To preserve limited liability for shareholders, directors and officers should follow these rules:

DO's

Hold Scheduled Meetings

• Annual shareholders' meeting date usually appears in the bylaws.
• Annual board of directors meeting is usually held immediately after the annual shareholders' meeting.

Hold special meetings of the board to make important decisions, such as to:

• Enter into a new lease
• Obtain financing
• Open a new bank account
• Enter into any other significant contract
• Change an officer's salary
• Fill a vacancy on the board or appoint a new officer
• Enter into a significant new venture;
• Sell most of the assets or dissolve the business

Keep good records

• Retain minutes of meetings or unanimous consent.
• Keep a corporate record book.
• Maintain good financial records.

Fiduciary Duty and Confidentiality

• Do what is in the best interest of the corporation and its shareholders.
• Keep corporate matters confidential.

Sign contracts in the name of the corporation with a signature block in substantially the following form:

And corporation representatives should also:

• By corporate resolution, empower an officer to sign a contract for the corporation.
• Purchase corporate assets in the name of the corporation
• Maintain corporate funds in a corporate accounts
• Carry insurance appropriate to the risks inherent in the corporation's business
• Fund the corporation at the time of incorporation sufficiently to carry it through the startup phase
• Comply with Articles of Incorporation, the Bylaws, and other organization documents or contractual restrictions

DON'Ts

• Don't commingle corporate and personal funds
• Don't take or use corporate assets for personal benefit