SHAREHOLDER WRITTEN CONSENT IN LIEU OF MEETING

OVERVIEW AND LEGAL FRAMEWORK

Shareholder action by written consent allows shareholders to approve corporate actions without holding a formal meeting. This mechanism is particularly useful for closely held corporations and for matters requiring prompt approval. However, the availability and requirements for written consent vary significantly by state and may be restricted or eliminated by the certificate of incorporation.

Key Legal Framework

Delaware (DGCL Section 228):
- Unless the certificate of incorporation provides otherwise, any action that may be taken at a meeting of stockholders may be taken without a meeting by written consent
- Consent must be signed by holders of the minimum number of votes necessary to authorize the action at a meeting at which all shares entitled to vote were present and voted
- Consents must be delivered to the corporation within 60 days of the earliest dated consent
- Prompt notice must be given to non-consenting shareholders
- Public companies commonly restrict or eliminate consent rights in their certificates of incorporation

MBCA Section 7.04:
- Default rule: Only unanimous written consent is permitted
- Articles of incorporation may opt in to less-than-unanimous written consent
- If articles permit less-than-unanimous consent, election of directors by written consent must still be unanimous
- Consents must be delivered within 60 days of the earliest dated consent

Important Distinctions:
- Delaware permits less-than-unanimous consent as the default; the MBCA requires unanimity as the default
- Some states (e.g., New York under BCL Section 615) require unanimous consent as the default, with opt-in for less-than-unanimous consent in the certificate of incorporation
- Always verify: (a) applicable state law; (b) certificate of incorporation provisions; and (c) bylaws provisions

When Written Consent Is Used

• Election of directors (subject to unanimity requirements in some states)
• Amendment of bylaws (if shareholder approval is required)
• Amendment of the certificate of incorporation
• Approval of mergers or consolidations
• Approval of the sale of substantially all assets
• Approval of voluntary dissolution
• Ratification of board actions
• Approval of stock option plans or equity compensation arrangements
• Waiver of preemptive rights
• Any other action that could be taken at a shareholder meeting

WRITTEN CONSENT DOCUMENT

WRITTEN CONSENT OF THE SHAREHOLDERS

OF [________________________________]

IN LIEU OF A [________________________________] (Annual/Special) MEETING

The undersigned, being the holders of shares of capital stock of [________________________________], a [________________________________] corporation (the "Corporation"), representing in the aggregate not less than the minimum number of votes that would be necessary to authorize or take the actions set forth below at a meeting at which all shares entitled to vote thereon were present and voted, hereby consent in writing, pursuant to [________________________________] (applicable state statute), to the adoption of the following resolutions without a meeting, without prior notice, and without a vote:

Record Date: [__/__/____]

Total Outstanding Shares Entitled to Vote: [________________________________] shares of [________________________________] stock

Minimum Shares Required for Consent: [________________________________] shares ([________________________________]% of outstanding)

RESOLUTIONS

Resolution 1: [________________________________] (Title)

RESOLVED, that [________________________________].

☐ Approved ☐ Not Approved

Resolution 2: Election of Directors (If Applicable)

RESOLVED, that the following individuals are hereby elected to serve as directors of the Corporation, to serve until the next annual meeting of shareholders or until their successors are duly elected and qualified, or until their earlier resignation or removal:

Note: In many jurisdictions (including MBCA states and New York), election of directors by written consent requires unanimous consent of all shares entitled to vote. California permits election to fill a vacancy (other than by removal) by majority written consent, but initial elections require unanimous consent. Delaware permits election by less-than-unanimous consent unless the certificate provides otherwise.

