DAVID J. WILLIS ATTORNEY
Copyright © 2016. All rights reserved worldwide.
LLC FORMATION CHECKLIST
Please fill out a separate checklist for each company you wish to form
A significant amount of explanatory material follows. If you wish to skip this, you can go directly to the questions beginning on page 6.
Texas and Nevada have great LLC laws and are our preferred states for entity formation. For more information on our suggestions for asset protection generally, see our web article Asset Protection in Texas.
The great majority of new companies that we form are LLCs, particularly the new series LLC (suitable for multiple assets), since we no longer recommend corporations for most of our clients’ investments. See our web article LLCs in Texas – The Series LLC.
The first step in the LLC formation process is to complete this LLC Checklist. If the Checklist is more than a few days old, we ask that yourequest a new LLC Checklist with current fees, costs, and options, all of which are subject to change without notice.
If you are doing a conversion of an existing traditional Texas LLC to a series LLC, please complete as much of this Checklist as may be applicable to your circumstances. We will also need copies of the formation documents of your current traditional LLC.
When you complete and return this Checklist, we would be happy to generate an itemized statement for you if you request.
Fees & Costs
Fees quoted below are online prices and do not include office meetings. Our fees are flat fee “plus costs” such as filing fees, etc.
Legal fees for LLC formation in Texas are $950 (traditional LLC) or $1,450 (series LLC) plus the filing fee with expedited handling ($325), company book (our cost – includes binder, seal, and custom membership certificates - $140 for hardbound burgundy/black or $240 for burgundy leather), and $20 domestic shipping by UPS ground (overnight/air is $20 additional). The client must supply a registered agent with a physical street address in Texas (not a POB or UPS box) unless you wish to engage this firm in that capacity at an annual fee of $250. EIN is not included but is easily obtained at irs.gov. Note: in the case of series companies, legal fees are $1,450 if individual series will have different membership and/or management.
Company Book with Documents
Company books (either hardbound or leather) with seal and printed membership certificates are offered at our cost. We insert our own sophisticated documentation into these books (instructions, organizational minutes, company agreement, etc.) designed to maximize asset protection. An extensive and detailed instruction letter is also included. We include questions, follow up, and changes/corrections to company documents within the immediate time frame after delivery, defined to be 3 calendar days.
If you wish for some reason to depart from the basic format we have created for these companies – and that format is extensively woven throughout the documentation – then doing so will involve significant customization and higher fees.
Accounting and Taxes
Willis is not an accountant, CPA, or tax attorney and does not give tax, book keeping, or accounting advice at all. Tax consequences vary considerably from client to client. Accounting methodologies differ. We suggest you consult in advance with a qualified CPA as to the book keeping and tax implications of entity formation and/or any proposed asset protection plan. Please do not ask us to get on the phone with your CPA and discuss either (1) the accounting and tax implications of our two-company or hub-sub structures or (2) series LLC accounting and taxes. We are regularly asked to do both. Mr. Willis is not qualified to advise a CPA in matters of accounting and taxes - so for reasons of professional liability we must respectfully decline to do this. If your CPA is not knowledgeable in the area of entity structuring or series LLCs, there are an abundance of continuing education programs that are available to members of the accounting profession. You definitely need a qualified CPA on your team, but that is not our function since we work with the legal side only. We will gladly explain the legal aspects of our entity formation strategies to your CPA. An extra fee may be incurred.
Anonymity Company Formation
The usual format for LLC formation involves disclosing the identity of the principal(s) behind the company. However, we offer our own proprietary system for utilizing an "anonymity trust" (our term) in connection with an LLC filing in order to maintain the client´s anonymity in the Certificate of Formation. The anonymity trust agreement is included (Note: this level of anonymity trust is not suitable for owning the homestead – see next option involving a living trust). Fees are higher for anonymity companies.
We offer anonymity company formation in Texas and Nevada. Fees are $2,500 (traditional LLC) or $3,500 (Series LLC) plus the filing fee ($325 in Texas with expedited handling), plus the company book (our cost – includes notebook, seal, and custom membership certificates - $140 for hardbound burgundy/black or $240 for burgundy leather), plus $20 domestic shipping by UPS ground (overnight/air is $20 additional). The first year’s registered agent services ($250 value) are included. EIN not included but is easily obtained at irs.gov.
