Corporation Information: Holding Your First Annual Meeting

Holding Your First Annual Meeting

Holding your first annual meetingRunning a corporation can be quite stressful, and if you're like many new business owners, the idea of holding your first-ever annual meeting will certainly contribute to the stress. You may find yourself asking pressing questions, such as: what do we discuss? Who must attend? What is required? If you are unsure of the process, continue reading. We've composed this article just for you.

Shareholders' Meeting

Every state requires a corporation to hold an annual shareholders' meeting. This meeting should touch on the following items: mergers, acquisitions, the transfer and sale of assets, and electing (and re-electing) of the Board of Directors in addition to settling other important business matters that are beyond the boards control.

Issuing Notice

Notice regarding an annual meeting can be found in the company Bylaws; however, a reminder should be mailed and/or emailed to each member to ensure they will be present (note: all shareholders should be notified. A minimum quorum is required to conduct the meeting; however, not all shareholders are required to be present.) The notice should include a date, time, and the location where the meeting will be held. For ad hoc meetings (special meetings called before or after the annual meeting), the purpose should be indicated within the notice. Each state retains its own notice requirements, so be sure that any notice requirements indicated in the Bylaws are consistent with your states statutory provisions.

Agenda Items

Each session must adhere to an agenda. Agenda items typically include appointing and removing directors from the board and important decisions that require shareholder approval (i.e. mergers, acquisitions, or dissolution). Voting requirements for each of these actions may vary; each corporation should refer to its states requirements to determine the number of votes required for the approval of any given action.

Board of Directors' Meeting

Responsible for the management of the company, directors establish broad policies and objectives for the organization of the corporation. These objectives typically include the selecting, removing, and reviewing the performance of its officers, and reviewing, denying, and approving important financial decisions--including, but not limited to: the annual budget. Note: the requirements are usually more stringent for larger, publicly traded corporations.

As with the shareholders' meeting, notice should be given to each director; however, all directors are not required to be present.

Minutes

Minutes are used as an official declaration of all decisions made during a session. They are essential to conducting any meeting. Only information of substance should be included, including the date, time, and location of the meeting, the names of all attendees, and every major decision made during the session in accordance with the agenda. Adjournment of a meeting should also be referenced alongside the time of commencement. Because minutes are used as official documents, participants should be given an opportunity to review (and amend, if necessary,) the minutes before making them official.

Short, Sweet, and To the Point

Since these meetings are vital to the organization and governance of a corporation, be sure to read through the agenda beforehand and decide on any key items you'd like to touch on. With that being said, keep conversation limited to agenda-specific items only--avoid lengthy presentations and off-topic discussion.