Living the Dream - Live “Everything You Need to Know About Maintaining Your Corporation or LLC”. Maintaining Your Corporation or LLC”. October 21, 2009 E-Seminar / Conference Call Hosts: Mark Kohler, CPA, Attorney At Law Mat Sorensen, Attorney At Law Special Guest: Holly Butterfield, Company Maintenance Department Telephone Facsimile © KKO Lawyers, LLP Telephone Facsimile © Kohler & Eyre CPAs, LLC Telephone Facsimile © NumberWon Accountants, LLC 2009

Maintaining the Corporate Veil & Asset Protection. What is the Corporate Veil? What is the Corporate Veil? Can the Veil be Pierced? Can the Veil be Pierced? Why is the corporate Veil helpful? Why is the corporate Veil helpful? Steps to Protect the Corporate Veil. Steps to Protect the Corporate Veil.

Inside Liability- Liability created inside the business. Goal is to protect the personal assets of the business owner from the liability created in the business with the corporate veil protection. Business entity Business owner 1)Corporate veil provides that the business owner is not held personally liable for the debts or liabilities of the company. 2)Corporate veil protection is available in an LLC, LP, or corporation. Judgmen t Corporate Veil Protecting The Business Owner

Piercing the Corporate Veil Alter Ego Theory. Pay personal expenses from business. Failure to comply with State corporate requirements such as Annual Meetings, Minutes, and Renewal. If you want the liabilities of the business to be separate from your personal assets you must treat the business as a separate and distinct entity from yourself personally as the owner.

How do I cleanup my Legalzoom entity? How do I cleanup my Legalzoom entity? COMMON MISTAKES Failure to file IRS s-election for an s-corporation. Corporations are all c-corporations by default unless you apply to the IRS to become an s-corporation by filing IRS Form This can be fixed if caught early. Failure to establish an operating or partnership agreement when partners are involved. Setting up the wrong type of entity for your business. Setting up your entity in the wrong State (e.g. Nevada). Failing to file a all of the required State documents.

Annual Minutes & Company Meetings Why are Annual Minutes so Important? Annual Minutes & Company Meetings Why are Annual Minutes so Important? Minutes are legal records that document actions of a business and are used to approve business decisions made by the principals of the business throughout the year. Minutes are legal records that document actions of a business and are used to approve business decisions made by the principals of the business throughout the year. Annual Minutes serve as a track record to document what business has transpired for the Company, reiterate who the current principals of the business are, and to also mention any legal action taken against the Company. Annual Minutes serve as a track record to document what business has transpired for the Company, reiterate who the current principals of the business are, and to also mention any legal action taken against the Company. The Corporate Veil could be pierced due to failure to keep complete annual minutes. The Corporate Veil could be pierced due to failure to keep complete annual minutes.

To ensure proper minutes are prepared keep good records. 1.Keep all Corporate Documents in one location for easy access and reference. 2. Keep a monthly journal of the Company’s actions and activities. It is easier to document monthly rather than try and remember what happened at the end of the year. 3. Keep a record of items you feel are important to list in your annual minutes such as elections or changes of officers, shareholders or managers, employees hired, fixed assets purchased over $1,000, significant material changes to the profit or loss of the Company. Any event you feel is note worthy.

When should you hold a Company Meeting? When should you hold a Company Meeting? Whenever the Company feels that it’s necessary. Whenever the Company feels that it’s necessary. Those involved in the Company should make every effort to attend the meeting. Those involved in the Company should make every effort to attend the meeting. Items that may be discussed during your meeting: a. Discuss Company changes and organizational issues. b. Discuss goals achieved and set future goals for the Company. c. Elect new Directors, Officers or Managers if needed. d. Discuss financial matters of the Company.

Annual State Renewals Annual State Renewals Most State’s have annual filing requirements. It is important that the Annual Report is filed on time and any filing fee’s paid to keep your Company in Good Standing. What happens when the Annual Report is filed? What happens when the Annual Report is filed? 1. Company information on file with the State is confirmed or updated. 2. Registered Agent information and Physical Business Address information for the Company is confirmed. 3. Officers, Managers or in some States Members are reiterated. 4. Business purpose of the Company to be restated.

Examples of Annual Renewal Requirements Examples of Annual Renewal Requirements California: Corporations file a Statement of Information annually with a filing fee of $ Corporations file a Statement of Information annually with a filing fee of $ Limited Liability Company’s file a biennial Statement of Information with a filing fee of $ Limited Liability Company’s file a biennial Statement of Information with a filing fee of $20.00.Colorado: Corporations file an Annual Report with a filing fee of $ Corporations file an Annual Report with a filing fee of $ Limited Liability Company’s file a Annual Report with a filing fee of $ Limited Liability Company’s file a Annual Report with a filing fee of $10.00.Arizona: Corporations file an Annual Report with a filing fee of $ Corporations file an Annual Report with a filing fee of $ Limited Liability Company’s do not have an annual filling requirement at this time. Limited Liability Company’s do not have an annual filling requirement at this time.

When is the Annual Report due? Most Annual Renewals are typically due the month the entity was registered within its respective State. Most Annual Renewals are typically due the month the entity was registered within its respective State. Florida, Georgia, Michigan and North Carolina are just a few States that have a deadline different from that rule. Florida, Georgia, Michigan and North Carolina are just a few States that have a deadline different from that rule. In most States, penalty fees are assessed if the Annual In most States, penalty fees are assessed if the Annual report is not filed on time. Your Company could possibly even be Administratively Dissolved. If Dissolved by the State, all liability gets distributed to the owners of the business personally.

States used to send renewal reminders to Company’s via mail but due to economic changes, notices are becoming a thing of the past. States used to send renewal reminders to Company’s via mail but due to economic changes, notices are becoming a thing of the past. Annual Filing Requirements change all the time. It is important to have someone you trust stay on top of these changes so that your Company isn’t in jeopardy of losing its good standing status. Annual Filing Requirements change all the time. It is important to have someone you trust stay on top of these changes so that your Company isn’t in jeopardy of losing its good standing status.

Misleading Business Solicitations Certain private Companies are sending Corporations and Limited Liability Companies solicitation letters in several States. It is important to pay attention to any notices you Receive. How can you tell if the notice you’ve received is a scam? Know your State Seal. Check the Seal on the notice. If it is not the Official State Seal then the notice did not come from the State. Disclaimer statement on notice that states “the notice you are receiving is not from any State of Government Agency”. Know your State annual filing fee. The solicitation letters that are being sent are asking for a considerable fee to be paid.

Example of Solicitation letter

California Customer Alert Notice

Company Maintenance Program CMP Included in our Program: Review of Current Company status with the appropriate State agencies. Notify you when annual meetings are necessary and prepare the Director, Shareholder and Member Minutes. Ensure that the annual required States filings are complete. Serve as Registered Agent if necessary and/or make necessary changes to appoint a Registered Agent with the Secretary of State. Copy and maintain a master file of all corporate documents. Annual Cost- $ per Company plus State filing fees. Registered Agent fees are due annually and are in addition to the CMP fees. To enroll in our Program please call (435) or us at

Thank You For more information, please contact us at: KYLER KOHLER OSTERMILLER & SORENSEN, LLP Tel: Fax: