Table of Contents
Article II:Duties and Responsibilities
Section A: Primary Responsibilities
Section B: Financial Structure
Section C: Policies, Objectives and Plans
Section D: Management
Section E: Controls
Section F: Employee Relations
Section G: Working Relationships
Section H: Standards of Performance
Section I: Expertise
Article I: Purpose
The Board of Directors is a supervisory body consisting of a set number of members which are defined in the Bylaws. The Board is to passon or review major decisions, to designate and remove the Chief Executive Officer, to watch out for signs of dishonesty in the top executives, and to correct incompetence or error on the part of the full-time management.
The Board should further provide direction of quality and nature to the total affairs of the business that will ensure the development and growth of the company in products, services, and in financial results.
In addition, provisions for the continuity of management of the quality and depth required to attain the objectives and serve the purpose of the business should be made by the Board.
Lastly, the Board serves as trustees for the investment of the stockholders, serves as the broad policy-setting body of the corporation, and as selectors of and advisors to the general management of the company.
THE “S” CORPORATION EXPLAINED
Myth: In order to form an S-Corporation, I only need to file the Articles of Incorporation.
It is not true that a corporate entity is fully formed with the filing of the Articles of Incorporation (or in the case of a Limited Liability Company, the Articles of Organization). Many times the questions are asked, “I formed my new corporation by filing the Articles of Incorporation, now what do I need to do?” and “My CPA recommended an S-Corporation, now what do I do?”
FEBRUARY 13, 2014
What exactly is retirement estate planning? Tonight will be filled with inquisitive action items to get your mind thinking about a difficult subject most people do not want to think about or believe that they can put off until they retire.
Estate planning involves deciding how you want your assets distributed after you die or become unable to make your own financial decisions. It is important to have a basic estate plan in place regardless of your net worth. The benefits include getting to name the people to whom you wish to give your assets; you can arrange it so that taxes siphon as little as possible from your estate; and you have the satisfaction of knowing that your financial affairs are in order so you won’t bequeath a costly administrative nightmare to your loved ones.
When retirement was far off in the future for you your investment strategy probably comprised of investing most of your money in stocks and mutual funds. You were in it for the long run and could ride the waves of the stock market highs and lows. As you reach retirement age the asset allocation rules change. An all stock portfolio may no longer make sense. A low-risk, all-bond portfolio might make sense for one person while assets spread out evenly across the three primary investment markets: stocks, bonds and cash maybe right for another. Each person and their circumstances are unique.
There is a widespread misunderstanding that if you and your spouse had set up a living trust, nothing needs to be done when the first spouse passes away except remove the deceased spouse’s name from bank accounts and real estate deeds. If you were under this impression, you may be leaving a big headache for your heirs and subjecting half of your estate to 35 or 55 percent inheritance tax, unnecessarily.
When the principal has an existing advance health care directive (AHCD) or power of attorney for health care (PAHC), the Authorization for Use and Disclosure of Protected Health Information (“HIPAA-CMIA”) document may be used as a stand-alone document to grant the agent rights over the health information and medical records of the principal, instead of executing a new AHCD or PAHC solely for that purpose.
If you are interested in forming and filing a franchise for your existing business, there are several important legal issues to consider.
Business Opportunity vs. Franchise
There are two areas of law in this respect, namely, business opportunity and franchise law. “Business opportunity,” which is legally known as Seller Assisted Marketing Plans, as defined under California Civil Code §1812.200 and are known as “SAMPs.” SAMPs must register with the Attorney General’s Office of each state, as required, provide disclosure statements, and provide buyers with specific notice and disclosures. The registration requirements, fees, and notice period are less than for a franchise. The Seller Assisted Marketing Plan Act was written for and aimed at seller discount buyers (think Avon, Jafra, MaryKay, Herblife) and the sale of vending machines, racks or work-at-home paraphernalia.
Choosing which type of entity to use is among the most important decisions a business can make. Most clients wish to avoid personal liability for the obligations of the business (an attribute of corporations) and may also wish to personally deduct the losses of the business and avoid double taxation of the income of and distributions from the business (attributes of partnerships). For businesses with these objectives, the limited liability company may offer the best of both worlds. An LLC is generally treated as a partnership for tax purposes. At the same time, the LLC’s members, like corporate shareholders, are not personally liable for the debts of the business.
This Checklist is prepared by [Buyer] on [Date] for the business [Target’s Name].
I. Finding and Evaluating an Acquisition Candidate
For those who have not already identified a business to purchase, this may be the most difficult step. Following are possible sources of information about businesses that may be for sale:
The Act provides that the laws of the state or foreign country under which a foreign LLC is organized govern its organization and internal affairs and the liability and authority of its members, and that a foreign LLC may not be denied registration by reason of any difference between those laws and the laws of California. Corp C §17450. Therefore, the Act permits members to “forum shop” for the LLC Act deemed most compatible with the members’ business purposes.