IL Corporations Flashcards
Promoter’s liability
Liable until novation.
Requirements on Articles of Incorporation
APAIN
APAIN
- Authorized shares, max number
- Purpose
- Agent (address of registered office)
- Incorporators
- Name of Corp.
Shareholder liability
Not liable unless the corporate veil is pierced
Par value
Minimum issue price
Preemptive rights
Right to maintain ownership percentage.
Business judgment rule
Presumption that directors manage the corp. in good faith and in the best interest of its SHs.
Directors are not liable for innocent mistakes of business judgment - no matter how bad.
Director duties:
- Of care - prudence, unless limited by Articles.
2. Of loyalty - no unfair benefits unless disclosed and ratified by independent board members.
Derivative Suits need:
- Contemporaneous ownership (standing)
- Adequacy
- Demand
Quorum
Majority of all SHARES.
Vote
Votes CAST in favor exceed votes CAST against.
Cumulative voting
shares x slots (for directors)
PRESUMED in Illinois.
Common stock
Pay last
Preferred stock
Pay first
Participating stock
Pay twice
Cumulative stock
Add up