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San Diego Corporate Law: What is an Incorporator?

When you want to create a corporation for your San Diego business, you can hire what is known as an “incorporator.” Your trusted and dedicated corporate attorney can be your incorporator; in fact, most often the incorporator is your corporate attorney. In general, an incorporator is the person who initiates the filing of papers and signs the papers with the California Secretary of State to create a new corporation. In general, the incorporator’s role as an incorporator ceases after the first meeting of shareholders and the first meeting of the board of directors. Here are more details.

San Diego Corporate Law: Who can be an Incorporator?

As said, an incorporator files the initial papers with the California Secretary of State to establish your new corporation. The incorporator does not need to be a shareholder, or an owner, or someone who will be involved in the business. On the flip-side, the owners, directors and those who are going to be running the business do not need to be incorporators and, other than authorizing the corporation to be formed, do not need to be involved. One exception is this: If the initial directors of the new corporation are named in the articles of incorporation, then those directors must sign and acknowledge the articles. See Cal. Corp. Code, § 200(b). As noted, most often, the incorporator is a corporate attorney hired for the purpose of forming a corporation.

San Diego Corporate Law: What is an Incorporator?

The role of an incorporator is defined by California statute. See Cal. Corp. Code, §§ 200 and 210. Section 200(a) states that “[o]ne or more natural persons, partnerships, associations or corporations, domestic or foreign, may form a corporation under this division by executing and filing articles of incorporation.”

San Diego Corporate Law: What can an Incorporator do?

The articles of incorporation do not need to specify who are the initial directors or shareholders of the corporation. Under those circumstances, pursuant to Cal. Corp. Code, § 210, the incorporator can take whatever actions are necessary to get the corporation up and running. Section 210 states:

“If initial directors have not been named in the articles, the incorporator or incorporators, until the directors are elected, may do whatever is necessary and proper to perfect the organization of the corporation, including the adoption and amendment of bylaws of the corporation and the election of directors and officers.”

California law allows the incorporators to act in this fashion because the existence of the corporation begins immediately upon the filing the initial articles of incorporation with the California Secretary of State. Someone must always be able to act for the corporation. Thus, until the board of directors is elected, that “someone” is the incorporator. As noted, once the board of directors is elected, the role of the incorporator comes to an end.

San Diego Corporate Law: Board Should Ratify Incorporator Actions

When the board of directors holds its first meeting, among many important tasks is to ratify the actions of the incorporator. This is usually done with a simple resolution where the board “ratifies and approves all actions taken by [NAME], as incorporator, including all actions taken to form the COMPANY and [OTHER ACTIONS].”

Call San Diego Corporate Law Today

If you need legal advice relating to setting up your corporation, call experienced business attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard has been named a “Rising Star” for 2015, 2016 and 2017 by Contact Mr. Leonard by email or by calling (858) 483-9200.

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Schedule a Consultation: 858.483.9200