POST-INCORPORATION LEGAL WORK

Contact Neufeld Legal for your corporate legal work at 403-400-4092 / 905-616-8864 or Chris@NeufeldLegal.com

Incorporation is merely the launching point of the new company, with the issuance of the Certificate of Incorporation representing the start of an ongoing legal process to maintain and advance the business of the corporation. There is an extensive array of legal work that follows for the corporation as it pursues its revenue generation, while optimizing the profits that it is capable of retaining.

A. Organizational Proceedings

Immediately after incorporation, the company exists but has no operating rules, officers, or shareholders. The Organizational Resolutions are required to bring the company to life.

  • Organizational Resolutions: The first meeting of directors (or written resolutions in lieu of a meeting) to adopt the corporate seal, appoint officers (President, Secretary, etc.), and set the financial year-end.

  • Adoption of Bylaws: establishing the internal rules of the company (e.g., how meetings are called, quorum requirements, and powers of directors).

  • Issuance of Founder Shares: Formally issuing shares to the initial owners. This involves:

    • Subscription agreements.

    • Resolutions approving the issuance.

    • Issuing physical or digital share certificates.

  • Corporate Registers: Setting up the "Minute Book" (the official record of the company), which includes registers for directors, officers, shareholders, and transfers.

  • Shareholders’ Agreement: If there is more than one owner, drafting a contract to outline exit strategies, dispute resolution, and share transfer restrictions (e.g., Shotgun clauses or Right of First Refusal).

B. Annual Maintenance

Corporations are required by law to maintain specific records every year to remain in existence and avoid being dissolved by the government.

  • Annual Return Filing: A mandatory form filed with the corporate registry (distinct from a tax return) confirming the company's current address and directors.

  • Annual General Meeting (AGM): Holding a meeting of shareholders to review financial statements and elect directors.

  • Annual Resolutions: In place of an in-person AGM, small companies often draft written resolutions signed by all shareholders and directors to:

    • Approve the financial statements.

    • Re-elect directors and appoint auditors (or waive the appointment of an auditor).

    • Ratify the acts of the directors from the previous year.

C. Changes to Corporate Structure

As the business evolves, the legal structure often needs to be updated to reflect reality.

  • Change of Directors/Officers: Filing notices with the government and updating the internal registers whenever someone resigns or a new person is appointed.

  • Change of Registered Office: Legal documentation required if the company moves its physical location.

  • Articles of Amendment: Filing formal changes to the company's constitution, such as:

    • Name Change: Changing the legal name of the business.

    • Share Structure Change: Creating new classes of shares (e.g., creating "Class B Non-Voting Shares" for employees or family members).

D. Financial & Securities Work

Whenever money moves into or out of the company (other than standard revenue/expenses), legal documentation is required.

  • Dividends: Drafting resolutions to declare dividends. (Note: Directors must usually sign a "solvency certificate" confirming the company can pay its debts before paying dividends).

  • Bonuses: Resolutions approving management bonuses.

  • Raising Capital: Issuing shares to new investors. This is complex and involves:

    • Subscription Agreements.

    • Securities law compliance (ensuring exemptions from prospectus requirements).

    • Updating the transparency register (verifying who the "significant individuals" are).

  • Stock Options: Creating Employee Stock Option Plans (ESOPs) to grant equity to employees.

E. Operational & Commercial Protection

These are essential for the protection of the corporate entity and its commercial pursuits.

  • IP Assignment: Ensuring that any intellectual property created by the founders pre-incorporation is legally transferred (assigned) to the company.

  • Employment and Contractor Agreements: Contracts defining the relationship between the company and its workforce.

  • Terms of Service / Privacy Policy: Legal text for the company website or application.

F. Commercial Transactions

These are the external contracts required to actually operate the business and generate revenue.

  • Sales and Customers:

    • Terms of Service/Use: Governing how users interact with your website or software.

    • Master Services Agreements (MSA): Setting the baseline legal terms for ongoing client relationships.

    • Purchase Orders & Sales Contracts: Standardizing terms for selling goods.

  • Supply Chain and Vendors:

    • Supplier Agreements: Contracts securing the delivery of raw materials or inventory.

    • Distribution/Reseller Agreements: allowing third parties to sell your products.

  • Intellectual Property (Commercialization):

    • Licensing Agreements: Granting others the right to use your IP (or vice versa) in exchange for royalties.

    • Non-Disclosure Agreements (NDAs): Protecting trade secrets during negotiations.

  • Real Estate:

    • Commercial Leases: Negotiating terms for office, warehouse, or retail space.

G. Corporate Transactions

  • Mergers & Acquisitions (M&A):

    • Asset Purchase: Buying the equipment, client lists, and IP of another business.

    • Share Purchase: Buying the actual legal entity of another business.

    • Amalgamation: Legally fusing two corporations into a single new entity.

  • Joint Ventures & Partnerships: Undertaking definitive / restricted to a specific purposes (joint ventures) and expansive (partnerhship) business arrangements in collaboration with any business entity / party.

H. Exit or Dissolution

Eventually, the corporate life cycle ends or transforms.

  • Amalgamation: Merging two corporations into one.

  • Continuance: Moving the corporation from one jurisdiction to another (e.g., moving for one province to another province).

  • Dissolution: The legal process of "winding up" the company, paying off debts, distributing remaining assets to shareholders, and formally closing the corporation with the government.

So when you are striving to implement the requisite legal maintenance of your business corporation on a regular basis, or undertaking corporate legal moves to advance the business of your corporate enterprise, contact our law firm at 403-400-4092 [Alberta], 905-616-8864 [Ontario] or via email at Chris@NeufeldLegal.com.

Certificate of Invorporation vs. Articles of Incorporation