Term
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Definition
| A buisness owned by one person. |
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Term
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Definition
| An individual's responsibility to pay the debts and obligations of a business from personal assets. ( e.g. home, car, etc. ) |
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Definition
| An individual or entity who manages a general or limited partnership. |
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Definition
| An investor in a limited partnership who has no management rights. |
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Term
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Definition
| A legal business entity owned by shareholders and managed by an elected board of directors and appointed officers. |
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Definition
| The group elected to manage a corporation. |
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Definition
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Term
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Definition
| Investors' responibility for the debts and obligations of a business is limited to the amount of their investment; when an investor is not responsible for paying the debts and obligations of a business from his or her personal assets. |
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Term
| Limited Liability Company |
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Definition
| An unincorporated entity that offers its members management rights, limited personal liability, and the taxation of partnerships. |
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Term
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Definition
| double taxation refers to a __________________. |
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Term
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Definition
| The requirements for creating and maintaining a buisness. |
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Term
| Articles of Incorporation |
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Definition
| The document that creates a corporation. |
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Term
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Definition
| Written guidelines and procedures for the operation and management of a corporation. |
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Term
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Definition
| An individual's responsibility to pay the debts and obligations of a buisness from personal assets. ( e.g. home, car, etc. ) |
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Term
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Definition
| Tax designation available to qualifying small corporations allowing corporate income to pass through the corporation to be taxed as personal income of the shareholders. |
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Definition
| An individual's responsibility for the debts and obligations of a business. |
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Term
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Definition
| Relationship in which one person, an agent, acts on behalf of another, the principal. |
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Term
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Definition
| One who acts for the benefit of another. |
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Term
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Definition
| One who permits or directs another to act on his behalf. |
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Term
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Definition
| Retroactively accept/approve an obligation created by an agent who did not have authority to act on behalf of the principal at the time of the transaction. |
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Term
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Definition
| Principal directs an agent to perform specified acts. |
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Term
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Definition
| The authority necessary for an agent to carry out the express directives of a principal. |
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Term
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Definition
| A relationship of trust creating a duty to act in good faith. |
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Term
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Definition
| Reimbursement for payment of another's debt. |
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Term
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Definition
| The care a reasonably prudent person would use in similar circumstances. |
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Term
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Definition
| Responibility of an agent to act for the benefit of the principal. |
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Term
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Definition
| Work performed without charge ( literally, "for the public good" ). |
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Term
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Definition
| Responsibility imposed on one person for the acts of another. |
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Term
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Definition
| The doctrine that holds a master/superior responsible for the acts of a servant/agent. |
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Term
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Definition
| Insurance coverage intended to compensate third parties for losses. |
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Term
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Definition
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Term
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Definition
| A name, other than the owner's name, under which a buisness operates. |
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Term
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Definition
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Term
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Definition
| Registration that allows state and local governments to impose and collect taxes assessed on the sale of goods. |
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Term
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Definition
| Guarantee that an act will be performed. |
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Term
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Definition
| Protection from unforseen losses. |
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Term
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Definition
| Reputation of a business and its goods and services. |
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Term
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Definition
| Association of two or more persons or entities who own a business for profit. |
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Term
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Definition
| Partnership for a limited duration. |
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Term
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Definition
| An association of two or more persons or entities who operate a buisness as co-owners for profit and allow all partners the right to manage business affairs. |
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Term
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Definition
| An association of two or more persons or entities who operate a business as co-owners for profit with one or more general partners ( managers ) and one or more limited partners ( investors ). |
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Term
| Limited Liability Partnership |
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Definition
| A general or limited partnership that registers as a limited liability partnership and protects its partners from vicarious liability for the negligence or malifesasance of other partners. |
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Term
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Definition
| A state other than the one in which a business is registered. |
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Term
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Definition
| A partnership organized and/or registered in another state. |
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Term
| Statement of Partnership Authority |
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Definition
| Document filed with the secretary of state that identifies the partners authorized to act for the partnership and describes the extent of the partners' authority. |
