Aged Shelf Corporation FAQ

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Aged Shelf Corporation FAQ

What is a Companies Incorporated shelf company?
What are the types of shelf companies?
What shelf company age is right for me?
What does a shelf company age
mean?

Additional shelf company benefits?
What is a Shell Company or Corporate
Shell?

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What is a Companies Incorporated shelf company?

A shelf company is an LLC or corporation that has been formed on a prior
date. Typically, it will not have conducted business. It does not hold
assets, has not incurred liability and has yet to issue stock. These
corporations are also referred to as seasoned shelf companies. When
you purchase a Companies Incorporated aged shelf company, it will
arrive in your possession with articles of incorporation file stamped
by the government with its incorporation date as well as:

  • Articles of Incorporation
  • “Action of Sole Incorporator” document which transfers the company
    to you
  • Minutes of meetings (blank sample forms)
  • A corporate kit (record book)
  • Stock certificates (blank, un-issued shares)
  • A corporate seal
  • Corporate Bylaws (unsigned forms)
  • A corporation checklist letting you know items to keep your company
    in good standing
  • Registered agent service
  • A CD with important forms
  • Federal Tax ID Number
  • Other important documents

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What are the types of aged shelf corporations?

Shelf and aged companies can refer to different types of legal entities. This
includes U.S. domestic corporations and LLC’s, as well as offshore and
international entities. The term “shelf” or “aged” only refers to the
fact that the company has already been filed and is sitting “on a
shelf” waiting to be purchased.

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What shelf company age is right for me?

It is important to choose the age appropriate to your needs. For a
building contractor or consulting company the number of years in
existence is important to the clientele. If you have been in the construction industry for 15 years, for example, obtaining a 15-year-old corporation may make sense because it corresponds with your time in the business. In order to obtain some contracts, the typical business age requirement is two years. That may not be the only factor in obtaining a bidding agreement, but it may be one of the many check-the-box items, especially, as we mentioned, when your corporate age and business age match one another. Moreover, some report that for a
business that wants to build corporate credit, the older the better. This may or many not be the case, but there are other factors that likely have more weight such as the profitability of the business and creditworthiness. Full disclosure is recommended. The key issues are the perceptions of the potential customers and
potential lenders. How old does the business need to be to convince the
client or the banker that the business is secure and stable? Is the age
of your business important? It usually is to a customer or lender. We are not saying that age is the only factor here but it may put a bit of weight on your side of the scale, in addition to other more important factors.

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What does a shelf company age mean?

The age of a shelf corporation is just as real as the age of a human
being. The law calls a corporation a person. It is an artificial
person. It is separate from the people who own it. The owners of a
shelf corporation, as with any other legal entity, are just as separate
from each other as two people are separate. The H.J. Heinz company
started in 1869. The original owners, officers and directors have long
since passed. However, the age of the company truly remains
in-tact.

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Additional shelf company benefits?

Shelf Corporation Benefits

  • Immediate availability – The company formed is ready to be shipped
    for immediate delivery rather than needing to wait for government
    filing.
  • Credibility to customers (This works best, in our opinion, when your actual time in the business corresponds to the age of the company. )
  • Possible Increased ability to bid on contracts. Many bid contracts require that the business be between two and five
    years. This works best when your actual time in the business corresponds to the age of the company.
  • Faster access to credit (because the company gets into your hands faster)
  • Faster to obtain venture capital (because the company gets into your hands faster)
  • Faster to take a company “public” and sell shares on a stock
    exchange if certain criterion are met, such as proper state and federal filings.
  • Less lead time to incorporate your company
  • Possibly increases the ability to bid or present your business in an arena where candidate
    companies have to breech an existence duration threshold for
    contractual adherence (full disclosure recommended)
  • Immediately obtaining a company with filing longevity
  • Faster access business opportunities

The above benefits are based on our opinion only and may not apply to your situation. Buyers of shelf companies have some big advantages over newly
filed businesses. First, the benefits mentioned above. Then, the
advantage of being able to purchase an established corporation and yet
put themselves in as officers, directors and shareholders, giving them
immediate control of the business. We recommend full disclosure in that you inform lenders and other parties that you have recently obtained an aged entity.

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What is a shell corporation or corporate shell?

Corporate shells are “shelf companies,” as they are known, that
are also companies that have already been formed. These types of
companies usually do not have shareholders, officers or directors
(unless required to be filed to maintain good standing). They generally
have no assets or liabilities. Such an entity is analogous to a new
home that has been built and is ready for you to occupy.

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