馃攳
Membership Interest Certificates - YouTube
Channel: LegaLees
[0]
hi this is Lee Phillips I'm an attorney
[2]
and this is another piece in my series
[5]
on YouTube about corporate formalities
[9]
what you do when you create and operate
[11]
a corporation or a limited liability
[14]
company and the two animals are quite
[17]
similar in their care and feeding we'll
[20]
assume that you've set up your company
[22]
you file all the stuff with the state
[23]
you've signed you everything they need
[25]
you've paid your money now what happens
[28]
well one of the first things that you
[30]
need to do is decide who's the owner or
[33]
owners of your company that maybe you
[37]
maybe you and your husband wife maybe
[40]
you and your partner's and I'm not
[42]
calling a partner in a partnership sense
[45]
I'm just saying people you work with in
[47]
the company but who owns it well you
[52]
need to define who owns it
[53]
sometimes that's required in the
[55]
Articles of Incorporation or the
[58]
articles of organization which are the
[60]
papers you file with the state to create
[62]
the company but it's almost always
[65]
required or should be a good idea anyway
[68]
to include that sort of stuff in the
[71]
bylaws the rules of the game if you're a
[75]
corporation or the operating agreement
[78]
the rules of the game if you are an LLC
[82]
they're the same thing but we call them
[84]
by different names so that we know
[85]
that's corporation that's LLC that
[90]
should talk about who the owners are and
[92]
what percentage ownership they have and
[96]
in a corporation a lot of the times the
[98]
corporate corporation will keep all this
[102]
what we call Treasury stock no stock
[105]
certificate in issue is just mine it's
[109]
the company's and in the LLC they can
[113]
keep back ownership by the LLC of a
[117]
percentage or a number of shares of the
[119]
ownership of the LLC so you don't need
[123]
to issue all of the shares at once
[125]
and by the way one
[127]
things that may be asked on the Articles
[129]
of Incorporation is how many shares
[133]
you've been issue if you issue 10
[135]
trillion shares the states going to
[137]
charge you you get the first 20,000
[140]
shares for free meet state filing fees
[143]
and after that they start tacking on and
[146]
I don't know what the number is it might
[147]
not be 20,000 but they start tacking on
[150]
additional fees so you don't want to
[153]
issue six trillion shares of stock if I
[157]
own the company one share of stock is
[159]
all I need one of the things that I'm
[162]
going to do when I get you into court
[164]
and Sue you and so I'm going to say okay
[166]
who are the owners of the company how do
[170]
you know that there are owners of the
[172]
company if you say well I'm the owner of
[174]
the company
[175]
okay did you issue a stock certificate
[179]
or a membership certificate is what we
[183]
call it in an LLC how do we know that
[187]
you're the owner of the company well it
[189]
says it in the bylaws it says it in the
[191]
articles of further the operating
[193]
agreement that's fine but I also want to
[196]
see in actual stocks or to you if I'm
[199]
going to invest in your company and I'm
[200]
going to be a third party guy silent out
[202]
there I'm going to give you the money
[205]
what do I want back well I want a stock
[209]
certificate back or a membership
[211]
interest you to get back which shows
[214]
that piece paper shows that I own X
[218]
percent of this company somebody shares
[220]
in this company if you haven't actually
[224]
issued the stock certificate or the
[227]
membership interest certificate then
[230]
when I get you into court I've got an
[232]
argument your honor
[233]
this wasn't a real company they didn't
[237]
even bother to define the ownership of
[240]
the company the guy knew he owned it all
[242]
it was his no problem it's his all regal
[247]
I want you to let me pierce the
[249]
corporate veil then go after the guy
[251]
directly so one of the elements that I'm
[254]
going to be looking for in the lawsuit
[256]
is where is the ledger
[259]
you have a stock ledger membership
[261]
interest ledger where you write down
[264]
certificate number one issued on
[266]
such-and-such a date to so on so for so
[270]
many shares and I want to see that
[273]
ledger and then I want to see the stock
[276]
certificate which goes through a
[277]
certificate number one and unless you
[280]
haven't jumped these hurdles actually
[281]
done the paperwork that's one indicia of
[285]
the fact that a you didn't treat this
[287]
like a real company why do I have to
[290]
treat it like a real company and the
[292]
courts will if they stack up enough of
[295]
these against you they will do what's
[297]
called pierce the corporate veil and
[299]
they will come after you personally so
[303]
these little steps
[304]
none of them are fatal particularly a
[307]
couple of them are pretty close but they
[311]
all add up it's the weight of the
[313]
evidence how did you treat your company
[315]
if you give IBM 100 bucks you want a
[319]
hundred bucks and stock back don't you
[322]
same thing
[323]
think about how do I want my company to
[327]
act how do I want to be treated and if
[332]
it's third party arm's length we've got
[335]
a good chance of keeping the limited
[337]
liability and these corporate
[339]
formalities of which issuing the stock
[342]
the ledger all that stuff is one of them
[344]
it's these corporate formalities that
[347]
add up that either give the court the
[350]
tip in your direction to protect you
[353]
with the limited liability or give the
[355]
tip to the court in the other direction
[357]
to pierce the corporate veil so these
[360]
are really important issue your stock
[362]
your membership interests
Most Recent Videos:
You can go back to the homepage right here: Homepage