After you incorporate your business as a corporation or LLC, it’s wise to adopt a document setting the rules by which your company will operate. This not only is a requirement in many states but allows your company to follow rules, hold regular meetings and generally prevent disagreements that inevitably come up in the life of most companies.
Corporations adopt what are known as Corporate Bylaws. These are the rules agreed upon by the shareholders for managing various aspects of the company including:
Limited Liability Company’s adopt what is known as an Operating Agreement. These are similar to Bylaws but since LLCs are less formally structured than corporations, the Operating Agreement tends to cover more areas of operation and deal with issues like:
Both Bylaws and Operating Agreements can cover much more than discussed here and are easily updated by approving any changes amongst the members or shareholders.