B_LAW 210 – 1st Edition Lecture 14 Outline of Last Lecture I. Business Entities (Part 2)a. Corporationsb. Limited Liability CorporationsOutline of Current Lecture II. Business Entities (Part 3)a. Other Forms of Entitiesb. Extra InformationCurrent Lecture- Other Forms of Entities:o Joint Ventures: A general partnership for a limited time and purpose (build a building, rent it out, and sell it). o Cooperatives: Association of individuals organized to provide an economic service to its members (buy bulk products to sell cheaper to members).o Syndicates: A group that finances a project (financing the building of a shopping center).o Franchises: A franchise exists when a franchisee pays a franchisor a franchise fee for the right to sell goods or services according to the franchisor’s marketing plan. Franchises must be registered under federal, and in many cases, state law. Franchisees:1. Must follow the exact specifications of the franchisor2. May not legally bind the franchisor Three types of franchises:- Product distributorships (car dealers)- Trademark licensing (NFL)- Business format (McDonald’s) - Extra Information:o Failure to file an Annual Report will result in automatic dissolution by the state for corporations and LLCs These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.o Business Judgment Rule protects directors against suits by shareholders when a director makes an honest mistake that negatively affects the corporation.o A Corporation’s advantages are:  (1) It shields owners from personal liability  (2) It is easier to raise financing. (The main disadvantage is double taxation.)o An LLC’s advantage is limited liability without double taxation.o Upon dissolution, creditors always come first (limited partners before general partners)o Corporations and LLCs can be “owned” by artificial persons as well as natural persons (artificial persons could include corporations and trusts)o A Separate Legal Entity (SLE) or legal entity has an existence apartment from the owners (A corporation can sue and be sued) A corporate veil can be pierced when corporate formalities are not followed (always sign as an agent of the