1. Company Forms (and development over time)
legal forms (British, American and Austrian)
setting up a limited company
advantages and disadvantages of company forms
company evolution (ex. Harley Davidson)
ownership and control of corporations (and how it is related to the current economic crisis)

2. Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
The company has a starting capital of _______________.

3. Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
The company has a starting capital of $100,000.

4. The company issues __________ shares, each one with a
Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
The company issues __________ shares, each one with a
nominal value (or "face value" or "par value") of $100.

5. The company issues 1000 shares, each one with a
Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
The company issues 1000 shares, each one with a
nominal value (or "face value" or "par value") of $100.

6. Roger has _________ shares or a ________ % stake (or "holding").
Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
Roger has _________ shares or a ________ % stake (or "holding").
How many more shares would he need to be the majority
shareholder and to have controlling interest? ______________

7. Roger has 500 shares or a 50 % stake (or "holding").
Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
Roger has 500 shares or a 50 % stake (or "holding").
How many more shares would he need to be the majority
shareholder and to have controlling interest? one

8. Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
RFM Ltd. makes a profit of $2000 in the first year. What is
the dividend per share? __________________

9. Roger Frank Margaret
$50, $15, $35,000
RFM Ltd.
RFM Ltd. makes a profit of $2000 in the first year. What is
the dividend per share? $2

10. #4 Advantages and Disadvantages
Sole Proprietorship
Partnership
Private Limited Company (Ltd.)
Public Limited Company (plc.)

11. #4 Advantages and Disadvantages
Sole Proprietorship
2, 6, 19
17, 20, 22
Partnership
Private Limited Company (Ltd.)
Public Limited Company (plc.)

12. #4 Advantages and Disadvantages
Sole Proprietorship
2, 6, 19
17, 20, 22
Partnership
8, 10, 21
3, 9, 12
(13, 20)
Private Limited Company (Ltd.)
Public Limited Company (plc.)

13. #4 Advantages and Disadvantages
Sole Proprietorship
2, 6, 19
17, 20, 22
Partnership
8, 10, 21
3, 9, 12
(13, 20)
Private Limited Company (Ltd.)
1, 5, 23
(10)
4, 13, 24
Public Limited Company (plc.)

14. #4 Advantages and Disadvantages
Sole Proprietorship
2, 6, 19
17, 20, 22
Partnership
8, 10, 21
3, 9, 12
(13, 20)
Private Limited Company (Ltd.)
1, 5, 23
(10)
4, 13, 24
Public Limited Company (plc.)
11, 14, 16
(5)
7, 15, 18

15. American and Austrian Company Forms

16. Company types differ mainly in the following points:
Liability - of owners, partners, shareholders, or "members"
Taxation - does the company or do the owners pay taxes (= "pass through taxation")
Legal status (as "legal person" or not?)
in Austria this is the basic difference between "Personen- oder Kapitalgesellschaft")
Ownership and control (combined or separated?)

17. American Companies A) Sole Proprietorship B) (General) Partnership
(two or more general partners with unlimited liability)
Limited (Liability) Partnership ("LLP")
(one or more general partners with unlimited liability, one or more silent partners with limited liability)
C) Limited Liability Corporation ("LLC")
a new hybrid form between partnerships and corporations – basically any variant of liability and taxation can be chosen by owners

18. American Companies D) Corporations (abbr. - “INC.”)
Close (or “Closely Held”) Corporation
maximum number of shareholders (differs
from state to state - often 30), shares not traded publicly
constitutes a new legal person
not technnically an official company form
Public Corporation (S or C)
separation of ownership (shareholders) and control (management: president or CEO - “chief executive officer” - vice-president(s) )
S = "pass through" taxation, C = the company pays taxes

19. Austrian Companies GesBR SE GmbH & Co KG OG (OEG) AG GmbH (EEG)
Below are the abbreviations of the most common Austrian forms of companies. Identify them and say which type of American or English company they are most similar to. SE
GesBR
GmbH & Co KG
OG (OEG) AG
GmbH
(EEG)
KG (KEG)
For a good English explanation of these company forms, see: and click on "Starting a Business in Austria"

20. Approximate Equivalents (US – Austria):
Sole proprietorship
General Partnership
Limited Partnership
Limited Liability Partnership (LLP)
Limited Liability Corporation (LLC)
Closed (closely-held) Corporation
(British: Private Limited Company – ltd)
Public Corporation
(British: Public Limited Company – plc)
GesbR, EEG, OG
KG, GesmbH+Co KG
(GesmbH+Co KG?) -
GmbH, AG (small)
AG (large)

21. Harley Davidson

22. Harley Davidson

23. Development of Harley-Davidson
1903 – Foundation by 3 owners (Partnership) Later 4th partner joins.
1907 – "Harley-Davidson Motor Company is incorporated on September 17th. The stock is split four ways between the four founders." (closely-held corporation)
1965 – Stocks offered to public (Public Corporation)
Merger with (takeover by?) AMF (Public Corporation, but also subsidiary of AMF)
executives buy H-D back from AMF in leveraged buyout (Closely-held corporation – 13 shareholders)

24. 1985 – Additional shareholders taken on to save company from bankruptcy. (Closely-held corporation)
1986 – Second public offering of shares. IPO – Initial Public Offering price is $11 (Public Corporation)
1986 – 1999 – Stocks split 5 times – Original 13 investors become multi-millionaires. (Public Corporation)
2003 – HD turns 100. Over 300 million shares outstanding, share price approximately $50. (Public Corporation)
financial crisis, share price drops to approximately $12

25. And today . . .