Corporations and Associations - Revisions

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0996*

HOUSE BILL 996
C1 6lr2301
CF SB 631
By: Delegate Amprey
Introduced and read first time: February 6, 2026
Assigned to: Economic Matters
Committee Report: Favorable
House action: Adopted
Read second time: February 27, 2026

CHAPTER ______

AN ACT concerning 1

Corporations and Associations – Revisions 2

FOR the purpose of requiring the State Department of Assessments and Taxation to notify 3
a person who files a charter document if the Department does not accept the 4
document; requiring the Department to accept a corrected charter document under 5
certain circumstances; authorizing certain governing bodies of certain corporations 6
to take certain actions without a meeting of the governing body subject to certain 7
conditions; authorizing certain individuals to take certain actions to carry out a final 8
order under bankruptcy law subject to certain conditions; repealing the authority of 9
certain persons to maintain a suit in a State court; repealing the penalty imposed on 10
each officer of a foreign corporation for certain actions; providing the means and 11
conditions for amending a partnership agreement are governed by the partnership 12
agreement; specifying the part ies bound by the partnership agreement and the 13
manner in which the agreement may be adopted and amended; and generally 14
relating to corporations and associations. 15

BY repealing and reenacting, with amendments, 16
Article – Corporations and Associations 17
Section 1–201, 2–408, 3–301, 7–301, 7–302, 9A–103, and 10–302 18
Annotated Code of Maryland 19
(2025 Replacement Volume) 20

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 21
That the Laws of Maryland read as follows: 22

2 HOUSE BILL 996

Article – Corporations and Associations 1

1–201. 2

(a) The Department may not accept for record any charter document of a 3
Maryland corporation which does not conform with law. However, any document which 4
purports to be acknowledged may be treated by the Department as properly acknowledged. 5

(b) (1) IF THE DEPARTMENT DOES NOT ACCEPT A CHARTER DOCUMENT 6
FOR RECORD , THE DEPARTMENT SHALL NOTI FY THE PERSON WHO FI LED THE 7
DOCUMENT OF THE REJECTION AND THE REASON FOR THE REJECTION. 8

(2) IF A CORRECTED CHARTE R DOCUMENT IS REFILE D AND 9
ACCEPTED BY TH E DEPARTMENT FOR RECORD WITHIN 30 DAYS AFTER THE 10
DEPARTMENT’S MAILING OF THE NOT ICE OF THE REJECTION , THE DEPARTMENT 11
SHALL ACCEPT FOR REC ORD THE CORRECTED CH ARTER DOCUMENT AS OF THE 12
DATE THE REJECTED CHARTER DOCUMENT WAS ORIGINALLY FILED. 13

(C) The Department may not accept for record or filing any charter document, 14
qualification, registration, change of resident agent or principal office, report, service of 15
process or notice, or other document until all required recording, filing, organization and 16
capitalization, and other special fees have been paid to the Department. 17

[(c)] (D) (1) The Department may accept documents that are filed for record 18
by electronic transmission. 19

(2) Documents filed for record by electronic transmission are subject to the 20
regular filing fees and expedited processing fees provided in § 1–203 of this subtitle. 21

[(d)] (E) (1) On payment of the regular processing fee and, if applicable, 22
expedited processing fee provided in § 1 –203 of this subtitle, the Department may accept 23
for preclearance any document or draft of any document listed in § 1–203(b)(1) or (4) of this 24
subtitle. 25

(2) The Department may adopt regulations to administer the preclearance 26
process. 27

2–408. 28

(a) Unless the charter or bylaws of the corporation requir e a greater proportion 29
or this article requires a different proportion, the action of a majority of the directors 30
present at a meeting at which a quorum is present is the action of the board of directors. 31

(b) (1) Unless the bylaws of the corporation prov ide otherwise, a majority of 32
the entire board of directors constitutes a quorum for the transaction of business. 33

HOUSE BILL 996 3

(2) The bylaws may provide that less than a majority, but not less than 1
one–third of the entire board of directors, may constitute a quorum unless: 2

(i) There are only two or three directors, in which case not less than 3
two may constitute a quorum; or 4

(ii) There is only one director, in which case that one will constitute 5
a quorum. 6

(c) Any action required or permitted to be taken at a meeting of the board of 7
directors or of a committee of the board may be taken without a meeting if a unanimous 8
consent which sets forth the action is: 9

