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> @ / 1 B 7 1 / : 5 C 7 2]W\U0caW\Saa7\<SdORO />@/1B71/:5C723 B67@2327B7=< 2]W\U0caW\Saa7\<SdORO />@/1B71/:5C723 B67@2327B7=< By LIONEL SAWYER & COLLINS Doing Business in Nevada is a general guide to certain Nevada laws that apply to the conduct of business in Nevada as of June 30, 2007 (except as specifically noted otherwise), and generally does not include federal law except for specific instances where particularly relevant or where the general reader might be unaware of an area of federal regulation. Because of the large volume of Nevada statutes, regulations and case law, any summary of Nevada law would have to omit many things. This guide does not cover all laws or regulations that could apply in all circumstances. The information contained in this guide is for general reference only and is not intended to provide legal advice. You should contact a Nevada attorney to advise you prior to conducting business in Nevada. 2]W\U0caW\Saa7\<SdORO />@/1B71/:5C723 B67@2327B7=< By LIONEL SAWYER & COLLINS Published By LIONEL SAWYER & COLLINS ©2008 Lionel Sawyer & Collins This book was written, edited, designed and typeset by Lionel Sawyer & Collins ~ Las Vegas, Reno, Carson City and Washington, D.C. This book is printed on acid-free, archival-quality paper. Manufactured in the United States of America. Cover photography by Opulence Studios. Select photography by Darryl W. Martin. Doing Business in Nevada: A Practical Guide by Lionel Sawyer & Collins Third Edition ISBN: 978-0-9745273-2-1 1. Business Law–Nevada 2. Business Enterprises–Law and Legislation–Nevada 3. Nevada–Economic Conditions iv LIONEL SAWYER & COLLINS Lionel Sawyer & Collins is the largest private law firm in Nevada. Lionel Sawyer & Collins is a full service, business-oriented law firm with offices in Las Vegas, Reno and Washington D.C. The Firm’s practice areas include real estate, banking and finance, corporations, business organization, employment and labor, healthcare, gaming, litigation, intellectual property, regulatory and licensing, governmental relations and lobbying, land use, tax, energy, telecommunications, water, and utilities. Since its inception in 1967, Lionel Sawyer & Collins has achieved a preeminent position in the State of Nevada, serving clients of all sizes, from individuals and small businesses to Fortune 500 companies. As a result of the firm’s long and extensive involvement in the Nevada legal, political and business communities, Lionel Sawyer & Collins is in a unique position to assist established Nevada businesses as well as businesses relocating to Nevada. We invite you to visit our website at http://www.lionelsawyer.com for more information about our attorneys and our firm. v ACKNOWLEDGMENTS Doing Business In Nevada, Third Edition, is a Lionel Sawyer & Collins’ publication. The Third Edition was edited by Jeffrey Zucker, Chair of the Firm’s Business Law Department and a Director, and Pearl Gallagher, associate attorney in the Business Law Department. The Editors would like to acknowledge and thank the following Lionel Sawyer & Collins’ attorneys for their contributions to Doing Business In Nevada, Third Edition: Cam Ferenbach (Eminent Domain) Ellen Whittemore (Gaming Law) Kirby Smith (Workers’ Compensation) Paul Larsen (Zoning Law) Craig Etem (Securities Law) John Naylor (Dispute Resolution) Elizabeth Brickfield (Spousal Rights) Linda Bullen (Environmental Law and Mineral Rights) Greg Gemignani (Franchise Law and Intellectual Property Law) Laura Thalacker (Employment Law) Matt Policastro (Tax Law) With special thanks to the following attorneys for their general contributions to Doing Business In Nevada, Third Edition: Christopher Walther Lucas Tucker Lauren Calvert-Arnold Robert Hernquist Christian Hale Tim Mulliner vi DOING BUSINESS IN NEVADA Table of Contents INTRODUCTION ............................................. 1 CHAPTER 1: AN OVERVIEW OF NEVADA ............................. 3 Nevada Geography and Climate ............................... 3 Nevada Culture and Entertainment ............................ 4 Nevada Agriculture and Mining ............................... 4 Nevada Technology, Energy, Telecommunications and Water Resources .................................... 5 Nevada Population, Housing and Income........................ 5 Nevada Employment ....................................... 6 Nevada Education ......................................... 6 Nevada Government ........................................ 6 Nevada Airports ........................................... 7 Nevada Highways, Public Transportation and Railroads ............ 8 Nevada Foreign Investment and Exports ........................ 8 The Nevada Market ........................................ 9 Nevada Taxes and Financial Incentives for Businesses ............. 