Everything you need to protect your business & personal assets 5th Edition “Should be part of any serious business library—and any corporate library.” BOOKWATCH Free Legal Updates at Nolo.com A L L F O R M S O N C D - R O M A F O F O F R M S M S M O N C D - R O R O R M N O L O ® • Hold legal board meetings • Document corporate decisions • Maintain your legal standing THE Meetings, Minutes & Resolutions THE Corporate Records Handbook Attorney Anthony Mancuso, author of Incorporate Your Business e Story Dear friends, Founded in 1971, and based in an old clock factory in Berkeley, California, Nolo has always strived to offer clear legal information and solutions. Today we are proud to offer a full range of plain- English law books, legal forms, software and an award-winning website. Everything we publish is relentlessly researched and tested by a dedicated group of in-house legal editors, who together have more than 150 years’ experience. 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Mancuso, Anthony. e corporate records handbook : meetings, minutes & resolutions / by Anthony Mancuso. 5th ed. p. cm. ISBN-13: 978-1-4133-1203-4 (pbk.) ISBN-10: 1-4133-1203-9 (pbk.) 1. Corporation law United States Popular works. 2. Corporate meetings Law and legislation United States Popular works. 3. Business records Law and legislation United States Popular works. I. Title. KF1414.85.M36 2010 346.73'0664 dc22 2009048204 Copyright © 1998, 2002, 2005, 2007, and 2010 by Anthony Mancuso. All rights reserved. e NOLO trademark is registered in the U.S. Patent and Trademark O ce. Printed in the U.S.A. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise without prior written permission. Reproduction prohibitions do not apply to the forms contained in this product when reproduced for personal use. For information on bulk purchases or corporate premium sales, please contact the Special Sales Department. Call 800-955-4775 or write to Nolo, 950 Parker Street, Berkeley, California 94710. Please note We believe accurate, plain-English legal information should help you solve many of your own legal problems. But this text is not a substitute for personalized advice from a knowledgeable lawyer. If you want the help of a trained professional—and we’ll always point out situations in which we think that’s a good idea—consult an attorney licensed to practice in your state. Acknowledgments Many thanks to Diana Fitzpatrick for a superb job of editing this material, and to the entire Nolo crew for helping this book nd its place in the world. About the Author Anthony Mancuso is a corporations and limited liability company expert. A graduate of Hastings College of the Law in San Francisco, Tony is an active member of the California State Bar, writes books and software in the elds of corporate and LLC law, and has studied advanced business taxation at Golden Gate University in San Francisco. He also has been a consultant for Silicon Valley EDA (Electronic Design Automation) and other technology companies. He is currently employed at Google in Mountain View, California. Tony is the author of many Nolo books on forming and operating corporations (prot and nonprot) and limited liability companies. Among his current books are Incorporate Your Business; How to Form a Nonprot Corporation; Nonprot Meetings, Minutes & Records; Form Your Own Limited Liability Company; and LLC or Corporation? His books and software have shown over a quarter of a million businesses and organizations how to form and operate a corporation or an LLC. Tony has lectured at Boalt School of Law on the U.C. Berkeley campus (Using the Law in Non-Traditional Settings) and at Stanford Law School (How to Form a Nonprot Corporation). He taught Saturday Morning Law School business formation and operation courses for several years at Nolo Press oces in Berkeley. He has also scripted and narrated several audiotapes and podcasts covering LLCs and corporate formations and other legal areas for Nolo as well as e Company Corporation. He has given many recorded and live radio and TV presentations and interviews covering business, securities, and tax law issues. His law and tax articles and interviews have appeared in the Wall Street Journal and eStreet.Com. Tony is a licensed helicopter pilot and has performed for years as a guitarist in various musical idioms, including jazz, Afro-Cuban, and R&B. For links to Tony’s books, go to www.nolo.com, click on “About Nolo,” then “Nolo Authors,” then “Anthony Mancusco.” Downloading Forms and Other Materials e printed version of this book comes with a CD-ROM that contains legal forms and other material. You can download that material by going to www.nolo.com/back-of-book/cormi.html. You’ll get editable versions of the forms, which you can ll in or modify and then print. Table of Contents Your Legal Companion for e Corporate Records Handbook 1 Corporate Documents and Laws Organize Your Corporate Records 4 Your State Corporate Filing Office 8 Looking Up the Law Yourself 8 2 Meetings, Minutes, and Written Consents—How to Document Corporation Action ree Ways to Document Formal Corporate Decisions 12 Questions and Answers About Meetings, Minutes, and Written Consents 13 3 Before You Hold Your Meeting—Prep Work and Notice Overview of Corporate Meetings 22 Steps to Hold a Meeting 22 4 How to Hold a Directors’ or Shareholders’ Meeting Step 1. Call and Provide Notice of the Meeting 46 Step 2. Prepare Your Agenda 46 Step 3. Prepare Your Resolutions in Advance 46 Step 4. Gather for Your Meeting 47 Step 5. Hold a Virtual Meeting 47 Step 6. Appoint a Chairperson and Secretary 49 Step 7. Calling the Meeting to Order 49 Step 8. Do You Have a Quorum? 