To form a corporation, you need to submit an âarticles of incorporationâ document to the state in which the business will be registered. While the content of this document varies immensely from jurisdiction to jurisdiction, you will always need to include basic information such as your corporationâs name, purpose, and the number of shares that may be issued.
To make things simple, you can use Signeasyâs free articles of incorporation template, which has been drafted in a way that is easy for government agencies to process when registering your corporation. That being said, don't forget to check with a local legal representative to verify whether any state-specific provisions need to be added.
Once the government body approves your application, you will receive a Certificate of Incorporation or an approval stamp on your articles of incorporation application.
Thatâs it â your corporation is legally registered! Once you open a bank account and secure essential business licenses or permits, you may start running the business.
Your incorporation articles, also known as âarticles of associationâ or âcorporate charter,â need to be filed with your local governing body.Â
The articles of incorporation template that you use should have the following elements:
In this section, state the name that you intend to assign to your corporation. The corporation name is usually suffixed with the likes of Company (Co.), Corporation (Corp.), or Incorporated (Inc.).
This is how your business will be referred to from the day of its inception, so be sure to put some thought into selecting an appropriate name. Also, make sure you have a unique name that does not conflict with an existing copyright.Â
Some states only require you to state a generic purpose â âAny lawful act or activityâ is the commonly used legal terminology. Using general terminology enables you to change your stated purpose anytime in the future without having to spend time and money on amending the articles of incorporation.Â
However, some states are very specific about mentioning the exact activity that your business will be performing. Be sure to consult with your legal representative before drafting this clause.
Here, you will state the location of your registered office, or the address at which the Secretary of State can communicate with you about important matters.Â
Also mention the name of your registered agent, or the person authorized to receive all tax and legal documents on your businessâs behalf.
This section outlines how long your company intends to remain operational. The most common duration is for all of time, or âperpetually,â unless the company is dissolved by the state or companyâs board of directors.Â
Include the names and physical addresses of the directors who are present during the formation of the corporation. More directors can be added during the first annual shareholder meeting, at which time their details can be added to the bylaws document.
How many shares are you authorizing to shareholders? The answer belongs in this section. Most SMBs decide to only issue one class of shares, which means each shareholder is treated the same when it comes to voting and other purposes.
You will need to mention and name the address of the individual or company that is filing the Certificate of Incorporation. This doesn't need to be a shareholder or director.
Here, you want to mention when your corporation will close its books for accounting and tax purposes.Â
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At this stage, the incorporator will need to sign the articles of incorporation application using an eSignature tool like Signeasy.
Note: Check with your legal counsel to verify whether your local state government accepts electronically signed documents.Â
Most people tend to confuse these two documents, since both contribute to forming the legal backbone of a business.Â
Here are the ways in which they differ from each other:
Is an internal document
Cannot easily be made into a templates, as the way each corporation operates is very unique
No fee needs to be paid for filing corporate bylaws
Outlines how the company needs to run, as well as the roles and responsibilities of the directors and other business agents
Doesn't require you to submit applications to any state agency, but must be maintained at your primary location of doing business
Mentions how many stocks can be issued/the value of stock owned by the business, along with the voting rights of each shareholder
Can be implemented with a simple vote by the shareholders and directors, where the majority accept the amendment to the bylaws. No amendment fee needs to be paid here
Is made publicly available
Has fairly standardized fill-in-the-blank template
Requires the incorporator to pay a fee for filing of the articles of incorporation
Requires you to legally conduct your business within a particular state
Requires that you submit an application to the department of state or the Secretary of State
Needs to mention the number of stock options that the organization is allowed to issue, alongwith the value of each stock
Can be implemented by filing the application with the Secretary or the Department of State. An amendment fee needs to be paid to the government
Now that you are familiar with the clauses in an articles of incorporation document, you should also figure out the best way to get them signed without having to deal with printers, scanners and courier agents.Â
As one of the best eSignature apps on the market, here is how Signeasy helps businesses increase their efficiency and cut down on hard-copy paperwork every day.
Sign up for a 14-day free trial here, so you can sign and share your articles of incorporation application for free!
The articles of incorporation agreement does not expire. Typically, the articles of incorporation have a clause called âduration,â in which you may state that the duration of the corporation is perpetual. Â
Bylaws are lengthy internal documents that outline how the business must operate. On the other hand, articles of incorporation are short documents that give legal status to your corporation. The latter needs to be filed with a state government entity.