Timing of incorporation Flashcards
What is moment of incorporation?
When 1) Secretary of state accepts fee AND
2) files the articles
Corporate existence begins!
Are corporations obligated to file bylaws?
NO, optional, but most corps have them because
Bylaws definition
Set forth day-to-day rules about operation and management of corp
Why not put rules into articles instead of bylaws?
Bylaws EASIER TO CHANGE
BOARD can change bylaws, articles must be amended by shareholders
What governs when bylaws and articles conflict?
ARTICLES always win
Defective/de facto corporation definition
When corporation is NOT properly formed but enters into obligations after it was allegedly formed
Rule for de facto corporations
Will be treated as limited liability corporation IF
1) GOOD FAITH effort to comply with process
2) organizers have NO ACTUAL KNOWLEDGE of defect in corporate status