Our Hub-Sub structure is $5,995 plus costs.
Optional add-on: adjustment of the anonymity trust so that it is also living trust specifically worded to take title to the client´s homestead and avoid probate. Trust agreement and deed into trust included. Add $750.
Nevada Series LLC Formation
A Nevada LLC is an excellent way to own and hold assets for those who want to add a measure of geographical and jurisdictional distance from potential plaintiffs. Fees for LLC formation in Nevada are $950 (traditional LLC) or $1,450 (Series LLC) plus $290 in costs, which include the $200 filing and expedited handling fee (regular processing is too slow); company book - $140 for hardbound burgundy/black (or $240 for leather); and $20 domestic shipping by UPS ground (overnight/air is $20 additional). EIN not included but is easily obtained at irs.gov.
You may be considering forming our recommended two-company structure (see our article Asset Protection in Texas). Many clients like the idea of locating their holding company in Nevada. Note, however, that a Nevada LLC is not recommended for a management company for Texas properties since it would then have to pay expensive fees to register and do business in Texas. We suggest using a Nevada company for a series holding company instead.
The Nevada registered agent is a UPS store with whom we have an established relationship. They charge approximately $375 per year (this does not go through us) which supplies your company with both a mailing address (on West Sahara Drive in Las Vegas) and registered agent services at that same address. Please do not request a different R/A. There are no franchise taxes in Nevada, but after establishing an LLC the state will require payment of an annual business license fee (subject to change) of approximately $200 (subject to change).
Conversion of Traditional Texas LLC to Series LLC
Some clients request that we convert a traditional Texas LLC to a series company. We generally discourage this option since older entities often come with "baggage" (debts, liabilities, contractual obligations, taxes owed, etc.) but under certain circumstances this may be acceptable. Fee is $1,250 excluding filing fee of $175 and any other costs (e.g., company book and shipping) and add-on options that the client may select.
Re-Documenting an Existing Traditional LLC
If you have formed a traditional LLC with a minimal "one pager" filing and have no company book, no organizational minutes, no company agreement, and no membership certificates, you may not be fully established or protected, in spite of Texas’ general bias against “piercing the corporate veil.” We will document your traditional LLC with a new company agreement and provide meeting minutes to the current date. Our fee is $650 plus the cost of a company book and membership certificates at our cost ($140 for hardbound burgundy/black or $240 for leather) plus $20 shipping. If the formal filing of a Certificate of Amendment with the Secretary of State is recommended, then fees are $225 plus the $175 filing fee (which includes expedited handling). EIN not included in these fees – but that is easily obtained at irs.gov.
Total Structural Reorganization
Clients occasionally request that we take their existing complicated structure (often consisting of numerous LLCs, corporations, and limited partnerships) and overhaul it to create a simplified but effective asset protection program. This is usually a major project. Fees begin at $2,500 and are deposited as an initial retainer. Supplemental retainer deposits may be required.
From time to time, we may have an inventory of existing, established companies and limited partnerships that are ready for immediate shipment. These are premium companies specially designed to include unique anonymity and asset protection features, EINs, and assumed name certificates. All sales of shelf companies are absolutely final since they involve proprietary intellectual content. Absolutely no exceptions. If interested, inquire about our current inventory.
Optional Add-Ons to Company Formation
Deeding Properties into your LLC or Trust: Specially crafted deeds for this purpose containing references to applicable statutes are $225 excluding recording fees. If three or more properties are involved at the same time, the fee for such deeds drops to $175 each. Add $50 if the legal description is by metes and bounds which will need to be keyed in rather than simple lot and block. Clients usually do their own recording in the county clerk’s real property records. Add $50 per instrument plus the applicable recording fees (usually $24 - $28 for deeds depending on the county) if you ask that we do the recording for you. It’s easy to do by referencing the local county clerk’s website. For more details, see our web article Deeding Property to an LLC.
Management and consulting contracts facilitate capital flow between companies by providing a convenient label for inter-company transfers (consulting fees in one direction, management fees in the other). Strongly recommended for the two-company structure. Add $175 per agreement for a total of $350. Note: the management agreement and the consulting agreement are real, full-length contracts usually are priced (online) at $350 each.
