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Business Review

April 29th

  • Operating agreement terms
  • Buy sell agreement and rules
  • Labor law compliance
  • S LLC election
  • Annual reports
  • Annual meetings
  • Change of Address
  • If my LLC has multiple members, what is the latest date I must send them the annual K-1 statement?
  • State franchise tax numbers
  • I didn’t put a capital contribution on the operating agreement on the operating agreement sigh when I first signed it. How do I put correct that?
  • My wife and I have a LLC, and I listed her as having 100% ownership. Should we split it 50 50 or 60 40 etc.
  • They have sent me a lot of documents. Do I need to download all of them?
  • LLC vs S Corp tax treatment
  • California management of Oregon LLC.
  • Capital Contribution, Loans, Start-up expenses.
  • Partnership Quarterly tax filings.
  • Employment withholding.
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Business Plan

paying yourself owners draw

as a realtor

schedule “A” capital contribution

amount of interest on a loan

paying interest through a company bank account.

Rental properties / collection problems

probate strategies

Using a holding company to collect rent

AZ post-filing requirements

When should the state annual report be filed?

using a living trust to manage taxes.

Adding your spouse to an LLC

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Conference Call

I have an LLC and I did not file anything for taxes. What are we supposed to do?

Would you have a template that we can use?

if we didn’t make money last year, but spent more money trying to get the business going, do we still need to file tax?

single filing jointly

North Carolina Attorney General / real estate scams

what happens when someone dies / trust / will

selling real estate through LLC profits / capital gains

how do partnership LLC pay their members? and there are no other employees?

My current LLC was formed with an individual who no longer wants to be in the partnership. What is involved in removing this individual and replacing with another?

generally speaking what do you recommend for assets protection?

How can I operate a company that protects me?

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Getting ready for your Annual Meeting

Many of our clients ask whether or not they have to hold an annual meeting if their entity is an LLC. Since it is not required by law in most states, why bother?

The answer goes back to common sense. You must be able to show a court of law that you are running a professional organization, separate and distinct from you, the owner, in order to maintain your liability protection.

Why would you give up the opportunity to run – and document – a formal meeting that shows you are acting in a professional manner?

More importantly, most operating agreements state that an annual meeting must be held.

Failing to abide by the terms of an agreement that, most likely, you signed, can seriously damage your protection.

The key here is not to fuss over the meeting, but to hold it in a manner that is fun.

First, choose a restaurant that you particularly enjoy – or perhaps one that you have always wanted to visit, as long as the bill will be reasonable for the level of business your company brought in last year. If you are on vacation, holding your annual meeting while you are away is one way to have the company foot the bill for some of your expenses.

Next, spend a couple of hours preparing. If you have kept your minutes up-to-date during the year, review them to ensure they are complete and note anything that is missing. If your minutes have not been kept up-to-date, make a list of all the decisions made and actions taken by the Managers that need to be approved and ratified.

The list does not have to be in the form of a Written Consent: You can create that later. Create an agenda for your meeting, including items to discuss regarding your plans for the current year.

Remember, if you are going to a nice restaurant, this meeting could last an hour and a half to two hours. And prepare a Waiver of Notice of Meeting and sign it. Bring your agenda and your notes to the restaurant. Hold your meeting in a leisurely fashion.

If your spouse or partner is with you but is not part of the company, make sure you note his or her presence as a non-member, and appoint him or her as secretary for the meeting. Make sure he or she takes notes during your discussion to help you write up the resolutions later on.

If you are alone, take notes yourself so you can remember what you thought about. Remembering may not be as easy as you think by the time you get to dessert.

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Investing with your IRA

Please review these videos and information for Checkbook IRA LLCs.

 

If you or another dis-qualified party invest along with your IRA this transaction will raise red flags and may be regarded as an “enabling” transaction. As a result the IRS may cause your IRA funds may be prematurely distributed along with taxes and penalties.

Some people are using their IRA funds to supplement the funds needed for an investment. (or vice versa) We have been informed that combining personal and IRA funds this way could be interpreted by the IRS as a “prohibited transaction” resulting in premature distributions, penalties and taxation.

Contact your Custodian and / or Qualified Accountant for details.

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Virtual Office

If you wish to set up a mail forwarding address for privacy, many of our clients are using the virtual office services offered by Davinci Virtual Office.

