Back in February, our chairman wrote one of his first blog articles on shares of stock entitled, Demystifying Stock. In it he defines “Stock” and some of the terms commonly associated with stock, like Authorized Shares. Reading his article should give you a better understanding of the definition of stock, but it may still leave you wondering, “How many shares of stock should I authorize for my corporation?” And some of you may still wonder further, “At what par value do I authorize the stock for the corporation?” Just as a quick refresher, Authorized Shares are the total number of shares that a corporation may sell or trade, and are defined at the time of filing the Certificate of Incorporation. When authorizing shares, the corporation must define the quantity, the par value and the classes for the authorized shares.  Though not an exact science, here are some general considerations when deciding how many shares to authorize for a Delaware Corporation.

Quantity – When authorizing shares for a Delaware Corporation, one should consider that the annual Delaware Franchise Taxes will be based on the number of shares; therefore, when possible, it is best to keep the number of authorized shares low.  A good rule of thumb is to authorize only what the corporation will need. Corporations with 5000 or less authorized shares are considered “minimum stock” and will pay the minimum Delaware Franchise tax each year. If you must exceed 5000 authorized shares your corporation will be classified as a “maximum stock”  and you will be afforded the opportunity to recalculate the company’s Franchise Tax using a complicated formula called the “Assumed Par Value Capital Method”  that will consider the company’s gross assets and the number of issued shares at the end of the year.

Par Value and Share Valuation – If you decide that you need more than 5000 authorized shares for your corporation, the Delaware Franchise Tax calculation is no longer a matter of consequence, and now the focus should shift to the par value assigned to the shares. If you must exceed 5000 shares, the next threshold for you to consider is a share valuation of $75,000. Share valuation is simply the number of Authorized Shares multiplied by the Par value. Par value is only relative to the bottom value of the share, and has no bearing on the “market value” or “stock price” of the share.   As with the number of authorized shares, generally it will be better to keep the par value as low as possible because the initial filing fees will be calculated based on the share valuation. “Minimum Stock” Corporations may consider a zero par value, but corporations in excess of 5000 authorized shares will want to assign a par value to the shares to avoid additional filing fees levied by Delaware Division of Corporations. Delaware Law will allow a par value as small as $0.000001, thus making it very easy to manipulate your company’s share valuation to remain below the $75,000 threshold. For example, if you decide you need 1,000,000 authorized shares you can assign a par value of $0.001 which will result in a share valuation (1,000,000 shares x $0.001 par value) of $1,000. Because the share valuation is less the $75,000, the corporation will not experience any additional filing fees at the time of incorporation.

Classes of Stock – Though the classes of shares have no direct influence on the Delaware Franchise Tax, it is still important to mention.  For most corporations the share class will be “Common” but the scope of Authorized Shares includes all classes (i.e. Common and Preferred). Therefore, it is important to remember that when you are considering the quantity of authorized shares or calculating the share valuation that the authorized shares are all shares combined, both common and preferred.

Radio II: Mastering the Radio

In my last post I wrote about booking yourself on call-in radio shows. This can be the easiest access you’ll have to media, but live radio is very unforgiving in a number of respects, so let’s deal with live radio media mastery today.

There are some basic radio rules. Last time I emphasized the need to brand. In fact, I put it in all upper case — BRAND — because it is so important. On live radio no one will know what company or product you’re talking about if you don’t tell them.

It is a rule of all media mastery that you speak clearly, simply, and in short but complete sentences. Nowhere is that rule as critical as it is in radio where you have only one tool, your voice, to capture the listener’s attention. In Addition, you need to speak slowly enough for listeners to hear and understand you. But at the same time you need to energize your voice. Make your voice commanding by using inflection and stresses, not by talking at machine-gun speed. A lot of professional radio personalities achieve vocal energy by acting out as they speak or read. That is, they grimace and gesticulate with exaggerated movement. To brighten their speech, they do something old radio pros call “putting teeth in it.” Putting teeth in a line means delivering it with a huge smile on your face. It looks ridiculous but sounds great. And, since it’s not TV, no one sees the jack-o’-lantern grin.

Here are some more live radio rules:
Be Brief
Keep it Simple
Never Pause

Be Brief: You already know that radio is a non-visual medium without a reread factor. A very long statement can sound like a speech or a sermon, rather than a conversation. Also speaking at excessive length may spur an interruption by the host. And even if he doesn’t cut you off, your long-winded answers are sure to frustrate listeners and cause their attention to wander. Brevity is not “Yes” and “No,” by the way; “Yes” and “No” are not answers but are the beginning of answers.

Keep it Simple: Radio listeners get one brief shot at comprehending what you’re saying. In media training sessions I used to tell participants that rather than “dumb down” their answers, just pretend to be talking to their aunt across the table at Thanksgiving dinner and speak at the appropriate level for her to understand without condescending to her. Simplify as much as you can without changing the meaning of what you’re saying.

Don’t Pause: Just as nature abhors a vacuum, live radio abhors silence. A listener hunting through the radio dial and hearing no talk, no music, nothing but the “sound of silence,” assumes that there’s no station and moves on. Radio interviewers know this and don’t want to lose the station surfers, so if you are silent for too long after a question, it’s likely your interviewer will begin talking to fill the void. When he’s talking, he’s using the medium’s most precious commodity – airtime – and you are not; you can’t deliver your message when he’s talking. In print interviews and in edited broadcast interviews, there’s nothing wrong with pausing after a question is asked, thinking for a beat and then launching into your answer. But in live radio — and live TV, for that matter — you can’t afford the luxury of thinking before you speak. And that’s why it’s extremely important that you never go into a live broadcast interview without a well-thought-out, well-rehearsed agenda.

Today while listening to Marketplace on the public radio station in my car I heard a very interesting trend report on the average age of entrepreneurs. Below is an excerpt:

Time for a misconception check. If you think all the hot entrepreneurs out there are twenty-to-thirty-somethings with the next big idea and unlimited energy to launch it, it’s time to readjust your thinking. The average tech-company founder is 39. Overall the over-50 crowd outnumbers the under-25’s two to one. From the Entrepreneurship Desk at Oregon Public Broadcasting, Marketplace’s Mitchell Hartman has more on the graying of the entrepreneurial workforce.

Read and listen to the full report here: http://marketplace.publicradio.org/display/web/2009/07/23/pm-elder/