Articles of Organization

Don’t Use a PO Box for LLC’s Designated Office

Question:  Line 3.a of the California Secretary of State’s Articles of Organization, Form LLC-1, requires the initial street address of the LLC’s designated office in California.  Can the designated office be a U.S. post office box?

Answer:  No.  If the LLC’s designated office in California is a U.S. post office box the California Secretary of State will reject the Articles of Organization.  If the LLC’s mailing address is different from the address of the LLC’s designated office in California it is ok to enter a U.S. post office box on line 3.b of the Articles of Organization, Form LLC-1 for the LLC’s mailing address.

By | 2015-04-29T22:19:58+00:00 April 29th, 2015|Categories: Articles of Organization, FAQs, Formation Issues|0 Comments

California Agent for Service of Process

Every new limited liability company formed in California and every LLC formed outside California that intends to register to do business in California must appoint an agent for service of process, aka resident agent.  New LLCs must designate the agent for service of process in the Articles of Organization, Form LLC-1.

The agent for service of process can be a person or a corporation that has complied with Corp C §17701.13(c).  Before a corporation (domestic or a foreign corporation registered to do business in California) can become an agent for service of process, it must file the certificate required by Corp C §1505 with the California Secretary of State. A general partnership, limited partnership and a limited liability partnership can never be an agent for service of process in Item 4 of Form LLC-1.

If a natural person is the agent for service of process the person must be a California resident.  Corp C §17701.139c). The person’s street address cannot be a post office box, but it can be a residence address or a business address.  The address should never include a c/o or “in care of” because the California Secretary of State will probably reject the Articles of Organization.

By | 2016-12-13T21:20:13+00:00 March 22nd, 2015|Categories: Articles of Organization, California Secretary of State, Formation Issues|0 Comments

Original Signature on Articles of Organization

Question:  When I file the Articles of Organization for my new LLC with the California Secretary of State will the Secretary of State accept Articles on which the organizer’s signature is a facsimile rather than an original signature?

Answer:  Yes, however, California law requires that the person who signs the Articles of Organization as the organizer retain the Articles of Organization with the original signature on it for five years.  See Corp C §17.1(d).  After it approves the Articles the Secretary of State will return the approved Articles with original signature to the company.  If it contains an original signature, then put the document in a safe place for the next five years.

By | 2016-12-13T21:20:13+00:00 March 18th, 2015|Categories: Articles of Organization, FAQs, Formation Issues|0 Comments

Manager Managed CA LLC Change to Member Managed

Question:  I formed a manager managed California limited liability company.  Can the members of the LLC change the form of management from manager managed to member managed by amending the Operating Agreement to state that the LLC is manager managed?

Answer:  No.  To change from manager managed to member managed, a California LLC must amend its Articles of Organization to provide in item 5 that the LLC will be managed by all of it members.  Of course the members should also modify the LLC’s Operating Agreement to provide for manager management.

To amend the Articles of Organization file Form LLC-5 with the California Secretary of State.

By | 2015-04-30T00:26:21+00:00 March 9th, 2015|Categories: Articles of Organization, FAQs, How Do I, Operating LLCs|0 Comments

Must a CA LLC Formed before 2014 Amend Its Articles of Organization?

Question:  My California limited liability company was formed before January 1, 2014, the date California’s new LLC act became effective.  Do I have to amend the LLC’s Articles of Organization filed with the California Secretary of State?

Answer:  If a manager managed California LLC was formed before 2014 and its Articles of Organization do not state that the LLC is managed by a sole manager or by more than one manager, the LLC must amend its Articles of Organization and specify the type of management.  California Revised Uniform Limited Liability Company Act Section 17702.01(b)(5) states “If the limited liability company is to be manager-managed, the articles of organization shall contain a statement to that effect.”

To amend your California LLC’s Articles of Organization file one of the following documents with the California Secretary of State:

Warning:  If you want your California LLC to be manager managed the Operating Agreement must also contain certain manager managed language.  Stated another way, a California LLC is member managed unless the following two conditions are satisfied:

  1. The Articles of Organization state the the LLC is manager managed, and
  2. The Operating Agreement contains the statutorily required manager managed language.

See California RULLCA Section 17704.07(a).

By | 2015-02-16T17:13:07+00:00 January 14th, 2015|Categories: Articles of Organization, CA LLC Formation, CA LLC Statutes, FAQs, Formation Issues|0 Comments

California LLC Naming Rules

Question:  What are the rules / statutory requirements for naming a new California limited liability company?

Answer:  The name of a CA LLC:

(1) must not be a name that is “likely to mislead the public” and must be distinguishable in the records of the California Secretary of State from the name of an existing LLC or an LLC name that has been reserved by another party.  Note: Names are not considered distinguishable if the only difference is a limited liability company ending;

(2) must include the words Limited Liability Company, or the abbreviations LLC or L.L.C. The words Limited and Company may be abbreviated to Ltd. and Co., respectively;

(3) may not contain the words bank, trust, trustee, incorporated, inc., corporation, or corp.; and

(4) must not contain the words insurer or insurance company or any other words suggesting that it is in the business of issuing policies of insurance and assuming insurance risks.

If the Articles of Organization for a new LLC has a name that does not satisfy all of the above CA LLC naming requirements the California Secretary of State will reject the Articles of Organization.

See California Corporations Code Section 17701.08 and 17708.05.  An LLC name is reserved pursuant to California Corporations Code Section 17701.09 using the Secretary of State’s Name Reservation form.