Please contact Christie Julian, Director of Sales (866) 875 7848 or cjulian@davincivirtual.com for more details. They have provided a video to show how their services function.

A no-cost option (as in FREE) to set up a business phone number is Google Voice. Once created, the new number can be set to ring as many other phone numbers as you wish.

Electronic FAX services also provide a cost effective means to receive or send FAXes from your PC. We use MaxEmail for our companies.

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Trading

Are Your Trading Gains Enriching the IRS and NOT You?

More and more people are making serious money in the stock market – trading options or stocks directly, or in the FOREX or the Futures markets. Whether you’re an investor or a full time trader, there are legitimate ways to increase your profit!

If you’re not sure of the difference between an IRS recognized Trader and an Investor, we have some more information just for you.  With this learning under your belt, you’ll be better off and able to make good decisions.  Decisions that can save you $10,000 or more every year. Watch this introduction to the IRS rules and how you can use them to your benefit. This eHow explanation may also be helpful in your decision-making. Please be aware that rules change and you should contact a knowledgeable accountant for your specific circumstances.

Are You an Active Investor?

If you are an active investor who would like to get more tax breaks and keep more of your earnings at home, keep on reading and view the video. You probably already know that your trading activity doesn’t qualify for the IRS “definition” of a trader, and so you are not able to claim the tax benefits that the IRS extends to that elite group of people. And even if you are trading as your primary source of income, the IRS may still dis-allow expense deductions that can legitimately benefit your bottom line. We have developed solutions that allow you to reduce the amount you pay in taxes on your profits. All legal and accepted by the IRS.
If you want to learn how easy it is, watch this Investors Only video.

Are You an IRS Qualified Trader?

If you’re an IRS qualified trader, wouldn’t you like to know how to get even more tax breaks and show even more profit for your work? You’re working hard to stay focused and on top of the market. You shouldn’t have to wonder if there is a way to reduce the taxes you pay, but you do. We have developed solutions that allow you to reduce the amount you pay in taxes on your profits. We can show you how to implement tax free benefits to you and your family – scholarships, medical re-imbursement plans and more. All legal and accepted by the IRS.
If you want to learn how easy it is, watch this Traders Only video.

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The Importance of Paperwork

Many people have misguided opinions about the importance of a minute book. They think that because the law does not require minutes or meetings, you can throw away your book or fail to document your decisions. That is unfortunate and shortsighted, especially if you are the only person in the company.

Your minute book is a vital part of your toolkit for your business. It contains your legal documents, as I explained earlier, and is a good place to keep notices from the IRS and the state so you have everything you need in one place. It also contains your operating agreement, which contains the rules by which you agree to run the company. If you do not have an operating agreement, you are subject to the statutes of the state. So it is better to have an operating agreement that you can read and follow and change if you wish. You can’t change the statutes and I doubt you will take time to read them so you know what the rules are.

You should also document your decisions in the form of resolutions and place those in your minute book. If you go to court or are audited by the IRS you have to be able to show that you are running a professional organization separate and distinct from you, the owner. The easiest way to do that is to document your decisions that are of legal, tax or financial importance.

All professional managers document their decisions.

You probably know this if you have ever worked in corporate America. If you don’t hold meetings or create written consents to document your decisions, how are you going to prove that you are running a professional organization? The IRS certainly isn’t going to take your word for it, and neither will a court. Your minute book, with your completed setup papers and up-to-date with your resolutions is a great tool to show that you are running the LLC as an entity separate from yourself.

If you cannot prove this, the IRS or court will determine that you are acting as a sole proprietor. The IRS may then also determine that your business is just a hobby, and that will seriously impact your write offs. The court, on the other hand, will allow the opposing counsel to pierce your corporate veil and place everything you own both in the LLC and outside the LLC at risk.

All of this is explained in your membership modules – particularly the first one on paperwork.

We would refer you to Kari Allen VanNoy and her company Just A Minute, LLC to help with preparing your company paperwork.

Visit their website for more information: www.JustAMinuteLLC.com or call them at (480) 344-1870.

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Tax Election

Many business owners don’t know how or when to select the correct tax treatment for an LLC or a Corporation.

All LLCs start off as a “flow-through” entity where all expenses and income are calculated as part of the Schedule C on your personal return and do not require any additional tax changes. So, when should you fill in an IRS form to change from either a single-member or a partnership LLC? Obviously, when your accountant suggests that you should consider using a specific tax election. Do not use an “S” or “C” election unless you’ve discussed the benefits and draw-backs with your CPA.

Here are some simple “guidelines” for you to consider.

2253 or Chapter S

  • An IRS form 2553 can be used to select sub-Chapter “S” tax treatment for an LLC or a Corporation
  • The main benefits to you as a small business owner includes a reduction in the amount of Social Security / Medicare taxes that you would have to pay on company profits and the ability to claim additional deductions for medical re-reimbursement
  • These savings in taxes can become significant once your company generates $40,000 – $50,000 per year of profit after business expenses
  • Once your revenue model shows that level of profit, you can file a form 2553 during the months of January/February to change your tax treatment to “S”

8832 or Chapter C

  • All Corporations start out being taxed this way – under Chapter C of the IRS Code
  • The main benefits are the ability to claim additional deductions for medical re-reimbursement or to partner as owners of a trading LLC to increase the allowable business deductions
  • Many Corporations wish to use the benefits of an “S” election and file a form 2553
  • Unless an “S” election is made, all profits remain with the Corporation and all taxes must be reported and paid by the Corporation

As always, discuss the benefits and dis-advantages with a qualified financial professional, since you may end up paying unnecessary taxes on any profits that your business may generate if you change tax elections.

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Sample Minutes and Resolutions

Written Consent of Action Without Meeting of the Manager(s)
of
[name of entity]

The undersigned, being the Manager(s) of [name of entity], as named in the Articles of Organization filed with the Secretary of State for [name of state] on , does consent to the following:

Resolved, that …

In witness whereof, the undersigned has executed this Action by Written Consent as of

[date].

[name of entity]

By:

[name of manager(s), position]

Waiver of Notice of Meeting of Members
of
[name of entity]

WE, the undersigned, being all of the members of the Company, hereby agree and consent that the meeting of members of the Company be held on the date and time and at the place designated hereunder, and do hereby waive all notice whatsoever of such meeting and of any adjournment or adjournments thereof.

We do further agree and consent that any and all lawful business may be transacted at such meeting or at any adjournment or adjournments thereof as may be deemed advisable by any member present thereat.  Any business transacted at such meeting or at any adjournment or adjournments thereof shall be as valid and legal and of the same force and effect as if such meeting or adjourned meeting were held after notice.

Place of Meeting:

Date of Meeting:

Time of Meeting:

Dated:

_____________________________
Member

_____________________________
Member

Waiver of Notice of Meeting of Managers
of
[name of entity]

WE, the undersigned, being all of the managers of the Company, hereby agree and consent that the meeting of members of the Company be held on the date and time and at the place designated hereunder, and do hereby waive all notice whatsoever of such meeting and of any adjournment or adjournments thereof.

We do further agree and consent that any and all lawful business may be transacted at such meeting or at any adjournment or adjournments thereof as may be deemed advisable by any manager present thereat.  Any business transacted at such meeting or at any adjournment or adjournments thereof shall be as valid and legal and of the same force and effect as if such meeting or adjourned meeting were held after notice.

Place of Meeting:

Date of Meeting:

Time of Meeting:

Dated:

_____________________________
Manager

_____________________________
Manager

Minutes of the Meeting of Members
of
[name of entity]

The meeting of the Members of the Limited Liability Company was held on the date and at the place set forth in the written Waiver of Notice signed by all Members, and prefixed to the minutes of this meeting.

Present at the Meeting:

The following items were discussed and ratified:

There being no further business, it was resolved that as of the date below, all actions taken at and pursuant to this meeting are hereby ratified and approved, and the meeting was adjourned on the date inscribed in these Meeting Minutes.

_________________________                  Dated:_______________20__
Member

_________________________                  Dated:_______________20__
Member

Minutes of the Meeting of Managers
of
[name of entity]

The meeting of the Managers of the Limited Liability Company was held on the date and at the place set forth in the written Waiver of Notice signed by all Managers, and prefixed to the minutes of this meeting.

Present at the Meeting:

The following items were discussed and ratified:

There being no further business, it was resolved that as of the date below, all actions taken at and pursuant to this meeting are hereby ratified and approved, and the meeting was adjourned on the date inscribed in these Meeting Minutes.

_________________________                  Dated:_______________20__
Manager

_________________________                  Dated:_______________20__
Manager

Example of resolution to add a member

Written Consent of Action Without Meeting
of the Members
of
[name of company]

The undersigned, being the sole Member of [name of company] (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, it would be beneficial for the Company to have two Members to own the Company and two Managers to operate the business;

IT IS THEREFOR

RESOLVED, that [incoming member] shall receive ___________ units of ownership in the Company upon agreement to abide by the terms of the Company operating agreement.  These units shall represent a _________ percent (___%) interest in the Company.

RESOLVED FURTHER, that the Manager of the Company is directed to issue the certificate of ownership to [incoming member] to evidence ___________ percent (___%) ownership in the Company and to add him as a new Member to the Membership list.

RESOLVED FURTHER, that [incoming member] be, and he hereby is, appointed a Manager of the Company until such time as the Annual Meeting of Members is held and his successor is elected and qualifies.

RESOLVED FURTHER, that the Manager of the Company be, and hereby is, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as she may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ______(date)________.

____________________________

Current Member

I, [incoming member], agree to abide by the terms of the Operating Agreement for [name of company] as of _______________, 2010.

_____________________________
[name of incoming member]

Example of resolution to withdraw ownership

Written Consent of Action Without Meeting
of the Members
of
[name of company]

WHEREAS, John Masters has resigned as Manager and Secretary of the Company; and

WHEREAS, John Masters desires to withdraw as a Member of the Company; and

WHEREAS, John Masters has delivered a letter to the Members giving up all rights to the assets and future earnings of the Company;

IT IS THEREFOR

RESOLVED, that John Masters resignation is accepted.

RESOLVED FURTHER, that the Company agrees to purchase John Masters’ twenty percent (20%) interest in the Company for a consideration of $2,500.

RESOLVED FURTHER, that the Treasurer is directed to issue a check in the full amount of $2,500 to John Masters upon receipt of his ownership certificate.

RESOLVED FURTHER, that Mary Jones is hereby appointed as Secretary of the Company until her successor is voted in at the next annual meeting and qualifies.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ______(date)________.

____________________________

Current Member

_____________________________
signed John Masters

Example of resolution to borrow funds

Written Consent of Action Without Meeting
of the Members
of
[name of company]

The undersigned, being a majority of the Members of [name of company] (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Company does not have sufficient funds to pay its current obligations (or whatever other reason you have); and

WHEREAS, [your name], a Member of the Company has offered to lend the Company the money required;

IT IS THEREFOR

RESOLVED, that the loan from [your name] in the amount of $____________, evidenced by the promissory note attached, is approved.

This note is secured by the Company’s assets and receivables.

RESOLVED FURTHER, that the Manager of the Company be, and hereby is, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as she may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ______(date)________.

____________________________
Member

____________________________
Member

PROMISSORY NOTE
Note: Adjust details in sections 7, 8 and 9 to reflect your specific situation. Speak to your accountant for clarification.

$XX,XXX.00                                                                                                                         Date   __________, 20___

City, State

1. Borrower’s Promise to Pay
FOR VALUE RECEIVED, the undersigned Company, having a primary address located at _________________________________________ (“Borrower”), hereby promises to pay to the order of _______________________________________ (the “Lender”), in lawful money of the United States of America constituting legal tender in payment of all debts and dues, public and private, the principal amount ______________ Thousand Dollars and zero cents ($XX,000.00).

[IF SECURED BY PROPERTY:] This Note is issued pursuant to and secured that certain mortgage agreement dated as of the date hereof between the Borrower and the Note Holder relating to the property commonly known as _______________________________ (the “Mortgage”). All capitalized terms not defined herein shall have the respective meanings assigned to them in the Mortgage.

[IF SUPPORTED BY A GUARANTOR:] This Note is further supported pursuant to Section 7, by the guaranty of _________________, (the “Guarantor”).

Borrower understands that the Lender may transfer this Note. The Lender, or any successor in interest thereof, is called the “Note Holder”.

2. Interest
From and after the date hereof (until maturity or default as hereinafter provided), interest on the principal amount outstanding shall accrue at a fixed rate equal to _____________percent (__%) per annum, and computed on the basis of a 365-day year.

