366 .K56 2010
Author Klein, William A.
Title Business organization and finance : legal and economic principles / by William A. Klein and John C. Coffee, Jr, Frank Partnoy.
Location Volume/Copy Barcode Status
 3rd Fl Reserve  KF1366 .K56 2010    3500501308602X  DUE 10-14-13 OVERDUE+
 Prefaceiii
 Introduction1
ch. 1 The Sole Proprietor 
I.Ownership Attributes 
A.Proprietorships as Organizations5
B.Ownership and Management5
C.Nature of Ownership Interest5
II.Owners and Creditors 
A.Liability for Debts; Open Accounts6
B.Liability for Debts; Unlimited Liability6
C.Nonrecourse Loans7
D.Business and Personal Debt7
E.Debt and Equity7
F.Leverage8
G.Potential Equity Attributes of Debt11
III.Owners and Ordinary Employees 
A.Introduction: Joint Enterprise Versus Purchased Inputs12
B.Implied Standard Contracts and Their Appeal12
C.Cooperation, Trust, Fairness, and Reputation13
IV.Owners and Ordinary Employees: Control 
A.The Servant-Type Agent and the Legal Right to Control14
B.The Economic Significance of the Legal Right to Control16
C.Vicarious Liability19
V.Organization Within Firms and Across Markets 
VI.Owners and Managerial Employees: Control, Risk, and Duration of Relationship 
A.Managers' Resemblance to Co-Owners21
B.Delegation of Broad Decision-Making Authority21
C.Major Versus Minor Decisions22
D.Duration of Relationship, Ease of Replacement, and Symbiosis22
E.Mode of Compensation, Incentive, Risk, and the Employee's Interest in Control23
F.Risk, Control, and Duration of Contract25
VII.Owners and Managerial Employees: Duty of Care 
A.Four Types of Lack of Due Care27
B.Contracts Regarding Duty of Care29
C.Limiting Scope of Authority30
VIII.Owners and Managerial Employees: Loyalty 
A.Conflict Concerning Information Provided to Owner32
B.Loyalty and Conflict Problems and Their Costs34
C.Self-Dealing and the Use of Incentives35
D.Self-Dealing, Joint Ventures, "Waste," and the Mythical Ideal37
E.The Legal Duty of Loyalty38
F.Loyalty and Problems of Ambiguity39
G.Absolute Barriers to Disloyalty39
IX.Irreducible Divergencies of Interest 
X.Avoidance of Conflict 
XI.Recapitulation 
XII.Speculation on Relationships Among Risk, Return, Control, Duration, and Specificity 
A.Risk and Return45
B.Risk and Control45
C.Duration and Specificity46
D.Duration and Control46
E.Duration and Risk46
F.Risk and Control---Owners and Employees47
XIII.Transfer of Ownership---Purchase Subject to Debt and Option to Purchase 
A.Purchase Subject to Debt48
B.Option to Purchase48
C.Lease With Option to Purchase50
ch. 2 Partnerships and Limited Liability Companies 
I.Introduction 
A.Joint Ownership51
B.Rules Designed for Small Firms52
II.Reasons for Joint Ownership 
A.Joint Ownership Versus Purchased Inputs53
B.The Need to Assemble At-Risk Capital54
C.Control Follows Risk56
D.Restatement---An Extreme Case56
E.Other Equity-Type Forms Of Investment58
F.Summary59
G.The Element Of Personal Services59
H.Combining Capital And Services60
III.Nature and Significance of "Partnership" 
A.Nature62
B.Significance63
IV.Formation 
A.Creation Without Formality63
B.The "Silent Partner"63
C.Implied Terms64
D.Tailor-Made Provisions65
E."Spoiling the Deal"66
F.The Partnership Agreement as a Drafting Challenge67
V.The Entity and Aggregate Concepts 
A.Reification and the Entity-Aggregate Distinction68
B.Who Cares?69
C.An Illustration70
VI.Fiduciary Obligation 
A.Fiduciary Obligation---A Legal Duty of Fairness71
B.Illustration: The Scope-of-Business Problem73
C.Economic and Other Effects75
D.Promoters---Drafting Around the Rule76
E.Summary78
VII.Contributions, Accounts, and Returns 
A.Capital Accounts79
B.Draw81
C.Capital Accounts and Value of a Partner's Interest83
D.Additional Capital84
E.Debt Held by, and Salaries Paid to, Partners89
VIII.Control, Agency, and Liability 
A.Introduction90
B.Control90
C.Partners as Agents of the Partnership93
D.Liability94
IX.Duration and Transferability 
A.Terminology95
B.Dissociation at Will95
C.Providing for Continuity97
D.Transferability99
X.Variations 
A.Limited Partnerships100
B.Limited Liability Companies102
C.Limited Liability Partnerships104