☐ Approved ☐ Not Approved

Resolution 3: Ratification of Prior Actions (If Applicable)

RESOLVED, that all actions heretofore taken by the Board of Directors and officers of the Corporation since the last annual meeting of shareholders, including but not limited to the following, are hereby ratified, confirmed, and approved in all respects:

(a) [________________________________]
(b) [________________________________]
(c) [________________________________]

☐ Approved ☐ Not Approved

Resolution 4: Approval of Amendment to Certificate of Incorporation (If Applicable)

RESOLVED, that the shareholders hereby approve the amendment to the Certificate of Incorporation of the Corporation as recommended by the Board of Directors, to amend [________________________________] (Article / Section) to read as follows:

"[________________________________]"

RESOLVED FURTHER, that the officers of the Corporation are hereby authorized to execute and file a Certificate of Amendment with the Secretary of State of [________________________________] in the form attached hereto or substantially similar thereto.

☐ Approved ☐ Not Approved

Resolution 5: Approval of Equity Compensation Plan (If Applicable)

RESOLVED, that the shareholders hereby approve the [________________________________] (name of plan) (the "Plan"), as recommended by the Board of Directors, authorizing the Corporation to reserve and issue up to [________________________________] shares of [________________________________] stock for issuance under the Plan, and that the officers of the Corporation are authorized to take all actions necessary to implement the Plan.

☐ Approved ☐ Not Approved

Resolution 6: Approval of Merger / Sale of Assets / Dissolution (If Applicable)

RESOLVED, that the shareholders hereby approve [________________________________] (describe the transaction), as recommended by the Board of Directors, and the officers of the Corporation are hereby authorized to execute and deliver all documents and take all actions necessary to consummate the transaction.

☐ Approved ☐ Not Approved

Resolution 7: Amendment of Bylaws (If Applicable)

RESOLVED, that the shareholders hereby approve the amendment to the Bylaws of the Corporation as recommended by the Board of Directors, to amend [________________________________] (Article / Section) to read as follows:

"[________________________________]"

☐ Approved ☐ Not Approved

Resolution 8: Waiver of Preemptive Rights (If Applicable)

RESOLVED, that the shareholders hereby waive any and all preemptive rights with respect to the issuance of [________________________________] shares of [________________________________] stock to [________________________________], as authorized by the Board of Directors on [__/__/____].

☐ Approved ☐ Not Approved

Resolution [____]: [________________________________] (Additional Resolution)

RESOLVED, that [________________________________].

☐ Approved ☐ Not Approved

EFFECTIVE DATE AND DELIVERY

This Written Consent is effective as of [__/__/____] (the "Consent Date").

Each undersigned shareholder acknowledges that:

1. This Written Consent has the same force and effect as a vote taken at a duly convened meeting of shareholders at which a quorum was present;

2. No meeting was held and no prior notice was given or required in connection with this Written Consent;

3. This Written Consent (or counterpart thereof) will be delivered to the Corporation at its principal office or registered office within sixty (60) days of the earliest dated consent delivered to the Corporation;

4. This Written Consent may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument;

5. Delivery of a signed counterpart by facsimile, email (PDF), or other electronic transmission constitutes valid delivery.

SHAREHOLDER SIGNATURES

Consenting Shareholder 1

Name: [________________________________]
Number of Shares: [________________________________]
Class/Series: [________________________________]
Percentage of Outstanding Shares: [________________________________]%

Signature: ______________________________
Date: [__/__/____]

Consenting Shareholder 2

Name: [________________________________]
Number of Shares: [________________________________]
Class/Series: [________________________________]
Percentage of Outstanding Shares: [________________________________]%

Signature: ______________________________
Date: [__/__/____]

Consenting Shareholder 3

Name: [________________________________]
Number of Shares: [________________________________]
Class/Series: [________________________________]
Percentage of Outstanding Shares: [________________________________]%

Signature: ______________________________
Date: [__/__/____]

Consenting Shareholder 4

Name: [________________________________]
Number of Shares: [________________________________]
Class/Series: [________________________________]
Percentage of Outstanding Shares: [________________________________]%

Signature: ______________________________
Date: [__/__/____]

