What must shareholders contribute for the corporation to issue shares?

Prepare for the New Brunswick Bar Exam. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

For a corporation to issue shares, shareholders must provide full consideration for the shares. This means that shareholders are required to pay the predetermined value for the shares being issued, which could be in the form of cash, property, or services. The concept of full consideration ensures that the corporation receives adequate value for the equity it is granting, thereby maintaining the integrity of its capital structure. It reflects the legal requirement that shares must not be issued for nothing, protecting both the interests of the corporation and its current shareholders.

Other options, such as brand name registration fees, a partnership agreement, and board approval, do not fulfill the necessary condition for share issuance. While board approval is generally needed for the issuance process, it does not pertain to the actual consideration that shareholders must contribute. Brand name registration fees and partnership agreements, while potentially relevant to the business's operations, are not related to the fundamental requirement for issuing shares.

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