(1) Given in writing or by electronic transmission by each member of the 10
board or committee entitled to vote on the matter; and 11

(2) Filed in paper or electronic form with the minutes of proceedings of the 12
board or committee. 13

(D) UNLESS THE CHARTER REQUIRES OTHERWISE, ANY ACTION REQUIRED 14
OR PERMITTED TO BE TAKEN AT A MEETING OF THE BOARD OF DIRECTORS OR OF A 15
COMMITTEE OF THE BOA RD OF A CORPORATION THAT IS REGISTERED A S AN 16
OPEN–END INVESTMENT COMPA NY UNDER THE FEDERAL INVESTMENT COMPANY 17
ACT OF 1940 MAY BE TAKEN WITHOUT A MEETING IF THE CONSENT OF A MAJORITY 18
OF THE ENTIRE BOARD OF DIRECTORS OR A MAJORITY OF THE DIRECTORS SERVING 19
ON THE COMMITTEE AND IN THE MANNER AND BY THE VOTE REQUIRED UNDER THE 20
FEDERAL INVESTMENT COMPANY ACT OF 1940 WHICH SETS FORTH THE ACTION IS: 21

(1) GIVEN IN WRITING OR B Y ELECTRONIC TRANSMI SSION BY THE 22
DIRECTORS WHO CONSENT TO THE ACTION; 23

(2) FILED IN PAPER OR ELE CTRONIC FORM WITH TH E MINUTES OR 24
PROCEEDINGS OF THE BOARD OR COMMITTEE; AND 25

(3) SENT WITHIN 3 DAYS AFTER THE EFFECTIVE DATE OF THE ACTION 26
TO ALL DIRECTORS OR TO ALL MEMBERS OF THE COMMITTEE. 27

(E) A DIRECTOR WHO DID NOT CONSENT AND RECE IVES A NOTICE UNDER 28
SUBSECTION (D) OF THIS SECTION MAY FILE A DISSENT TO THE ACTION BY SENDING 29
A NOTICE OF DISSENT TO THE SECRETARY OF THE CORPORATION WITHIN 10 DAYS 30
OF RECEIPT OF THE NOTICE BY: 31

(1) CERTIFIED MAIL , RETURN RECEIPT RE QUESTED, BEARING A 32
POSTMARK FROM THE UNITED STATES POSTAL SERVICE; OR 33

4 HOUSE BILL 996

(2) ELECTRONIC TRANSMISSION. 1

[(d)] (F) (1) An individual, whether or not then a director, may assent to an 2
action by a consent that will be effective at a future time that is no later than 60 days after 3
the consent is delivered to the corporation or its agent. 4

(2) The effective time of a consent under this subsection may include a time 5
determined on the happening of an event that occurs no later than 60 days after the consent 6
is delivered to the corporation or its agent. 7

(3) A consent under this subsection shall be deemed to have been given at 8
the effective time if the individual: 9

(i) Is a director at the effective time; and 10

(ii) Did not revoke the consent before the effective time. 11

(4) Unless otherwise provided in the consent, a consent under this 12
subsection is revocable before the effective time. 13

[(e)] (G) (1) The charter may provide that one or more directors or a class of 14
directors shall have more or less than one vote per director on any matter. 15

(2) If the charter provides that one or more directors shall have more or 16
less than one vote per director on any matter, every reference in this article to a majority 17
or other proportion of directors shall refer to a majority or other proportion of votes entitled 18
to be cast by the directors. 19

3–301. 20

(a) (1) [If the] SUBJECT TO SUBSECTION (B) OF THIS SECTION, IF A final 21
order [of a court makes a plan of reorganization] FOR RELIEF HAS BEEN ENTERED OR IS 22
OTHERWISE EFFECTIVE UNDER FEDERAL BANKRUPTCY LAW AND I S binding on the 23
stockholders of a corporation, the board of directors OF THE CORPORATION, THE trustee 24
APPOINTED BY THE BAN KRUPTCY COURT , or THE receiver APPOINTED BY THE 25
BANKRUPTCY COURT, as the case may be, may AMEND THE CHARTER , AMEND THE 26
BYLAWS, TRANSFER ASSETS , DISSOLVE THE CORPORA TION, OR take any OTHER 27
action necessary to carry out the [plan] ORDER without any [other corporate approval ] 28
ACTION BY THE STOCKHOLDERS. 29