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Term
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Definition
| Those in a relationship of trust. |
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Term
| Joint and Several Liability |
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Definition
| Doctrine of shared responsibility allowing creditors to sue individuals separately ( severally ) or together ( jointly ) to satisfy a debt. |
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Term
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Definition
| Shared responsibility; requires that all individuals be sued together to recover a debt. |
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Term
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Definition
| Requires that business assets be used to pay partnership debts before a creditor can look to partners' personal assests. |
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Term
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Definition
| The contribution of property or money to a partnership. |
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Term
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Definition
| The initial investment of property or money by a partner to partnership. |
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Term
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Definition
| Co-ownership of property by partners. |
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Term
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Definition
| Transfer of ownership interest to another. |
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Term
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Definition
| Take property for the payment of debts. |
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Term
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Definition
| Termination of business association. |
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Term
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Definition
| The process of liquidating assets, paying debts, and distributing surplus to partners. |
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Term
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Definition
| Ninety-day grace period allowing partnership business to continue when a partner withdraws. |
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Term
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Definition
| Process of turning assets into cash ( "liquid assets" ). |
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Term
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Definition
| A contract among partners that address the rights, duties, and interests of the partners and governs the operations of the partnership; also known as the articles of partnership. |
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Term
| Certificate of Limited Partnership |
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Definition
| Document filed with the secretary of state registering for limited partnership status. |
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Term
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Definition
| Business profits and losses are taxed as the personal income of partners. |
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Term
| Entity Classification Election |
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Definition
| Allows LLP's and other unincorporated entities, such as limited liability companies, to choose whether they will be taxed as a partnership or a corporation literally by checking a box declaring their taxable status. |
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Term
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Definition
| Individuals appointed by the board of directors to manage the daily operations of a corporation. |
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Term
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Definition
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Term
| Centralization of Management |
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Definition
| Core group of individuals who manage a corporation. |
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Term
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Definition
| Statutory requirements for formation of a business entity. |
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Term
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Definition
| Taxation of corporation income at two levels: (1) the corporate level and (2) the shareholder level. |
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Term
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Definition
| Describes the intended purpose(s) of a coporation. |
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Term
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Definition
| Actions by a corporation that exceed the corporate purpose and/or powers. |
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Term
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Definition
| A legal entity created to conduct business. |
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Term
| Statutory Close Corporation |
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Definition
| A corporation owned by a small number of shareholders whose shares are not freely transferable. |
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Term
| Stock Transfer Restriction |
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Definition
| Restriction on the transfer of ownership (stock) of a corporation. |
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Term
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Definition
| A corporation formed by one or more professionals to conduct business. |
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Term
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Definition
| Corporation formed for charitable purposes. |
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Term
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Definition
| The individual who organizes and forms a corporation. |
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Term
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Definition
| The individual who signs and files the corporation's articles of incorporation. |
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Term
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Definition
| Selection of a jurisdiction in which to do business. |
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Term
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Definition
| A Corporation operating in a state other than the state in which it was incorporated. |
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Term
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Definition
| A corporation operating in the state in which it was incorporated. |
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Term
| Preincorporation Share Subscription |
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Definition
| An agreement to purchase shares of a business once it is incorporated. |
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Term
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Definition
| A corporation properly formed in accordance with state law. |
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Term
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Definition
| A business that has not strictly complied with the state's statutory incorporation process but conducts business in good faith as though it were a corporation. |
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Term
| Incorporation by Estoppel |
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Definition
| A business that is not properly incorporated but may be extended the liability protections of a corporation in a contract dispute. |
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Term
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Definition
| Distribution of corporate profits to shareholders. |
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Term
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Definition
| A voting mechanism that allows each shareholder to cast as many votes as there are vacancies on a board of directors. |
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Term
| Extraordinary Corporate Matter |
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Definition
| An action that will affect the organization of the corporation. |
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Term
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Definition
| The Minimum number of shares or directors that must be present at a meeting for an action by shareholders or directors. |
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Term
