llcs-corporations-partnerships

Definition 

A person who owns stock in a corporation.

See also

• Common stock
• Preferred stock

Definition

The highest governing document in a corporation.  Also known as the corporate charter, it generally includes the purpose of the corporation, the type and number of shares, and the process of electing a board of directors.  The articles of incorporation must be filed with the state at the time of incorporation, and may be amended or repealed as permitted by law and the articles themselves.

See also

• Bylaws

Definition

Latin, meaning "beyond the powers."  Describes actions taken by government bodies or corporations that exceed the scope of power given to them by laws or corporate charters.  When referring to the acts of government bodies (e.g., legislatures), a constitution is most often the measuring stick of the proper scope of power. 

See also:

• Ultra vires (international law)

Definition

An entity created in accordance with legal rules that acts as a single (fictional) person.  A corporation may sue and be sued, lend, borrow, issue stock, exist indefinitely, and act in many other ways distinct from the shareholders who own it and the managers who run it.  Each U.S. state can create rules by which new corporations are formed (i.e., rules of incorporation).  

See Artificial person and Natural person.

Definition

Any corporation that does not qualify and elect to be an S corporation under the Internal Revenue Code. Unlike S corporations, C corporations must always pay income taxes directly to the federal government.  

Definition

A corporation that qualifies and elects to be an S corporation under the Internal Revenue Code.  Unlike C corporations, S corporations typically do not pay taxes to the federal government.

Definition

A fiduciary duty is a legal duty to act solely in another party's interests. Parties owing this duty are called fiduciaries. The individuals to whom they owe a duty are called principals. Fiduciaries may not profit from their relationship with their principals unless they have the principals' express informed consent. They also have a duty to avoid any conflicts of interest between themselves and their principals or between their principals and the fiduciaries' other clients.

Business Law Definition

In business and partnership law, contribution may refer to a capital contribution, which is an amount of money or assets given to a business or partnership by one of the owners or partners. The capital contribution increases the owner or partner's equity interest in the entity. Capital contributions are not considered business income unless given in the form of a loan.

1.  A retailer who purchases goods or services for resale to consumers in a principal capacity.

2.  In securities law, a person who functions at least part time as an agent, broker, or principal in the business of offering, buying, selling, or otherwise dealing in securities issued by another person.  Either direct or indirect involvement with such transactions can suffice for classification as a dealer.  See, e.g., 15 U.S.C.

Partnership law: an overview

A partnership is a for-profit business association of two or more persons. Because the business component is defined broadly by state laws and because "persons" can include individuals, groups of individuals, companies, and corporations, partnerships are highly adaptable in form and vary in complexity. Each partner shares directly in the organization's profits and shares control of the business operation. The consequence of this profit sharing is that partners are jointly and independently liable for the partnership's debts.