It is vital that all corporations keep adequate documentation in the form of minutes of shareholder and director meetings. In many jurisdictions, the absence of proper records may be a 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.

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.

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A legal guide to corporate housekeeping, forms, etc...

adapted from: Methven & Associates, 2232 Sixth Street, Berkeley, CA 94710 phone: (510) 649- 4019; fax: (510) 649-4024; e-mail: bmethven@methvenlaw.com Web site: www.methvenlaw.com; Copyright 2000 Bruce E. Methven. All Rights Reserved.

»Example of minutes of a Board of Directors Meeting