LIMITED LIABILITY COMPANY FORMATION STEPS 

AND ATTORNEY’S OUT-OF-POCKET COSTS

 CLIENT’S RESPONSIBILITIES:  My clients have responsibility for the following matters unless we have made other special arrangements.  Any requested attorney involvement is not included in any estimates given to my client for the formation and organization steps and will be subject to additional charges.

 Ø     Choose the formal entity name and any assumed business name which may be used in the new business and tell me so I can check the availability of the name(s).  (It is best to have two alternatives.  Cannot be the same or similar to existing business names of record without consent of existing business.  Not a problem if it’s similar to a name currently used by one of your own existing entities.  But I will need to draft and file a consent.)

 Ø     Retain a CPA or tax adviser and consult with them concerning your overall plan.

 Ø     Consult with all lenders holding a mortgage against real estate and/or personal property to be contributed to the new business, and determine their requirements.  Get tentative approval and determine what is needed for a final approval.  Revise the business plan as necessary.

Ø     Consult with all landlords holding a lease of real estate and/or personal property to be contributed to the new business, and determine their requirements.  Get tentative approval and determine what is needed for a final approval.  Revise the business plan as necessary.

Ø     Determine what business, use and/or occupancy licenses or permits are needed to operate the new business.  Make sure all can be in place, will be in place and are in place on opening day.

Ø     Consult with an insurance broker for advice on the various types of business insurance protection you may need and have the insurance in place on opening day.

MY USUAL SERVICES TO FORM AND ORGANIZE A LIMITED LIABILITY COMPANY (LLC) READY TO CONDUCT BUSINESS (Some steps will occur simultaneously with others)

 Ø     Check availability of business name(s) you have chosen (Local County Clerk and Sec’y of State Online Search) and advise of availability.

 Ø     Prepare consent by existing entity having the same or similar name to use of name if necessary and you agree and if reasonably and quickly obtainable.

 Ø     Reserve name with Sec’y of State (with foregoing consent, if applicable)

 Ø     Prepare and file Certificate of Formation

 Ø     Prepare Company Agreement (Operating Agreement) for signature

 Ø     Prepare minutes of an organization meeting, at which Members acknowledge and ratify the formation; authorize and sign any remaining documents; authorize bank accounts; elect Managers; etc.

 Ø     Prepare and file assumed name certificate(s) at local County Clerk (with consents as needed)

 Ø     Prepare and file assumed name certificate(s) with Sec’y of State (with consents as needed)

 Ø     Obtain and set up LLC Record Book (like a Corporate Minute Book) (Depending on the needs of the LLC, we may or may not issue certificates showing units of membership interest held.  The membership interest may be uncertificated.)

 Ø     Prepare and deliver a lengthy advisory letter about operating the LLC, including maintaining it as a separate entity

 Ø     Miscellaneous meetings, discussions and correspondence necessary to accomplish the foregoing

 ATTORNEY’S ESTIMATED OUT-OF-POCKET COSTS: $500 in filing fees and Minute Book (This is an estimate for your convenience; it is not a guarantee.  This is an estimate of costs only.  It does not include the attorney’s fee.)

 I will be happy to discuss these matters in more detail and to answer any questions you may have.  Just call me or send me an email.

 Thank you.

 Best,

Marvin Champlin

(NOTE: This summary assumes formation and organization of a new LLC.  If you are acquiring an existing business or an interest in one, the steps and services are quite a bit different.  I urge you to conduct due diligence.  Obtain copies of all contracts affecting the business to be acquired, if any.  Ask for a list of all outstanding liabilities of all kinds, including taxes, claims, judgments and liabilities.  If asked to be involved in such a case, I will request and review all documents and conduct public records searches as needed.)