10 CHAPTER 2: BUSINESS ORGANIZATION ............................ 11 Corporations ............................................ 11 In Brief .............................................. 11 Organization ......................................... 11 Corporate Record Keeping ............................... 12 Board Governance Issues . 14 Stockholder Governance Issues ............................ 18 Dissolution ........................................... 20 Stockholder Rights Plans ................................ 21 Control Share Act ...................................... 21 Business Combination Act . 22 Statutory Close Corporations ................................ 22 Joint Ventures ............................................ 23 Partnerships ............................................. 24 vii General Partnerships .................................... 24 In Brief ........................................... 24 Organizational Formalities ............................ 24 Record Keeping .................................... 25 Governance ....................................... 25 Liability of Partners ................................. 26 Dissolution and Termination .......................... 26 Registered Limited-Liability Partnerships .................... 27 In Brief ........................................... 27 Organization ...................................... 27 Record Keeping .................................... 28 Governance ....................................... 28 Liability of a Partner ................................ 29 Dissolution and Termination .......................... 29 Limited Partnerships ................................... 29 In Brief ........................................... 29 Organization ...................................... 30 Record Keeping .................................... 31 General Partner Governance ........................... 32 Limited Partner Governance ........................... 33 General Partner Liability.............................. 33 Limited Partner Liability .............................. 34 Liability for Contributions and Return of Distributions ...... 34 Dissolution, Charging Orders, Receivership and Termination ................................. 35 Registered Limited-Liability Limited Partnerships ................ 37 In Brief .............................................. 37 Organization ......................................... 37 Liability of a Partner .................................... 38 Record Keeping, Governance, and Dissolution ............... 38 Limited Liability Companies ................................ 38 In Brief .............................................. 38 Organization ......................................... 38 Record Keeping ....................................... 40 Member and Manager Governance Issues ................... 41 Dissolution ........................................... 44 Professional Entities ....................................... 45 Sole Proprietorships ....................................... 46 viii Non-Profit Corporations ................................... 47 In Brief .............................................. 47 Organization ......................................... 47 Record Keeping ....................................... 48 Officers and Directors Governance Issues .................... 48 Members and Delegates ................................. 50 Dissolution ........................................... 51 Business Trusts ........................................... 52 In Brief .............................................. 52 Organization ......................................... 53 Record Keeping ....................................... 53 Governance Issues ..................................... 54 Dissolution ........................................... 56 Mergers, Conversions, Exchanges and Domestication ............. 56 Mergers and Exchanges . 56 Conversion ........................................... 57 Domestication ........................................ 58 Dissenters’ Rights ...................................... 59 CHAPTER 3: REPORTING REQUIREMENTS FOR FOREIGN DIRECT INVESTMENT ................................. 60 CHAPTER 4: ANTI-TRUST LAW ................................. 62 CHAPTER 5: CONSUMER PROTECTION LAWS ....................... 64 CHAPTER 6: REGULATION OF FRANCHISES ......................... 68 CHAPTER 7: TAXATION ....................................... 69 Personal Income Tax ...................................... 69 Business Tax / State Business License .......................... 69 Bank Excise Tax .......................................... 70 Property (Ad Valorem) Tax ................................. 70 Property Transfer Tax ..................................... 71 Sales and Use Tax ......................................... 72 Live Entertainment
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