Tennessee corporate bylaws requirements come from two statutes: the Tennessee Business Corporation Act (TBCA) for for-profits and the Tennessee Nonprofit Corporation Act (TNCA) for nonprofits. Both leave most drafting choices to the organization, but both impose a baseline. Bylaws cannot conflict with the charter or with state law, and they must cover the pieces the statutes assume are there: how the board is structured, which officers exist, how meetings run, how records are kept, and how the document itself gets changed. Everything else is drafting judgment.
Who Adopts the First Set of Bylaws
For a for-profit corporation, bylaws come into existence at the organizational meeting held after the charter is filed with the Secretary of State. If the charter names initial directors, those directors run the meeting, appoint officers, and adopt the bylaws. If the charter does not name directors, the incorporators run the meeting and either elect directors or complete the setup themselves. The meeting can happen inside or outside Tennessee, and incorporators can skip the meeting entirely by unanimous written consent.1Justia. Tennessee Code 48-12-105 – Organization of Corporation
For a nonprofit without members, the incorporators adopt the bylaws until directors are chosen, and the board then takes over. Once the board is in place, it can adopt or amend bylaws by a majority of the directors in office, provided the meeting notice states that bylaw changes are on the agenda.2Justia. Tennessee Code 48-60-202 – Amendment of Bylaws by Board of Directors or Members
Board of Directors
Every Tennessee for-profit corporation must have a board, and the board exercises all corporate powers unless the charter says otherwise.3Justia. Tennessee Code 48-18-101 – Requirement for and Duties of Board of Directors A narrow exception: corporations with 50 or fewer shareholders can dispense with or limit board authority by describing in the charter who performs the board’s duties instead. Anyone stepping into that role is held to the same standards as a director.
Nonprofits get no such exception. Every Tennessee nonprofit must have a board, and the board exercises all corporate powers unless the TNCA or the charter provides otherwise.4Justia. Tennessee Code 48-58-101 – Requirement for and Duties of Board of Directors The bylaws are where you set the number of directors, their terms, how vacancies get filled, and any standing committees the board can create.
Required Officers
A for-profit corporation has whatever officers its bylaws describe or its board designates. The board elects or appoints officers unless the charter or bylaws say otherwise, and one person can hold multiple offices. Somewhere in the bylaws or in a board action, one officer must be given responsibility for preparing minutes and authenticating corporate records.5Justia. Tennessee Code 48-18-401 – Required Officers
Nonprofits have a firmer floor. Every Tennessee nonprofit must have at least a president and a secretary, and the same person cannot hold both offices at once. Otherwise, one person can fill multiple roles. The same minutes-and-records duty applies.6Justia. Tennessee Code 48-58-401 – Required Officers Spell out each officer’s duties, term, and removal process in the bylaws so there is no ambiguity when a resignation or dispute lands on the board’s desk.
Meetings, Quorum, and Voting
A for-profit corporation must hold an annual shareholder meeting at a time stated in or determined under the bylaws, unless directors are elected by written consent instead.7Justia. Tennessee Code 48-17-101 – Annual Meeting A nonprofit with members must also hold an annual meeting, at which the president and chief financial officer report on activities and finances.8Justia. Tennessee Code 48-57-101 – Annual Meeting Missing the annual meeting does not automatically void corporate actions, but skipping it invites governance disputes.
For shareholder voting groups, the default quorum is a majority of the votes entitled to be cast, unless the charter sets a different threshold. Bylaws can raise the quorum or the vote required, but only if the charter authorizes it, and once raised, those higher thresholds cannot be adopted, changed, or repealed by the board acting alone.9Justia. Tennessee Code 48-20-201 – Amendment of Bylaws by Board of Directors or Shareholders Cover how meetings are called, the notice period, who presides, and how votes are counted.
