For many companies, corporate documents are not often reviewed or updated as often as necessary. This can be problematic when structural changes occur, members want to leave, or dissolution arises.
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Corporate documents look different from organization to organization, but they all need to be clear and accurately reflect the nature of the corporation.
In Michigan, the principal documents used to form a corporation are the articles, bylaws, share certificates, and the organizational minutes or consents of the incorporators, board of directors, and shareholders.
Bylaws function as a high-level guidance for governance of the corporation. Bylaws often dictate how the board functions and should be reviewed periodically.
Bylaws should anticipate the worst-case scenarios for the business. Many times, business entities are formed with optimism and this can cause issues down the line. If bylaws are not carefully drafted to account for all of the ‘what ifs’ that could arise, problems can turn into expensive legal battles.
An entity’s bylaws should operate to eliminate confusion in current and future operations.
We help our clients regularly review and update bylaws to ensure that they are in keeping with the organization’s practices. We also review them to help ensure that the board members are offered protection and clear exit strategies.
Have you looked at your organization’s bylaws recently?
If not, it may be time to review them for clarity, accuracy, adequate planning, and current guidelines.
We can help review your bylaws and corporate documents to make sure your organization is prepared for whatever may come your way. Call us today.
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