Equity stripping. Appropriate if the LLC has assets of $1M or more and a lawsuit is likely. This technique reduces the (apparent) worth of your company in the public records. Why do this? To deter creditors and lawsuits. We prepare a line of credit Promissory Note for up to one million dollars (payable to an existing Nevada company) that is backed by a Deed of Trust & Security Agreement to be filed in the public records. You will of course also receive a pre-signed Release of Note and Lien for you to hold and file whenever you choose to do so. $450 excluding filing fees.
Attorney serving as registered agent in Texas (to receive official mail and accept service of process from the constable): $250 annually per company. For Nevada companies we arrange for you to pay direct to our excellent registered agent in Las Vegas. Our complete terms and conditions relating to RA services are listed in the “Additional Policies” section below. Note: We reserve the right to decline to file formation paperwork that lists a competing asset protection law firm as registered agent or otherwise threatens the proprietary nature of our documents.
Assumed name certificates (DBAs). Signing and filing of Assumed Name Certificates under our firm name is not included, since this may expose us to additional liability (we then may be named as a defendant in any lawsuit against the entity) but may be available for an additional fee.
Upgrade to leather company book. The company books we supply are heavy-duty commercial grade books that include a company seal and membership certificates. The usual company book is red/black hardbound and very nice. The premium book is generally burgundy/black leather and is extremely nice (display quality). Note that our vendors may occasionally run out of stock on any particular type of company book, and there are a number of styles out there, so we reserve the right to substitute another type of equal or greater value. Books are passed along to the client at our approximate cost. Sorry, for reasons of professionalism, we do not supply company documents without a proper company book to contain them.
Custom Drafting of LLC Documents. LLC documents are appropriately customized to suit the client and the situation but nonetheless follow a certain pattern and format. Asking us to prepare a company agreement, for example, is not an opportunity for the client to redesign or reinvent the way we generally draw up such documents. If the client desires a significant rewrite of a document that departs from our usual format, then a significantly higher custom document preparation fee would apply. Custom drafting services are most definitely available, but not at the shelf price.
No returns. Neither shelf companies nor newly-formed LLCs are returnable or exchangeable because of the unique and valuable intellectual property involved in our documentation. We have done this work for many years and developed asset protection devices and provisions that are simply not available anywhere else. No exceptions. We cannot emphasize this enough.
Note on the Availability of Loans to Real Estate Investors. It is occasionally necessary for an investor to “shop” lenders (just as he or she might need to shop title companies, insurers, and other providers) in order to determine which of these is most friendly to the investor’s structure and business model. Lenders are routinely more difficult to work with than they used to be. As to obtaining loans, this firm does not make any assurances that you or your entity will be able to get a loan from any particular lender.
We consider our documents to be unique and proprietary. They are not “sold” to the client but are licensed to the client for one-time use only. We reserve the right to decline to do business or file formation paperwork that lists a competing asset protection law firm as registered agent or otherwise threatens the proprietary nature of our documents.
Asset protection can be complex work – so feel free to ask for an exact quote for the combination of entities and features you’re seeking. Filing fees and other costs are beyond our control and are subject to change. Fees and costs must both be paid in advance, since we immediately start writing checks on behalf of the client. Please go to the “Make Payment” button on the website for payment options.
1. State of formation. Which state are you using to form this company?
_______ Texas ________ Nevada
_______ I am not forming a new company. I am re-documenting an existing one. Please use the information that follows to draft the core LLC documents for my existing company. Formation documents (including the file number and date of filing) are attached.
2. Traditional vs. Series LLC. What type of LLC do you wish to form?
_______ Series ________ Traditional
3. Name of LLC. What name have you chosen for the company? Please do not use all caps here unless you actually want the official name of the company to be in all caps. In other words, we will use the name exactly as you write it in the space below.
Please double check the way you have written the above company name. It will be used in filing documents exactly as you have written it above, including capitalizations, spacing, and commas.
Unfortunately, most popular, easy names are taken, so you may need to be creative – which isn’t necessarily a problem from an asset protection point of view. Our recommendation is to get a “random” name (nothing special) for the LLC (e.g., “ABC LLC”) and then afterward personalize the company with an assumed name certificate (“DBA”) filed with the local county clerk. Makes the entity harder to find and sue. This may involve the extra step of mailing in an assumed name application or making a trip to the county clerk’s local office to get your DBA, but it is well worth it.
