In all but limited circumstances, an investor lending money to a corporation need not be concerned that the act of borrowing money by that corporation is ultra vires.

Question

Quizplus · Accepted Answer

The concept of ultra vires, which refers to actions beyond the scope of a corporation's powers, has largely been eliminated or significantly reduced by modern corporate statutes. These statutes typically allow corporations to engage in any lawful business activity, thus minimizing the concern that borrowing money would be beyond a corporation's powers.

In All but Limited Circumstances, an Investor Lending Money to a Corporation