3. Maximum Interest Rate
It is the intention of the Holder that the interest on the Loans that may be charged to, collected from or received from the Company shall not exceed the maximum rate permissible under applicable law.  Accordingly, anything in this Note or any other Loan Document to the contrary notwithstanding, in the event any interest (as so defined) is charged to, collected from or received from the Company by the Holder pursuant hereto or thereto in excess of such maximum lawful rate, then the excess of such payment over that maximum shall be applied to the reduction of the outstanding principal balance of the Loans (without any prepayment premium or penalty), and any portion of such excess payment remaining after payment and satisfaction in full of the Loans shall be returned by the Holder to the Company.

4. Payment

(a) Borrower agrees to pay principal of $XX,XXX with the then accrued interest on or before ________________, 20__.  Borrower shall make its payments to [name of lender], located at [lender’s address] (the “Payment Address”), or at such different place if notified by the Note Holder in writing.

(b) Said interest shall be payable annually on the [date]  day each and every calendar year  in lawful money of the United States beginning on the [date]  day of  [month] , 20xx , in annual installments of  _____________________________ Dollars ($XXXX), and continuing thereafter until the Maturity Date (as defined below), or until said principal and interest have been paid in full, at [lender’s address] the Payment Address, or at such other place as the holder hereof may designate in writing from time to time.  Each installment payment shall be credited first to the interest then due, and the remainder to the principal.

(c) On _______________, 20__ (the “Maturity Date”), the entire outstanding principal balance of the indebtedness evidenced hereby and all accrued and unpaid interest shall be due and payable in full.

5. Prepayment
This Note may be prepaid in whole or in part at any time without penalty. If any partial prepayment is made, the Maturity Date and the interest payment dates shall remain in full force and effect.

6. Event of Default
If Borrower fails to make any payment of principal or interest as the same becomes due and payable, and such failure is not cured within thirty (30) days after  receipt of  written notice thereof or at any time thereafter during the continuance of any such event, the Note Holder may, with or without notice to Borrower, declare this Note and the indebtedness evidenced hereby to be immediately due and payable, whereupon this Note and the indebtedness evidenced hereby shall become immediately due and payable, without presentment, demand, protest, or other notice of any kind, all of which are hereby expressly waived.

7. Guaranty
The Guarantor, does hereby personally, irrevocably and unconditionally guarantee all obligations under this Note, including the prompt and complete payment when due (whether at the stated maturity, by acceleration or otherwise) of all indebtedness, obligations and liabilities of the Borrower to the Note Holder, whether now existing or at any time hereafter incurred which arise out of or are in connection with this Note whether for principal, interest, premium, fees, expenses, attorneys’ fees or otherwise. Any person, who takes over these obligations, including the obligations of a guarantor, surety or endorser of this Note, is also obligated to keep all of the promises made in this Note. The Note Holder may enforce their right under this Note against the Guarantor. For the purposes hereof “demand” shall include the commencement and continuance of any legal proceedings.

8. NOTE SECURITY AND TRANSFER
If all or any part of the property securing this Note or any beneficial interest in it is sold or transferred without complying with the terms of this Note, as set forth in Paragraph One (1), the Note Holder may at its option require immediate payment in full of all sums owed under this Note.

In the event that the Note Holder is required to defend any action in State or Federal Court seeking to forfeit the rights of the Borrower, pursuant to any State or Federal forfeiture statute, the Borrower agrees to pay any attorneys’ fees which the Note Holder incurs defending the nature and priority of Note Holder’s lien. This Note may not be transferred by Borrower without the written consent of the Note Holder.

This Note is secured by a Mortgage on the real property as legally described in the Mortgage.

9. Waivers
Borrower hereby waives demand, presentment for payment, notice of dishonor, protest, and notice of protest and diligence in collection or bringing suit and agree that the holder hereof may accept partial payment, or release or exchange security or collateral, without discharging or releasing any unreleased collateral or the obligations evidenced hereby.  Borrower further waives any and all rights of exemption, both as to personal and real property, under the constitution or laws of the United States or the State of _______________________.

10. No Waivers By Lender
The Note Holder’s course of dealing, or forbearance from, or delay in, the exercise of any of the Note Holder’s rights, performance privileges or right to insist upon the Borrower’s strict performance of any provisions contained in this Note, or other loan documents, shall not be construed as a waiver by the Note Holder, unless any such waiver is in writing and is signed by the Note Holder.  The rights and remedies of the Note Holder under this Note shall be cumulative and not alternative.  Neither the failure nor any delay in exercising any right, power or privilege under this Note will operate as a waiver of such right, power or privilege and no single or partial exercise of any such right, power or privilege by the Note Holder will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege.

