MEE Corporations Exam Latest Update

MEE Corporations Exam Latest Update Laws that govern organizations generally adhere to the Model Business Corporation Act ("MBCA"). Corporation Characteristics - ANSWER - Shares that are freely transferable - sustained existence in the face of the deaths of individual shareholder s - shareholders' liability is restricted; and - the centralized management of assets by directors and personnel Corporate Powers - ANSWER - May be established for any lawful purpose, except finance and insurance. - In general, corporations are permitted to exercise all powers that are necessary or expedient to achieve any or all of the purposes for which they were establishe d. Articles of Incorporation - ANSWER - The articles of incorporation are s ubmitted to the secretary of state's office to establish a corporation. - Articles may be amended through a protracted process in which the board proposes the amendment to the shareholders, and the shareholders vote on t he amendment . Mandatory Provisions - ANSWER - The name and address of the incorporator must include "inc." or a similar symbol. - the name of the organization - the name and address of the initial registered agent; and - the maximum number of shares that the corporation is permitted to issue mission of the corporation - stock: quantity, type, and value Optional Provisions - ANSWER The Articles of Incorporation may also include: - information regarding the initial board of directors - provisions that restrict the liability of directors - anything that has the potential to be included in bylaws - shareholders are held accountable for the corporation's obligations - defining, limiting, and regulating the authority of the corporatio n, board, and shareholder Initial Directors Appointed - ANSWER Directors must convene promptly to finalise the organisation of the corporation by: - the appointment of personnel - the adoption of ordinances - conducting any other business that was presented to the meeting In the event that the Articles of Incorporation do not specify the initial d irectors, the incorporators are obligated to convene a meeting at the request of a majorit y of the incorporators to either elect directors or elect a board of directors. Th e board of directors will subsequently complete the organisation of the corporat ion. The annual shareholder meeting is frequently specified in the bylaws, incl uding the time and location. - The record date for determining the shareholders who are eligible to vote at a meeting or receive dividends. - the minimum number of shareholders required to constitute a quorum - the percentage of votes required to authorise corporate action - any limitations on the transferability of the share. De jure corporations are those that are established in accordance with t he statute. In general, the commencement of corporate existence occurs when the Articles of Incorporation become effective. In general, a certified statement of the fact of incorporation by the state is regarded as evidence of "de jure" status. De Facto Corporation - ANSWER Corporation is not in statutory compliance; however, it is de facto if: - a sincere effort was made to adhere to the statute - the proprietors, in good faith, conducted themselves as thoug h they were a corporation (de facto corporations are today uncommon; however, they provide directors and shareholders with protection from liability, with the exception of the state.) Corporation by Estoppel - ANSWER If not de jure or de facto, it could still be a corporation by estoppel if: - The creditor consistently acted and thought as if he were interacting with a corporation. Additionally, D is unable to protect itself from liability by asserting that corp is not a legal entity if it falsely represented itself as a corporation. Ultra Vires Doctrine - ANSWER The Board of Directors is prohibited from taking any action that exceeds the authority of the corporation, as outlined in th e Articles