D.Mining Partnerships105
ch. 3 Corporations 
I.A Brief Overview 
A.Preliminary Observations106
B.The Important Characteristics108
C.Variations: Closely Held, Intermediate, and Start-Up Corporations110
II.The Development of the American Business Corporation: A Historical Overview 
III.The Reification Illusion 
A."Decomposing" the Corporation117
B.Illustrations119
IV.The Basic Structure for Control and Operation 
A.Introduction122
B.Shareholders124
C.Directors131
D.Officers137
V.Formation 
A.The Formal Process139
B.Amendment141
C.Negotiations at the Formation Stage142
D.Duration and Transferability144
E.Limited Liability and its Exceptions146
F.Choice of Law150
G.Purposes, Powers, and Ultra Vires155
VI.Obligations of Officers and Directors 
A.Duty of Care156
B.Duty of Loyalty162
C.Duties Regarding Information: Rule 10b-5170
VII.Corporate Accountability: The Issue of Separation of Ownership and Control 
A.Implications of the Separation of Ownership and Control178
B.The Mechanisms of Corporate Accountability185
VIII.Fundamental Changes: Mergers and Acquisitions 
IX.A Slice of Financial History: "Watered Stock" and Its Lessons in Fraud 
X.Dividends, Retained Earnings, and Compensation 
A.Dividends230
B.Retained Earnings and Capital Gain233
C.Compensation for Services233
XI.Additional Capital 
XII.The Shareholder as Lender 
XIII.Federal Income Tax Considerations 
A.Formation235
B.Substituted Attributes236
C.The Corporation as a Taxable Entity237
D.Losses238
E."S" Corporations239
ch. 4 Basic Corporate Investment Devices: Economic Attributes and Formal Characteristics 
I.Introduction 
II.Some Definitions 
A.Expected Return242
B.Risk and Uncertainty243
C.Yield245
D.Risk Premium246
E.Risk Aversion248
F.Compensation for Volatility Risk249
III.Types of Securities: Formal and Functional Characteristics 
A.Bonds, Debentures, and Notes251
B.Shares of Common Stock286
C.Interests Derived From Common Stock295
D.Preferred Stock305
E.Other Forms of Investment310
F.Miscellaneous Devices and Hedging313
IV.Financial Alternatives Inside and Outside the Firm 
ch. 5 Valuation, Financial Strategies, and Capital Markets 
I.Valuation 
A.The Interest Rate320
B.Market Price321
C.Discounted Present Value322
D.The Discount Rate333
E.Allowing for Risk: Two Methods341
II.Leverage and Choice of Capital Structure 
A.Introduction343
B.Pure Leverage Effect344
C.Leverage and Risk345
D.Some Variations346
E.Spurious Leverage349
F.Leverage and Wealth350
III.Capital Structure 
A.Introduction352
B.A Hypothetical Corporation in a Simplified World353
C.The Advantage of Unbundling353
D.The Net Income Perspective354
E.How Much Leverage?355
F.Another View: Homemade Leverage356
G.Extending the Argument: Arbitrage357
H.Another Perspective: The One-Owner Corporation359
I.Unleveraging360
J.The Real World361
K.Tax Effects363
L.Monitoring Problems373
M.Managerialism377
N.Asymmetric Information and Signaling380
O.Another Perspective: Extreme Leverage382
IV.Dividend Policy 
A.Constraints385
B.The Conventional View386
C.Separation of the Investment Decision and the Dividend Decision395
D.Redemption398
ch. 6 Financial Markets 
I.Introduction 
II.Rethinking Business Organizations Using Derivatives 
A.Categories and Uses of Derivatives403
B.Options405
C.Forwards410
D.Hybrids414
E.Structured Finance416
III.The Evolving Nature of Financial Markets 
A.Exchange and Over-the-Counter Markets422
B.The Impact of Technology and New Trading Platforms432
IV.Market Efficiency and Behavioral Finance 
V.New Regulatory Approaches 
A.Globalization and Foreign Competition447
B.Disclosure and Accounting Harmonization448
C.Deregulation449
 Table of Cases457
 Index461
Published New York : Thomson Reuters/Foundation Press, 2010.
Edition 11th ed.
Description xv, 476 p. : ill. ; 24 cm.
Series Concepts and insights series
Concepts and insights series.
Bibliography Includes bibliographical references and index.
Subject Business enterprises -- Law and legislation -- United States.
Added Author Coffee, John C., 1944-
Partnoy, Frank.
ISBN 9781599414492 (pbk.)
159941449X (pbk.)
OCLC No. or Control No. 611986929