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Flashcards in Business Entity: Formation Deck (5)
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1

Business Entity
Formation
Sole Proprietorships

Sole Proprietorships
- no formal filing
- do need tax ID

2

Business Entity
Formation
General Partnerships

General Partnerships
- governed by Revised Uniform Partnership Act
- RUPA is a form contract that supplies a contact among partners
- by agreement may vary RUPA provisions
- written agreement not required
- may file with state, but not required

3

Business Entity
Formation
LP's, LLP's, LLLP's, LLC's

LP's, LLP's, LLLP's, LLC's
- must file with state
- governed by Revised Uniform Limited Partnership Act (LLC's have their own version)

4

Business Entity
Formation
Corporation

- Revised Model Business Corporation Act
- Delaware Corporate Code
- must file Articles of Incorporation with state including:
- corporate name
- # of authorized shares
- address of office and registered agent
- names and addresses of incorporators
Process
- file
- hold organizational meeting
- draft and adopt bylaws
- obtain certificates of authority to do business in other states

5

Business Entity
Formation
Promoters and their Contracts

Promoters and their Contracts
- person who forms corporation
- owe fiduciary duty to: corporation, other promoters, contemplative investors
- forbidden from profiting from pre-incorporation contracts
- unless full disclosure to board and get approval
- full disclosure to shareholders and their approval
- promoters are liable on pre-incorporation contracts unless contract indicates only corporation
- promoter remains liable even if corporation adopts the contract
- corporation liable if adopts expressly or impliedly
- once adoption, corporation can enforce

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