Both the Model Business Corporation Act and the Revised Model Business Corporation Act provide that acts to be taken at a shareholders' meeting or a director's meeting may be taken
without a meeting if the action is taken by all the shareholders or directors entitled to vote on the action. The action must be evidenced by one or more written consents bearing the date of signature and describing the action taken, signed by all the shareholders or directors entitled to vote on the action, and delivered to the corporation for inclusion in the minutes or filing with the corporate records.
This form is a generic example that may be referred to when preparing such a form for your particular state. It is for illustrative purposes only. Local laws should be consulted to determine any specific requirements for such a form in a particular jurisdiction.
California Unanimous Consent to Action by the Shareholders and Board of Directors of Corporation, in Lieu of Meeting, Ratifying Past Actions of Directors and Officers Introduction: In California, the Unanimous Consent to Action by the Shareholders and Board of Directors of a Corporation, in Lieu of Meeting, Ratifying Past Actions of Directors and Officers is an essential legal process that allows corporations to validate and approve past actions taken by their directors and officers. This mechanism ensures legal compliance and transparency within a corporation's decision-making process. This article will provide a detailed description of this procedure, including its purpose, requirements, and variations. Key Keywords: California, unanimous consent, action, shareholders, board of directors, corporation, meeting, ratifying, past actions, directors, officers. Purpose of Unanimous Consent to Action: The Unanimous Consent to Action by the Shareholders and Board of Directors is a crucial instrument in corporate governance. It serves to legitimize and validate previous decisions or actions taken by directors and officers that were not initially voted upon during a formal meeting. This process allows corporations to maintain legal compliance, rectify any deficiencies in their decision-making process, and enhance transparency. Requirements for Unanimous Consent to Action: To initiate the Unanimous Consent to Action, certain requirements must be met: 1. Unanimous agreement: All shareholders and members of the board of directors must provide their unanimous consent to the proposed action. 2. Prior action: The action being ratified should have already been taken or implemented by the directors or officers. It cannot be a theoretical or future action. 3. Written consent: The unanimous consent must be given in writing, with each shareholder and director signing the document explicitly expressing their consent and agreement. 4. Timely submission: The consent document should be submitted within a reasonable timeframe after the action has been taken. The California Corporations Code does not provide a specific time limit, but prompt submission is recommended. Types of Unanimous Consents to Action: While the process of unanimous consent remains standard, there are specific types of actions that may require ratification by the shareholders and/or directors: 1. Shareholder Consent: Shareholders may need to ratify actions such as amendments to the corporation's articles of incorporation, mergers, acquisitions, or the issuance of new shares. 2. Director Consent: Directors may need to validate actions such as the appointment of officers, adoption of bylaws, entering into contracts, or the sale of corporate assets. Benefits of Unanimous Consent: The utilization of Unanimous Consent to Action by the shareholders and board of directors of a corporation in California offers several advantages: 1. Time-saving: It eliminates the need for convening formal meetings, saving valuable resources such as time and costs associated with organizing and conducting meetings. 2. Flexibility: It allows for quick decision-making and the ability to validate past actions without compromising the corporation's day-to-day operations. 3. Compliance adherence: Ratifying past actions helps maintain legal compliance, ensuring that any potential mistakes or errors made by directors or officers are rectified promptly. 4. Clear documentation: The written consent document becomes a legal record, providing transparency and evidence of the unanimous agreement reached by the shareholders and directors. Conclusion: The Unanimous Consent to Action by the Shareholders and Board of Directors of a Corporation, in Lieu of Meeting, Ratifying Past Actions of Directors and Officers is an essential process in California's corporate governance framework. It allows for the validation of previous decisions or actions taken by directors and officers without convening formal meetings. This mechanism fosters legal compliance, transparency, and efficient decision-making within corporations, ensuring the smooth operation of their affairs.
