Question: What is your opinion on reserving a name for my new company with the Arizona Corporation Commission?
Answer: I never reserve a name for a new LLC or corporation unless it would be a big problem if the company did not get the name. Big problem to me means that the loss of the name would cause my client to pay a lot of money or if you think somebody who knows about your plans for a new company might reserve the name just to prevent you from getting it. In the thirty years I have been a business lawyer in Arizona forming over 2,300 companies, I have reserved a name less than five times.
Think of it this way. If you check a name with the Arizona Corporation Commission (check it here) and it is available, it means the name has been available from the beginning of time to the moment you checked it. The chance that somebody is going to get that exact name before you in the near future are slim to none.
When people do reserve a name, it is not a problem for me when we form the limited liability company or corporation if the person or company that reserved the name is a member or manager named in the Articles of Organization of an LLC or named in the Articles of Incorporation of a corporation. If that person is not named in the Articles, the holder of the name rights must assign the rights to the name to one of the people or entities named in the Articles and the assignment document must be submitted to the Arizona Corporation Commission when you file the Articles.
P.S. Early in my legal career, I was merging two corporations into one survivor corporation. I reserved the name of the new corporation. It was very important that the merger occur on a specific date. The Arizona Corporation Commission rejected my merger documents because it said correctly that I was not named in the name reservation. That’s when I learned about the need for the name holder to assign the rights to the name to somebody who is named in the Articles.