If you're getting ready to launch a new business, chances are you know your product or service and your market like the back of your hand. But the mechanics of forming a business entity-knowing the terminology-may be more difficult to understand.
To help you sort through the terminology, Harvard Business Services, Inc. has included a comprehensive glossary to help guide you. To use the glossary, match the first letter of the term you want to look up with the alphabet list below, and click on that letter.
Of course, our team of business formation professionals is standing by to help you make informed decisions if you need more information
The Incorporation State!
Delaware Corporate Law
An expert body of law first created over 100 years ago that governs nearly every aspect of corporate governance and affairs of Delaware Corporations.
Delaware Court of Chancery
Same as “Chancery Court.”
Delaware General Corporation Law (DGCL)
An expert body of law modeled after the Model Business Corporation Act.
Delaware Limited Liability Company Act (DLLCA)
A leading body of law governing LLCs formed in Delaware.
Delaware Statutory Trust Act (DSTA)
A ground-breaking body of law that provides for the creation of trusts outside the realm of English Common Law. Here, a grantor can not only remain a beneficiary and still maintain limited liability protection, but can also act as trustee or advisor to the trust.
Delaware: Better Than Offshore™
This is a protected mark of Harvard Business Services, Inc. that refers to Delaware’s status as an Offshore Financial Centre. “Better” refers to the fact that Delaware and U.S. governments do not require the entity or its registered agent to disclose who holds beneficial interests in the entities formed here.
Individuals elected to manage the affairs of a Corporation. Sometimes, LLCs choose in their Operating Agreements to have directors, which said directors may be individuals or entities.
The act of formally dissolving an existing entity that no longer intends to conduct business in its home state in the future.
The transfer of money or other property from a partnership to a partner.
The payment of money or other property by a Corporation to its shareholders. The making of this payment is at the sole discretion of the Board of Directors.
Doing Business As (DBA)
The act of conducting business under a trade name that is different than the official or true name.
A Corporation that has incorporated in Delaware.
The act of changing the home state of an entity from one jurisdiction to another, preserving the original date of formation.
The taxation of corporate earnings at the corporate level and again at the shareholder level. A Corporation pays income tax on its annual profits. Then, if it issues a dividend to shareholders, these shareholders must pay taxes on this income again on their separate returns.
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