Please do not ask us to select an LLC name for you. Note that a comma between the company name and “LLC” is not required. Many assume it is.
4. Name clearance for Texas. Have you called the Texas Secretary of State to make sure your proposed company name is available? Call (512) 463-5555 for name availability. A proposed name cannot be the same as or deceptively similar to an existing LLC name. Please take some care with this step to avoid wasted time and expense. And do not check online for Texas name availability – that method has proven to be unreliable. Call them instead.
________ Yes, I've called and the name is available. I'm relying on this telephone clearance. Go ahead and order the company book from the printer now.
________ Yes, I've called and the name is available. However, I'm in no rush. Wait to order the company book from the printer until we receive faxed approval of the LLC from the Secretary of State's office
________ No, I haven't called the Secretary of State yet. Please do not process this Checklist or take any other action except for preparing an itemized invoice.
Again: do not rely on any online method to determine LLC name availability in Texas.
Also: we suggest you do not reserve a name. We will then be unable to file documents for you. Only the person on the name reservation will be able to do so (for 120 days).
General comments on LLC names and name availability:
Your proposed name is not allowed to be the same as or “deceptively similar” to the name of an existing company within the state. You may be told by the S of S clerk on the phone that you’ll need a letter of consent to use a particular name you want. Forget it. As a practical matter, no one ever gives such letters, so you will need to think of another name. We once formed a company called “Blue Toe-Nailed Surfer Dog” – a unique name indeed, although the client does business under a more sedate assumed name. In any case, I suggest that under most circumstances business be done not under the company name but under an assumed name (DBA). Suggest reading our article on Assumed Names in Texas.
Unless you direct us not to (above), we will order the company book from the printer based on the assurance from you that the name is available. If re-filing is necessary because of name unavailability it will be at the client’s expense. All risk of name selection is on the client. Sometimes we’re told by a clerk that a name is OK on the phone and the formation paperwork is later rejected. Clerks make mistakes. The problem is that now a new company book with engraved membership certificates will need to be ordered (book cost plus $20 shipping). If you’re willing to wait for the whole process to work its way through before ordering the company book then you must expressly instruct us to that effect (check the appropriate box above). In no case will this firm absorb any client costs, including the cost of re-ordering a company book, should that become necessary.
5. Members. Who are going to be all of the initial members of the Company and what are their respective percentage interests? These may not be minors unless represented by a trustee or guardian.
NAME AND ADDRESS PERCENTAGE INTEREST
6a. Most of the time (99%) individual series will have the same membership and managers as the company at large. However, the statute permits variability on this. In your case, will the members of any particular series (e.g., Series A or Series B) have different members or percentage membership from the company at large? If so, please specify, and note that legal fees increase to $1,450 because of the extra documentation. If not, disregard this question.
SERIES NAME AND ADDRESS PERCENTAGE INTEREST
6. Managers. Who shall we list on the formation documents (i.e., the Certificate of Formation or COF) as being the initial manager(s) or co-managers of the company? Note: We prefer not to name spouses in this section at all, even if the spouse is going to be a co-manager (reason: it needlessly makes them a potential target if the LLC is sued). You can still have additional managers even if they’re not listed in the COF. They will be named and recognized at the First Meeting of Members. But as a general preference, I prefer that these filings not reveal more private information than is absolutely necessary.
NAME AND MAILING ADDRESS OF EACH INITIAL MANAGER TO BE LISTED ON THE COF
We generally recommend using a POB rather than the home address here. Do not use the same address as the registered agent you are naming unless you actually physically office there.
Secretaries of State can and do turn down addresses unpredictably. They occasionally Google an address to make sure it’s not a POB. If re-filing is necessary for this reason, it is at the client’s expense.
7. Monetary Contributions. What are the monetary contributions of each member to the company? It is optional (i.e., not necessary) to state this specifically. However, some clients want this number reflected in the organizational minutes. Otherwise we will make a general statement about the initial members making a contribution to formation fees and expenses and leave it at that.
Services, formation costs, and $________ [optional]
Services, formation costs, and $________ [optional]
Services, formation costs, and $________ [optional]
8. Loans to the LLC. Will you be making any loans to the LLC? New companies are often funded by a combination of equity (cash) and debt (loans by the members to the company). If you have special requirements in this area, what are they?
