Illinois State Statute Code

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Sec.2.05.

Incorporators.

  1. One or more incorporators may organize a corporation under this Act. Each incorporator shall be either a corporation, domestic or foreign, or a natural person of the age of 18 years or more.
  2. Unless otherwise provided in the articles of incorporation, any action as provided in Section 2.20, Section 10.10 and Section 12.05 to be taken by the incorporators of a corporation, may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by all the incorporators.

Sec.2.25.

By laws.

Unless the power to make, alter, amend or repeal the by laws is reserved to the shareholders by the articles of incorporation, the by laws of the corporation may be made, altered, amended or repealed by the shareholders or the board of directors, but no by law adopted by the shareholders may be altered, amended or repealed by the board of directors if the by laws so provide. The by laws may contain any provisions for the regulation and management of the affairs of the corporation not inconsistent with law or the articles of incorporation.

Sec.2.25.

Authorized shares.

Each corporation shall have power to create and issue the number of shares stated in its articles of incorporation. Such shares may be divided into one or more classes, including classes of common shares, any or all of which classes may consist of shares with such designations, preferences, qualifications, limitations, restrictions, and such special or relative rights as shall be stated in the articles of incorporation; provided, however, that common shares may have no preference over any other shares with respect to distribution of assets upon liquidation or with respect to payment of dividends. Subject to the provisions of Section 7.40 of this Act, the articles of incorporation may limit or deny the voting rights of or provide special voting rights for the shares of any and all classes or of any series of a class. Without limiting the authority herein contained, a corporation, if so authorized in its articles of incorporation, may issue shares of preferred or special classes subject to one or more of the following conditions:

  1. Subject to the right of the corporation to redeem any of such shares at not exceeding the price fixed by the articles of incorporation for the redemption thereof.
  2. Entitling the holders thereof to dividends which are cumulative or partially cumulative, or which are non cumulative.
  3. Having preference over any other class or classes of shares as to the payment of dividends.
  4. Having preference as to the assets of the corporation over any other class or classes of shares upon the voluntary or involuntary liquidation of the corporation.
  5. Convertible into shares of any other class, or into shares of any series of the same or any other class.
  6. The dividend rate on which may be determined upon the basis of any facts ascertainable outside the articles of incorporation, but only if the manner in which such facts are to operate upon the dividend rate of any such preferred or special class shall be clearly and expressly set forth in the articles of incorporation.

Notwithstanding anything contained in Sections 6.10 and 7.40 of this Act, except as otherwise provided in the articles of incorporation, a corporation may create and issue, whether or not in connection with the issue and sale of its shares or bonds, rights or options entitling the holders thereof to purchase from the corporation, upon such consideration, terms and conditions as may be fixed by the board, shares of any class or series, whether authorized but unissued shares, treasury shares or shares to be purchased or acquired, notes of the corporation or assets of the corporation. The terms and conditions of such rights or options may include, without limitation, restrictions or conditions that preclude or limit the exercise, transfer or receipt of such rights or options by any person or persons owning or offering to acquire a specified number or percentage of the outstanding common shares or other securities of the corporation, or any transferee or transferees of any such person or persons, or that invalidate or void such rights or options held by any such person or persons or any such transferee or transferees. Any such rights or options heretofore created or issued prior to the effective date of this amendatory Act of 1989 which are in conformity with this Section 6.05 and are not otherwise in conflict with other provisions of this Act, are hereby ratified. Nothing in this Section 6.05 shall affect the rights and fiduciary obligations of the board of directors of a corporation in the creation and issuance of such rights or options, or in the taking or failing to take any action with respect to such rights or options.

Sec.6.40.

Liability of subscribers, shareholders, personal representatives and pledgees. A holder of or subscriber to shares of a corporation shall be under no obligation to the corporation or its creditors with respect to such shares other than the obligation to pay to the corporation the full consideration for which the shares were issued or to be issued. Any person becoming an assignee or transferee of shares or of a subscription for shares in good faith and without knowledge or notice that the full consideration therefor has not been paid shall not be personally liable to the corporation or its creditors for any unpaid portion of such consideration.

