2. Types of Corporations
There are three types of corporations:
Domestic
Foreign
Alien
A corporation can have all three designations.
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3. Incorporating: Where and
How
A business can incorporate
in any state they wish, but
normally like to stay close
to customers.
Some states are
considered to be more
“Business-friendly”
Most states require at least
3 incorporators in order to
charter.
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4. Traditional Articles of
Incorporation
Name and Address of the corporation
Corporate Objectives
Type and Amount of Stock to Issue
Expected Life of the Corporation
Financial Capital at the Time of Incorporation
Provisions for the Transferring Shares of Stock among Owners
Provisions for Regulating Internal Corporate Affairs
Address of the Business Office Registered with the State of Incorporation
Names and Addresses of the Initial Board of Directors
Names and Addresses of the Incorporators
Page 157 in text; Boone and Kurtz
5. Levels of
Management
The five levels:
Stockholders
Board Of Directors
Top Management
Middle Management
Supervisory Management
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6. Stock Ownership and
Rights
In closely held corporations stock is generally
unavailable to outsiders and stockholders also
manage all of the company’s activities
In publicly held corporations stock is sold to
the general public. Public held corporations
will usually hold an annual stockholders
meeting. This gives the stockholders to vote
on any issues that require their approval.
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7. Board Of Directors
Elected by stockholders
Sets overall policy, authorizes any major
transactions, and hires the CEO
Inside Directors: Normally employed by the
company as an executive
Outside Directors: Not employed by the
company but usually stockholders.
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8. Middle and Supervisory
Management
While CEOs make most of the corporate
decisions, middle management handles the
ongoing operational functions of the company.
Leaving the day-to-day management to the
supervisory personnel. They hand out
assignments to employees and give out
performance reviews.
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