Corporate governance and records, board and shareholder resolutions, consents, directors’ meetings, shareholder meetings, and minutes
Corporations in general are required by state law to observe corporate formalities. The requirements for corporate formalities vary greatly by state and with the specific type of corporation. However, even if state law does not place stringent requirements on corporate formalities, it is recommended for a corporation to establish and follow certain guidelines and rules in order to enjoy the protection offered by a corporation. Moreover, business entities other than corporations such as limited liability companies (LLC) and limited partnerships (LPs) are recommended to establish and observe formalities even when not required by state law.
Similar to an LLC and an LP in Florida, a corporation is a type of business entity that is separate and distinct from its owners. A corporation operates separately from the owners of the business and enjoys most rights and obligations that individuals usually possess, including the ability to enter into contracts, sue and be sued in its own name, loan and borrow money, own assets and pay taxes. The distinction between the owners of the corporation and the corporate entity shields the business owners from liabilities and losses incurred by the corporation.
In this respect, corporations offer the strongest protection to its owners from personal liability but also require maintaining extensive corporate formalities reporting in order for the protections of a corporation to exist. If corporate formalities are not followed, it can result in what is known as “piercing the corporate veil.” In simple terms, piercing the corporate veil means that the corporation is no longer acting separately from the business owners and can result in the business owners becoming liable for losses or liabilities that the company incurs in its regular course of business.
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Corporate formalities include to record-keeping, board and shareholder resolutions, consents, directors’ meetings, shareholder meetings and minutes, operational processes, reporting and any other steps and precautions the business must take to ensure that the corporation remains legally separate from its owners. Most of corporate formalities and steps include holding regular meetings for corporate directors and shareholders, maintaining a separate account for the corporation and documenting the corporate activity. The individual requirements for holding general and special meetings for directors and shareholders, providing notices and maintain corporate records vary by state law.
We assist clients with corporate formalities for corporations, LLCs and LPs, including advising on holding general directors and shareholder meetings, special meetings of directors, members, managers and shareholders, keeping accurate records such as board and shareholder resolutions and meeting minutes, exercising fiduciary duties of officers and directors, developing plans and procedures for business contracts and compliance manuals, establishing independent director committee and subcommittee and following company bylaws, articles of incorporation, operating agreement, limited partnership agreement and other documents.
We advise private companies, senior management, boards of directors and board committees on a full range of corporate governance and compliance matters, and applicable Florida state and federal law. Corporate governance covered include issues that arise in the context of fiduciary duties and responsibilities of directors and officers in change of control transactions, financial reporting, internal investigation and special committees of directors.
In addition, we execute and analyze corporate governance materials including, board and shareholder resolutions, proxy statements, advance notice bylaws and minutes of director and shareholder meetings among others.
Contact us, your business attorney in Florida to help you with corporate governance, board and shareholder resolutions, consents, directors’ meetings, shareholder meetings, and minutes.