11. Attorneys’ Fees
Borrower agrees to pay reasonable attorneys’ fees and costs actually incurred by the Note Holder hereof in collecting on this Note, whether by suit or otherwise.

12. Miscellaneous
As used herein, the terms “Borrower,” “Lender” and “Note Holder” shall be deemed to include their respective successors, legal representatives and assigns, whether by voluntary action of the parties or by operation of law.  This Note has been negotiated, and is being executed and delivered in the State of _________________. Borrower hereby submits to jurisdiction in the State of ____________.  This Note shall be governed by and be construed in accordance with the laws of the State of ______________.   This Note may not be modified except by written agreement signed by the Borrower and the Holder hereof, or by their respective successors or assigns. Any notice required to be sent to a party under this Agreement will be in writing, effective on receipt by that party, and will be sent by fax, first-class mail or personal delivery to the addresses for such party as set forth in Section 1 hereof.  Either party may change its notice address by giving written notice to the other party at the other party’s notice address.

IN WITNESS WHEREOF, Borrower has caused this Note to be executed and delivered as of the date first set forth above.

BORROWER:

By: __________________________________
Its: President/Manager

READ AND APPROVED: [lender] _________________________________________

DATE: ______________________________

Example of resolution to authorize Real Estate Transactions

Written Consent of Action Without Meeting
of the Members
of
[name], LLC
a Limited Liability Company

The undersigned, being all the Members of [name], LLC (hereinafter referred to as the “Company”) approve the following actions by written consent in lieu of meeting.

WHEREAS, the Members desire that they should have the power and authority to act for the Company individually in any matter on behalf of the Company;

IT IS THEREFORE

RESOLVED, that any Member be, and hereby is authorized and empowered to act individually on any matter on behalf of the Company, including the acquisition, purchase, management, maintenance and sale of real and personal property, regardless of its value.

RESOLVED FURTHER, that the Members of the Company be, and hereby are, authorized, empowered and directed in the name and on behalf of the Company, to execute such agreements, instruments and other documents, and to take such other actions, as any of them may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolution, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of [date].

____________________________
[name], Member

_____________________________
[name], Member

Written Consent of Action Without Meeting
of the sole director and shareholder
of
[name], INC
a Corporation

The undersigned, being the Sole Director and Shareholder of _______________, Inc. (hereinafter referred to as the “Corporation”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Director and Shareholder desires that the President should have the power and authority to act for the Corporation individually in any matter on behalf of the Corporation;

IT IS THEREFORE

RESOLVED, that the President be, and hereby is authorized and empowered to act individually on any matter on behalf of the Corporation, including the acquisition, purchase, management, maintenance and sale of real and personal property, regardless of its value.

RESOLVED FURTHER, that the Officers of the Corporation be, and hereby are, authorized, empowered and directed in the name and on behalf of the Corporation, to execute such agreements, instruments and other documents, and to take such other actions, as any of them may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolution, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ________________, 20xx.

____________________________
, Director & Shareholder

Example of resolution to change Tax election to sub-Chapter S

Written Consent of Action Without Meeting
of the Members
of
[name], LLC
a Limited Liability Company

The undersigned, being all the Member[s] of [name], LLC (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Members deem that it would be advantageous to the Company to be taxed under Subchapter S of the Internal Revenue Code of 1986, as amended

IT IS THEREFORE

RESOLVED, that this limited liability company hereby elects to be treated as a Small Business Corporation for federal income tax purposes under Subchapter S of the Internal Revenue Code of 1986, as amended, commencing January 1, 2015.

RESOLVED FURTHER, that the amended Operating Agreement, suitable for a limited liability company taxed under Subchapter S of the Internal Revenue Code of 1986 be, and hereby is, approved, ratified and adopted by the Member and that it be inserted into the Minutes Book in place of the Operating Agreement adopted _____________.

RESOLVED FURTHER, that the Manager of the Company be, and hereby is, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as any of them may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of [date].

