It is important to keep your corporate minute book current. It should include various important documents, such as the company’s articles of incorporation, bylaws, and minutes or written consents of all meetings and actions of the directors, committees and shareholders.
A current corporate minute book is a useful tool in helping you to comply with corporate formalities, which helps prevent shareholder liability. In addition, in the event you want to raise money or sell your business, attorneys for the other side will likely want to see your minute book.
Problems to avoid include the following:
- Minutes that the secretary has not signed
- Written consents without all necessary signatures
- No minutes for regularly scheduled shareholder or board meetings
- Written consents authorizing execution of certain documents as attached, but failing to attach the documents
- Failure to document calls or notices of meetings
- Notices or calls of meetings that are legally inadequate
- Shareholder minutes that do not reflect the number of shares present or how they voted
- Resolutions showing board approval but not shareholder approval where both are necessary
- Lack of authorization for issuing shares of stock
Keeping an up-to-date corporate minute book is not unduly burdensome, but well worth the time and effort.