BUSINESS MAINTENANCE
Our firm recognizes that all businesses have ongoing legal needs. As businesses mature, their legal needs grow. Our firm keeps current on changes in the law, and we help clients to be proactive in the management of their operations.
Business Maintenance Requirements
State laws require that certain formalities be met for the business entity to remain intact and to preserve the maximum liability protection. For example, a business must keep registration forms and fees current with the Secretary of State, a meeting of the shareholders and directors must be held at least annually, and the business entity must be operated in a manner that is financially distinct from its interest holders. We help businesses ensure that all legal obligations are met.
Business and corporate maintenance services include:
• Annual Minutes and Consent Actions
• Board of Director Resolutions
• Maintaining Corporate Books
• Determining Advantageous Tax Strategies
• Amendment to Articles of Incorporation
• Amendment to Bylaws
• Amendment to Operating Agreement
Operating and Maintaining an LLC or Corporation
While an LLC is generally much easier to maintain than a corporation, some regular record keeping, accounting, and government filing is required to keep your LLC in good standing with the State.
For example, in connection with its formation, corporations generally must elect directors and officers, adopt bylaws, issue share certificates, and set up minute books; and once they are formed, they must hold annual meetings of shareholders to reelect directors and annual meetings of directors to re-elect officers. All of these meetings must be duly recorded in the corporation's minute books. If they fail to perform these formalities, this failure may strengthen the case to "pierce the corporate veil" — that is, to hold the shareholders personally liable for claims against their corporation. In seeking to obtain a veil piercing order, lawyers will argue that since these shareholders are not complying with corporate rules, they do not deserve corporate protections.
LLCs, like corporations, are subject to veil piercing, particularly if they fail to keep books and records that are separate from those of their owners or if they are used to commit unfair or fraudulent acts.
However, as noted, the LLC Acts in South Carolina and other states, unlike corporate acts, do not impose significant formalities in connection with LLC formations and operations. Thus, whereas the "statutory formalities" argument can provide significant support for one who attacks a corporate veil, this argument will be wholly unavailable to plaintiffs attacking LLC veils.
