{
 "@context": "https://schema.org",
 "@type": "DefinedTerm",
 "@id": "https://wulfkaal.github.io/entities/mbca-7-32",
 "identifier": "kaal:entity:mbca-7-32",
 "name": "Mbca 7 32",
 "termCode": "mbca-7-32",
 "inDefinedTermSet": {
  "@id": "https://wulfkaal.github.io/entities/index.json"
 },
 "author": {
  "@type": "Person",
  "name": "Wulf A. Kaal",
  "identifier": "https://orcid.org/0000-0003-0757-275X"
 },
 "dateModified": "2026-07-29",
 "canonicalForm": "https://wulfkaal.github.io/entities/mbca-7-32.md",
 "sha256": "0abdd747407f2eb0e03feb9143ba28f46293c46fb0a50b5643bcece958fd0571",
 "additionalProperty": [
  {
   "@type": "PropertyValue",
   "name": "status",
   "value": "derived"
  },
  {
   "@type": "PropertyValue",
   "name": "claim_count",
   "value": 7
  },
  {
   "@type": "PropertyValue",
   "name": "work_count",
   "value": 1
  },
  {
   "@type": "PropertyValue",
   "name": "year_span",
   "value": [
    "2017",
    "2017"
   ]
  },
  {
   "@type": "PropertyValue",
   "name": "non_current_claims",
   "value": 0
  }
 ],
 "subjectOf": [
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/3017612-001",
   "identifier": "kaal:claim:3017612-001",
   "text": "The 1991 passage of Section 7.32 of the Model Business Corporation Act triggered a wave of state authorization of shareholder control agreements, adopted specifically to secure the validity of such agreements rather than leaving validity to uncertain judicial development.",
   "abstract": "Since Section 7.32 of the Model Business Corporation Act (MBCA) was passed in 1991, most US states have authorized shareholder control agreements in an effort to support the validity of such agreements.",
   "citation": "Wulf A. Kaal, Shareholder Agreements - National Report of the United States of America (2017). SSRN: https://ssrn.com/abstract=3017612",
   "datePublished": "2017",
   "claim_type": "mechanism",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "United States state corporate law",
    "post 1991"
   ],
   "source_pdf_sha256": "33821db406f92efbe1698fbaed37687595c13b7ce5463b4a879df679fd4af1ac",
   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/3017612-005",
   "identifier": "kaal:claim:3017612-005",
   "text": "Under MBCA Section 7.32 the ten year duration limit is only a default rule, unlike the corresponding limit for voting trusts, so parties who specify a longer term are permitted to have it.",
   "abstract": "The section specifies a 10 year limit, a similar period to voting trusts, but unlike voting trusts, this period is just a default rule, so that if the parties specify a longer period it is permitted.",
   "citation": "Wulf A. Kaal, Shareholder Agreements - National Report of the United States of America (2017). SSRN: https://ssrn.com/abstract=3017612",
   "datePublished": "2017",
   "claim_type": "definitional",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "agreements formed under MBCA Section 7.32"
   ],
   "source_pdf_sha256": "33821db406f92efbe1698fbaed37687595c13b7ce5463b4a879df679fd4af1ac",
   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/3017612-008",
   "identifier": "kaal:claim:3017612-008",
   "text": "A shareholder agreement authorized under MBCA Section 7.32 ceases to be effective once the corporation's stock is listed on a national securities exchange or regularly traded in a dealer maintained market, so the going public event terminates the arrangement.",
   "abstract": "agreement ceases to be effective when the stock of the corporation is listed on a national securities exchange or regularly traded in a market maintained by one or more members of a national or affiliated securities association.",
   "citation": "Wulf A. Kaal, Shareholder Agreements - National Report of the United States of America (2017). SSRN: https://ssrn.com/abstract=3017612",
   "datePublished": "2017",
   "claim_type": "condition",
   "confidence": "evidenced",
   "is_failure_mode": true,
   "scope_conditions": [
    "MBCA jurisdictions",
    "corporation becomes publicly traded"
   ],
   "source_pdf_sha256": "33821db406f92efbe1698fbaed37687595c13b7ce5463b4a879df679fd4af1ac",
   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/3017612-009",
   "identifier": "kaal:claim:3017612-009",
   "text": "MBCA Section 7.32 requires unanimity, so agreements that bind only a block of shareholders rather than all of them cannot rely on that section and must find authorization elsewhere.",
   "abstract": "Most importantly the agreement must be unanimous, so that agreements that do not involve all shareholders, such as agreements designed to keep control within a block, must look elsewhere for their authorization.",
   "citation": "Wulf A. Kaal, Shareholder Agreements - National Report of the United States of America (2017). SSRN: https://ssrn.com/abstract=3017612",
   "datePublished": "2017",
   "claim_type": "condition",
   "confidence": "evidenced",
   "is_failure_mode": true,
   "scope_conditions": [
    "agreements seeking MBCA Section 7.32 protection"
   ],
   "source_pdf_sha256": "33821db406f92efbe1698fbaed37687595c13b7ce5463b4a879df679fd4af1ac",
   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/3017612-010",
   "identifier": "kaal:claim:3017612-010",
   "text": "MBCA Section 7.32 requires a writing but, departing from earlier statutes, does not require the agreement to sit in the articles or bylaws, so stand alone written shareholder agreements are expressly valid.",
   "abstract": "The agreement must be in writing, but unlike some earlier statutes, the written agreement does not have to be in the articles or bylaws—stand-alone written agreements are specifically allowed.",
   "citation": "Wulf A. Kaal, Shareholder Agreements - National Report of the United States of America (2017). SSRN: https://ssrn.com/abstract=3017612",
   "datePublished": "2017",
   "claim_type": "definitional",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "MBCA Section 7.32 agreements"
   ],
   "source_pdf_sha256": "33821db406f92efbe1698fbaed37687595c13b7ce5463b4a879df679fd4af1ac",
   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/3017612-011",
   "identifier": "kaal:claim:3017612-011",
   "text": "The Model Act conditions the arrangement on notice to the market for shares by requiring a legend on the stock certificates that flags the agreement to purchasers of covered shares.",
   "abstract": "Finally, the Model Act language requires that a legend appear on the stock certificates flagging the agreement for purchasers who buy shares covered by such an agreement.",
   "citation": "Wulf A. Kaal, Shareholder Agreements - National Report of the United States of America (2017). SSRN: https://ssrn.com/abstract=3017612",
   "datePublished": "2017",
   "claim_type": "condition",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "MBCA Section 7.32 agreements"
   ],
   "source_pdf_sha256": "33821db406f92efbe1698fbaed37687595c13b7ce5463b4a879df679fd4af1ac",
   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/3017612-018",
   "identifier": "kaal:claim:3017612-018",
   "text": "Under the MBCA a purchaser of shares who bought without knowledge of an existing shareholder control agreement may obtain rescission of the purchase.",
   "abstract": "Under the MBCA, rescission may also be available to a purchaser of shares who did not have knowledge of the existence of a shareholder control agreement at the time of purchase.",
   "citation": "Wulf A. Kaal, Shareholder Agreements - National Report of the United States of America (2017). SSRN: https://ssrn.com/abstract=3017612",
   "datePublished": "2017",
   "claim_type": "condition",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "purchaser lacked knowledge of the agreement at the time of purchase"
   ],
   "source_pdf_sha256": "33821db406f92efbe1698fbaed37687595c13b7ce5463b4a879df679fd4af1ac",
   "status": "current"
  }
 ],
 "description": "7 claims in the published works of Wulf A. Kaal carry the concept tag 'mbca-7-32'. Derived node: a roster, not an adjudicated definition."
}