Tag: Shareholders

Corporate, COVID-19

Shareholder Distancing

Shareholder Meetings in the Age of “Social Distancing” and COVID-19

Written by Blake Baron

Background

On March 13, 2020, the U.S. Securities and Exchange Commission (the “SEC”) published guidance to assist public companies, investment companies, shareholders and other market participants affected by COVID-19 in connection with their upcoming shareholder meetings. The SEC explained that this guidance was designed to allow these companies to continue to hold their meetings, including through the use of technology, and engage with shareholders under social distancing circumstances, while still complying with the federal securities laws.

Shareholder Meetings – The Impact of COVID-19 and the Natural Transition to Virtual Meetings

Generally, public companies and investment companies are required to hold annual meetings of security holders, with the federal securities laws requiring the delivery of proxy materials to the voting shareholders.  Over the past few years, more and more companies have been transitioning to either complete “virtual” shareholder meetings or “hybrid” meetings, which avoid the need for in-person shareholder attendance. Continue reading “Shareholder Distancing”

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Corporate

Unlimited Liability for New York Business Owners

People crossing the street in Manhattan New York City
Photo Credit: istock.com/deberarr

By Arina Shulga

One of the main benefits afforded to a corporate structure is the limited liability protection for its owners. This means that the corporation and its shareholders are treated as separate legal entities and it is the corporation’s assets, and not the assets of its individual shareholders, that are available to pay for judgments and claims of creditors.

In certain limited circumstances such as fraud, disregard for corporate formalities, and inadequate capitalization, the limited liability shield can be “pierced” by the courts to hold the corporation’s shareholders personally liable for the corporation’s debts and other obligations. Such “piercing” of the corporate limited liability shield is a prevalent practice in most if not all states. Continue reading “Unlimited Liability for New York Business Owners”

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