A legal entity established by filing a Certificate of Incorporation. It is allowed to borrow money and enter into contracts separate and independent of its stockholders. Stockholders receive distributions and elect directors who run the company through officers (at-will employees) that conduct the day-to-day activities. The stockholders are protected by a “corporate veil” that prevents debts against the corporation from being enforced against individual stockholders in their capacity as stockholders; this is known as “Limited Liability”. The laws in the state of formation govern the internal affairs of the corporation. The rules governing corporations require certain formalities be followed so as to comply with local laws. These include annual meetings, among others.