Articles of Incorporation
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The Articles of Incorporation serve essentially four (4) purposes:

  1. It brings the corporation "to life";
  2. It represents a contract between the corporation and the shareholders of the corporation;
  3. It represents a contract between the corporation and the state; and
  4. It puts everyone on notice about the corporation’s existence.
The single act of filing the Articles of Incorporation with your state establishes these four basic relationships.

It also helps to know what the Articles of Incorporation are not, and do not do.

The Articles of Incorporation are not:

  • Bylaws (sometimes called Regulations)
    • Bylaws are used by corporations to set the groundwork for how the corporation runs.
    • A corporation’s bylaws are similar in many respects to an LLC’s Operating Agreement.
  • Articles of Organization
    • Articles of Organization are used by Limited Liability Companies to do many of the same things as a corporation’s Articles of Incorporation (but there are some differences).

The Articles of Incorporation do not:

  • Set up how the corporation runs, including such issues as management, shareholders, meetings, directors, officers, the issuance and transfer of shares, corporate records, indemnification, and many other operating provisions. All of this is done in the corporation’s Bylaws.
In essence, the Articles of Incorporation don’t do a whole lot more than the 4 functions mentioned above. The Articles of Incorporation are generally a fairly easy step to complete. The corporation’s Bylaws, on the other hand, take much more time and effort to properly set up. The Bylaws set up how the internal components of the corporation will run and generally can range in length from 10 to 40 pages or more. In contrast, the Articles of Incorporation are usually just 1 to 3 pages.

Next, we’ll explore the contents of the Articles of Incorporation.

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