PTBC (Physical Therapy Board of California) California Law Practice Exam

What must PT corporation regulations include regarding stock?

1. Regulations must forbid the sale of stock

2. Stock must be sold to a disqualified person within a specified time

3. Stock owned by a disqualified or deceased person must be sold to the corp or remaining shareholders as allowed

4. All stock must be publicly traded

The correct answer is: Stock owned by a disqualified or deceased person must be sold to the corp or remaining shareholders as allowed

PT corporation regulations must include provisions that address the transfer of stock owned by a disqualified or deceased person. Option A is incorrect because regulations do not necessarily have to forbid the sale of stock, but can instead outline the condition in which stock can be sold. Option B is incorrect because it only mentions the sale of stock to disqualified persons, but regulations should also address the sale of stock owned by deceased persons. Option D is incorrect because not all stock has to be publicly traded, as it depends on the company's decision and the type of stock offered. Therefore, option C is the best answer as it covers all necessary provisions for the transfer of stock.