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How Will The Potential State Shutdown in Minnesota Affect Your UCC & Corporate Transactions?

First Corporate Solutions Team — Fri, 24 Jun 2011 22:39:30 +0000

Across the nation, state and county-level governments face overwhelming budget shortfalls, dramatically impacting their ability to deliver public services. We learned this week that things are particularly bad in the state of Minnesota.

Due to a statewide budget crisis, the Minnesota Secretary of State’s office is facing a potential closure. The Minnesota State Legislature adjourned last month without appropriating money to fund state government operations for the fiscal year that begins on July 1, 2011. The Secretary of State’s office will be unable to provide public services without these funds. Minnesota and county recorders and courts are also at risk.

Read the Secretary of State’s press release here

The Attorney General has intervened, seeking a court order that would allow essential government functions to continue, including the services provided by the Secretary of State’s office. It is unknown at this time whether a decision can be reached before June 30, 2011 in order to avoid disruption of services.

In the event of a Secretary of State shutdown:

§ No UCC Financing Statements or Amendments will be filed

§ No UCC and Lien searches will be performed

§ No new business entities can be formed

§ No copies of corporate records can be made or certificates issued

§ No apostilles or authentications will be applied to documents

§ No substituted service of process will be available

If you have any upcoming deals in Minnesota, we encourage you to submit your search and filing requests as soon as possible to avoid any negative consequences of the potential shutdown.

In the event of a Secretary of State shutdown, First Corporate Solutions will still be able to provide UCC and Lien searches; however please note the index date will not advance until the state reopens for business.

Please feel free to contact us at 800.406.1577 | info@ficoso.com with any questions or to initiate an expedited Minnesota service request.

[Update: 6/30/2011]

It is unknown at this time whether lawmakers can reach an agreement before close of business on June 30, 2011 in order to avoid disruption of services. We encourage you to submit your search and filing requests as soon as possible to avoid any negative consequences of the potential shutdown. The Secretary of State’s office will remain open until 8:00pm CDT today to assist customers in completing their critical transactions.

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3 Tips for Choosing a Public Records Service Company

First Corporate Solutions Team — Fri, 08 Oct 2010 22:23:21 +0000

Many small businesses have an internal department that handles all of their public records search and filing needs. As businesses grow and due diligence requirements get more complex, most decide to enlist the help of a private service company to carry out their public records requests. Deciding which company to entrust with your business can be a tough choice. Between nationwide and local vendors, there are hundreds (if not thousands!) of companies to choose from.

Here are three things to consider when evaluating a potential public records service provider:

1. Reputation & Experience

How long has the company been in business? What is their reputation within their industry and yours? The work a public records service company provides is critical to the success of your business so it is important to work with a company you trust. Ask around. Speak with others in your line of work and find out who they use and if they are satisfied. Another good way to learn about a company is to go online. By visiting a company’s website you can often read their history, learn about their specialties and read testimonials from those that have used their services.

2. Location
Where is the company located? The physical location of a service provider matters for a couple of reasons. First, working with a service provider that is located within your same time zone ensures your phone calls and emails can be answered promptly. For rush requests especially, it is important to be able to reach your service representative during your normal business hours. Secondly, consider working with a service provider that is located in the region (state/county) where the bulk of your business lies. A service company that is located outside of this area will be forced to contract out your requests, incurring additional costs and taking extra time to complete projects.

3. Price
What does the company charge for the services you need them to complete? When evaluating service companies based on price, look beyond their service charge listed on their fee schedule. Does the company charge for delivery of results? Do they hire other agents to do the work and pass those fees along to you? What do they charge for copies? Do they offer volume or project discounts? These are all factors that can affect the overall cost of a public records transaction. And remember, online searches and filings are typically offered at a lower rate that their offline (manual) counterparts. Look to companies that offer online solutions to get the most for your due diligence dollar.

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Civil Litigation Searching – What Court Should I Search?

First Corporate Solutions Team — Fri, 09 Jul 2010 22:42:07 +0000

In a recent blog post titled, “Ordering a Civil Litigation Search: 5 Pieces of Information Your Searcher Will Need From You,” we mentioned that when ordering a litigation search, your searcher will be expecting you to provide direction as to which specific court they should visit. Several readers responded, saying that they could use some help figuring out what court to search. First Corporate Solutions cannot offer any legal advice in terms of telling customers where to perform their searches, but we can provide some basic information about common customer searching practices and what types of cases are found at certain courts.

When performing civil litigation searches as part of a pre-funding due diligence investigation, we find that most customers elect to search the State Court of General Jurisdiction. For a more comprehensive search effort, many will also add a search of the U.S. District Court.

