November 15, 2008

Every Delaware Corporation Must Have A Registered Agent

If you want to become incorporated in Delaware, you’re not required to have a place of business that’s physically located here. In fact, you’re not even required to do business in Delaware. Instead, what’s required is that you have and maintain what’s called a “registered office” located in the State of Delaware. In addition, the corporation must have a Delaware registered agent who's located at the registered office.

Choosing a Delaware business attorney to act as your Delaware registered agent gives you immediate access to an attorney in Delaware if you should need one.

A Delaware corporation is required to provide to its registered agent the name, business address, and business telephone number of a natural person who is an officer, director, employee, or designated agent of the corporation, who is then authorized to receive communications from the registered agent. Such person is considered the communications contact for the corporation.

The registered agent’s main responsibilities are: (1) to accept service of process and other communications directed to the corporation and forward it to the corporation; (2) to forward to the corporation the annual report required by Delaware law; (3) to be present at the registered office during normal business hours; and (4) to retain (in paper or electronic form) the information concerning the current communications contact for each corporation for which he serves as a registered agent.

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September 30, 2008

Choosing A Name For Your Business In Delaware

A young man recently formed a Delaware corporation on his own. Instead of consulting with a Delaware business attorney before he filed the necessary papers with the State, all he did to make sure he could use the name he wanted was to check the Delaware Division of Corporations website. He happily discovered that the name he wanted to use was available.

He opened a bank account in his corporation’s name, he ordered letterhead, and he ordered business cards. He got a taxpayer identification number from the IRS, and he got his business license from the Delaware Division of Revenue.

A few months later, he got a letter from a lawyer demanding that he cease and desist using the name because the lawyer’s client, who ran a similar business, had been using the same name for many years.

When he contacted me, this young man was in a state of high anxiety. He didn’t know what he had done wrong, and he was scared. He was worried about all the money and time he had spent just getting his business ready to open for business.

The simple and rather common mistake my client made was in limiting his name availability search to the Division of Corporations website. He didn’t realize that the only obligation of the Division of Corporations was to make sure that a new corporation’s name is distinguishable in their records from the names of other companies who were already registered. On this point, names don't have to be very different to be distinguishable on the Division of Corporations records. For example, the name "Transamerica Airlines, Inc.," is considered distinguishable from the name, "Trans-Americas Airlines, Inc."

In my next article on this topic, I’ll address what my client could have done to make sure the name he wanted for his corporation was in fact available.

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September 16, 2008

Resources For Start-Up Businesses

For Delaware businesses that are starting out, there are a lot of resources available at your fingertips. Here are several links that you should find helpful.

Delaware Division of Revenue - Services For Business Taxpayers

Delaware Guide For Small Businesses

Delaware's Business Resource

Delaware Economic Development Office

Delaware Small Business Development Center

United States Small Business Administration

Service Corp of Retired Executives (SCORE)

Delaware Division of Corporations

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