Mcbride Charter and by-Law Provisions

McBride Charters and By-Law Provisions
University of Phoenix
Corporate Governance
March 13, 2011

McBride Charters and By-Law Provisions

      In order for an organization to become a legal corporation it needs to have a corporate charter approved by the state government. What is a corporate charter? It is defined as, “A written document filed with a U.S. state by the founders of a corporation detailing the major components of a company such as its objectives, its structure and its planned operations.” (Investopedia, 2011) The sole purpose of a charter is to establish legitimacy for one’s corporation. Each charter must have the physical name and address of the company that is filing it as well as the names and addresses of all other directors or individuals who will have any affiliation with the handling of any legal documents for the business. A corporate charter must state the purpose or reason for forming the corporation with some states allowing the charter just to state that the business is being formed to conduct lawful business activities. This allows the corporation to be allowed to participate in legal activities. The charter must also state the number of shares that they will be able to issue to current and or future investors. If the corporation is going to issue out multiple classes of stock it must list on the charter the types of stocks they are. The values per share of the stock which is decided upon by the directors of the corporation must also be listed in the charter along with the par or minimum value of each share. The charter must be filed with the secretary or department of state where the corporation will be located in order for it to be considered a legitimate corporation.
      Once a corporate charter or also known as an article of incorporation is filed it will become public domain, meaning, that anyone who is opening up a similar business or just wants to find out more about a certain business will be able to access...