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Articles of Incorporation refers to the highest governing document in a corporation. It is also known known as the corporate charter. The Articles of Incorporation generally include the purpose of the corporation, the type and number of shares, and the process of electing a board of directors.
The Articles of Incorporation states the name, purpose, place of office, incorporators, capital stock, and term of the Company upon its establishment. The By-Laws outline the rules on annual and special meetings, voting, quorum, notice of meeting and auditors and inspectors of election.
There are usually two types of stocks that a C corporation could issue: common stocks and preferred stocks.
Common shares represent residual ownership in a company and in the event of liquidation or dividend payments, common shares can only receive payments after preferred shareholders have been paid first.
orporations are able to issue both common and preferred stock. Sorporations are able to issue only common stock. The primary difference between preferred and common stock is that preferred stock usually pays a predetermined dividend usually to directors or select shareholders, but gives no inherent voting rights.
This legal document contains general information about the corporation, that includes its business name, address and other essential information. It is the primary document of authentication of the company, and the Registrar of Companies (ROC) issues this document.
An entrepreneur needs to submit the following documents for the incorporation of a company. (a) Memorandum of association. (b) Articles of association. (c) Written approval of the proposed directors to function as directors and an undertaking to buy the qualification shares.