(2) IF THE FINAL ORDER AUTHORIZES A TRUSTEE OR A RECEIVER TO 30
TAKE ACTION, THE TRUSTEE OR THE R ECEIVER MAY TAKE THE ACTION WITHOUT 31
THE APPROVAL OF THE BOARD OF DIRECTORS. 32

HOUSE BILL 996 5

(b) (1) ON THE ENTRY OF A FIN AL DECREE IN THE BAN KRUPTCY 1
PROCEEDING CLOSING A CASE AND DISCHARGING THE TRUSTEE OR THE RECEIVER, 2
SUBSECTION (A) OF THIS SECTION SHALL NO LONGER APPLY TO THE CORPORATION. 3

(2) THE CLOSING OF THE CASE AND DISCHARGE OF THE TRUSTEE OR 4
THE RECEIVER MAY NOT AFFECT THE VALIDITY OF ANY ACT TAKEN PRI OR TO THE 5
CLOSING AND DISCHARGE UNDER SUBSECTION (A) OF THIS SECTION. 6

(C) If a charter document is required to be filed with the Department to carry out 7
a transaction under subsection (a) of this section, it shall state: 8

(1) That the transaction was carried out under [a plan of reorganization 9
pursuant to a] THE final order of a BANKRUPTCY court having jurisdiction; 10

(2) The name of the court and the caption and docket number of the 11
proceedings; and 12

(3) That the transaction was approved by the board of directors, THE 13
trustee, or THE receiver, as the case may be. 14

[(c)] (D) If the action is taken by a trustee or receiver, he may sign and 15
acknowledge the charter document for the corporation, and no other execution, 16
acknowledgment, or affidavit on behalf of the corporation is required. 17

7–301. 18

If a foreign corporation is doing or has done any intrastate, interstate, or foreign 19
business in this State without complying with the requirements of Subtitle 2 of this title, 20
[neither] the corporation [nor any person claiming under it ] may maintain a sui t in any 21
court of this State [unless] IF it shows to the satisfaction of the court that: 22

(1) The foreign corporation [or the person claiming under it ] has paid the 23
penalty specified in § 7–302 of this subtitle; and 24

(2) Either: 25

(i) The foreign cor poration or a foreign corporation successor to it 26
has complied with the requirements of Subtitle 2 of this title; or 27

(ii) The foreign corporation and any foreign corporation successor to 28
it are no longer doing intrastate, interstate, or foreign business in this State. 29

7–302. 30

6 HOUSE BILL 996

(a) [(1)] If a foreign corporation does any intrastate, interstate, or foreign 1
business in this State without qualifying or registering as required by Subtitle 2 of this 2
title, the Department shall impose a penalty of $200 on the corporation. 3

[(2)] (B) This penalty may be reduced or abated under § 14 –704 of the 4
Tax – Property Article. 5

[(b) Each officer of a foreign corporation which does intrastate, interstate, or 6
foreign business in this State without qualifying or registering as required by Subtitle 2 of 7
this title, and each agent of the foreign corporation who transacts intrastate, interstate, or 8
foreign business in this State for it is guilty of a misdemeanor and on conviction is subject 9
to a fine not exceeding $1,000.] 10

9A–103. 11

(a) Except as otherwise provided in subsection (b) of this section, relations among 12
the partners and between the partners and the partnership AND THE MEANS AND 13
CONDITIONS FOR AMEND ING THE PARTNERSHIP AGREEMENT are governed by the 14
partnership agre ement. To the extent the partnership agreement does not otherwise 15
provide, this title governs relations among the partners and between the partners and the 16
partnership. 17

(b) The partnership agreement may not: 18

(1) Vary the rights and duties under § 9A–105 of this subtitle except to 19
eliminate the duty to provide copies of statements to all of the partners; 20

(2) Unreasonably restrict the right of access to books and records under § 21
9A–403(b) of this title; 22

(3) Eliminate the duty of loyalty under § 9A–404(b) or § 9A –603(b)(3) of 23
this title, but: 24

