Nature of shareholders’ agreements a contractual device A corporation from the economic perspective has been described as a “firm”45. Corporations are for-profit-seeking enterprises composed by persons and assets and organized by rules46. The rules could be determined by i) law, ii) contracts or other forms or agreements, iii) corporate organs and officials and, iv) market 38 XXXXX X. XXXXXXX, The use and misuse of the business judgment rule in the close corporation, 00 Xxxxx Xxxx X. Xxx. 456, 466 (1985). 39 Easterbrook and Xxxxxxx, supra note 1, at 273. 40 Committee of Corporate Laws, supra note 25, at 4. 41 Xxxxxxx, supra note 38, at 466. 42 Easterbrook and Xxxxxxx, supra note 1, at 274. 43 XXXXXX, supra note 34, at 383. 44 XXXXX X. XXXXXXX, XXXX X. XXXXXX, XX., XXXXXX X. XXXXXX, Cases and Materials on Corporations 711 (Aspen Publishers 5th ed. 2000). 45 See X’XXXXXX and XXXXXXXX, supra note 14, at 1 (describing the concept of a firm from an economic perspective: “The “firm” is what we call the set of relations that arise when resources are allocated by the entrepreneur via commands to her employees rather than the set of relations that arise when an entrepreneur allocates resources via contract with outsiders. Thus, depicted as a circle, and using Xxxx, the classic owner/entrepreneur as an example, the Coasean firm includes Xxxx and her employees, but excludes the customers, suppliers, and creditors with whom Xxxx does business.”).
Nature of shareholders’ agreements a contractual device A corporation from the economic perspective has been described as a “firm”45. Corporations are for-profit-seeking enterprises composed by persons and assets and organized by rules46. The rules could be determined by i) law, ii) contracts or other forms or agreements, iii) corporate organs and officials and, iv) market 38 xxxxX x. xXXxxXx, The use and misuse of the business judgment rule in the close corporation, 00 Xxxxx Xxxx X. Xxx. 456, 466 (1985). 39 Easterbrook and Xxxxxxx, supra note 1, at 273. 40 Committee of Corporate Laws, supra note 25, at 4. 41 Xxxxxxx, supra note 38, at 466. 42 Easterbrook and Xxxxxxx, supra note 1, at 274. 43 Xxxxxx, supra note 34, at 383. 44 XXxxX X. XXxxxXx, XxXx X. XxXXXX, Xx., XxxxxX X. Xxxxxx, Cases and Materials on Corporations 711 (Aspen Publishers 5th ed. 2000). 45 See X’XXxxXx and XXxXxxxx, supra note 14, at 1 (describing the concept of a firm from an economic perspective: “The “firm” is what we call the set of relations that arise when resources are allocated by the entrepreneur via commands to her employees rather than the set of relations that arise when an entrepreneur allocates resources via contract with outsiders. Thus, depicted as a circle, and using Xxxx, the classic owner/entrepreneur as an example, the Coasean firm includes Xxxx and her employees, but excludes the customers, suppliers, and creditors with whom Xxxx does business.”).
