What is an “incorporator”?

 In Blog, Business Law

If you’ve decided to form a corporation for your business, it has to start somewhere. The first step in forming a corporation is to file your company’s Articles of Incorporation with the Secretary of State. The person who completes the filing and signs the Articles is called the “incorporator.” (If there is more than one incorporator, each must sign the Articles.) This person brings the new corporation into existence and lays the foundation for its business life.

Who is the incorporator?

The person who performs the role of incorporator for your business might be you, your partner, or any other person who will have a continuing role in the business. On the other hand, they might be a third party whose role is limited to setting up the corporation. For instance, there are companies who set up corporations for a fee. Often times, your business lawyer will be the incorporator.

What else does the incorporator do?

The incorporator is basically the person who gets the ball rolling on your corporate formation. In addition to filing and signing the Articles of Incorporation, the incorporator can perform any other tasks necessary to complete the process. This includes adopting bylaws for the corporation and electing officers and directors.

Sometimes the names of the initial directors for the corporation will be included in the Articles. If they are not, the incorporator will appoint them. Once the directors are appointed, the incorporator can resign and hand over the reins. (The directors can then go on to perform other necessary actions, such as issuing shares, electing officers, and determining business details, like the location of the principal executive office.)

Your incorporator will often complete his or her actions via a document called “Action of Incorporator.” Or the incorporator(s) may hold a meeting to conduct initial business and record the minutes. Once the incorporator’s job is done, they should complete, sign, and date a letter of resignation. Each of these documents should be filed with the company’s records. This will help keep your corporate records complete.

Using a third party incorporator for your business

The use of an experienced third party incorporator has many benefits, the most important of which is getting it done correctly right from the beginning. If you decide to use a third party to help set up your business, make sure you choose someone who knows what they’re doing. If done incorrectly, it could come back to haunt you later (i.e., if someone sues your business, flaws in the incorporation process could jeopardize your personal assets). Whatever you do, you should have everything documented and kept with your corporate records.

Helix Law Firm can help with the incorporation process

We can help you understand your options and determine if incorporation is in the best interests of your business, or if another entity would be more appropriate. We can also help you get off on the right foot and make sure your business’s continuing legal obligations are met.

If you’re interested in forming a corporation or other entity for your business, please call us at (619) 567-4447 to schedule a free consultation.

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