fbpx
logo
Call Us : 623.551.5457
Menu ▼▲
  • Home
  • Firm Overview
    • Testimonials
  • Attorneys
    • Sam Crump
    • Nichole Oblinger
  • Practice Areas
    • Bankruptcy
      • Chapter 7
      • Chapter 13
      • Short Sales
      • Foreclosures
    • Business & Corporate Law
      • Disputes
      • Corporate Counseling
      • Business Formation
      • Contract Law
      • E-Commerce Law
      • Franchises
    • Civil Litigation
    • Family Law
      • Divorce
      • Child Support
      • Child Custody
      • Marriage
    • Real Estate Law
    • Probate & Estate
  • Resources
    • Articles
    • Blog
    • FAQs
      • Family Law
      • Search and Seizure
      • Foreclosure
      • Drunk Driving, DUI & DWI
      • Divorce Meditation
      • Arrests and Interrogations
      • Alimony
  • Contact

Corporate Minutes

An often overlooked matter by small business owners are the company’s corporate minutes. It is vital that all corporations keep adequate documentation in the form of minutes of its member, shareholder and director or manager meetings. In many jurisdictions, including Arizona, the absence of proper records may be cause potential liability for the shareholders of a corporation, particularly in cases where the shareholders are directors themselves, or where they have close relationships to the corporate directors. The following are some frequently asked questions about corporate minutes:

1) What types of matters are usually included in corporate minutes?

Most jurisdictions require corporations to hold annual shareholder’s meetings to elect directors. Also, the bylaws of most corporations also require their board of directors to have an annual meeting. Although the board may delegate day-to-day operation of the business, the following actions normally require approval by the board of directors:

  • Electing officers of the corporation
  • Adopting business policies and plans,
  • Designating committees and allocating authority to them
  • Issuing and selling stock
  • Approving the sale, lease, conveyance, exchange, transfer, or other disposition of all or substantially all corporate property and assets
  • Approving mergers and reorganizations
  • Approving the adoption of pension, profit-sharing, other employee benefit plans and stock-option plans
  • Approving corporate borrowing and loans
  • Entering into joint ventures.

The board generally should also approve the following types of transactions:

  • Designating corporate bank accounts and authorized signatories
  • Changing an officer’s compensation (unless this has been expressly delegated)
  • Entering into a major lease of premises
  • Entering into any other major contractual agreement or venture

2) What if my company has informal meetings?

May companies, small corporations in particular often have informal “meetings” where these matters are decided. If you are on of these such companies, it is important to subsequently prepare meeting minutes or unanimous written consents (signed by all the directors in lieu of a meeting) that approve the actions. These type of meetings are perfectly acceptable, the meeting should just be documented in your company records.

3) Why should I have corporate minutes?

The single most important reason to keep corporate minutes is to ensure you liability protection you desired when you created your company. One way people try to assign personally responsibility to company owners is to establish that the company hasn’t properly kept corporate minutes. While this is not determinative it is some of the strongest elements to assign personal responsibility to company owners.

Additionally, corporate minutes establish the background record to support business growth and equipment upgrade or replacement.

The minute book also leaves a trail that enables owners to look back at the decisions and transactions of a corporation and determine effective dates for tax purposes.

4) What do I do if I haven’t done minutes in a long time?

First, it is never too late to start keeping your corporate minutes. So the most important thing to do is simply start keeping minutes and document your actions going forward. It is better late than never.

In regard to prior actions, you can not go back in time and shouldn’t fabricate, predated minutes to try and pretend you held meetings. That can actually look worse for you if you ever ended up in court. However, at your first meeting you certainly can review the actions you have done since the last time you held a meeting and approve those actions. At least you would have some record of what has occurred to date.

As always, do not take this article as a substitute for the advice of your attorney. The article is meant to provide some basic information not provide you legal advice. For proper legal advice you should consult with a local attorney.

Craig Boates
Boates

Return to Articles Page

  • Recent Articles

    • An Overview of Chaper 13 Bankruptcy

    • Arbitration Basics

    • Arizona Landlord Tenant Law

    • Arrests and Interrogations FAQ

    • Bankruptcy Basics

    • Basics of Commercial Leases

    • Business Entities – Which one is right for your Business ?

    • Business Succession Planning

    • Buying a Business: What You need to know?

    • Car Accidents Caused by Negligence

  • Testimonials

    • "We have been using Anthem Law's services for many years. They have helped us purchase a company, create a living trust and create legal documents. Anthem Law has been a great resource for our legal needs and we will continue to use them in the future."

      Steve Cahow, Netech Global, LLC
    • "I highly recommend Anthem Law."

      Brack J
    • "Anthem Law has excellent attorneys. They're trustworthy, always reliable, and provide very enlightened and informative advice."

      Josh Dolin, Tempo Creative
    • "Anthem Law helped me through a difficult contract negotiation for my business. Their attention to detail was extremely important. It allowed me to make the correct decisions throughout the entire process. I have used them for various legal needs and found them to be thorough and professional."

      Tim Maki, Insurance Agent
    • "I am sincerely thankful, and grateful, for the guidance and support I received from Anthem Law as I went through the emotional stress and pain that comes with going through a divorce. They were so genuine and kind; their advice was both realistic and reassuring- a comfort when I thought I couldn't make it through this situation."

      Tammy H.
    • "I engaged the services of Anthem Law when my wife and I separated and filed for divorce. The firm handled the case with true professionalism and empathy for my situation. My wife and I reconciled; a result the attorneys were pleased to hear. Two years later my wife and I have again filed for divorce. I again engaged Anthem Law and have again experienced the professionalism and empathy of the firm. I would highly recommend Anthem Law for your legal needs."

      Donald H.
    • "Sam Crump is more than just our family's attorney, he is a trusted business advisor and friend. I could not recommend someone more than I do Sam."

      Mike O’Shaughnessy, Pres. – Guardian Pro
  • Contact Us

    Anthem Law

    42104 N. Venture Drive, Suite D126
    Anthem, Arizona 85086

    Phone: 623-551-5457
    Facsimile: 623-551-5458

Get Social
  • Home
  • Firm Overview
  • Attorneys
  • Practice Areas
  • Articles
  • Contact Us
Copyright © 2021 Anthem Law