(i) The partnership agreement may identify specific types or 25
categories of activities that do not violate the duty of loyalty; however, the partnership 26
agreement may not be amended to expand or add any s pecific types or categories of 27
activities that do not violate the duty of loyalty without the consent of all partners after full 28
disclosure of all material facts; or 29

(ii) All of the partners or a number or percentage of not less than a 30
majority of disinterested partners specified in the partnership agreement may authorize or 31
ratify, after full disclosure of all material facts, a specific act or transaction that otherwise 32
would violate the duty of loyalty; 33

(4) Unreasonably reduce the duty of care unde r § 9A –404(c) or § 34
9A–603(b)(3) of this title; 35
HOUSE BILL 996 7

(5) Eliminate the obligation of good faith and fair dealing under § 1
9A–404(d) of this title, but the partnership agreement may prescribe the standards by 2
which the performance of the obligation is to be m easured, if the standards are not 3
manifestly unreasonable; 4

(6) Vary the power to dissociate as a partner under § 9A–602(a) of this title, 5
except to require the notice under § 9A–601(1) of this title to be in writing; 6

(7) Vary the right of a court to expel a partner in the events specified in § 7
9A–601(5) of this title; 8

(8) Vary the requirement to wind up the partnership business in cases 9
specified in § 9A–801(4), (5), or (6) of this title; 10

(9) Vary the law applicable to a limited liability partne rship under § 11
9A–106 of this subtitle; or 12

(10) Restrict rights of third parties under this title. 13

10–302. 14

(a) A partnership agreement may provide for classes or groups of limited partners 15
having the relative rights, powers, and duties that the partnership agreement may provide, 16
and may provide for the future creation, in the manner provided in the partnership 17
agreement, of additional classes or groups of limited partners having the relative rights, 18
powers, and duties senior to existing classes and gr oups of limited partners as the 19
partnership agreement may provide. 20

(b) Subject to § 10–303 of this subtitle, the partnership agreement may grant to 21
all or certain identified limited partners or a specified class or group of limited partners the 22
right to vote (on a per capita or any other basis) separately or together with the general 23
partners or with all or any other class or group of limited partners or on any matter. 24

(c) A partnership agreement that grants a right to vote may set forth provisions 25
relating to notice of the time, place, or purpose of any meeting at which any matter is to be 26
voted on by any limited partners, waiver of any notice, action by consent without a meeting, 27
the establishment of a record date, quorum requirements, voting in person or by proxy, or 28
any other matter with respect to the exercise of any right to vote. 29

(D) A LIMITED PARTNERSHIP IS BOUND BY AND MAY ENFORCE THE 30
PARTNERSHIP AGREEMEN T WHETHER OR NOT THE LIMITED PARTNERSHIP HAS 31
ITSELF MANIFESTED ASSENT TO THE AGREEMENT. 32

(E) A PERSON THAT BECOMES A PARTNER IS DEEMED TO ASSENT TO THE 33
PARTNERSHIP AGREEMENT. 34
8 HOUSE BILL 996

(F) TWO OR MORE PERSONS I NTENDING TO BECOME T HE INITIAL 1
PARTNERS OF A LIMITED PARTNERSHIP MAY MAKE AN AGREEMENT THAT PROVIDES 2
THAT ON THE FORMATION OF THE LIMITED PARTNERSHIP THE AGREEMENT WILL BE 3
THE PARTNERSHIP AGREEMENT. 4

(G) UNLESS OTHERWISE PROV IDED IN THE PARTNERS HIP AGREEMENT , 5
THE AFFIRMATIVE VOTE OR CONSENT OF ALL TH E PARTNERS IS REQUIR ED TO 6
AMEND THE PARTNERSHIP AGREEMENT. 7

(H) (1) A PARTNERSHIP AGREEMENT MAY SPECIFY THAT AN AMENDMENT 8
TO THE AGREEMENT REQUIRES: 9

(I) THE APPROVAL OF A PERSON THAT IS NOT A PARTY TO THE 10
AGREEMENT; OR 11

(II) THE SATISFACTION OF A CONDITION. 12

(2) IF THE ADOPTION OF TH E AMENDMENT DOES NOT INCLUDE THE 13
REQUIRED APPROVAL OR SATISFY THE SPECIFIED CONDITION, AN AMENDMENT TO 14
A PARTNERSHIP AGREEMENT IS INEFFECTIVE. 15

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 16
October 1, 2026. 17

Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.