To form your company, you will need to file the ‘Articles’ with the entity tasked with forming companies in your state. Each state is different, but in North Carolina, this is the Department of the Secretary of State. You can find a template for the Articles on the Secretary of State’s website here to complete your Corporation Formation.
Corporation Formation Parts
Corporation Articles (Articles of Incorporation) contain a lot more information than LLCs because of the nature of how corporations work. Each state has their own requirements of what has to be in the Articles of Incorporation, primarily company name, address, registered agent name, registered agent address, incorporator name and address, number of shares issued, types of shares issued, date started, and a signature of the incorporator.
Most Common Requirements
- Name of the Company. You name must include “Inc,” “Corporation,” or any other common abbreviation for a Corporation. Before choosing a name, you should also run through a name search, checking the Secretary of State’s site, the USPTO, register of deeds, Google, domain registry, and any state trademark offices in which you might want to conduct business.
- Registered Agent and Address. This isn’t required in all states, but it is the person or entity that is located within the state borders that is responsible for accepting service of process on behalf of the company. This is important because this is the place a person can sue a business in the event the business has wronged that person. Just by serving this person, even if the business owner never gets the lawsuit, subjects the business to the jurisdiction of the court.
- Principal Office Location. This also isn’t required in all states, and isn’t required in North Carolina, but it provides a backup for the registered agent in case service cannot be obtained on the registered agent. It also provides the public with more information about your company.
- Incorporator. The Incorporator does not necessarily have to be a shareholder, but the Incorporator is the person who is setting up the corporation. This person has only the authority to set up the corporation, unless the Articles or Bylaws specify that she has other authority.
- Shares. The Incorporator must specify the number and types of shares that will initially be issued. In many states, there are tax or agency requirements for certain amounts of shares. In North Carolina, we do not have such restrictions, but be careful when you do business in these other states.
The major difference between an LLC and a Corporation is the shares provisions.
- Number of Shares
- Classes of Shares
Publicly Available
Since the articles are publicly accessible, it may be wise to include more in yours if you’re seeking investment. The more information in the articles, the more transparent your company will be. Many times, it may be a good idea to include a purpose section in the articles for investors or if your corporation is a nonprofit.
Certain other provisions, including purpose, you may want to keep more private. How meetings are conducted isn’t information the public needs to know because the public isn’t invited to those meetings. Therefore, that kind of information should not be included in these Articles.
If you need help with your Corporation Formation, or have questions or concerns regarding this process, please feel free to contact us at richard@lawplusplus.com or by calling 919-912-9640.