State Court of General Jurisdiction

These courts are the primary trial courts of the state court system. Each state manages its state court system differently and this level of court goes by many different names such as: Superior Court, Court of Common Pleas, Circuit Court etc.

A State Court of General Jurisdiction hears a variety of case types including: most criminal cases, personal injury matters and contract cases (uscourts.gov).

U.S. District Court

These are the trial courts of the federal court system. There are ninety-four U.S. District courts throughout the nation and various U.S. territories. Every state has at least one U.S. District Court, some having as many as four.

Many different types of cases can be found at a U.S District Court including: civil actions that cross state lines and criminal cases filed by the United States (uscourts.gov)

Litigation searching can be complex. It is best practice to speak with your firm’s risk management department or your attorney before ordering a litigation search to determine what searches will yield the greatest benefit for your transaction.

To learn more about the U.S. Court system, visit their website www.uscourts.gov.

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Why Reserve your Business Name?

First Corporate Solutions Team — Fri, 11 Jun 2010 18:35:27 +0000

Meeting with business partners, speaking with attorneys, making decisions, drafting documents, obtaining signatures… setting up a new business entity can take a lot of patience and planning. One important step you can take to help reduce your stress and simplify your job is to reserve your business name in advance of submitting your formation documents.

The process is simple:

1. Complete the proper request form for that state and pay the required fee. Name reservation requests can typically be submitted by mail or in person.

2. The state filing office will then check your desired name for availability against existing entities in their records.

3. If the name is not already in use in that state or deceptively similar to any existing entity, the name held for your exclusive use. The duration varies, but the reservation is usually good for between 60-120 days and is renewable.

A name reservation can be particularly useful if you are planning a multi-state qualification and want to be certain your chosen name can be used in all states in which you plan to transact business. By filing a name reservation, you can secure your chosen name for your exclusive use until you are ready to file your formation documents – saving you time and money in rejected documents later.

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Do you know State of Delaware Offers Preclearance Corporate Filing Service?

First Corporate Solutions Team — Fri, 02 Apr 2010 16:19:21 +0000

For those of you who have never used the preclearance corporate filing service in Delaware, it really is a handy way to make sure you have drafted your document correctly. This service is particularly useful for documents that need to be processed as a rush, as you can be assured you will not encounter any problems or rejections once submitted.

The state offers three tiers of preclearance service: routine, 24-hour, and 2-hour.

The filing experts at the SOS will go over the document with a fine-toothed comb looking for any deficiencies or discrepancies. The state will return your document along with a detailed letter describing whether your document would be acceptable for filing.

Even better, the state is expanding their preclearance service to include annual reports. As of May 1, 2010, you will be able to submit any required annual reports with your preclearance document and receive filing officer notes on that as well. You can always contact your corporate service provider if you need any help in utilizing this service.

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FRAUD ALERT: Watch out for Misleading Corporate Filing and Renewal Solicitations – UPDATE

First Corporate Solutions Team — Wed, 30 Dec 2009 17:31:00 +0000

Regular readers of our blog may recall that several weeks ago we posted an item about misleading solicitations being sent to California small businesses. These official-looking notices demand exorbitant fees for the filing of annual statements or the drafting of corporate minutes and threaten loss of corporate status for failure to comply.

The Secretary of State’s office has issued a new Customer Alert to inform the public that the scope of the misleading solicitations has expanded to include dissolution filings.

The solicitation letters originate from a company called Business Filings Division. The letter instructs recipients to send $495 and a completed form to them for processing in order to dissolve their entity. The steps and verbiage suggested in the letter DO NOT meet the requirements of the California Corporations Code.

For more information and to view a sample of the misleading solicitation, you can follow this link to the Secretary of State’s New Customer Alert:

http://www.sos.ca.gov/business/be/alert-misleading-solicitations-terminations.htm

Please take some time to investigate the links included above and remember to review all notices carefully before submitting payment for services. If in doubt about a notice your firm has received by mail, call a public records specialist to discuss specific filing requirements for your organization.

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Delaware Franchise Tax Time is Almost Upon Us!

First Corporate Solutions Team — Tue, 15 Dec 2009 18:10:26 +0000

While everyone is in the midst of the holiday chaos, we’d like to throw out a friendly reminder that Delaware annual reports and annual franchise taxes for corporations are due on 3/1/2010 for 2009.

ALL corporations incorporated in the State of Delaware are required to file an annual report, and all but exempt domestic corporations are required to pay taxes. The annual report filing has been raised to $50.00 this year, with minimum tax at $75.00 and maximum tax at $180,000.00.

