Free California Corporate Bylaws Template

Corporate bylaws are the internal rules a California corporation adopts to run its own affairs. Section 212 of the Corporations Code governs them, and it opens with a requirement rather than a permission.

Under section 212(a), the bylaws shall set forth the number of directors, unless the articles do it instead. California corporate bylaws that skip this are incomplete on the face of the statute.

The board-size rules are where California departs sharply from most states, so they come first.

A Three-Director Floor, and Its Five Exceptions

Section 212(a) provides that the number or minimum number of directors shall not be less than three. Five carve-outs follow: before shares are issued the number may be one or two; so long as the corporation has only one shareholder it may be one or two; and so long as it has only two shareholders it may be two.

Fixed Number or a Range

You may state an exact number, or a stated minimum and maximum. If you choose a range, section 212(a) caps the maximum at two times the stated minimum minus one. The board or the shareholders then fix the exact figure inside that range, in the manner the bylaws provide.

Changing the Number Once Shares Are Out

After shares are issued, a bylaw that specifies or changes a fixed number, changes the maximum or minimum, or switches between a fixed and a variable board may only be adopted by approval of the outstanding shares. A further limit applies to cuts below five directors, which a minority of more than 16-2/3 percent of the shares entitled to vote can defeat.

Emergency Bylaws

Section 212(c) lets bylaws include provisions that operate only in an emergency as defined in section 207, such as how a board meeting gets called and what quorum applies. During one, the board may act as needed but may not take any action requiring a shareholder vote unless that vote was obtained beforehand.

Three, unless one of the five statutory exceptions in section 212(a) fits your corporation. The exceptions all turn on either not having issued shares yet or having only one or two shareholders.

Solo founders run into this most often. A single-shareholder corporation may run with one director, but the moment a third shareholder arrives, the three-director floor applies and the bylaws need to match.

Plan the wording accordingly. A range gives you room to add directors without a bylaw amendment, while a fixed number keeps control tight and predictable.

California corporate bylaws stay internal, so nothing here involves a filing with the state.

1. Form the corporation by filing your articles of incorporation.
2. Settle the board size first. Decide between a fixed number and a minimum-maximum range, and check it against the three-director floor.
3. Draft the rest of the bylaws around meetings, proxies, officers, committees, and shares.
4. Adopt them and record the decision in your minutes with a date.
5. Keep the signed set with your corporate records, and reissue it whenever an amendment passes.