When you start a new business, you should make a habit of employing good recordkeeping practices early on. Keeping proper corporate records is advisable for a number of reasons, including facilitating your dealings with banks, government authorities, clients, and potential investors. Good governance includes documenting how the directors were elected and providing evidence of how the initial stockholders received their shares. This article offers the simplest approach for completing initial corporate actions by written consent rather than having formal meetings. Written consents can be prepared, executed, and filed quickly and easily without the effort or expense of conducting a formal meeting. Note that the discussion below only provides one methodology for documenting initial corporate actions, which can vary based on the specific laws of your state of incorporation. For each state's specific rules on forming a corporation, see the 50-State Guide to Forming a Corporation.
Most (if not all) states require that a corporation's articles of incorporation (called a certificate of incorporation in some states) be filed by one or more incorporators who meet state law requirements. An incorporator could be an attorney, registered agent, service company, or some other person or entity who might, or might not, have a personal stake in the corporation going forward.
In any case, it is quite common for the first entry in the minute books of a corporation (following the filing of the charter) to be a simple, one-page written consent signed by the incorporator entitled a "Statement of Organizational Action of the Sole Incorporator of [Name of Corporation] to Taking of Action in Lieu of Organizational Meeting," whereby the incorporator names the members of the board of directors. Then, the incorporator concludes the written consent by resigning as the incorporator, effective immediately. Note that in most states, there is no prohibition against the incorporator naming itself as a director in the same consent. Furthermore, this approach assumes that there is only one incorporator and that the filed articles of incorporation don't name the initial directors. If your corporation has more than one incorporator, then revise your written consent accordingly and have it signed by all of the incorporators.
Depending on the business laws of your state of incorporation, the incorporator will likely have the option of taking certain additional actions as well. For example, under Florida law, if the articles of incorporation do not name the members of the board, then the incorporator has the authority to not only appoint the board, but also to carry out the remaining organizational actions of the corporation, including issuing stock and approving the bylaws. (Fla. Stat. Ann. § 607.0205(1)(b).)
Once the incorporator has executed its organizational consent, the newly-appointed board can then execute its own, separate written consent — entitled "Written Consent in Lieu of an Organizational Meeting of the Board of Directors of [Name of Corporation]" — to complete the organizational process. A standard function of this initial board consent is to appoint the original officers of the corporation. Under the business laws of most states, the board of directors elects the corporate officers and the directors are permitted to serve dual roles as officers. In other words, these written consents could name you, as the owner of the company, as both the Chief Executive Officer and a member (or the chairman) of the Board of Directors.
The initial board consent should include a separate paragraph to address the issuance of stock to the initial shareholders of the company. This section should clearly state the name of each individual or entity to whom the company is granting shares, the number of shares, and the price per share. Note that your state's business laws might permit the company to issue shares to the stockholders without the preparation or delivery of physical stock certificates.
Unless the incorporator has previously elected (for whatever reason) to approve the company's bylaws itself, the board of directors typically bears the responsibility of reviewing and approving the company's bylaws. The common thinking is that the board should be the responsible body for approving the bylaws because the bylaws address fundamental corporate governance topics such as board and shareholder meetings, officer appointments and responsibilities, the issuance of shares, company accounting practices, and the like.
The company's secretary must make sure that its minute books include the incorporator's written consent, the initial board consent (which evidences the initial issuance of stock), a capitalization table (listing all of the company's initial shareholders and their stock ownership), and copies of all stock certificates issued, if any. Note that forms for the written consents described above can be found at Incorporate Your Business, by Anthony Mancuso (Nolo).