A C corporation is that standard form of incorporation. Unlike an S corporation, profits are taxed at the corporate level, thereby relieving shareholders of personal liability. If you are creating C corporation it may be in your best interests to work with Bryan business lawyers to ensure that you complete the necessary steps.
LLCs and partnerships require agreement forms that indicate how the business will be run. A corporation, on the other hand, uses bylaws to achieve this end. You should make the creating of bylaws a top priority early in the process of creating a corporation.
The steps for creating corporate bylaws are as follows:
- Decide upon the number of members that are to be on the board of directors. Shareholders elect the board members, whose chief purpose is to decide on strategies the corporation will utilize. You should consider having an odd number of directors on the board to avoid ties in voting.
- Name the corporate officers and their functions. These individuals will be responsible for the daily operation of the company. You should have as a minimum a chief executive officer, chief financial officer and secretary.
- Many corporations wish to refrain from being publically traded. When the stock is issued a buyout provision needs to be in place in a close corporation. This provision requires shareholders who either leave the company to make the shares he owns available to other shareholders for purchase.
- Set a date for the annual shareholder meeting. The law requires that you have at least one meeting of the shareholders each year. The bylaws should indicate when this meeting will take place. Prior to any meeting you need to determine what matters need to be discussed. From this you can glean whether the meeting will require attendance by the shareholders or only the directors.
- Write out a process for amending bylaws if this becomes necessary.
Legal Assistance with Creating Bylaws
You may wish to include Bryan business lawyers in the process of creating your corporation’s bylaws. Your lawyers will be able to help you set up the corporation properly. Call Peterson Law Group to arrange a consultation at 979-703-7014 or 936-337-4681.