Any corporations who do not file their annual report on or before March 1st will be required to pay an additional penalty of $100.00, as well as interest on any unpaid tax balance which accrues at 1.5% per month.

It’s also important to note that any corporations that owe $5,000.00 or more pay estimated taxes in quarterly installments.

All annual reports and tax payments must be completed online via the DE SOS website: http://corp.delaware.gov/paytaxes.shtml

The site is very easy to use, but the folks at the State office are always ready to answer any questions that might arise.

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Fraud Alert: Watch out for Misleading Corporate Filing and Renewal Solicitations

First Corporate Solutions Team — Fri, 20 Nov 2009 17:35:29 +0000

California public records professionals have learned of a troubling new con taking place in our state. Over the last couple of years, we have fielded countless phone calls from anxious clients regarding suspicious notices they have received in the mail. The official-looking notices demand exorbitant fees for the filing of annual statements or the drafting of corporate minutes and threaten loss of corporate status for failure to comply.

THESE NOTICES ARE FRAUDULENT. Although they may appear to come from a legitimate government agency, refer to specific code sections in the text or contain an official-looking seal, they are actually solicitations for business from phony companies that prey on earnest small business owners, hoping trick them into paying something for nothing.

Prompted by thousands of complaints, the Attorney General’s office is taking action. Last month, Attorney General Edmond G. Brown, Jr. filed suit against several individuals and businesses that have been running misleading solicitation scams.

You can read the Attorney General’s press release by following this link:

http://ag.ca.gov/newsalerts/release.php?id=1817&

The Secretary of State’s office has issued a Customer Alert that provides valuable tips for spotting fraudulent notices:

http://www.sos.ca.gov/business/be/alert-misleading-solicitations.htm

Please take some time to investigate the links provided above and remember to review all notices carefully before submitting payment for services. If in doubt about a notice your firm has received by mail, call a public records specialist to discuss specific filing requirements for your organization.

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Exempt Corporations in Delaware

First Corporate Solutions Team — Fri, 06 Nov 2009 17:48:30 +0000

Because of an addition to the Delaware General Corporation Law, the Delaware Secretary of State is asking that all non-stock corporations filed with the SOS complete an amendment filing in an attempt to set the exempt records straight, as well as ensure that all non-stock corporations are charged the correct Annual Report filing fee come tax time.

The addition signed into law by the 145th General Assembly and the Governor is as follows:

Amend § 391, Title 8, Delaware Code, by adding a new subsection (j) as follows:

“(j) As used in this section, the term “exempt corporation” shall be defined as any corporation organized under this chapter that is not authorized to issue capital stock and that:

(1) is exempt from taxation under § 501(c) of the United States Internal Revenue Code or any similar provisions of the Internal Revenue Code, or any successor provisions;

(2) qualifies as a civic organization under § 8110(c)(1) of Title 9 or § 6840(4) of Title 16;

(3) qualifies as a charitable/fraternal organization under § 2593(1) of Title 6;

(4) is listed in § 8106(a) of Title 9;

(5) is organized primarily or exclusively for religious or charitable purposes; or

(6)(i) is organized not for profit and (ii) no part of its net earnings inures to the benefit of any member or individual.”

This filing, which the SOS asks to be completed and returned by November 30, 2009, will be filed at no charge. Any corporations meeting one of the above listed requirements will pay an Annual Report filing fee of $25 rather than the $50 fee required from non-exempt corporations.

Any questions can be directed to the Delaware Division of Corporations: 302-739-3073.

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New Massachusetts LP and LLC Regulations

First Corporate Solutions Team — Fri, 30 Oct 2009 16:53:01 +0000

As of October 30th, 2009, Massachusetts has approved new regulations pertaining to Limited Partnerships and Limited Liability Companies. Copies of these regulations can be found here: http://www.sec.state.ma.us/COR/cornotice.htm

One of the perks: in the past, if you were merging a MA LLC and a MC Corp., you had to provide both a filing for the Corp as well as a filing for the LLC; according to the new regulations, now you only have to submit one filing (the fees remain the same as they were for both filings, so no break there).

Another nice change is that you will no longer be required to provide two originals for MA Limited Partnership filings when filing over the counter; one will suffice (e-filing will remain the same as there are no originals required). The MA SOS will also now begin issuing LP Good Standing certificates, which will list the LP’s general partners. This new, long-awaited certificate will replace the Long Legal Listing General Partners.

For a complete list of changes and updates, visit the URL above.

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