_____ Not applicable to us. We are not making any loans to the company at this time.
_____ Yes, we will be both injecting capital and making one or more loans to the Company. We would like this reflected in the organizational minutes as follows:
We _____ do _____ do not need a promissory note prepared (extra fee of $175).
Terms of note are as follows: ______________________________________________________
9. Company purpose. What is the purpose of the company?
______ operating a single business – an "SPE" or single purpose entity (e.g., a restaurant, a fourplex,
retail outlet, etc.).
______ passively owning and holding multiple investment properties (e.g., a “holding company” for
rent houses and the like).
______ managing multiple investment properties ("management company") and actively signing leases;
contracts, etc. This company is the one most likely to be sued and should therefore remain largely a shell in order to avoid losses due to litigation.
______ owning a combination of businesses and investment properties.
______ other: _________________________________________________________
10. Anonymity. Will this be an anonymity company? If not, skip this question. “Anonymity Company” refers to our proprietary anonymity structure utilizing a trust as sole member/manager. It must be built into the structure from the outset (not possible to add later).
______ No, this is not going to be an anonymity company. The names of all members and managers will be publicly disclosed in the formation documents in the usual way.
______ Yes. Anonymity is a priority for us. We want to establish the LLC using an anonymity trust as sole member and manager of the LLC. We realize that this is a more expensive option.
Disregard the next question if this is not an anonymity company.
11. Trust Information for Anonymity Companies. If this is going to be an anonymity company as mentioned in the previous question, please supply the information below.
If this is not going to be an anonymity company, disregard this question and continue to the next.
Name of Trust: _______________________________________________________________
Usually it is simplest just to use the same name for the trust as for the LLC – e.g.: “ABC LLC” would be owned and managed by the “ABC Trust.” But this is variable at your election.
Address of Trust: _____________________________________________________________
As always, we suggest a POB.
Who will act as Trustee?
______ The sole Trustee will be ___________________________________________
______ There will be Co-Trustees (the usual case for husband and wife).
Address of Trustee or Co-Trustees: _________________________________________________
Children are often (if not usually) named as Beneficiaries. If this is the case, what are their names?
It is also possible to name one or more Contingent Beneficiaries (in case the Primary Beneficiaries do not survive. This is optional. If applicable in your case, please supply names:
Are any of the Primary Beneficiaries or Contingent Beneficiaries minors? If so, we will need to draft the Trust Agreement to include a sub-trust for minors.
______ Yes. Names: ____________________________________________________
The sub-trust(s) should terminate at age: ______ 18 ______ 21 Other:______
______ No minors involved
Disregard this next question if you are forming a traditional (i.e., not a series) LLC.
12. Series LLC property. If you are forming a series LLC, which property or businesses do you want to put in each series (if you know at this time)? We use a letter system – Series A, Series B, etc. Please follow that alphabetical format. If you are forming a traditional LLC (which of course does not contain series) then disregard this question.
Example: Series A: rental property at 123 Oak St., Houston, TX 77057
Series B: my general contracting business called “Mr. Fix-It”
Series A: _____________________________________________________________
Series B: _____________________________________________________________
Series C: _____________________________________________________________
Series D: _____________________________________________________________
We now offer an anonymity option for these deeds. For example, instead of deeding an asset into “ABC LLC – Series A,” we create a trust . . . and the deed going into “The Series A Trust” showing your POB address. Fees are $550 for the Trust Agreement plus $275 for the two Warranty Deeds that this structure requires.
______ Yes, I am interested in this anonymity option.
______ No, I would prefer to deed my asset(s) into series in the usual way.
Conveyance of real property, a business, or other asset into a series is not automatic as a result of forming the company. It must be accomplished by a separately executed Warranty Deed (or Bill of Sale for non-realty assets) into the specific series (Series A, Series B, etc.). Such deeds need to be carefully worded. This is not included in LLC formation fees. Deeds are $225 excluding filing.
13. More detail on managers. As to actual management of the company as a whole, to be shown in the First Meeting of Members, who will be managing the LLC? At this point we want to list all managers, whether they were disclosed on the COF or not.
