Business Companies: Organs, Shares, Dissolution, and Liquidation

Vocabulary practice flashcards covering corporate organs of s.r.o. and a.s., share valuation, shareholding rights, methods of restructuring without liquidation, bankruptcy proceedings, and the liquidation process.

Vyloučení společníka (Expulsion of a Partner)

The expulsion of a partner decided by the general meeting according to law, for reasons such as failure to pay the required capital contribution specified in the partnership agreement, disclosure of business secrets, or theft.

Jednatel (Executive Director of an s.r.o.)

The statutory body and top management of a limited liability company (s.r.o.), appointed by the general meeting from among partners or external individuals; responsible for continuous company management, entering into business contracts, dealing with authorities, issuing orders, and hiring or firing employees.

Akcie (Share / Stock)

A security that serves as a confirmation of a capital contribution, granting the shareholder ownership of a portion of a joint-stock company (a.s.).

Jmenovitá / Nominální hodnota akcie (Nominal / Par Value of a Share)

The specific capital contribution amount printed on the share, typically in the order of thousands of CZK for easier accounting.

Základní kapitál (Registered Capital)

The sum of the nominal values of all issued shares in a joint-stock company.

Tržní hodnota akcie (Market Value of a Share)

The price at which a share trades on a stock exchange or through securities dealers; it exceeds nominal value ($\text{market} > \text{nominal}$) when the company is profitable, and falls below nominal value ($\text{market} < \text{nominal}$) when the company incurs losses and debts.

Methods of Acquiring Shares (Způsoby získání akcií)

The four legal avenues to become a shareholder: by contribution upon company establishment (founder), by purchase (on a stock exchange or from securities brokers), by inheritance, or by gift.

Dividenda (Dividend)

A regular distribution of a portion of a joint-stock company's profits paid out to its shareholders.

Kontrolní balík akcií (Controlling Block of Shares)

A shareholding representing $> 50\%$ of the company's registered capital (measured in CZK value rather than the sheer number of shares), ensuring the majority shareholder cannot be outvoted at the general meeting; sometimes referred to as a golden share (zlatá akcie).

Elektronická / Nemateriální akcie (Book-entry / Immaterial Share)

An electronic form of a share recorded as an entry in an account at the Central Securities Depository (Centrální depozitář cenných papírů), with account statements verifying shareholder ownership analogous to bank account statements.

Představenstvo (Board of Directors)

The statutory executive body of a joint-stock company (a.s.) consisting of a minimum of $3$ persons, who are either shareholders themselves or appointed third parties.

Dozorčí rada (Supervisory Board)

The supervisory and control organ of a joint-stock company consisting of at least $3$ persons; members cannot concurrently serve on the board of directors, and their role is to oversee the board's activities and report directly to the general meeting.

Sloučení (Merger by Acquisition)

A form of company dissolution without liquidation wherein company A ceases to exist and becomes incorporated into surviving company B, transferring all its assets, liabilities, and employees.

Splynutí (Merger by Formation / Consolidation)

A form of company dissolution without liquidation wherein two or more existing companies (A and B) dissolve and unite to establish an entirely new entity (company C).

Rozdělení (Division / Demerger)

A form of company dissolution without liquidation (the reverse of consolidation) wherein existing company A dissolves and splits into two or more newly created companies (B and C).

Forms of Corporate Dissolution Without Liquidation (Sloučení, Splynutí, Rozdělení)

The three restructuring models where business entities undergo transformation without liquidation: acquisition (A dissolves into existing B), consolidation (A and B dissolve to create new C), or division (A dissolves to form new B and C), with assets, liabilities, and employees transferring over.

Předlužení (Over-indebtedness)

The critical financial condition where a company's liabilities exceed its total assets ($\text{debts} > \text{assets}$), causing an insufficiency of funds to satisfy creditor claims and triggering bankruptcy.

Finanční bankrot / Konkurz (Bankruptcy)

A form of corporate dissolution without liquidation resulting from over-indebtedness where assets, liabilities, and employees do not transfer to any successor entity; employees are dismissed and partners/shareholders receive no remaining assets.

Insolvenční správce (Insolvency Administrator)

An official appointed by the regional court (krajský soud) following a bankruptcy filing submitted by the debtor company or a creditor; tasked with liquidation-like administration to settle company liabilities.

Likvidační podíl (Liquidation Share)

The distribution of remaining net assets paid out to company partners or shareholders proportional to their initial capital contributions following dissolution with liquidation (in contrast to bankruptcy, where owners receive nothing).

Úkoly likvidátora (Tasks of the Liquidator)

The eight sequential duties carried out during corporate liquidation: announcing the liquidation in the press, liquidating assets, collecting receivables, dismissing staff, settling debts, distributing surplus to partners, applying for removal from the Commercial Register, and archiving documents for $5\text{ or more years}$.

Zánik společnosti (Extinction of a Business Company)

The legal termination of a business company, formally achieved upon its official deletion (výmaz) from the Commercial Register (obchodní rejstřík).