Last Updated October 12, 2023

Shareholders' Consent to Action Without Meeting

Alternate Names:

A Shareholders' Consent to Action Without Meeting is also known as:

• Consent Resolution
• Action by Unanimous Written Consent
• Notice of Action by Written Consent
• Shareholder's Written Consent to Action

What is a Consent to Action Without Meeting?

A Shareholders' Consent to Action Without Meeting, or a consent resolution, is a written statement that describes and validates a course of action taken by the shareholders of a particular corporation without a meeting having to take place between directors and/or shareholders.

Bear in mind that a meeting does not necessarily mean a face-to-face meeting nowadays when the bylaws of many corporations authorize shareholders' meetings to be held via telephone or video conferencing. A consent resolution dispenses with the requirement for any form of meeting.

Many smaller companies substitute special meetings with consent resolutions because it saves time by not having to schedule meetings. These consent forms are very useful, especially for minor matters where having to call a formal meeting would waste time and resources.

What is a corporate resolution?

A corporate resolution refers to either a decision of the shareholders at a shareholders' meeting or a decision of the board of directors at a directors' meeting.

Major decisions which need to be made at such meetings include (but are not limited to) the purchase or sale of another business, corporate reorganization (like mergers), stock issuance, and settlements of lawsuits.

What is the difference between a consent to action and meeting minutes?

The only difference between a Shareholders' Consent to Action Without Meeting and meeting minutes is whether or not a formal meeting has taken place. Where meeting minutes would record the actions taken at the meeting, the consent to action can allow the same actions to be taken as long as written consent is given by the minimum number of voting shareholders.

The consent forms will set out the proposed action, and, once the action is passed, the signed forms are filed in the corporate minute book.

How do I write a consent to action from for a shareholder?

For shareholders to give consent to action in lieu of a meeting, the consent form must include:

• The jurisdiction of incorporation (the state where the business is incorporated)
• The name of the corporation
• The name of the chairperson of the meeting (usually the chairperson of the board or the president or secretary of the corporation)
• The shareholders' names
• The resolutions' (whatever decisions are made by the shareholders)
• Date the resolution comes into effect (usually upon signing)
• Certified resolutions, if necessary (where the president or corporate secretary verifies and approves the resolutions)

The consent resolution form is usually signed by named shareholders in the document, and the actions should be recorded in the corporate minute book.

Related Documents:

• LLC Operating Agreement: an agreement used to detail the rights and obligations of every LLC member and to establish operational details of the limited liability company
• Minutes of Shareholders' Meeting: a document used to record decisions made by a company during a meeting of its shareholders
• Share Purchase Agreement: a contract used to detail the sale of stocks or shares between a shareholder and another individual or corporation
• Share Repurchase Agreement: an agreement used to document the sale of stock or shares from a shareholder back to their corporation
• Shareholder Agreement: a contract that outlines the rights and responsibilities of a shareholder of a corporation
• Shareholders' Organizational Meeting: a document used to record the shareholders' initial resolutions or actions to organize a corporation

Sample

Shareholders' Consent to Action Without Meeting

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