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Smart Way #7: Make sure the directors/managing members play an active role in deciding important matters such as major capital expenditures and other fiscal matters and document their involvement.
The more a dominant shareholder appears to be in control of the company's fiscal matters, the more the business entity appears to be a sham. If you bypass the directors, the court could easily conclude that your so-called directors are directors in name only. This means that the corporation is in fact, controlled by one person, whom it then holds personally liable. This is compounded if the dominant shareholder is siphoning earnings and profits of the corporation for personal use.
