Also known as the “first shareholders meeting” the corporation's organizational minutes is an initial meeting of the owners. During these required meetings, the owners and managers of the corporation have an agenda that includes appointing officers as well as the board of directors, and one that approves bylaws, and other resolutions. This meeting is also a place to ratify and approve the actions of the incorporators.
Minutes of a corporation are a written record of what has occurred in the meeting. Meeting minutes ensure that everything is documented and placed on corporate record. There are no legal requirements when it comes to minutes, or how they should be recorded.
What Is a Corporate Organizational Meeting?
There are important tasks that need to be executed at a corporate organizational meeting. These include drafting the articles of incorporation, distributing shares, electing officers, and then draft as well as approve corporate bylaws.
Any person who is named as a director is able to hold and call a meeting. If the formation documents do not name any directors, then it can be helped by a founder. In a corporation, a founder is referred to as an incorporator.
After the initial meeting by the incorporators and board of directors, it is then that the corporation can even be born. There may be other issues that are discussed during an organizational meeting. This may include electing a different corporation status (s-corp or non profit), or choosing insurance.
Before the meeting takes place, it is smart to prepare with forms that were used to incorporate. This is essential. It is also important to ensure that all forms and documents have been signed by the incorporators and board of directors.
What Should be Included in Organizational Meeting Minutes
If you are responsible for the organizational meeting minutes, there are a few things you should consider including. Here’s what to include in your organization's meeting minutes.
- Who is present, including an explanation of the names of the committee members
- Issues that are open for discussion
- Future discussion, summarized
- Ratification of the actions of the incorporator for incorporating the corporation
- Adoption of written bylaws
- Approval of the form of a stock certificate
- Fix the fiscal year
- Organize the Board of Directors by naming the Directors and officers of the Board
- Election of initial officers of the corporation
- Determining director compensation, if any
- If the Directors or officers are to be employed by the corporation, their compensation, employment contract, and other employment terms
- Issuance of stock to stockholders and recitation of the consideration received by the corporation in exchange for the stock
- Qualification to do business in other states
- Agenda for the next meeting
- Who the meeting was adjourned by
Why Does Your Corporation Need Organizational Minutes?
Corporations come with various form requirements, but these also benefit the company. Recording minutes may seem unnecessary, but it is helpful in recording the process of your corporation. Additionally, although the meeting is most often restating information that is already in the Articles of Incorporation, it may seem pointless.
Despite this, not everything at the first shareholder meeting is a repeat of what you have earlier discussed. Being able to understand the issuance of shares as well as the true value of shares is invaluable. This way you can know the value of assets that are agreed upon, and know who owns which stock, as well as which stock is available publicly.
Start Your Corporation the Right Way
Starting a corporation in Delaware can be overwhelming. With so much paperwork to handle and deadlines to meet, the process can be extremely stressful. Especially for new business owners.
That’s why we recommend working with a business attorney. A business attorney will have gone through the process before and knows what to expect. They can worry about the details like organizational minutes while you focus on more important tasks.
If you are a Delaware business owner looking to start a corporation, we can help! Contact us today to schedule a free consultation! We are more than happy to help!