BUS 202: Business Law - Cooper Smith Review Course

Course Overview

• Focus on business organizations
• Discuss business types, corporate finance, mergers/acquisitions, securities, employment law

Business Formations

Types of Business Forms

• Sole proprietorship
• General partnership
• Limited partnership
• Limited liability partnership
• Limited liability company

Sole Proprietorship

• Most common business form in the U.S.
• Owned by a single person
• No formalities needed, but specific business licenses may be required
• Total control by the owner
• Taxation: Reported on Schedule C of personal tax return
• Liability: Owner is fully liable for business debts and obligations
• Advantages: Easy to form, total control
• Disadvantages: Difficulty in raising capital, unlimited liability

Partnerships

General Partnership

• Voluntary association of two or more persons
• Liability: Partners are jointly and severally liable for debts
• Governed by Uniform Partnership Act
• Taxation: Single level, partners report profits/losses on personal tax returns

Limited Partnership

• Includes general and limited partners
• General partners manage, have unlimited liability
• Limited partners have limited liability, no management role
• Governed by Revised Uniform Limited Partnership Act

Limited Liability Company (LLC)

• Hybrid between corporation and partnership
• Limited liability for all members
• Flexible management structure
• Can choose to be taxed as a corporation or partnership

Corporations

Corporate Formation

• Formed under state law
• Requires articles of incorporation
• Types: Open (publicly traded) and close (private)
• Management: Board of directors manages, shareholders own

Corporate Finance

• Sources of finance: operating funds, loans, equity, bonds
• Equity Securities: Common and preferred stock
• Debt Securities: Bonds and notes

Mergers and Acquisitions

• Merger: Two companies combine into one
• Acquisition: One company buys another
• Hostile Takeover: Unapproved acquisition attempt

Securities and Regulation

• Governed by SEC Acts of 1933 and 1934
• Key Rules:
  • Rule 10b: Anti-fraud in securities transactions
  • Rule 10b-5: Prohibits insider trading
• SEC oversees securities market, ensures fair practices

Employment Law

Employee Benefits

• Workers Compensation: Insurance for work-related injuries
• OSHA: Workplace safety standards
• FLSA: Minimum wage, child labor laws, overtime rules
• FMLA: Family medical leave
• COBRA: Continuation of health coverage after employment
• ERISA: Governs employee retirement plans

Employment Discrimination

• Governed by Title VII of Civil Rights Act
• Prohibits discrimination based on race, color, religion, gender, national origin
• EEOC: Enforces discrimination laws
• Defenses: Merit, seniority, BFOQ
• Other Acts:
  • Equal Pay Act
  • Age Discrimination in Employment Act (ADEA)
  • Americans with Disabilities Act (ADA)

Conclusion

• The course aims to provide a comprehensive understanding of business law principles and legal structures affecting business organizations, securities, and employment.