No person holding shares as executor, administrator, guardian, trustee, assignee for the benefit of creditors, or receiver shall be personally liable as a shareholder, but the beneficial owner thereof and the estate and funds in the custody of the executor, administrator, guardian, trustee, assignee, or receiver shall be liable for any unpaid portion of the full consideration for which such shares were issued or to be issued. No pledgee or other holder of shares as collateral security shall be personally liable as a shareholder.

Sec.8.05.

Board of directors.

  1. Except as provided in Article 2A of this Act, each corporation shall have a board of directors and the business and affairs of the corporation shall be managed by or under the direction of the board of directors.
  2. The articles of incorporation or by laws may prescribe qualifications for directors. A director need not be a resident of this State or a shareholder of the corporation unless the articles of incorporation or by laws so prescribe.
  3. Unless otherwise provided in the articles of incorporation or by laws, the board of directors, by the affirmative vote of a majority of the directors then in office, and irrespective of any personal interest of any of its members, shall have authority to establish reasonable compensation of all directors for services to the corporation as directors, officers or otherwise, notwithstanding the provisions of Section 8.60.

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Sec. 5 1.

Organization.

  1. One or more persons, other than natural persons under 18 years of age, may organize a limited liability company by executing and delivering articles of organization to the Secretary of State as specified in Sections 5 5 and 5 45. The organizers need not be members of the limited liability company. Each organizer of a limited liability company organized to engage in the practice of medicine shall be a licensed physician of this State or an attorney licensed to practice law in this State. The execution of the articles of organization constitutes an affirmation by the person, under penalty of perjury, that the facts stated therein are true.
  2. A limited liability company shall have one or more members.
  3. A limited liability company is a legal entity distinct from its members.

Sec.10 10.

Liability of members and managers.

  1. Except as otherwise provided in subsection (d) of this Section, the debts, obligations, and liabilities of a limited liability company, whether arising in contract, tort, or otherwise, are solely the debts, obligations, and liabilities of the company. A member or manager is not personally liable for a debt, obligation, or liability of the company solely by reason of being or acting as a member or manager.
  2. (Blank).
  3. The failure of a limited liability company to observe the usual company formalities or requirements relating to the exercise of its company powers or management of its business is not a ground for imposing personal liability on the members or managers for liabilities of the company.
  4. All or specified members of a limited liability company are liable in their capacity as members for all or specified debts, obligations, or liabilities of the company if:
    1. a provision to that effect is contained in the articles of organization; and
    2. a member so liable has consented in writing to the adoption of the provision or to be bound by the provision.

Sec.15 1.

Management of limited liability company.

  1. In a member managed company:
    1. each member has equal rights in the management and conduct of the company's business; and
    2. except as otherwise provided in subsection (c) of this Section, any matter relating to the business of the company may be decided by a majority of the members.
  2. In a manager managed company:
    1. each manager has equal rights in the management and conduct of the company's business;
    2. except as otherwise provided in subsection (c) of this Section, any matter relating to the business of the company may be exclusively decided by the manager or, if there is more than one manager, by a majority of the managers; and
    3. a manager:
      1. must be designated, appointed, elected, removed, or replaced by a vote, approval, or consent of a majority of the members; and
      2. holds office until a successor has been elected and qualified, unless the manager sooner resigns or is removed.
  3. The only matters of a member or manager managed company's business requiring the consent of all of the members are the following:
    1. the amendment of the operating agreement under Section 15 5;
    2. an amendment to the articles of organization under Article 5;
    3. the compromise of an obligation to make a contribution under Section 20 5;
    4. the compromise, as among members, of an obligation of a member to make a contribution or return money or other property paid or distributed in violation of this Act;
    5. the making of interim distributions under subsection (a) of Section 25 1, including the redemption of an interest;
    6. the admission of a new member;
    7. the use of the company's property to redeem an interest subject to a charging order;
    8. the consent to dissolve the company under subdivision (2) of subsection (a) of Section 35 1;
    9. a waiver of the right to have the company's business wound up and the company terminated under Section 35 3;
    10. the consent of members to merge with another entity under Section 37 20; and
    11. the sale, lease, exchange, or other disposal of all, or substantially all, of the company's property with or without goodwill.
  4. Action requiring the consent of members or managers under this Act may be taken without a meeting.
  5. A member or manager may appoint a proxy to vote or otherwise act for the member or manager by signing an appointment instrument, either personally or by the member or manager's attorney in fact.