Meeting and Minutes
One of the formal requirements every corporation must do is hold an annual meeting with the Shareholders and Board of Directors. This is a requirement of every state in order for the corporation to remain in good standing. The business is also required to take minutes of meetings to be kept with the internal books and records of the company.
Corporations are required to hold at least one shareholder meeting every year. The bylaws of the corporation state the time and location of the annual meeting. The annual meeting is required to elect/re-elect the board of directors and vote on other business affairs. Special meetings may also be required to discuss actions that need immediate attention like: removal of a director, corporate merger or dissolution.
Proper notice to shareholders of annual meeting and special meetings is required and should be followed. All shareholders that are entitled to a vote must be given notice of any meeting, however all shareholders are not required to attend the meeting. For meetings where directors will be elected the notice should include the names of the persons nominated for election. Typically, notice of meetings should be provided two weeks to three months before the meeting.
Although all shareholders are entitled to a vote, not all shareholders may attend the meeting and vote. Most states have default quorum of a majority of voting shareholders. Some states allow the company to specify their own quorum requirements within their bylaws. During meetings items are presented to the shareholders to vote on. Depending on the topic voting requirements may differ. The corporation should check with their states to find out the minimum number for votes required to approve a particular action.
Typically minutes of the shareholder/director meetings are taken by the secretary of the corporation. Minutes should include a high level overview of the meeting but doesn’t need to include the specific details. The minutes are an official record of the decisions made during the meeting. The minutes of the meeting should include: time, date, place and who was in attendance at the meeting. They also should include the agenda items to be discussed, voting items and their outcome and how a certain individual voted on each item.
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