Consenting Shareholder 5

Name: [________________________________]
Number of Shares: [________________________________]
Class/Series: [________________________________]
Percentage of Outstanding Shares: [________________________________]%

Signature: ______________________________
Date: [__/__/____]

REVOCATION OF CONSENT

Revocation Notice (To Be Used by a Shareholder Who Wishes to Revoke Consent)

To: [________________________________] (Corporation Name)
[________________________________] (Address)

The undersigned shareholder hereby revokes the written consent previously executed on [__/__/____] with respect to the following resolution(s):

☐ All resolutions
☐ Resolution(s) numbered: [________________________________]

This revocation is effective upon delivery to the Corporation, provided that it is delivered before the Corporation has received sufficient consents to authorize the action(s) described in the revoked resolution(s).

Name: [________________________________]
Number of Shares: [________________________________]
Class/Series: [________________________________]

Signature: ______________________________
Date: [__/__/____]

Note on Revocability: Under DGCL Section 228(c), a consent may be revoked by written notice delivered to the Corporation before the Corporation has received consents signed by the number of stockholders required. Once sufficient consents have been received, the action is irrevocable. The MBCA Section 7.04(d) similarly provides that consent may be revoked before the consent becomes effective.

NOTICE TO NON-CONSENTING SHAREHOLDERS

(Required When Consent Is Less Than Unanimous)

[__/__/____]

To: All Shareholders of Record of [________________________________] Who Did Not Execute the Written Consent

Dear Shareholder:

Pursuant to [________________________________] (applicable state statute, e.g., DGCL Section 228(e)), notice is hereby given that the following actions were taken by written consent of the shareholders of [________________________________] (the "Corporation"), without a meeting, on [__/__/____]:

Actions Taken:

1. [________________________________]
2. [________________________________]
3. [________________________________]

The written consent was signed by shareholders holding [________________________________] shares, representing [________________________________]% of the Corporation's outstanding shares entitled to vote, which constitutes the minimum number of votes necessary to authorize the actions described above.

If you have any questions regarding the foregoing actions, please contact [________________________________] at [________________________________].

Sincerely,

______________________________
[________________________________]
Secretary

RECORD-KEEPING REQUIREMENTS

The Corporation shall maintain the following records in connection with this Written Consent:

☐ Original (or copies of) signed written consents of all consenting shareholders
☐ Shareholder list as of the record date, showing shares held and voting entitlement
☐ Calculation of minimum consent threshold
☐ Copy of notice to non-consenting shareholders (if consent was less than unanimous)
☐ Proof of delivery of notice to non-consenting shareholders
☐ Copy of any revocation notices received
☐ Secretary's certification of the consent
☐ Any related board resolutions recommending the action(s) taken by consent

Records shall be maintained with the Corporation's minute book and shall be available for inspection by shareholders in accordance with applicable law.

MULTI-STATE COMPARISON TABLE

PRACTICE NOTES FOR ATTORNEYS

Critical Pre-Consent Checklist

☐ Verify that the certificate of incorporation does not prohibit or restrict action by written consent
☐ Determine the applicable consent threshold (unanimous vs. less-than-unanimous)
☐ Set or determine the record date for the consent solicitation
☐ Obtain a certified list of shareholders as of the record date
☐ Calculate the minimum number of shares required for each action
☐ Determine whether the board has recommended the proposed action(s)
☐ Prepare the written consent document and distribute to shareholders
☐ Track delivery of signed consents (maintain a log with dates)
☐ Monitor the 60-day delivery period (if applicable)
☐ Prepare notice to non-consenting shareholders
☐ File the consent with corporate records

Key Drafting Considerations

1. Certificate of Incorporation Review: This is the most critical step. In Delaware, the certificate may eliminate or restrict consent rights. In MBCA states, the articles may need to affirmatively authorize less-than-unanimous consent. The certificate trumps the statute in most cases.

