Karen Schroeder

Are shareholders and Board of Directors of a newly formed corporation entitled to compensation for their services?

karen — Mon, 30 Jan 2012 19:31:01 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a reader wants to know if shareholders and her Board of Directors of her newly formed corporation are entitled to compensation for their services?

ANSWER: Probably not – unless compensation is provided for by separate contract, the corporate bylaws or a separate corporate resolution. However, do note that the Board of Directors does have the power to fix the salary of each and every officer. Let me assist you with your corporate law questions by contacting my office today.

How to sign loan documents for a corporation so it is clear he is not taking on personal liability for his business loan?

karen — Sat, 12 Nov 2011 19:15:56 +0000

For Karen’s “Q & A” this week, a business owner wants to know how to sign loan documents for his corporation so it is clear he is not taking on personal liability for his business loan? ANSWER: Whenever a person signs on behalf of the company, they should add their title next to their signature so that it will be clear that they are acting as an agent of the company rather than in their individual capacity. This should be done even though a business owner might also be required to endorse or guarantee the same personally.

Is it required to make a filing with the state about how my corporation was initially capitalized?

karen — Fri, 28 Oct 2011 19:11:53 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a Chamber member asks if she is required to make a filing with the state about how she initially capitalized her corporation? ANSWER: No filing is required, but you should place a memo in your official corporate book spelling out exactly how and in what percentage capitalization of the corporation occurred; by depositing cash, transferring property to the business, or services were performed in exchange for ownership shares. Feel free to submit your corporate law questions or contact my office today.

A reader asks what parties need to sign Buy-Sell Agreements

karen — Sun, 28 Aug 2011 15:33:22 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a reader asks what parties need to sign Buy-SellAgreements. ANSWER: Both business owners and their spouses must sign a Buy-Sell Agreement for the
business to exercise its right to buy in the future. Also, the business owner’s will or trust must devisethe business interest in a consistent manner with the Buy-Sell, or your goals could be defeated. Let meassist you with your corporate law questions by contacting my office today.

A business owner wants to know how to evaluate his ownership interest in his Buy-Sell Agreement?

karen — Sun, 28 Aug 2011 15:26:18 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a business owner wants to know how to evaluate hisownership interest in his Buy-Sell Agreement. ANSWER: 4 suggested ways include: (1)Book value atthe time of transfer, which may or may not include goodwill or depreciation; (2)Joint agreement on a setprice; (3)If a first option agreement, by matching an outside offer; and (4)There is always appraisal by athird party. Let me assist you with your corporate law questions by contacting my office today.

business owner wants to know how to evaluate his ownership interest in his Buy-Sell Agreement.

karen — Sun, 28 Aug 2011 15:24:00 +0000

A business owner wants to know the benefits of a Buy-Sell Agreement.

karen — Thu, 28 Jul 2011 15:22:41 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a business owner wants to know the benefits of a Buy-Sell Agreement. ANSWER: First, a Buy-Sell ensures that outsiders will not enter into the managementof your business. It also keeps heirs out of the business if they weren’t already there. Second, it ensuresthat there will be a purchaser for the business interest when the specified event occurs – which benefitsyour heirs. Let me assist you with your corporate law questions by contacting my office today.

A corporate business owner wants to know if he should execute a Buy-Sell agreement for his business succession plan?

karen — Wed, 13 Jul 2011 15:20:26 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a corporate business owner wants to know if he shouldexecute a Buy-Sell agreement for his business succession plan. ANSWER: Buy-Sell agreements, bothmandatory and first option, are the most common succession plan whereby the business or one of itsowners buys out an owner’s share of the business for a predetermined price on the occurrence of aspecified event within a fixed period of time. If properly drafted, it not only avoids probate of a businessinterest, but it minimizes disruption to business operations. Let me assist you with your corporate lawquestions by contacting my office today.

A reader wants to know what is most important to include in his business succession plan as a sole proprietor?

karen — Tue, 28 Jun 2011 15:17:56 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a reader wants to know what is most important toinclude in his business succession plan as a sole proprietor. ANSWER: If you are a sole proprietor, theprobable recipients of your business succession will be family members or employees. Do not assumethat the intended recipients have the desire or ability to run your business – so ask them. Lastly, do notconfuse ownership with management – it can be separated. Let me assist you with your corporate lawquestions by contacting my office today.

A business owner wants to know when he should startworking on his business succession plan?

karen — Mon, 13 Jun 2011 15:15:45 +0000

For Karen’s Coffee & Counsel “Q & A” this week, a business owner wants to know when he should startworking on his business succession plan. ANSWER: Start early! Consider including your preferred exitstrategy in your business’ governing documents, like your operating agreement, when you start yourbusiness or incorporate. Let me assist you with your corporate law questions by contacting my officetoday.