Orrick's Emerging Companies Group Start-Up Forms Library

Transcription

1 Orrick's Emerging Companies Group Start-Up Forms Library The attached document is part of the Start-Up Forms Library provided by Orrick's Emerging Companies Group. By using/viewing the attached document, you agree to the Terms of Use Agreement for the Start-Up Forms Library, which can be viewed at:

2 1. Contact Information: Address: (street address necessary) Contact Person: address: Telephone number: Fax number: 2. Name: a. Proposed name of corporation Alternate names: INCORPORATION QUESTIONNAIRE (Delaware Corporation) b. Has name been reserved? If yes, when will reservation expire? c. Name must also be available for use in the following states: d. Will the business be conducted under a fictitious name? If so, list the name 3. Trademark: a. Should Orrick request a trademark search regarding the name? If yes, how should the search be performed? On-line search ( $ for legal fees and database access costs) Thomson & Thomson search ( $ per mark) b. Mark(s) or name(s) to search: c. If mark or name is clear, should Orrick carry out trademark prosecution?

3 4. Purpose of corporation: a. Generally: a any lawful act or activity bank or trust company professional corporation nonprofit corporation b. Brief description of proposed business activities (if it will be a nonprofit corporation, provide specific details): 5. In which other states will the corporation do business or own property? 6. Name and street address of initial agent for service of process: a. In Delaware: Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, Delaware Other: b. In California, or other state in which Company will do business (preferably an individual): Corporation Service Company, which will do business in California as CSC- Lawyers Incorporating Service Other: 7. Directors: a. Number: fixed at OR flexible number of directors: i. minimum of ii. iii. maximum of initially fixed at 2

4 b. Initial directors (the first director listed will be designated the Chairman of the Board): Name Street Address (business or residence) Fax Number Address 8. Officers: 1 Name Title Street Address (business or residence) Social Security Number 1 The same person can hold more than one office. Delaware law does not require any particular number or type of officers. If qualified in California, it s a good idea to have a CEO a CFO and a Secretary at a minimum. 3

5 9. Capitalization: a. Number of each class of authorized shares: i. shares of common: 2 ii. iii. par value per share: shares of (attach description) $ par value shares of (attach description) $ par value b. Number of shares to be initially issued: c. Proposed initial stockholders and consideration: Name and Address Number of Shares Class of Stock Amount and Form of Consideration Describe Any Special Vesting Provisions: 2 Note that because Delaware corporate tax and annual franchise tax are based on the number of shares and the par value of the shares, it is advantageous for a corporation to have a relatively small number of shares and to assign a low par value to the shares (e.g., $0.0001). There are two methods for calculating annual franchise taxes: the Authorized Shares Method and the Assumed Par Value Capital Method. The method which results in the lesser tax may be used by the Company, but note that Delaware will initially send a report of taxes owed based on the Authorized Shares Method which is usually much higher than the alternative method for small thinly capitalized startup companies. Refer to Section 503 of the Delaware General Corporation Law for a more detailed explanation on how to calculate the annual franchise tax. The typical approach is to authorize a number of shares of common stock equal to the fully diluted pre-money valuation of the Company so that the Series A can be sold for $1.00 per share which has optical significance to VCs. This must be counterbalanced by the need to grant options in relatively large share amounts which has optical significance to employees. For example, if the pre-money valuation is likely to be less than $10 million, the Company will probably want to authorize a number of common shares equal to 2X (or some other round multiple) of the pre-money valuation, even though this will mean the Series A shares will be sold for less than $1.00 per share. 4

6 d. Will any of the funding be provided indirectly or directly by non-u.s. investors? If yes, what percentage voting interest in the corporation will the non-u.s. investor(s) acquire? 3 e. Type of consideration: 1. Cash or cancellation of indebtedness 2. Promissory Note (note that at least the par value of the shares cannot be paid by the note) 3. Assets (includes personal property and leases of real property) (Describe: ) 4. Services actually rendered to the corporation (i.e., not future services) f. Will the shares be freely transferable (subject to requirements of federal and state law)? If not, attach rider describing transfer restrictions, including any: i. Vesting provisions. To assist in the completion of the 83(b) election forms, provide the social security number of each shareholder and shareholder s spouse: ii. iii. iv. Buy-sell arrangements. Co-sale agreements. Right of first refusal provisions. g. Will the corporation initially have (if any, attach rider describing principal terms): 1. voting agreement or voting trust agreement 2. irrevocable proxy 3. stock option plan 4. other executive compensation plans 5. employment contracts h. Are there subscription or other preincorporation agreements? (If so, attach a rider describing the proposed principal terms) 3 If the percentage ownership of the non-u.s. investors is calculated as 10% or greater, the corporation will be required to make a filing (i.e., Form BE-13 or filing for exemption thereto) with the U.S. Department of Commerce to report the acquisition. 5

7 i. Will there be an initial debt financing? If yes, describe terms: 10. Except as indicated below, a. All directors and officers will be given irrevocable mandatory indemnification to the fullest extent permitted by law under the Charter. b. All shares will have equal voting rights. c. Corporate existence will be unlimited in duration. d. All shares will be fully paid for. e. Shares will not be subject to assessment. f. Stockholders will not have preemptive rights. g. No limitations will be placed upon the business engaged in and powers exercised by the corporation. h. No supermajority will be required and no special quorum will be required for any action. i. There are no special qualifications for being a stockholder. j. The directors, and not the stockholders, will determine consideration to be received for future shares. Exceptions (state if there are none): 11. Additional Information: a. Fiscal year of corporation ends (generally suggest 12/31): b. Accountants (name, address and telephone): 6

8 c. Bank (name and address): d. Information for Employer I.D. Number (required for corporation to open bank account and for tax purposes): 1. Name and social security number of officer who will sign the form: 2. First date corporation will pay wages: 3. Peak number of employees expected in next twelve months in each of the following categories: a) nonagricultural b) agricultural c) household 4. To whom will the corporation sell most of its products or services? business (wholesale) public (retail) other (specify) 5. Has principal officer of corporation filed for an Employer Identification Number before? If yes: a) Name of previous corporation/applicant: b) When (month/day/year) and in which city was previous EIN obtained? c) Previous EIN: e. S corporation election? 4 4 Note that if a corporation elects to be treated as an S corporation, and if it wants the election to be effective for the first income year, the federal and state election forms must be filed with the IRS on or before the 15th day of the third month of the corporation s first income year (which starts when it has stockholders, acquires assets or begins doing business, whichever occurs first). 7

9 If yes, provide social security number of each shareholder and shareholder s spouse, if not previously provided in item 8.f(1) above: f. Information for California Employment Development Department registration form (required only if new corporation will have employees): 1. Social Security numbers: CEO V.P. Secty. Treas. 2. Driver s license number: Pres. V.P. Secty. Treas. 3. Will payroll exceed $ in any calendar quarter? If so, when? 4. First month that worker contributions for disability insurance will exceed $ or personal income tax withheld exceeds $ Nature of business - check one: retail trade wholesale trade service repairing manufacturing contracting other Describe kind of product or type of service: 8

10 6. Name, title, residence address, business phone, residence phone, and driver s license number of person who will be signing the registration form: g. Should Orrick order a corporate seal? Should Orrick order a minute book? 9