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CORPORATIONS -  Corporate Mechanics & Comparing Profit and Non-profit Corporations
    In either case, you form a corporation by filing Articles of Incorporation with the Secretary of State of the state you choose to incorporate in.  Usually this is the state where you will be doing business.  The main exception is for multi-state business.  Delaware has held itself out as having an excellent corporations bar, bench, statute and case law just to attract companies from other states.  In the third edition to their hornbook, Laws of Corporations, Henn and Alexander say: “Delaware, since the beginning of the [20th] century, has been the most popular jurisdiction of incorporation for multi-state corporations. … While many other jurisdictions offer many similar advantages, no other jurisdictions are as fully accommodating to corporations, especially corporate management, as Delaware.”  Any corporation that expects to actively conduct business in more than one state should consider a separate corporation in each jurisdiction.

    After filing Articles, the next step is to hold an organizational meeting and adopt the bylaws.  Generally, a corporation comes into existence when the Secretary of State issues the certificate of incorporation.

    The Articles name the initial directors who are to act until a meeting of members or shareholders formally elect a regular board of directors.  In either case the Articles also must spell out how many directors (or what range) constitute the full board of directors.

    Iowa will permit a nonprofit corporation to have directors only.  They are self-perpetuating.  Otherwise, every non-profit must identify who is eligible to become a member of the corporation.  The members of a non-profit corporation are entitled to vote to elect the directors.  The shareholders of a for-profit are entitled to vote to elect the directors unless the Articles provide, in addition to voting shares, one or more classes of non-voting shares.

    It is the responsibility of the shareholders or members to elect directors at least annually, at an annual meeting.  The terms of directors can be staggered; but the Wall Street Journal has reported this year that staggered terms are falling out of favor among large corporations.  It is the responsibility of the directors, at least annually, to elect the officers.  The names of the offices are set in the bylaws.  If an office isn’t created in the bylaws, the person who holds that job is not actually an officer.

    One of the best sets of corporate bylaws I have seen belongs to the Colgate-Palmolive Company.  Recently I compared them with the bylaws for Microsoft and for Intel.  My results of that comparison follow.  Download Excel Spreadsheet here.