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Definition
| Written authorization for another person to vote on behalf of a shareholder. |
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Term
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Definition
| A proxy directing a proxy holder how to vote on a particular issue. |
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Term
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Definition
| A proxy allowing a proxy holder to vote at his or her discretion. |
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Term
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Definition
| The right of a shareholder to purchase newly issued shares of stock in order to maintain the shareholder's proportionate ownership interest of corporation. |
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Term
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Definition
| Written summary of proceedings of shareholders' or directors' meeting. |
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Term
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Definition
| Lawsuit filed by shareholders on behalf of the corporation to protect corporate interests. |
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Term
| Piercing the Corporate Veil |
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Definition
| When individual shareholders are held personally liable for corporate debts to prevent fraud or injustice. |
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Term
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Definition
| Combining personal assets with business assets. |
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Term
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Definition
| Literally "the other self"; when shareholders do not treat a corporation as a separate entity and use it to conduct private business, they may be held personally liable for the obligations of the corporation under the alter ego doctrine. |
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Term
| Inadequate Capitalization |
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Definition
| Insufficient funding for corporate ventures. |
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Term
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Definition
| General rule adopted by courts immunizing directors from liability for their actions if due care is used ( e.g., seeking the opinion of an expert, etc.). |
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Term
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Definition
| A director who has a personal interest in a corporate transaction. |
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Term
| Usurpation of Corporate Opportunity |
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Definition
| When a director takes advantage of a corporate opportunity for him/herself without first allowing the corporation the opportunity. |
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Term
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Definition
| Transaction by a corporate insider who has information that is not available to the general public; prohibited by SEC Rule 10b-5. |
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Term
| Securities and Exchange Commission |
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Definition
| Federal agency that regulates securities. |
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Term
| Securties Exchange Act of 1934 |
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Definition
| Federal law regulating the disclosure of information in the sale or exchange of securities. |
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Term
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Definition
| Profits made by directors, officers, or 10 percent shareholders from the purchase and sale of a corporation's shares within a six month period. |
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Term
| Fundamental Corporate Change |
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Definition
| Change that significantly affects the basic foundation of a corporation. |
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Term
| Standard Approval Procedure |
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Definition
| Two-step process for approval of fundamental corporate change requiring (1) board of directors approval and recommendation and (2) shareholder approval. |
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Term
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Definition
| Document notifying the secretary of state of fundamental corporate change. |
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Term
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Definition
| Rights of shareholders who object to a fundamental corporate change to force the corporation to buy their shares at a fair market price. |
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Term
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Definition
| Occurs when one or more corporations ( merged corporations ) are absorbed into another existing corporation ( surviving corporation ). |
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Term
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Definition
| Corporation that is absorbed by another corporation. |
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Term
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Definition
| Corporation that continues its existence after a merger. |
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Term
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Definition
| Merger that occurs pursuant to statutory requirements. |
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Term
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Definition
| Corporation subject to takeover by another entity ( e.g. corporation ) or individual. |
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Term
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Definition
| Merger occuring when a corporation exchanges its shares for those of a target corporation. |
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Term
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Definition
| Corporation owned by another corporation. |
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Term
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Definition
| Document notifying the secretary of state of a merger. |
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Term
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Definition
| Document issued by the secretary of state approving, and thus effecting, a merger. |
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Term
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Definition
| Merger of two corporations into a newly formed corporation. |
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Term
| Articles of Consolidation |
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Definition
| Document notifying the secretary of state of a consolidation. |
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Term
| Ordinary Course Of Business |
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Definition
| The usual and customary dealings of a business. |
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Term
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Definition
| An attempt to take over management and/or ownership of a corporation without the consent of its directors and shareholders. |
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Term
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Definition
| Public offer by an aggressor to purchase shares of a target corporation. |
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Term
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Definition
| An aggressor's attempt to gain control of a corporation by soliciting the voting rights (proxies) of its shareholders with the intent to elect its board of directors. |
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Term
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Definition
| Termination of a corporation without the consent of its board and directors and/or its shareholders. |
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Term
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Definition
| The individual who manages the liquidation of business assets. |
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Term
| Administrative Dissolution |
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Definition
| Termination of a corporation by the secretary of state. |
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Term
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Definition
| Document notifying the secretary of state of the dissolution of a corporation. |
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Term