______ one managing member – name: __________________________________
______ co-managing members (common for business partners or husbands and wives)
______ we will be hiring a non-member manager:
Disregard this next question if you are forming a traditional (i.e., not a series) LLC
14. As to management of each individual series (if you are forming a traditional LLC, disregard this question):
_______ The managers of the company will also manage the individual series (This is the usual
case, about 95% of the time).
______ We will have a separate managing member for each series/property (This is permitted
but can get complex). Extra fees may apply for custom drafting
15. Officers. Will you also be selecting officers (Chairman, CEO, President, Treasure, Secretary, or any assistants or deputies thereof)? This is optional. Most people forming an LLC don’t bother, electing instead to have the title “manager” or “managing member” (same thing). But you can also name officers if you like. Note: if your initial manager is going to be a trust (an “anonymity company”) then you should designate at least a President to sign checks and official LLC documents.
________ No officers at this time (keeps things simple).
________ Just one officer – Make me President as well as Manager
________ Yes, the officers will be (choose the ones that apply):
PLEASE READ THIS NEXT QUESTION ON R/As CAREFULLY
16. Registered agent. Who will be the registered agent and what will be the registered address? Note: this address will be public record. Choices:
_____ We have someone to serve as registered agent:
Street Address (not POB, PMB, UNIT X – 1200, or the like, or the S of S will reject our filing – they often Google such addresses to check them):______________________________________
_____ We would like the attorney to serve as registered agent for this Texas LLC (add $250 annually). Registered address will be 330 Rayford Rd., Suite 401, Spring, TX 77386. Choosing this office as reg. agent has a couple of advantages. First, annual meeting minutes for the LLC are free upon request; and second, in the event you are served, we can advise on what you may have been served with. A non-lawyer reg. agent cannot offer much in the way of legal advice - only refer you to your attorney.
Note that the R/A is designated to receive only official mail – from the state, legal notices from attorneys, etc. Routine correspondence including bank statements and junk mail are not forwarded. Routine correspondence should be directed to your LLC's POB.
_____ Nevada: UPS STORE 0715
Attn: Diane Watson
4616 W. Sahara Ave.
Las Vegas, NV 89102-3796
Tel. (702) 878-8999
Fax (702) 878-5108
Please do not select a different NV registered agent. This is the one with whom we have an established and beneficial working relationship. Diane Watson and her husband own a free-standing UPS store (where you can get different sizes of boxes and levels of service). You will be dealing with Diane directly, not through us.
Function of Registered Agent: The registered agent receives official mail from the Secretary of State, the Comptroller, and legal notices and correspondence. This is also the person who is served with process by the constable if the company is sued. Most often the registered agent is an individual, but it can also be another LLC or corporation. Not for bank statements or routine correspondence.
Address of Registered Agent: Note that the registered address must be a physical street address since a constable cannot serve a PO Box. The address cannot contain “Post Office Box,” “POB,” “PMB,” “Unit XX-YYYYY” or other obvious indication that it is a postal box or the Secretary of State will likely reject it. If re-filing is necessary because of such a rejection, it will be at the client’s expense. For anonymity reasons it is recommended that the home address never be used as the company’s registered address or as the address of an initial manager. Note: Initial managers can use a POB – just not the R/A.
Fees for Reg. Agent Services: If the attorney serves as registered agent in Texas, there is an add-on fee of $250 annually. Our function is to forward official company mail and accept service of process only. The registered agent can be easily changed by filing a form with the Secretary of State along with a $15 fee.
17. Signing authority. Who will be empowered to sign Membership Certificates (check one)?
________ the sole managing member
________ any managing member may sign
________ both managing members (if there are co-managing members) must sign
________ president (if officers are named)
________ secretary (if officers are named)
________ other: _______________________________________________________
18. Signing authority. Who will be empowered to sign company checks (check one)?
________ any managing member of the company may sign
________ both managing members (if more than one) must sign
________ president (if officers are named)
________ secretary (if officers are named)
________ other: __________________________________
19.Assumed Name(s). If you intend that the company will operate under a DBA (assumed name other than the official name at the secretary of state’s office), what is that assumed name so we can mention it the organizational minutes? This is not required at this point in the process, but if you already know what these DBA name(s) are, then list them here and we’ll refer to them in the organizational minutes. See our article Assumed Names in Texas for advice on this. Note that filing for DBAs is not included in our formation fees.
