Originally from:
Advising Minnesota Corporations and Other Business Organizations - 2nd Edition - Hardcover
Advising Minnesota Corporations and Other Business Organizations - 2nd Edition - Electronic
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CHAPTER 24
OVERVIEW OF INCORPORATION
DOCUMENTATION
Section
§ 24.01 Importance
§ 24.02 Purposes
§ 24.03 Corporate Control Issues
§ 24.04 Interrelationship of Incorporation Documents
§ 24.05 Ethical Issues--Conflicts of Interest
§ 24.06 --Duty of Competence
§ 24.07 Functional Approach
§ 24.01 Importance
Businesspersons and their lawyers often are tempted to gloss over the
importance of documentation at the incorporation stage. The legal market
is awash with standardized incorporation forms and the filing process is
quite simple.
Businesspersons and lawyers should not blindly adopt standardized
incorporation documents.1 Ultimately, standard forms may serve a
particular corporation just fine with few or no changes. Before this
conclusion is reached, however, the persons setting up a corporation
should pause to consider the hidden complexities of incorporation.
Among these complexities are the need for an appropriate and functional
corporate business structure, the need for mechanisms to govern or guide
the various interrelationships among shareholders, directors, officers,
creditors, governmental authorities, heirs, and others, and the need to
consider tax and securities ramifications.
§ 24.02 Purposes
Incorporation documents serve, first, the formal purpose of satisfying
the statutory requirements necessary for valid incorporation.2 A second,
perhaps even more important, purpose is to define and give life to the
business bargain and expectations of the corporation’s owners.
Customized provisions in the articles, bylaws, share subscription and
shareholder agreements, and other documents may be necessary to
accomplish this purpose. Minnesota law will automatically inject
statutory provisions into the civil or nonstatutory business bargain unless
the incorporation documentation affirmatively “opts out” of such
provisions. The Minnesota Business Corporation Act also allows
modification of all but a few statutory provisions and expressly permits
many optional provisions, all of which are adopted most easily at the
time of incorporation.3
Roger J. Magnuson is a Partner at Dorsey and Whitney, LLP, where he serves as Head of the National Strategic Litigation Group and has practiced since 1973. He has been recognized as one of the top trial lawyers in the United States by major national and international publications, including Chambers International Guide to American Lawyers, which profiles the top 500 trial lawyers in the United States, Best Lawyers in America, Who's Who in American Law, and Who's Who in America. Mr. Magnuson was also recognized by a Journal of Law and Politics' survey for Judge's Choice "Wins Most Cases."
Some high profile cases that he has litigated include representation of the Florida Senate in the Bush v. Gore election controversy in 2000; and representation of the Plaintiffs in the widely publicized and studied Mall of America case. For several years he has represented, among other persons and entities, the Minnesota Twins and Major League Baseball principals and players in litigation; and has litigated national and local cases in federal and state court venues. He has appealed before the Supreme Court in a number of cases; as well as the Minnesota Supreme Court. He has authored several articles and 7 books.
Richard A. Saliterman is a Principal in Saliternan & Siefferman P.C., a full-service firm in Minneapolis established in 1976. Mr. Saliterman is a leading expert on corporate business matters, and is the author of several publications on business start-ups, franchises, and trademarks. Mr. Saliterman is the former National Judge Advocate for the U.S. Navy League, based in Washington D.C.
Contributing Editor:
Amanda Chang
Contributing Authors:
Alecia Anderson
Seth Back
John Baker
Shannon Berg
Constatin Burachek
Benjamin Carpenter
Ryan Check
Carl Christensen
Peter Fear
Michael Frasier
Aaron Hall
Catherine Hanson
Paul Harman
Amy Ithlan
Michael Kern
Chris Kuhlman