Please enable JavaScript.
Coggle requires JavaScript to display documents.
Corporations (Formation (Defective Corp. (De jure corporation: organized…
Corporations
Formation
-
Promoter Liability:
- Promoter - Person who causes a corp. to be formed, organized, and financed (usually they become s'holder, dir., or officer.
- Promoters are personally liab. as a corp's agent on pre-incorporation contracts entered into on corp's half.
- K can specifically disclaim a promoter's personal liab.
- Personal liab. continues until a novation-the corporation adopts the K and all parties agree that the promoter will be discharged from the contract.
- Corp. is not liable on pre-incorporation agreements unless it assumes liab. by its own act after the Articles of Incorporation are filed
- can be express or implied.
Defective Corp.
De jure corporation: organized in compliance with the statue but failed to comply with a statutory provision.
De facto corp.: stat. compliance is insufficient for de jure status
- Good faith , colorable attempt to comply
- Corp. principals, in good faith, acted as if they were a corp.
Corp. by Estoppel - Creditor who has always dealt with the principals as if they were a corp. is estopped from later alleging that the corp. is defective. D who has held himself out as a corp. cannot avoid liab. by claiming there is no corp.
-
Fed. Securities Law
-
Section 16(b) - short-swing trading (only publicly traded companies)
- Prevent unfair insider trading
- Profit recoverable
- Requires two transactions in stock
-
Issuance of Stock
Every corp. must authorize and issue at last one class of common stock and may authorize one or more classes of preferred stock.