Question

Nancy corporation agreed to sell all of its capital stock to Eddie corporation for three monthly payments of $100,000. After Eddie made the first required payment, it ceased making other paymebts. The stock subscription agreement states that Eddiis, thus, forfeits its payments and is entitled to no future consideration.

in a minimum of 5 to 7 sentences, summarize the baxkground of your case and indicate any assumptions you are making regarding the case. define your problem statement and research question(s)

Answer 1

Nancy Corporation has agreed to sell all its capital stocks to Eddie. We need to assume that stocks will be issued with an initial subscription and 2 calls each after 1 month duration. It also has a build in clause that failure to remit any calls will render forfeiture of stocks. Adequate care has to be taken while entering into agreements and issuance of notices for subscriptions, calls and forfeiture are made to ensure that forfeiture is in accordance with local statutes. Reasonable opportunity has to be given to Eddie as per law to enable him to make his monthly installments and after due caution the stocks remained un-paid then Nancy Corporation are well within their rights to forfeiture of stocks.