barbri_outline_-_ny_(2005)_-_corporations

barbri_outline_-_ny_(2005)_-_corporations - CORPORATIONS I....

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Corporations 1 C ORPORATIONS I. Organization of New York Corporations A. Formation Requirement – people, paper, acts 1. Incorporators (people) a. Tasks – (i) execute & deliver the certificate it to Dept of State, and (ii) hold organizational meeting b. Requirements – (i) adult humans (no entities); (ii) need at least 1 incorporator 2. Certificate of Incorporation (paper) – Articles of Incorporation a. Purposes of certificate – contract between (i) corporation & S/H; (ii) corporation & state b. Information in certificate: (i) : (a) Corporate name – must include the words “corporation”, “incorporated”, or “limited” (or abbreviation) (b) County in NY of the “ office of incorporation ” – need not be place of business (c) Designation of NY Sec of State as agent for service of process – (d) An address for forwarding process. can also name registered agent for service of process. (e) Name & address of each incorporator. (ii) Statement of duration – if silent, presumed perpetual existence (iii) Corporate purpose : (a) General statement of purpose – “to engage in all lawful activity, after first obtaining necessary state agency approval” is acceptable (b) (beyond scope of the certificate): - Ultra vires contracts are valid - S/H can seek an injunction to enjoin any unauthorized act or transfer or property - Attorney General can institute a proceeding to annul or dissolve the corporation or to enjoin it from doing unauthorized business - Responsible O & D’s are liable to corporation for ultra vires losses (iv) Capital structure – must include (i) authorized stock, (ii) # of shares per class, (iii) information about par value , relative rights, preferences & limitations of each class, (iv) information on series (subclass) if preferred shares are issued in series (subclasses) NOTE: at least 1 class of stocks or bonds must have unlimited voting rights, & 1 class of stock must have unlimited dividend rights (a) Authorized stock – maximum # of shares the corporation can sell (b) Issued stock – # of shares the corporation actually sells (c) Outstanding stock – shares that have been issued & not reacquired by the corporation 3. Acts a. Execution – each incorporator signs certificate & acknowledges it before a notary b. Deliver – incorporators deliver it to the NY Dept of State c. Filing Dept of State files the certificate (filing by the Dept is conclusive evidence of valid formation , meaning that it’s a de jure corporation) d. Hold organizational meeting to – (i) adopt any bylaws; (ii) elect BoD who will then take over management B. Legal Significance of Corporation 1. Internal affairs (duties, relationship among D, O, & S/H) governed by the New York law – authority to act is mainly derived from: (i) the BCL, (ii) case law, (iii) certificate of incorporation & (iv) bylaws 2. Separate legal person – can (i) enter contracts, (ii) transfer property, (iii) buy & sell securities (its own or others), (iv)
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barbri_outline_-_ny_(2005)_-_corporations - CORPORATIONS I....

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