A corporation in Massachusetts is an independent body formed to serve a lawful purpose. A Massachusetts corporation has all the powers of a natural person. A business corporation can be formed in the state of Massachusetts in accordance to the provisions laid down by the Massachusetts Business Corporation Act, 2004. A corporation is a separate legal entity with the power to buy, sell or otherwise acquire an interest in a real or personal property. It has perpetual succession. A corporation can sue and be sued under the corporate name. It can carry out a lawful business, and operate offices in a state, territory or district in the United States, or in a foreign country. It can appoint officers and agents of the corporation for various duties and fix their compensation.
A corporation can be formed by one or more natural persons by executing and filing articles of organization. Such persons should have completed 18 years of age. The articles of organization shall contain the names and addresses of the initial directors. It should contain the corporate name, the number of shares authorized to issue, a brief statement of the character of business carried out by the corporation, the names and addresses of the directors until successors are elected, and name and addresses of incorporators. The articles of organization should also include the name and address of the registered agents of the corporation.
In Massachusetts, bylaws have to be adopted and the officers are to be elected before filing the articles of organization. Bylaws lay down internal rules and procedures for the corporation. They deal with issues such as the existence and responsibilities of corporate offices, the size of the board of directors and the manner and term of their election, how and when board and shareholder meetings will be held, who may call meetings, and how the board of directors will function.
A Massachusetts corporation can assume any name which, in the judgment of the state secretary, indicates that it is incorporated. However, a corporation should not adopt the name or trade name of another corporation established under the laws of the commonwealth. It shall not adopt a name of an established corporation, firm, association or person carrying on business in the commonwealth, at the time of incorporation. A name reserved under the laws of the commonwealth for another or proposed corporation should also be avoided.
The incorporators need to hold a meeting soon after organization of the corporation. It is in this meeting that the bylaws shall be adopted. The meeting shall also appoint the initial directors, and corporate officers. Any action that requires consensus in a meeting of the incorporators can be taken without a meeting if all the incorporators consent to the action in writing and the written consents are filed with the records of the corporation.
The board of directors exercise all corporate powers under the authority of the corporation. All the affairs of the corporation are to be managed by the board of directors. The articles of organization can set forth the limitations for the powers of directors. The number of directors are fixed in accordance to the bylaws of the corporation. However, it should not be less than three. If there are only two stockholders, the number of directors shall be not less than two. Prior to the issuance of any stock, or if there is only one stockholder, there shall be at least one director. The number of members of the board of directors may be increased by the stockholders at any meeting except otherwise provided by law.
Every year, a meeting of the shareholders needs to be held by the corporation at a time stated or fixed by the bylaws. The meeting may be held in or out of the state in accordance to the bylaws. If the bylaws do not suggest any specific place, the meeting can be conducted at the corporation’s principal office.
For more information on forming a corporation in Massachusetts, please visit the Secretary of the Commonwealth, Corporations Division