Maryland State Incorporation Bylaws
Writing bylaws is one of the steps a Maryland company must complete in the incorporation process. Bylaws are the rules and regulations for operating the business that do not appear in the Maryland corporation’s articles of incorporation. Maryland does not require a corporation to file the company’s bylaws with any agency in the state. A Maryland corporation must maintain the company’s bylaws with other important business documents.
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Significance
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Bylaws provide a Maryland corporation with an orderly way of conducting the company’s business affairs. Furthermore, having written bylaws supports the limited liability protection of the Maryland corporation. Without the presence of written bylaws, a Maryland corporation owned by a single shareholder may be treated the same way as a sole proprietor. This means the company’s owner may lose his home and other personal assets as a result of company obligations and liabilities.
General Information
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A Maryland corporation’s bylaws include general information such as the name and location of the business. The bylaws may describe the nature of the company’s business activities or the purpose for establishing the legal existence of the business. Also, the bylaws may indicate the date and location of the company’s shareholder and director meetings.
Every Maryland corporation must hold at least one annual meeting. The bylaws may contain provisions that allow shareholders and directors to call special meetings. The bylaws may indicate the number of shares the company has the authorization to issue to potential investors, if the number of authorized shares does not appear in the Maryland corporation’s articles of incorporation.
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Directors and Officers
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The bylaws for a Maryland corporation may indicate the number of board members who will serve on the company’s board of directors. The bylaws should communicate the term that each director will serve and criteria for selecting new directors. The bylaws must include terms for removing board members and explain the compensation due to members of the board. The bylaws should also state the salary due to officers of the company. Bylaws must detail the duties of the company’s officers and the term that individuals will serve as officers.
Considerations
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Maryland corporations may include miscellaneous provisions in their bylaws such as the procedures the company must follow to amend the articles of incorporation or the bylaws. The bylaws may communicate the individuals in charge of recording and maintaining company records. The bylaws may or may not indicate banking procedures for handling the company’s business transactions. The fiscal year of the Maryland corporation may appear in the company’s bylaws as well.
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