EIN Loans
May 10th, 2008
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Question: Corporation – Day 1 – Zero Assets – Issue Bonds?
Lets assume you start a Corporation. You’ve filed your articles of incorporation with the State, obtained an EIN from the IRS, and opened a Bank Account for the corporation.
Now obviously your business is broke. It has $0.00 in its bank account and you aren’t earning a single nickel at this time.
My question is, can you issue Bonds if your unable to get bank loans? What are the requirements and difficulties in issuing Corporate Bonds?
Answer: In theory you could issue bonds, in practice no.
To begin with, there is no market for bonds for a brand new corporation without a track record.
Next, you would have to spend several thousands in order to comply with the rules and regulations of the Securities and Exchange Commission.
Finally, you would have to pay interest rates approaching those wanted by a loan shark.
If you can convince people that your business and business plan are sound you will have more luck seeking angel investors to finance your enterprise.
Hope this helps
Jerry-the-bookkeeper
Fabric verkauft an Fabric?
Der seit Ende Mai zum Verkauf stehende Londoner Club Fabric ist, wie CMU und das Factmag heute berichten, scheinbar verkauft – an eine neue Firma der Fabric-Macher. Das betrifft auch das gleichnamige Label und den gleichnamigen Verlag. Offiziell bestätigt ist aber noch nichts.
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