Assignment 6 - A Hole in His Parachute

Assignment 6 - A Hole in His Parachute -...

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A Hole in His Parachute Business Law II (BA265) Robert McGill 25 August 2011
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A Hole in His Parachute  1 In this scenario, we discuss Knight, the owner of all capital stock of Knight-Ridder Corporation, a newspaper business. Knight sold all his shares to Murdoch and promised to serve as adviser to the newspaper for a period of five (5) years in return for an annual salary of $2.5 million. After three years, Murdoch petitioned for dissolution. If the corporation was dissolved what right does Knight have to collect the balance of the salary from the corporation? When attempting to answer this question, one must answer several other questions first. Did Murdoch engage Knight’s services via contract? If so, did the contract exist between Murdoch and Knight or Knight-Ridder Corporation and Knight? If the contract was between Knight and the corporation then Murdoch, the corporation’s Director would not be liable. Directors are not usually personally responsible for contracts that
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Assignment 6 - A Hole in His Parachute -...

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