Corporate Meeting Minutes
Corporate Meeting Minutes – Sacramento Business Attorneys
Our Sacramento attorneys handle dozens of corporate formations per year. Most individuals come to us because they believe they’ve reached that point where their potential liabilities are becoming to great of a risk. Running a business as a sole proprietor does come with risks. The main risk is personal liability, but since this article is meant to discuss life after formation, you can check out some of the advantages and disadvantages of a sole proprietorship here.
Once you’ve made the decision to form a business entity, such as an LLC or a Corporation, you will now need to keep up with the required corporate formalities. Failure to keep up with these formalities can result in the loss of the main reason you decided to form an entity in the first place: personal protection from liabilities. You should think of your new business entity as a separate and independent child. This child must have it’s own identity. If a third-party cannot distinguish between you and the business entity, then it is likely that you will lose that protection from personal liabilities. So, how do you protect yourself from personal liabilities and keep this new business entity separate and independent? Corporate meeting minutes.
What should be included in corporate meeting minutes?
Admittedly, drafting corporate meeting minutes can be tiresome and boring. That’s why a good chunk of new corporate business owners do not keep up with these formalities. Another reason is because business owners and board members don’t know what to include in these meeting minutes. So, let’s make drafting corporate meeting minutes less burdensome and easier to understand.
Activities that should be included in meeting minutes are major activities. You don’t need to include every action that is in the ordinary course of business.
For example, a restaurant decides to purchase the building it was previously leasing. This would be considered a major activity. Compare that to the restaurant deciding to purchase their regular weekly surplus of appetizer chips. This would not be a major activity, but would be an activity in the ordinary course of business. It wouldn’t make much sense to require businesses to have weekly meetings to vote on purchasing the same amount of appetizer chips. Now, compare those two examples with signing a purchase agreement with an appetizer chip producing company. The purchase agreement is for restaurant to purchase appetizer chips from the producing company at a minimum of 100lbs of appetizer chips each week for two years. Should the decision for restaurant to sign this purchase agreement be in the corporate meeting minutes Easy, right?
How about an example of a meeting minute?
You shouldn’t over think the language of the corporate meeting minutes. Just get those major activities in writing. Here is a sample from an annual meeting regarding net profit distributions:
Financial Report and Net Profit Distribution
Upon motion made, seconded, and adopted, the annual financial report was approved, attached to the minutes of the LLC, and the net profit was distributed in the following manner among the Members:
Member Name Distribution Amount
What can Sacramento’s business attorneys Carson & Kyung Do to Help?
Our Sacramento business attorney help with the day-to-day operations of businesses. This includes attending meetings with corporate business owners and board members on a quarterly or annual basis. We oversee these meetings and can then draft and maintain meeting minutes for your business entity to ensure you’re in compliance with the laws. We currently represent dozens of business around the Sacramento area and are confident you’ll be happy with our services.
Contact Sacramento’s Business Attorneys
Forming a business entity is easy, but maintaining the legal protections and having well-drafted internal governing documents is difficult. Feel free to contact Sacramento’s Business Law Attorneys to set up an initial consultation to discuss your business entity’s corporate formalities.
By: Trevor Carson Google+
*The information provided in this post does not constitute legal advice or opinion. The information is for guidance purposes only. Individual situations vary and you should contact us for a consultation. Images courtesy of Sura Nualpradid; Stuart Miles; FreeDigitalPhotos.net Sacramento’s Business Law Attorneys Discussing Corporate Meeting Minutes.
Sacramento Business Resources
California Secretary of State, located in Sacramento at 1500 11th St, Sacramento, CA 95814.