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Definition
| Document forming a limited liability company. |
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Term
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Definition
| Written agreement governing the management and operation of a limited liability company. |
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Term
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Definition
| Elected managers of a limited liability company. |
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Term
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Definition
| Document notifying the secretary of state of the termination of a limited liability company. |
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Term
| Billy Bob, one of four general partners of the general partnership, Newtown Property Investments, leases a building to the partnership. Billy Bob owns a one half interest in the building. Billy did not disclose his ownership interest to the any other partner. Billy violated his Duty of Loyalty to the partnership. |
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Definition
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Term
| In a general partnership, partners have an equal right to manage. |
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Definition
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Term
| Implied authority is granted through a partnership agreement. |
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Definition
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Term
| All partners are agents of the partnership. |
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Definition
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Term
| Several liability allows a tort victim to sue one partner at a time. |
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Definition
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Term
| A partnership agreement must be signed by all partners to be binding. |
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Definition
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Term
| Before creditors can seek payment, personally, from partners some states require that assets of the partnership be exhausted first. |
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Definition
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Term
| General Partners manage limited partnerships |
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Definition
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Term
| In an agency relationship, a principal acts on behalf of an agent. |
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Definition
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Term
| Principals can be held liable for the actions of their agents. |
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Definition
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Term
| An agent must be working on the principal's behalf in order for the principal to be held liable for the agent's actions. |
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Definition
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Term
| A principal may be held liable for the actions of an independent contractor. |
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Definition
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Term
| Registration of an assumed business name helps avoid consumers' confusion with other businesses operating under similar names. |
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Definition
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Term
| A sole proprietorship can have more than one employee |
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Definition
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Term
| Sole proprietors may limit their personal liability for business debts through contracts. |
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Definition
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Term
| A contract has no barring on a business |
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Definition
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Term
| A sole proprietorship cannot have more than 35 shareholders |
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Definition
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Term
| "First in time, first in right" is the rule applicable to the use of a business name; that is, the first proprietor to use an assumed business name will be granted the exclusive right to use the name, regardless of whether the proprietor registered the name with the secretary of state. |
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Definition
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Term
| Licensing requirements allow states and counties to regulate business. |
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Definition
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Term
| Sole proprietors are personally liable for all debts and obligations of their business. |
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Definition
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Term
| Creditors of a sole proprietor may seek payment of business debts from assets of the sole proprietorship. |
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Definition
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Term
| Business profits are taxed as a sole proprietor's personal income. |
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Definition
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Term
| A partnership begins simply by one or more individuals beginning business. |
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Definition
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Term
| The business income of a partnership is taxed as the personal income of the partners. |
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Definition
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Term
| Creditors of a partnership may seek repayment of business debts from the personal assets of the partners. |
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Definition
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Term
| Limited partners manage limited partnerships. |
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Definition
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Term
| Limited partners are not responsible for the debts and obligations of their limited partnerships. |
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Definition
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Term
| Partners may limit their personal liability for business debts and obligations through a partnership agreement. |
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Definition
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Term
| A limited liability partnership (LLP) offers limited partners personal liability protections. |
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Definition
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Term
| An LLP is regulated by statute and therefore does not need a partnership agreement to define the rights and duties of the partners. |
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Definition
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Term
| LLPs offer more expansive personal liability protections to partners than general partnerships. |
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Definition
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Term
| All partners of an LLP may participate in management of partnership business. |
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Definition
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Term
| The term personal liability refers to a business owner's personal responsibility for the income taxes assessed on the profits and losses of the buisness. |
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Definition
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Term
| The purpose of a limited partnership is to limit the number of investors in a business. |
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Definition
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Term
| The duty of Loyalty requires that an agent solely for the benefit of the principle is performing her duties. |
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Definition
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Term
| Sole Proprietors must obtain the consent of their board of directors before making management decisions. |
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Definition
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Term
| In a limited liability partnership, all partners are personally liable for the debts and obligation of the partnership business. |
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Definition
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