2. Record Date: Under DGCL Section 213(b), if no record date is fixed by the board, the record date is the day the first signed consent is delivered to the corporation. This is important because it determines which shareholders are entitled to consent.

3. 60-Day Rule: All signed consents must be delivered to the corporation within 60 days of the earliest dated consent. If the 60-day period expires before sufficient consents are collected, the entire consent solicitation fails, and the process must be restarted. Track deadlines carefully.

4. Notice to Non-Consenters: Under DGCL Section 228(e) and similar statutes, prompt notice of the action taken must be given to shareholders who did not consent. Failure to give notice does not invalidate the action but may give rise to claims by non-consenting shareholders.

5. Multiple Counterparts: Written consents may be executed in counterparts. Each shareholder may sign a separate copy, and all counterparts together constitute the written consent. This is common practice for corporations with multiple shareholders.

6. Electronic Execution: Most states now permit electronic delivery and execution of written consents. Confirm that the applicable state statute and the corporation's governing documents permit electronic consent.

7. Class Voting: If the proposed action requires approval by a specific class of shares (e.g., preferred stockholders voting as a class), a separate written consent from that class is required, meeting the applicable threshold for that class.

8. Appraisal Rights: If the action taken by written consent would trigger appraisal rights (e.g., a merger), non-consenting shareholders must receive notice sufficient to satisfy appraisal right requirements.

Common Pitfalls

• Failing to verify certificate of incorporation provisions regarding written consent
• Using less-than-unanimous consent when only unanimous consent is permitted
• Failing to collect all consents within the 60-day window
• Failing to give notice to non-consenting shareholders
• Failing to use the correct record date for determining consent eligibility
• Attempting to elect directors by less-than-unanimous consent in jurisdictions that require unanimity
• Not properly authenticating electronic consents
• Failing to file the consent with the corporation's minute book

SECRETARY'S CERTIFICATION

I, [________________________________], the duly elected and acting Secretary of [________________________________] (the "Corporation"), a [________________________________] corporation, hereby certify that:

1. The foregoing Written Consent was duly executed and delivered by shareholders holding a total of [________________________________] shares of the Corporation's [________________________________] stock, representing [________________________________]% of the total outstanding shares entitled to vote.

2. The record date for determining shareholders entitled to consent was [__/__/____].

3. As of the record date, the Corporation had [________________________________] shares of [________________________________] stock outstanding and entitled to vote.

4. The minimum number of shares required to authorize the actions described in the Written Consent was [________________________________] shares, representing [________________________________]% of the outstanding shares.

5. ☐ The Written Consent was unanimous (all outstanding shares represented).
   ☐ The Written Consent was less than unanimous, and prompt notice of the action taken was provided to all non-consenting shareholders on [__/__/____].

6. All signed consents were delivered to the Corporation within sixty (60) days of [__/__/____], the date of the earliest signed consent.

7. No revocation of consent was received by the Corporation prior to the Corporation's receipt of sufficient consents.

8. The Written Consent has been filed with the minutes of the Corporation's shareholder meetings.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of the Corporation as of [__/__/____].

______________________________
[________________________________]
Secretary

[CORPORATE SEAL]

SOURCES AND REFERENCES

• Delaware General Corporation Law, Title 8, Del. Code (DGCL)
• § 228: Consent of stockholders or members in lieu of meeting
• § 213(b): Record date for written consent
• § 242: Amendment of certificate of incorporation
• § 251: Merger or consolidation
• § 271: Sale, lease, or exchange of assets
• § 275: Dissolution generally
• Model Business Corporation Act (MBCA)
• § 7.04: Action without meeting (shareholder written consent)
• § 7.05: Notice of meeting
• California Corporations Code § 603
• New York Business Corporation Law § 615
• Texas Business Organizations Code § 6.201, § 6.202
• Florida Statutes § 607.0704

This template is provided by ezel.ai for informational purposes only. It does not constitute legal advice and should not be used as a substitute for consultation with a qualified attorney.