Delaware corporate bylaws delineate the internal framework and operational protocols for corporations registered in the state. They address the roles and responsibilities of corporate officers and directors, protocols for shareholder meetings, voting procedures, dividend distribution policies, and the handling of corporate assets.
These bylaws are drafted during the incorporation process, requiring formal approval by the corporation’s board of directors and shareholders. Unlike articles of incorporation, these internal documents do not require filing with the Secretary of State. They serve as a reference in resolving internal disputes and addressing matters involving external parties.
Legal Requirements
According to state law, corporations must establish bylaws (Del. Code § 109). Additionally, it’s important to consider several other legal requirements when drafting the bylaws for your corporation:
Naming Considerations
- Required Words: “Association,” “Company,” “Corporation,” “Club,” “Foundation,” “Fund,” “Incorporated,” “Institute,” “Society,” “Union,” “Syndicate,” “Limited,” an abbreviation thereof, or language of like import (choose one).
- Prohibited Words: “Bank,” or any variation, unless the business is a financial institution.
- Name Reservation Period: 120 days.
- Renewal Period: Renewable (for consecutive 120-day periods).
- Transferability: Yes.
Emergency Bylaws
Corporations can adopt emergency bylaws effective during various emergencies, such as attacks on the United States or areas where the entity operates, nuclear disasters, or pandemics, without the need for a quorum. They cover meeting protocols, succession plans, and necessary actions during emergencies. Officers and directors acting under these bylaws are protected from liability, and regular bylaws remain in effect (§ 110).
