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Companies Served Since 1981

The HBS Blog


The HBS Blog offers insight on Delaware corporations and LLCs as well as information about entrepreneurship, start-ups and general business topics.

The Benefits of a Company Kit
By Frannie Esparza Tuesday, December 10, 2013

do i need a company kit

Often, when people call to inquire about forming an LLC or corporation in Delaware, they are unsure of which formation package they should purchase and unaware of the benefits of the extra features.

 

In sales, extra features are often used to entice the customer to purchase the more expensive option.

 

In many instances, you may never even use any of the extra tools you purchased.

 

This can be frustrating and understandably make you question the notion of extra features.

 

We include a Corporate Kit as one of the extra features in our Standard package, and we want to let you know that you are truly getting great value for your money. 

 

We are not interested in pushing you to purchase unnecessary items or the most expensive package.

 

The Corporate Kit offers useful tools that you may find beneficial in running your startup company. We want to assure you of the benefits you will receive if you opt to purchase the formation package that includes the Company Kit; we want you to feel confident in moving forward with your purchase. 

 

The following are key components of the Company Kit for an LLC or corporation, and the benefits of each:

 

Gold Embossed Company Binder

 

  • You receive the Gold Embossed Company Binder with a Standard Package purchase. Our clients are often impressed by the professional and elegant binder, which provides a safe place to store and organize all your important company documents.

 

Great, thank you. I received the Company binder today in mail from FedEx, looks very nice. Good job.” – ByteSurge LLC

 

LLC Operating Agreement or Corporate Bylaws

 

  • People often call us and ask how they can show ownership in an LLC since the only information required to be filed with the state of Delaware is the name of the LLC and the name and address of the Registered Agent. We also have people who wonder what complicated process they will need to go through in order to remove or change members within their LLC.

 

  • The hard copy of an Operating Agreement Template included in the Company Kit is a very useful tool in helping you define ownership, management and the day-to-day activities for your LLC. The Operating Agreement is a written agreement among the members that is not required to be publicly filed or disclosed to the Delaware Division of Corporations.

 

  • As a result, an LLC allows for confidentiality and the ability to create a customized management structure, which prescribes the economic relationship among owners. The Operating Agreement can be written in any language and typically is not required to be translated into English.

 

  • The beauty of the Operating Agreement is that it is a convenient internal document that can be modified and updated as often as you'd like. We do not need to know about it, nor does the state of Delaware. Any changes you need to make within your company are documented and updated solely by you and your members.

 

corporate bylaws

  • However, remember that an LLC Operating Agreement is a binding contract among the members and you must have the unanimous consent of the members to change it.

 

  • The Company Kit also includes a hard copy of corporate bylaws. Typically, the Board of Directors of a corporation creates this vital document. The bylaws are a clear and concise definition of the structure of your corporation, and include identification of the directors and officers of the corporation as well as their duties and responsibilities.

 

  • The bylaws also define the day-to-day procedures of the company. Bylaws are composed of data such as names and information of the directors and the date, time and location of the annual shareholder meeting.

 

  • If you need to make changes to the structure of your corporation, such as adding or removing directors or officers, the state of Delaware does not need to know about these changes. Corporate changes are typically made internally, and then the information is listed in the Delaware corporation annual report.

 

  • The only time we need to know about any changes is if you change your company address or the primary communications contact person we have on file. We want to make sure the correct person at your company receives all important documents, bills and notices from the Secretary of State in a timely manner. You should also notify us if you need to change the amount of authorized stock for your company.

 

Organizational Resolutions or Corporate Resolutions

what is a corporate kit

  • The Company Kit also includes a template for your Organizational Resolutions. Typically, you would keep this document with the LLC or corporation business records after all members have agreed to it and signed it.

 

  • This document is kept on file and represents official decisions made collectively, by all members. The decisions authorized by all members can be presented with this written document in court, if necessary.

 

  • Often, Organizational Resolutions are required for obtaining additional services. Proof of your resolutions is often required to assign authorization in order to open a bank account.

