Shareholder Rights: What Are Corporate Bylaws?
A shareholder is an individual or institution that owns at least one share in a corporation. Both public companies and private companies can have shareholders. As a shareholder, you have a financial interest in seeing the company do well. However, unless you are a majority shareholder, you have limited ability to influence the company’s action.
One of your primary rights as a shareholder in Florida is the right to inspect and review corporate bylaws. Those bylaws may provide additional legal protection. At Pike & Lustig, LLP, we want to make sure that shareholders know their rights. Here, our West Palm Beach shareholder dispute lawyers explain the most important things to know about corporate bylaws.
Corporate Bylaws: A Definition
The Cornell Legal Information Institute offers a useful definition of corporate bylaws: They are the “rules adopted by an organization to govern its internal operations and external dealings.” Referred to both as ‘company bylaws’ and simply ‘bylaws’, corporate bylaws are a legal document that will clarify certain regulations and procedures for day-to-day operations of the business.
Florida Shareholders have a Right to Inspect Corporate Bylaws
Under Florida state law (Florida Statutes § 607.1602), shareholders have the right to inspect certain types of corporate documents and records. Among other core documents that shareholders should be able to access in a reasonably timely manner include a company’s articles of incorporation and its corporate bylaws. If you are a shareholder who is struggling to get access to corporate bylaws, an experienced Florida shareholder rights lawyer can help.
Key Provisions to Look for in Corporate Bylaws
Every company’s corporate bylaws are different. The rules, regulations, and procedures govern the specific structure and operations of the business. That being said, there are some common elements that are generally shared in corporate bylaws of most companies in Florida. Here are some key provisions to look for when reviewing a company’s corporate bylaws:
- Statement of Purpose: A statement of purpose should clarify the goals of the business, including its target customer base.
- Membership: You need to know how membership and ownership works, including the voting records of certain classes of shareholders.
- Board of Directors: How is the board of directors determined and what is their power? The corporate bylaws should clarify the structure of the board of directors.
- Shareholders’ Meeting: The process for scheduling and conducting a shareholders’ meeting.
- Amendment Process: Corporate bylaws may need to be amended at some point in the future. There should be a process in place to govern any potential changes.
Call Our South Florida Shareholder Law Attorneys for Immediate Assistance
At Pike & Lustig, LLP, our Florida commercial law attorneys have extensive experience handling complex shareholder rights cases. If you are involved in a dispute over corporate bylaws or any other shareholder rights matter, we can help. Call us now or send us a direct message to arrange a fully confidential review of your case. Our commercial litigation lawyers handle shareholder disputes throughout South Florida, including in West Palm Beach, Miami, and Fort Lauderdale.