Corporate Law Flashcards
Corporate Law
Sole proprietorship
Personally liable for everything.
Partnership
Multiple people are liable for everything, but multiple people want to be partners in running the business. The bad thing about this is that there is no corporate shell around it. You wouldn’t incorporate it so that you’re not double taxed (through the individual and then through their corporate business).
Traditional Corporation
Like Nike, non-profits (although they’re a little different)
LLC
Geared towards small businesses.
Things you need to start up a corporation
Name of Corporation Number of Shares (if for profit) Address of Registered Office and Agent Name and Address of Each Incorporator Addresses Where Notices May Be Mailed
Registered Agent
If you are going to sue the corporation, this is the person that you do things with. That is who you supine to do the law suit.
What must bylaws include?
Time or Method of Fixing the Time for Annual Meetings
Number of Directors
Description of Corporate Officers
IRS Form SS-4
Your Identity
IRS Form 1023
If you want to be a tax exempt organization. Generally this means you don’t pay federal, state, or property taxes. There are a lot of hooks that come with that as well.
Why a governing board?
To be the boss of the CEO
Duty of Care
Acting in Good Faith
Business Judgment Rule
Duty of Loyalty
Act in the Best Interests
of the Organization
Important Elements of Non-Profit Organizations
Mission Organizational Documents Governing Body Governance and Management Policies Financial Statements and Form 990 Reporting Transparency and Accountability
Sarbanes Oxley Act
Certifications of financial reports
Ban on personal loans to any executive officer or director
Public reporting of CEO and CFO compensation
Audit Board independence
Criminal and civil penalties for securities violations
Piercing the Corporate Veil
When the corporate shield of limited liability is broken
