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By-Laws
The articles of incorporation identify your company's structure while the by-laws spell out how your company will be operated. A corporation's by-laws may contain any provisions for the regulation and management of the affairs of the corporation not inconsistent with law or the articles of incorporation.
Illinois by-laws should outline everything that you could consider as essential for the legal (corporate compliance with the Illinois statutes) management of your company. Listed below are items that you should consider as pertinent to your company's operations.
REGISTERED AGENT
1. Identify your principal office in the State of Illinois, and determine if that office can be changed from time to time by the board of directors, if you do not have a physical location and your representation is through a Registered Agent, identify their principal office location and address and your registered agent's name.
SHAREHOLDERS
2. Identify shareholder information pertaining to annual and special meetings, location and times, how the shareholders will be notified of such meetings, and whether the actions of the shareholders can be taken without a meeting and by written consent. If your company pays dividends, you may want to fix a record date to determine shareholders entitled to notice of a vote at a meeting, identify a quorum, proxies and identify voting shares as set forth in your articles of incorporation. This section also may address voting procedures.
DIRECTORS
3. Identify director information pertaining to how many directors, tenure and their qualifications and if and how the number of directors can be increased or decrease, replaced, removed or retired and addresses vacancies in general. Annual, regular and special meetings and notice for such meetings should be outlined, and reference to what constitutes a quorum. This section should identify informal actions (actions by the board of directors without a meeting and documented by written consent), compensation, presumption of assent and resignation procedures.
OFFICERS
4. Identify the number of officers your company may have, their title, how they are to be elected and their term of office, removal, vacancies and a description of each officer's role within the company. Officer elections are typically handled at the annual meeting, with documentation evidencing their election by written consent.
COMMITTEES
5. If your company will have committees, identifying how they will be appointed, what constitutes a quorum, how they will act (unanimous consent in writing without a meeting or by meeting with appropriate notice given).
CONTRACTS, LOANS AND BANKING
6. Identify who authorizes and signs on behalf of the corporation and what actions need written consent of the board of directors.
CERTIFICATE FOR SHARES
7. Identify whether the issued shares of the corporation will be represented by certificates, who will sign the certificates, documentation of issuance's, how you will deal with lost or transferred shares and address any restrictions on transfer of any shares.
FISCAL OR CALENDAR YEAR
8. You can choose to identify whether your company will have a calendar or fiscal year end, or you can specify that this will be determined by resolution of the board of directors.
CORPORATE SEAL
9. Identify if your company will use a corporate seal. Having a corporate seal is no longer mandatory by Illinois statute, but including this language will document the fact that the company either does or does not use a seal.
WAIVER OF NOTICE
10. Identify whether notices of meetings can be waived in writing.
INDEMNIFICATION OF OFFICERS AND DIRECTORS
11. This is probably the most important aspect of your company by-laws. Identify who this indemnification covers and to what extent, specify authorization by directors, legal counsel of shareholders, repayment of expenses related to same, insurance, and shareholder notification.
AMENDMENTS
12. Identify that the by-laws may be amended by written consent of the shareholders entitled to vote and by written consent of the directors.
Illinois Registered Agent can assist you with the regulation (corporate compliance) of your company's written consents that will effectively avoid your company's piercing the corporate veil. We offer a resolution preparation service that is very reasonably priced.
Illinois Registered Agent, Inc.
