In Canada, Articles of Incorporation define a corporation, namely,
- the initial directors of the corporation,
- the classes of shares in the corporation,
- the number of shares in each class of shares that the corporation may issue (or that the number is unlimited),
- the rights and privileges of the shareholders of each class of shares,
- the share transfer restrictions, and
- other parameters restricting the corporation’s activities.
The Articles of Incorporation are the primary rules governing the structure of a corporation in Canada. Articles of Incorporation are filed with a Provincial government office. Some corporations also are organized with By-Laws, which are the secondary rules governing the management of a corporation.
Legal ending Options for corporations in Ontario:
- Professional Corporation
Or you can get the Ontario government’s Articles of Incorporation blank form for free:
Once a Province or the Federal government creates a corporation electronically, they issue Certificate of Incorporation. Manually incorporated Ontario corporations do not get a Certificate of Incorporation.
The Articles of Incorporation may sometimes be referred to the Corporate Charter in some jurisdictions outside Canada and the USA.
Classes of Shares
Often corporations only have a Common class of shares. Some corporations with a Common class of shares also have a Preferred class of shares.
Some corporations usually have multiple classes of shares, numbered alphabetically, to solve issues that may occur when there are multiple shareholders in a corporation who may or may not be active participants in the corporation. It is best to incorporate with articles that allow a corporation to grow by gaining investors, without giving up control to the investors, and to give valuable employees bonus shares. An optimal set of shares in articles of incorporate includes classes A, B, C, and D; see our sample Ontario Articles of Incorporation.
If you will need to issue subordinate shares to raise money without losing control, try our articles with an unlimited number of class A, B, C, and D shares:Articles of Incorporation Ontario Sample $49.99 Classes A, B, C, and D
Sophisticated corporations, like Magna International, further optimize their share structure by having dual class A shares: Class A1 and Class A2, to allow outside investors have seats on the board of directors.
Non-Profit Articles of Incorporation
Non-profit corporations don’t have shareholders. Instead, non-profit corporations have members, directors, objects, and bylaws.
Charity Articles of Incorporation
Non-Profit corporations may register as a charity if they have charitable objects.
The Government of Ontario maintains a standard set of charitable object clauses (called “Pre-approved objects”) that describe the most common types of work carried out by charities. If the work intended to be carried out is accurately described by one or more of the pre-approved objects, then it becomes easier to apply to incorporate a charity.
This page explains when and how to apply using pre-approved objects