Corporate Stock The corporate board must decide what amount of financing from share capital is adequate for their corporation to operate. There is, however, no minimum or maximum share capital required under statute. Shares may be issued for consideration other than cash, such as agreements to perform services for the corporation, promissory notes, other corporate securities tendered. And while the corporate charter or bylaws can provide restrictions on the rights attached to its securities (e.g. the right to transfer), Tennessee statutes themselves provide no such restrictions. Likewise the state does not restrict the rights of foreign shareholders to own stock in a company.
A corporation's legal structure does provide limited liability protection to its shareholders, whether the shareholders be individuals, a parent company, or other organizations However, shareholders may still be legally liable for their own individual actions or conduct if they are active within the company.
For Limited Liability Companies (LLCs), Partnerships, Proprietorships, Joint Ventures, and certain other legal entities, the term "stockholder" is no longer be appropriate, as these organizations offer equity rights and financing through means different than a traditional corporation. For example, in the case of an LLC, members rather than stockholders control and own the company. Of these membership interests, an LLC in Tennessee may further designate those members holding governance membership as opposed to financial membership interests. Such designations may carry significant tax consequences.