50 Step 9. Approve Minutes From Last Meeting 52 Step 10. Reports by Officers and Committees 52 Step 11. Introduce and Discuss Specific Proposals 54 Step 12. Take the Votes of Directors or Shareholders 56 Step 13. Handle Unfinished Business 59 Step 14. Adjourn the Meeting 59 [...]... directors’ meetings, because both are required to be held annu ally under provisions of the bylaws of the corporation Of course, Saul and Barbara plan to reelect each other to the board again this year, and they discuss and plan corporate operations all the time So their annual meetings are held on paper only They prepare minutes for each of these paper meetings and place them in the corporate records. .. Various state laws may impact the activities and operations of all businesses, whether or not they are incorporated For example, state and local building codes, professional and occupation licensing, and other laws and regulations may apply to your business and its operations When to Consult a Professional Holding corporate meetings and preparing standard resolutions and other corporate paperwork are usually... holding corporate meetings and other formalities according to state corporate laws Bylaws typically specify the frequency of regular meetings of directors and shareholders and the call, notice, quorum, and voting rules for each type of meeting They usually contain the rules for setting up and delegating authority to special committees of the board, the rights of directors and shareholders to inspect the corporate. .. together in person and discuss and vote on items of corporate business During or after the meeting, written minutes are prepared showing the date, time, place, and purpose of the meeting and the decisions (resolutions) approved by the board of directors or shareholders Chapters 3 and 4 cover the steps necessary to hold a real meeting of directors and shareholders Chapters 5 and 6 show how to prepare minutes. .. shareholders’ meetings These meetings are usually scheduled in the corporation’s bylaws The annual shareholders’ meeting is held first, in order to elect the board for the upcoming year After the shareholders’ meeting, and usually on the same day, the annual directors’ meeting is held At this meeting, the directors accept their positions for the upcoming year and tend to any business and corporate planning... annual meetings Instead, the secretary of the corporation pre pares minutes for a paper meeting showing the election of the board plus any other business the shareholders and directors agree upon in advance Example: Windows, Drapes, Sofas and Ottomans, Inc., is a closely held corporation owned and run by Saul and Barbara, a married couple They prepare minutes for the corporation’s annual shareholders’ and. .. form Minutes for a real or paper meeting are not prepared Only the written consent forms are kept in the corporate records book, to indicate that directors and shareholders made the necessary decisions Chapter 8 covers the procedure and forms necessary to obtain director and shareholder approval by written consent Questions and Answers About Meetings, Minutes, and Written Consents The questions and. .. shareholders’ meeting where the annual financial and business reports of the corporation are presented by the corporate secretary and president, followed by nominations and a vote for next year’s board Although the three main shareholders obviously have the power to reelect them selves each year and make other important corporate decisions, they go out of their way to include the outside shareholders... Shareholders’ 5 Preparing MinutesAnnual Shareholders’ Meetings 62 Preparing Minutes for Meetings Preparing Minutes for Special Shareholder Meetings 72 for Directors’ Meetings 6 Preparing MinutesMinutes Form 83 Choosing the Correct Preparing Minutes for Annual Directors’ Meetings 84 Preparing Minutes for Special Directors’ Meetings 92 7 PaperIsMeetings to Hold a Paper Meeting?... corporate filing office website Also, you’ll normally find there is one phone number at the corporate filing office devoted to handing corporate inquiries from the public l Throughout this book, we refer to the office that accepts corporate filings as the state corporate filing office, whether this office is formally designated as the secretary of state office or by some other title Your State’s Corporate . board meetings • Document corporate decisions • Maintain your legal standing THE Meetings, Minutes & Resolutions THE Corporate Records Handbook Attorney Anthony Mancuso, author of Incorporate. consumer and business self-help books and software.” LOS ANGELES TIMES e Trusted Name (but don’t take our word for it) 5th edition The Corporate Records Handbook Meetings, Minutes & Resolutions By. of the forms, which you can ll in or modify and then print. Table of Contents Your Legal Companion for e Corporate Records Handbook 1 Corporate Documents and Laws Organize Your Corporate Records