Guidelines For Preparing Minutes of The Board of The LLC or Corporation

Steven D. Goldberg, Esq. Wilmington, DE
sgoldberg@stevendgoldberg.com
http://www.stevendgoldberg.com
Contact me if you need assistance in forming/organizing a Delaware business entity or any matter of Delaware law. Delaware Forms and Publications are available at http://www.delawarellclaw.com

 In our last post we answered the question of whether you need to keep minutes for your LLC. In this post we will discuss the basic requirements for the minutes themselves. Many company agreements are drafted to include in the management framework of the LLC, a board of directors. The minutes should evidence on their face compliance with the requirements of the company agreement in the case of a LLC or the bylaws in the case of a corporation. The minutes should reflect: 

• Time, date and place of the meeting.
• Compliance with notice requirements. If notice is written, a copy of the notice should be attached to the minutes and if oral, a written waiver of notice should be attached.
•  The attendees to evidence that quorum requirements have been met.
• The name and title of the person presiding over meeting and the person acting as secretary of the meeting recording the minutes. 
•  All non-board members in attendance as well as those board members excused or absent. If board members leave and rejoin the meeting or are late joining the meeting, the points at which various individuals join and leave the meeting should be noted.
• The minutes should identify in general terms each agenda item that was discussed.
• The minutes generally should reflect in general terms the discussion of the  matters considered and the participation of the directors in the discussion. It is the function of minutes to summarize the board’s discussion of various factors which underlie its decisions. Comments and questions are generally not be attributed to individual directors as minutes are not intended to be a verbatim transcript but rather a summary record.
•  To provide evidence that the board made an informed decision and to evidence that the board met its the duty of care, that it satisfied the standards underlying the business judgment rule and met its other fiduciary duties, a summary of the factors considered by the board in reaching such decisions should be reflected. The minutes again are not intended to be a verbatim transcript. Minutes reflect a summary of the board’s considerations, recognizing that minutes are inherently a significantly condensed writings. Factors considered should be described generally, not necessarily in detail, and need not include all of  the specifics of the analysis and consideration.
•  If the board received the advice, opinion, or report of advisers, including lawyers, accountants, a committee, or an officer, the minutes should reflect the board’s consideration of those matters. If the board has privileged discussions with legal counsel, the minutes should reflect that a privileged discussion with counsel on a particular matter was held. Executive sessions should be noted but the matters discussed in executive session need not be detailed. 
• The resolutions adopted or other decisions made or decisions not to take an action should be reflected in the minutes. The minutes are not required to reflect individual votes cast, however in some circumstances directors may wish the minutes to reflect their individual votes. The minutes should reflect any directors who recused themselves from a decision or a vote, any abstentions, and, at the request of a director, any dissent.

                 The minutes constitute the company’s official record of its meetings. It is advisable to keep minutes in electronic form such as a PDF file as paper files can be lost or damaged.

 If you need assistance with preparing minutes, a company agreement or any other matter of Delaware law, please contact me at sgoldberg@stevendgoldberg.com