_______ Our DBA(s) will be ______________________________________________
_______ No DBA at this time.
20.Real estate. After forming the company, will you need to convey any real estate into it or into any specific series of the company (e.g., Series A, Series B, etc.)? You can do this now or later as a second step in the process. If you want to do it now, please give details. The fee for deeds is $275 per deed excluding filing fees ($225 each for three or more at once) excluding county clerks’ recording fees. We would like to have a copy of your existing deed to prepare a deed into the company in order to obtain the correct legal description.
_______ I am attaching a copy of the deed(s) to this checklist. Please go ahead and prepare one or more deeds (add $225 per deed excluding filing fees). If there is/are loan(s) against the property, you have a couple of drafting options regarding this:
______ State in the Warranty Deed that the company will assume the existing debt.
______ State that the company will take the property "subject to" the existing debt.
______ Since it’s not strictly necessary to refer to existing indebtedness in the Warranty Deed, don’t mention it.
It would be helpful if you would write the full street address at the top of each deed. So we know which deed goes with which street address.
______ I am not deeding properties into the LLC yet – maybe later. If and when I’m ready to do that, I will send you a copy of the existing Warranty Deed to the property to work from.
21. Business interests. After forming the company, will you be transferring any businesses or other non-realty assets into it or into one of the series? If so, a Bill of Sale will need to be prepared to accomplish that transfer. In some cases, if the business owns real estate, you may need a Warranty Deed and a Bill of Sale to complete the process.
_______ We do not need a Bill of Sale. No non-realty assets are being transferred.
______ We do need a Bill of Sale. Details: ____________________________________
If you are wanting a Bill of Sale, note that it is the client's obligation to produce any exhibits (a list of furniture or inventory being transferred, for example). So you will need to prepare any such exhibit and send it to us.
22. Option. Management and Consulting Agreements (for clients establishing our recommended two-company structure). An accounting device that provides a basis for moving funds back and forth between the two companies – management fees in one direction, consulting fees in the other. A convenient way to label transfers.
_______ We do not need these agreements at this time.
_______ We would like to have management and consulting agreements included
in order to facilitate capital flows between our two companies (add $350).
23. Option. Will you be implementing an “equity stripping” arrangement to reduce your company’s public value in the eyes of creditors and plaintiffs? Suggested for those in litigation. Fee is $450. Note that this is done on an individual county (not statewide) level.
_______ Yes. Details: __________________________________________________
24.Will you need a Property Management Agreement (if you will be using an independent contractor property manager)? Word template is $225.
________ Yes. The name and address of the manager is: ________________________
________ No, we do not need this at this time.
25. Option. Will you be needing a residential lease for use with your investment properties? For $275, we supply editable versions in Word of both our long form and short form landlord-oriented leases.
________, Yes, please include these two templates.
________, No thanks, maybe later.
26. Will you be needing a Confidentiality Agreement to be signed by all members that protects the LLC’s confidential information? $175.
27. Company book and shipping:
Choice of book (our approx. cost from the vendors we use):
_______ Burgundy/black hard cover with membership certificates and seal ($140)
_______ Upgrade to burgundy leather, display-quality book ($240).
There may be some variation in available LLC books since our vendors are subject to change depending on their inventory. Also, leather books may differ slightly in the shade of leather used.
Choice of shipping:
_______ UPS ground shipping is OK.
_______ I prefer 2-day air (add $20 per shipping event).
Note: In total, there are three “shipping events.” One is from us to the Secretary of State; another is from the printer to us; the last is from us to you.
Ship the company book to:
_______ the company’s registered address shown above.
_______ my physical address shown below (we use UPS exclusively , so please supply a street address – UPS will not deliver to a PO Box unless it’s a UPS store).
28. Do you have any special requirements or instructions? Specify:
Person completing this form:
Street Mailing Address for UPS
Thank you for taking the time to supply the foregoing information. I know it’s a lot but we want to do a thorough job for you.
This Checklist may be emailed to LoneStarLandLaw@aol.com or faxed to (832) 201-5321. Turnaround is one to two business days.
Let us know if you need an itemized statement before making payment. We will gladly provide one. Otherwise, kindly go to “Make Payment” on the website for payment options.
We look forward to promptly being of service to you.