Jody Bailey financed her university education by refereeing various recreational hockey leagues around the city. Her long-term career plan upon graduating with a Bachelor of Commerce Degree was to one day operate her own marketing firm. Unfortunately, upon graduation, Jody found herself with few employment opportunities in her field. Not being the type to sit idle, Jody accepted a job managing one of the hockey leagues. She quickly came to realize that there was significant confusion with scheduling ice time resulting in poor team attendance.

Not being particularly computer savvy, Jody contacted an old roommate Sara Strong, who had recently graduated with a Computer Engineering Degree. Jody and Sara ultimately developed a team management computer program that permitted players contact information and team schedules and rosters to be uploaded from a web platform making information readily available to managers, coaches and players.

The team management computer program has been quite successful and Jody and Sara have been contacted by a variety of sports leagues across the country looking to pay for the service.

Sara manages the technical side of the service and Jody manages the business side including invoicing, accounts receivable and marketing. However, with the rapid growth of their business, Jody and Sara recognize that to continue to expand their business and hire employees they need financial support. As well, they need to consider the form of business arrangement that best suits their needs.

1. Discuss in detail the forms of business available, including the advantages and disadvantages for each form of business and what business form is best for Jody and Sara.
2. If Jody and Sara decide to form a corporation, why should they consider a Shareholders Agreement? What should a Shareholders Agreement contain? What powers are affected should they decide to enter into a Unanimous Shareholders Agreement?
3. What obligations would Jody and Sara have if they incorporate the business and are appointed as corporate officers and directors?
4. What steps can Jody and Sara take to protect their team management computer program?
5. If Jody and Sara decide to form a corporation, what options are available for raising capital to expand the business?