Records and Inspection Rights
Tennessee for-profit corporations must keep permanent records of all meeting minutes, all actions taken without a meeting, and all committee actions. A current copy of the bylaws with all amendments must be kept at the principal office.10Justia. Tennessee Code 48-26-101 – Corporate Records Nonprofits carry identical obligations.11Justia. Tennessee Code 48-66-101 – Corporate Records
Shareholders can inspect and copy the bylaws and other principal-office records during regular business hours after giving at least five business days’ written notice. The charter and bylaws cannot take that right away.12Justia. Tennessee Code 48-26-102 – Inspection of Records by Shareholders More sensitive records, like accounting records or board minute excerpts not held at the principal office, require a good-faith, proper purpose stated with reasonable specificity. Nonprofit members have parallel inspection rights on the same five-business-day notice, and those rights also cannot be eliminated in the charter or bylaws.13Justia. Tennessee Code 48-66-102 – Inspection of Records by Members
Conflicts of Interest and Indemnification
The TNCA addresses director and officer conflicts directly. When a director or officer has a personal financial interest in a transaction under consideration, they must disclose information the other directors don’t already have. The transaction can proceed only if a majority of “qualified directors” (at least two) approve it after the conflicted director leaves the deliberation entirely.14Justia. Tennessee Code 48-58-703 – When Directors or Officers Action Respecting Conflicting Interest Transaction Is Effective If the process isn’t followed, the transaction can be challenged in court unless it is shown to have been fair to the corporation, or the attorney general approves it.15Justia. Tennessee Code 48-58-702 – Conflicting Interest Transaction May Be Subject of Equitable Relief The TBCA has parallel provisions for for-profits. A written conflict of interest policy in the bylaws is worth including regardless of entity type.
Bylaws are also the usual home for indemnification of directors and officers. Under both the TBCA and TNCA, an officer who is not a director is entitled to the same mandatory indemnification as a director and can apply for court-ordered indemnification on the same terms.16Justia. Tennessee Code 48-18-507 – Indemnification of Officers, Employees, and Agents17Justia. Tennessee Code 48-58-507 – Indemnification of Officers, Employees, and Agents Beyond the statutory floor, an organization can extend additional indemnification to officers, employees, and agents through the charter, bylaws, a board resolution, or a contract, as long as the extension is consistent with public policy. Spell out in advance who gets indemnified, under what conditions, and how legal expenses are advanced.
Amending the Bylaws
A for-profit board can amend or repeal bylaws unless the charter reserves that power to shareholders, or the shareholders have adopted a specific bylaw and expressly stated the board cannot change it. Shareholders keep the amendment power in all cases, even when the board also has it.9Justia. Tennessee Code 48-20-201 – Amendment of Bylaws by Board of Directors or Shareholders
Nonprofit amendments follow the same structure, but with specific voting thresholds when members act. Members approve bylaw amendments by two-thirds of the votes cast or a majority of the total voting power, whichever is less. An amendment that only establishes or changes a specific dues amount requires a majority of members present and voting, unless the charter or bylaws set a higher bar. If the charter requires a third party’s written approval for amendments, that approval must be obtained too.2Justia. Tennessee Code 48-60-202 – Amendment of Bylaws by Board of Directors or Members
One self-locking rule applies to both entity types: a bylaw that increases the quorum or voting requirement for the board can be adopted or amended only by meeting whichever is greater, the current requirement or the proposed one. A slim majority cannot quietly lower a governance protection the organization previously chose to raise.
Extra Items for 501(c)(3) Nonprofits
A Tennessee nonprofit seeking or maintaining 501(c)(3) status has to satisfy federal requirements that go beyond state law. The most consequential is the dissolution clause: the IRS requires the organizing documents to state that on dissolution, assets will be distributed for exempt purposes under IRC Section 501(c)(3), or to a federal, state, or local government for a public purpose.18Internal Revenue Service. Does the Organizing Document Contain the Dissolution Provision Required Under Section 501(c)(3) This language usually lives in the charter, and many organizations put it in the bylaws as well.
The IRS also asks on Form 990 whether the organization has a written conflict of interest policy, how it manages conflicts, and how it identifies them. Building a compliant policy into the bylaws answers those questions in one place.
What Happens When Bylaws Are Ignored
Directors and officers have a fiduciary duty that includes following the bylaws. When leadership holds improperly noticed meetings, makes unauthorized decisions, or skips procedural requirements, the resulting corporate actions can be invalidated. Shareholders who believe the board has harmed the corporation by acting outside its authority can bring a derivative proceeding; the shareholder must have owned shares when the transaction occurred (or acquired them by operation of law afterward), and the complaint must describe any demand made on the board and why it was refused, ignored, or not made.19Justia. Tennessee Code 48-17-401 – Procedure in Derivative Proceedings Nonprofit members can pursue similar remedies, and Tennessee Rule 23.06 requires the complaint to be verified and to allege that the plaintiff was a member at the time of the disputed transaction and fairly represents similarly situated members.20Tennessee Administrative Office of the Courts. Tennessee Rules of Civil Procedure Rule 23.06 – Derivative Actions by Shareholders
Courts treat bylaws as binding contracts between the organization and its stakeholders. The best protection is drafting clear rules, following them consistently, and keeping the records that prove you did.