There’s a lot to do after incorporating a company. For liability and tax purposes, it is crucial to complete the post-incorporation setup before the company starts conducting business or takes an investment. Sure you can find a laundry list of procedures and rules to follow online but is that stuff even accurate? It’s not worth finding out. Stuff like determining how many shares should be allocated and adopting a stock plan both super important, and overwhelming. When something legal-related is of importance and seems to be “too much” for a non-lawyer, it’s time to turn to LawTrades.
Dealing with legal issues as a non-lawyer is too risky - especially when dealing with corporate formalities. The consequences for messing up are severe as well. Failing to complete the necessary steps following formation can lead to “piercing the corporate veil.”
Lay the foundation
Completing post incorporation requirements correctly can make or break your company’s well-being. The troubling part is that failing to do it correctly can appear years down the road when it’s too late to correct.
It’ll take you many hours and days just to learn how to complete these tasks, aside from the hours you’ll spend drafting and implementing them. Leave the post incorporation to the legal professionals.
What are bylaws?
Bylaws specify how the company is operated. It outlines rights and power distribution among the officers or managers. Bylaws make it easy for a company to run and manage as well as identify, how it will be run and managed through bylaws.
Does a corporation have to issue stock after incorporating?
Issuing stock is a formality with corporations. In order to be fully compliant with all of the operating formalities, issuing stock is a necessary procedure.
What does it mean to “pierce the corporate veil?”
It’s a situation that occurs when a court sets aside limited liability and hold a corporation's shareholders (SHs) or directors personally liable. A court pierce the corporate veil after concluding that the corporation was merely an alter ego of the SHs / directors. At this point, the wrongful SHs / directors are treated as if they are agents of the corporation. A major factor used to justify piercing the veil is when the SHs/directors deviate from corporate formalities.
What’s limited liability protection?
It’s the biggest reason why people choose to incorporate their businesses. It provides owners protection from their personal assets against creditors’ claims. As long as the owners truly treat their business as a separate entity, they retain such protection.
Can I use LawTrades if I only need one of those agreements listed above?
Absolutely. That’s a comprehensive list of what most corporations are in need of after filing their articles of incorporation. For example, if your company is interested in having your bylaws drafted then we can help you with just that.
Talk to a LawTrades Expert email@example.com (646) 781-7196