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How to Replace Text Incorporators' Organizational Meeting

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In this video tutorial, Michael Lapete discusses the importance of organizing your corporation immediately after incorporation. He explains the roles of shareholders, directors, and officers. Shareholders, akin to stockholders in companies like Apple, are the owners but are not involved in daily operations. Directors, elected by shareholders, make key decisions and bear liability for those decisions. Understanding these roles is crucial for setting up a well-structured corporation. This is the first part of a series focused on corporate organization post-incorporation.

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Why do you have to hold organizational meetings after the certificate of incorporation has been sent to the corporation?

After incorporation, the incorporators or first directors are required to call an organizational meeting of the directors. The purpose of this first meeting of the directors is to organize the corporation by adopting a number of resolutions that will allow the corporation to conduct its activities.

Can the director and incorporator be the same person?

Only persons of 18 years and above can be an incorporator, and some state also requires the person to be resident in the state. The person can be the owner or director of the corporation. An incorporator can be anybody qualified to file paperwork on behalf of the corporation.

Is the director the owner of a company?

Shareholders and directors have two completely different roles in a company. The shareholders (also called members) own the company by owning its shares and the directors manage it. Unless the articles say so (and most do not) a director does not need to be a shareholder and a shareholder has no right to be a director.

What is the difference between incorporators and directors?

The incorporator is the person or persons who organize the corporation and file the Articles of Incorporation. Once the filing is complete the incorporators function is usually finished. After that the management of the corporation is performed by the directors.

How do you change a companys share structure?

How to change classes of shares. If the directors wish to change the classes of shares described in the articles, or any of the rights attached to a class of shares, an amendment to the articles (see Amending your articles) of the corporation will be required. A special resolution of the shareholders is needed.

Are incorporators the same as owners?

Typically, incorporators are the actual owners of the business. In such a situation, although they begin as incorporators with very little rights, they become the owners of the corporation once its existence begins.

Is an incorporator a director?

Oftentimes, the incorporator is not a shareholder, director or officer of the corporation. Most frequently, the incorporator is the lawyer who is handling the formation of the corporation. Following the first meeting of the Board of Directors and officers, the incorporator resigns from its role.

What is an organizational meeting?

Organizational meetings are held to appoint officers, elect or appoint directors, issue shares in the corporation, approve bylaws, setup minute books, appoint or waive the appointment of auditors, set up bank accounts, etc.

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Replace Text Incorporators' Organizational Meeting