 

  • In addition, if you are looking to obtain a loan through a financial institution on behalf of the LLC or corporation, it may also be presented as a proposal to the lender. When and why you would need this document depends on who you are working with and the type of action you are seeking. However, it is an important piece of the Company Kit that can be beneficial in various ways.

 

The Delaware Company Guidebook 

 

  • The Delaware Company Guidebook is the perfect resource included in the Company Kit that may very well answer a majority of your questions related to your Delaware LLC or corporation. The Guidebook covers many different topics in an effort to facilitate running your company, from tax issues to record keeping and overall management of the company.

 

corporate kit contents

Membership or Stock Certificates & Transfer Ledger

 

  • Membership and stock certificates are also included in the Company Kit, along with a Stock Transfer Ledger. The twenty certificates included in the Company Kit are official, professional and secure, with high-quality security features such as watermarks, embedded fibers and void pantograph backgrounds.

 

  • The stock certificates may be issued to the members of the LLC or to the shareholders within a corporation. The LLC Membership Certificates display ownership described through the units or percentage owned by each member.

 

  • A corporation's stock certificates demonstrate the number of shares issued to the shareholder, thus displaying ownership within the corporation.These stock certificates can be easily managed through the Stock Transfer Ledger as you add, remove or transfer ownership among existing or new members.These documents are also internal and can be managed however you feel best suits your company.

 

As you can see, our Corporate Kit is fully equipped with useful tools in order to help you achieve success in your new business ventures.

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How to Deal With Social Media Criticism
By Kathryn Hawkins Monday, December 9, 2013

Social media channels such as Facebook and Twitter are effective ways to communicate with fans and introduce your company to new audiences. However, when opening up your brand’s social channels for public expression, you need to be aware that there may be criticism as well—and prepare to react quickly and efficiently to stop misinformation in its tracks before new prospects veto your brand.

For example, in 2010, Pampers redesigned its Cruisers and Swaddlers diaper product lines with a new technology known as “DryMax,” which are 20 percent thinner than previous versions of the diaper lines.

However, soon after rolling out the revamped products, a few parents began complaining that their children had gotten rashes from the new diaper lines. They voiced their concerns both on the Pampers official Facebook page, and on a critic-created “RECALL PAMPERS DRY MAX!” page, which grew to more than 3,100 “fans” who rallied against the brand and shared their criticisms of the diapers. Even worse, the online outcry led mainstream media to pick up the story, with a CNN story questioning whether the diapers were dangerous.

Pampers responded with a detailed communications strategy, issuing several press releases that included statements in support of Dry Max by Kimberly Thompson, founder of the pediatric safety and risk group Kids Risk. Representatives from Pampers also granted television interviews to several media sources to tell the company’s side of the story.

The diapers were also inspected by the U.S. Consumer Product Safety Commission, which confirmed that the products were not a cause for consumer safety concern.

Even so, Pampers offered a dedicated support line for questions regarding the Dry Max products, and kept its social media channels open for discussion, positive or negative. They even offered to compensate some worried parents for pediatrician visits to explore the source of their children’s medical problems.

The brand successfully weathered the social media storm, and today, its Facebook page is a rich environment where parents can ask questions about diapering and baby care, and share parenting tips and stories with one another through Pampers’ daily conversation prompts.

By addressing the rumors and taking steps to alleviate customer concerns while maintaining an open social media environment, Pampers proved itself as a social media success story.

What lessons can you take away from Pampers’ success story?

  • Don’t ignore or censor the criticism. By acting like you have something to hide, fans will grow more suspicious.
  • Be respectful of people who claim there is an issue. By making a good-faith effort to acknowledge people’s concerns and communicate with them, you will be more likely to keep them as loyal fans.
  • Get experts to speak out on your behalf. If followers are making untrue claims about your brand, issue statements from experts who have credibility in your industry to disprove those claims.
  • Don’t let the controversy take over your social media account. While it’s important to acknowledge and respond to the backlash, you should also continue to post news updates and positive comments about your company, and ask questions of your followers that can help you foster a true online community.
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How to Raise Money for a Business
By Rick Bell Tuesday, December 3, 2013

In February 2011, Devin Scott wrote an interesting HBS Blog about the “Jobs Act,” including some of the advantages coming to small businesses due to its passage and anticipated signing into law by the president.

