Shelf Corporation Definition
A Shelf Corporation
is a corporation that is formed, but has never been used. Shelf corporations should come with a
certificate of incorporation and franchise tax documents that have been filed with the Secretary of State of where the shelf corporation was formed.
Shelf or Aged Corporations are used for convenience, to assume a corporate history and to develop a perceived stability of the business operation. Therefore, as long as the corporation is clean of liabilities, it really does not matter where the aged shelf corporation was initially filed. It can always be continued in another state. In terms of the purpose of the corporation, it matters. Corporations are best served in Delaware when they are to go public with an offering. Nevada and Wyoming are best for privacy, asset protection, confidentiality and flexibility in management.
Companies and professionals, known to sell aged corporations, put their reputation on the line. Each aged corporation must be clean from liability, claims, hostile action or other negative problems.
These shelf corporations are also considered "anonymous", meaning there are no Shareholders, Directors, or Officers listed with the Division of Corporations. Anonymity can be a major benefit of forming a corporation.
Corporation will be organized according to your wishes. You name first directors, officers and shareholders.
Advantages of a Shelf Corporation:
- establish a history for your business.
- enhance your corporations image with age.
- build corporate credit. It may be easier with age.
- encourage companies to do business with you. Some companies are more willing to do business with an established company vs. a younger company.
- If you wish to bid on a contract that requires your corporation be established for a certain period of time.
- If you wish to obtain a bank loan. It may be easier if you can show you have history of being incorporated.
- obtain corporate credit cards and leases. (For example, Gateway computers lease only to corporations 6 months old or more, etc.)