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Registered office & agent. (Other offices authorized.) Article I, Sections 1 & 2. n.a.
Corporate seal. Article VIII n.a.
Stockholder meetings - place. Article II, Section 1. Article I, Section 1.3
Stockholder Ann. Mtg. - date & time. Article II, Section 2. Article I, Section 1.1.
Stockholder Ann. Mtg. - written notice. Article II, Section 4 Article I, Section 1.4.
Stockholder Special Meetings. Article II, Section 3. Article I, Section 1.2.
Stockholder Spec. Mtgs. - written notice. Article II, Section 4 Article I, Sect. 1.4; Article III, Sect. 3.3.
Stockholder Ann. Mtgs. - Bus. Conducted. Article II, Section 2. n.a.
Director nomination procedure. Article II, Section 9. n.a.
Stockholder action by written consent. Article II, Section 8. n.a.
Record date for S'holder consent eligibility. n.a. Article I, Section 1.7.
Independent inspection/review of written consent forms. n.a. n.a.
Stockholder voting rights. Article II, Section 6. Article I, Section 1.9. (Proxies)
Stockholder quorum. Article II, Section 5. Article I, Section 1.5.
Inspectors determine quorum, conduct S'holder voting. n.a. n.a.
Shareholder list. Article II, Section 7. Art. I, Sect. 1.8; Art. VI, Sect. 6.1( c).
Directors: Role, number, term, eligibility to serve. Article III, Section 1 & 2. Article II, Sections 2.1 & 2.2.
Preferred Stockholders' voting rights. n.a. n.a.
Directors - meeting & office location(s). Article III, Section 5. Article II, Section 2.3. (Mtg. Place)
Directors - additional powers. n.a. n.a.
Committees - appointed by Directors. Article III, Section 9. Article II, Section 2.12.
Committee appointment by majority vote. n.a. Article II, Section 2.12.
Designation of Committee chair. n.a. n.a.
Personnel, organization & compensation committees. n.a. n.a.
Audit committee. n.a. n.a.
Finance committee. n.a. n.a.
Other committees. Article III, Section 9(b). n.a.
Committee rules. n.a. Article II, Section 2.12.
Committee vacancies. Article III, Section 9(c). n.a.
Committee meetings - time & place. Article III, Section 9(d). Article II, Section 2.12.
Committee quorum, voting, written consent. Article III, Section 9(d) [re Quorum] Article II, Section 2.12.
Committee member term. Article III, Section 9(c). Artticle II, Section 2.12
Committee minutes & proceedings. n.a. Article II, Section 2.12.
Director compensation. Article III, Section 8. Article II, Section 2.11.
Committee member compensation. Article III, Section 8. n.a.
Newly elected Board meeting, time & place. Article III, Section 5(a). Article II,Section 2.3.
Regular meetings of the Board. [By Resol., no notice.] Article III, Section 5(b). Article II, Section 2.3.
Special meetings of the Board. [3 days notice.] Article III, Sections 5(c) & 5(d). Article II, Sec. 2.4; Article III, Sect. 3.3.
Quorum for Board meetings. Article III, Section 6. Article II, Section 2.7.
Officers elected by Directors. Article IV, Section 1. Article IV, Sections 4.1 & 4.2.
Additional offices may be created by Directors. Article IV, Section 1. Article IV, Section 4.1
Compensation of Officers. Article IV, Section 1. Article IV, Section 4.5.
Officers' term in office, removal from office. Article IV, Section 2(a). Article IV, Section 4.2.
Chairman of the Board - powers & duties. Article IV, Section 2(b). See Article IV, Section 4.4.
President - powers & duties. Article IV, Section 2(c). See Article IV, Section 4.4.
CEO - powers & duties. n.a. Article IV, Section 4.3.
Alternate presiding officer. n.a. See Article IV, Section 4.4.
Vice President (if only 1 appointed) - powers & duties.  n.a. See Article IV, Section 4.4.
Vice President (if more than 1) - powers & duties Article IV, Section 2(d). See Article IV, Section 4.4.
Secretary - duties. Article IV, Section 2(e). See Article IV, Section 4.4.
Assistant Secretary(s) - duties. n.a. See Article IV, Section 4.4.
Treasurer - duties. Article IV, Section 2(f).  See Article IV, Section 4.4.
Assistant Treasurer(s) - duties n.a. See Article IV, Section 4.4.
Controller - duties. Article IV, Section 2(f) [CFO] See Article IV, Section 4.4.
Vacancies. Article III, Section 3. Article II, Sect. 2.10; Art. IV, Sect. 4.7
Delegation of duties. n.a. n.a.
Stock certificates. Article VI, Section 1. Article V, Section 5.1.
Stock transfers. Article VI, Section 3. Article V, Sections 5.2 & 5.3.
Registered stockholders. Article VI, Section 5. n.a.
Fixing record date. Article VI, Section 4. Article I, Section 1.7.
Lost certificate. Article VI, Section 2. n.a.
Inspection of books. n.a. See Article VI.
Checks. n.a. n.a.
Fiscal year. n.a. n.a.
Dividends. n.a. n.a.
Notices. Article X Article III, Section 3.3.
Amendments to bylaws. Article XI n.a.
Emergency provisions apply in event of catastrophe. n.a. n.a.
Emergency meeting(s) of Board. n.a. n.a.
Filling vacancies. n.a. n.a.
Quorum. n.a. n.a.
Amendment without notice. n.a. n.a.
Powers / authority. n.a. n.a.
Powers in addition to those provided by law. n.a. n.a.
Director - Resignation & Removal Director - Resignation
Article III, Section 4 Article II, Section 2.9.
Director - Attend via Tel. Conf. Dir. & Shh. Mtgs. - Comm. Equip.
Article III, Section 6(d) Article III, Section 3.2.
Director - Action without meeting Director - Action by Consent
Article III, Section 7 Article III, Section 3.1
Executive Committee  
Article III, Section 9(a)  
Emeritus Director  
Article III, Section 10  
Execution of Corporate Instruments
Article V, Section 1  
Voting of Securities owned by Corp.
Article V, Section 2  
Other Securities of the Corporation
Article VII  
Indemnification of Officers, Directors
Article IX  
  Stockholder - Mtg. Adjournment
  Article I, Section 1.6
  Stockholders - Organ. of Mtg.
  Article I, Section 1.10.
  Stockholders - Order of Mtg.
  Article I, Section 1.11.
  Directors - Notice of Meetings
  Article II, Section 2.5.
  Directors - Waiver of Notice
  Article II, Section 2.6.
  Directors - Mtg. Adjournment
  Article II, Section 2.8.
  Officers - Resign. or Removal
  Article IV, Section 4.6.
  Shares Without Certificates
  Article V, Section 5.4.
  Maint. of Corp. Books & Recs.

Article VI

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