After it was signed, the process of writing the regulations (rules) about how the law should be followed began, and on Sept. 23, 2013, one of the key advantages for small business became available. It’s called “Rule 506 (c)” and it allows small companies to raise startup capital in a way that was formerly a serious federal crime: by “general solicitation.”

You see, when the Securities Exchange Commission (SEC) was created in 1933, with Joseph P. Kennedy as the first Chairman, there were only TWO ways to sell stock in your company: 1) To make a PUBLIC OFFERING and 2) to make a PRIVATE PLACEMENT. Each of these methods required strict adherence to law and many hours of document crafting and due diligence on the part of lawyers.

Now, we have a third option: the public solicitation. Without eliminating the two existing options, the SEC is now allowing companies the ability to publicly advertise that their stock is for sale. The solicitation can be made repeatedly and can take many forms of public noticing such as TV, radio, newspapers and magazines, public meetings, etc. There is no limit to the amount of advertising you can do or how long your campaign can last.

There is, however, a slight catch: When people respond to the solicitations and desire to purchase your stock, the company MUST take reasonable efforts to prove that the investor has a net worth of more than $1 million, OR that the investor has made at least $200,000 for both of the past two years and is reasonably expected to make $200,000 in the next year. This is the definition of an “accredited investor” in its simplest form.

If the company cannot be assured that the investor qualifies, they cannot take his money.

In the past, investors could simply sign a document stating that they were accredited investors. This is called self-certification and it satisfied the company’s requirement to allow ONLY these high-net-worth individuals to buy their stock. But with the new rules for public solicitations the company must actually perform some due diligence on their investors.

All things considered, this newly legal way of raising investment capital for your company is GOOD NEWS for small businesses all across the USA and will open up new sources of funds for entrepreneurs.

NOTE: There is also a FOURTH method of raising investment capital in the JOBS Act which has been called, “crowd-funding” but it has not yet been completed by the regulators and is not expected to become available until next year. You can be sure we’ll report on it when it becomes available.

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Harvard Business Services Testimonials
By Michael Bell Monday, December 2, 2013

In this video you will hear from some of our most loyal customers. They will answer the following questions. Why they chose Harvard Business Services. How easy we made the process. What we did for their business and how we helped them become successful entrepreneurs

Please share your thoughts/ideas in the comments. We would love to know how you take the ordinary work day and turn it into something extraordinary!

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The Corporation Tickler: What It Is and How to Use It
By Andrew Millman Tuesday, November 26, 2013

What is the Corporation Tickler?  What’s it for?  Why do I need it? 

Not only does the Gold Embossed Deluxe Corporate Kit include:

  • Delaware Company Guidebook
  • Customizable By-laws
  • Meeting Minute Book
  • Organizational Resolutions
  • 20 Customizable Numbered Stock Certificates
  • Stock Transfer Ledger
  • Corporate Forms Disk
  • Corporate Seal (Lead-Cast Lettering, Fold-up style)

Another helpful organizational tool included in the Corporate Kit is the Corporate Tickler (p.17 of the Corporate Kit).  The Corporation Tickler is an asset used to help owners remember when certain things need to be done. It’s also a great place to keep track of all vital information for your corporation.  This allows you to keep up to date records on the identity, addresses, and information of shareholders, directors, the president, vice president, secretary, treasurer, as well as any other officers of the corporation.

Need to know when to hold the next annual meeting or the fiscal year end for the corporation?  It’s all right here: Up-to-date contact information for the company’s registered agent, accountant, attorney, banker, insurance broker, etc. can also be recorded on the Corporation Tickler—even something as simple as the location of the company seal, if it’s often recorded.  You don’t want get caught in a jam when you are in need of this invaluable corporate information.  Keep everything up-to-date on the Corporation Tickler, and keep it in a safe place.

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