____________________________
[name], Member

_____________________________
[name], Member

Example of resolution to dissolve the Company

Written Consent of Action Without Meeting
of the Members
of
[name], LLC
a Limited Liability Company

The undersigned, being all the Member[s] of [name], LLC (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Members no longer wish to pursue any business interests in the Company;

IT IS THEREFORE

RESOLVED, that the affairs of the Company be wound down and that the Company be dissolved.

RESOLVED FURTHER, that the Managers of the Company be, and hereby are, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as they may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ______(date)________.

____________________________
Member

____________________________
Member

Written Consent of Action Without Meeting
of
the Manager(s)
of
[name of entity]

The undersigned, being the Manager(s) of [name of entity], as named in the Articles of Organization filed with the Secretary of State for [name of state] on , does consent to the following:

Resolved, that …

In witness whereof, the undersigned has executed this Action by Written Consent as of

[date].

[name of entity]

By:

[name of manager(s), position]

 


WAIVER OF NOTICE OF MEETING OF MEMBERS
OF
[name of entity]

 

WE, the undersigned, being all of the members of the Company, hereby agree and consent that the meeting of members of the Company be held on the date and time and at the place designated hereunder, and do hereby waive all notice whatsoever of such meeting and of any adjournment or adjournments thereof.

 

We do further agree and consent that any and all lawful business may be transacted at such meeting or at any adjournment or adjournments thereof as may be deemed advisable by any member present thereat.  Any business transacted at such meeting or at any adjournment or adjournments thereof shall be as valid and legal and of the same force and effect as if such meeting or adjourned meeting were held after notice.

 

Place of Meeting              :

 

Date of Meeting               :

 

Time of Meeting               :

 

Dated:

 

_____________________________

Member

 

_____________________________

Member


WAIVER OF NOTICE OF MEETING OF MANAGERS
OF
[name of entity]

 

WE, the undersigned, being all of the managers of the Company, hereby agree and consent that the meeting of members of the Company be held on the date and time and at the place designated hereunder, and do hereby waive all notice whatsoever of such meeting and of any adjournment or adjournments thereof.

 

We do further agree and consent that any and all lawful business may be transacted at such meeting or at any adjournment or adjournments thereof as may be deemed advisable by any manager present thereat.  Any business transacted at such meeting or at any adjournment or adjournments thereof shall be as valid and legal and of the same force and effect as if such meeting or adjourned meeting were held after notice.

 

Place of Meeting              :

 

Date of Meeting               :

 

Time of Meeting               :

 

Dated:

 

_____________________________

Manager

 

_____________________________

Manager


MINUTES OF THE MEETING
OF THE MEMBERS OF
[name of entity]

 

 

The meeting of the Members of the Limited Liability Company was held on the date and at the place set forth in the written Waiver of Notice signed by all Members, and prefixed to the minutes of this meeting.

 

Present at the Meeting:

 

The following items were discussed and ratified:

 

 

There being no further business, it was resolved that as of the date below, all actions taken at and pursuant to this meeting are hereby ratified and approved, and the meeting was adjourned on the date inscribed in these Meeting Minutes.

 

_________________________                  Dated:_______________20__

Member

 

_________________________                  Dated:_______________20__

Member


MINUTES OF THE MEETING
OF THE MANAGERS OF
[name of entity]

 

 

The meeting of the Managers of the Limited Liability Company was held on the date and at the place set forth in the written Waiver of Notice signed by all Managers, and prefixed to the minutes of this meeting.

 

Present at the Meeting:

 

The following items were discussed and ratified:

 

There being no further business, it was resolved that as of the date below, all actions taken at and pursuant to this meeting are hereby ratified and approved, and the meeting was adjourned on the date inscribed in these Meeting Minutes.

 

_________________________                  Dated:_______________20__

Manager

 

_________________________                  Dated:_______________20__

Manager


Example of resolution to add a member

Written Consent of Action Without Meeting
of The Members of
[name of company]

 

The undersigned, being the sole Member of [name of company] (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, it would be beneficial for the Company to have two Members to own the Company and two Managers to operate the business;

IT IS THEREFOR

RESOLVED, that [incoming member] shall receive ___________ units of ownership in the Company upon agreement to abide by the terms of the Company operating agreement.  These units shall represent a _________ percent (___%) interest in the Company.

RESOLVED FURTHER, that the Manager of the Company is directed to issue the certificate of ownership to [incoming member] to evidence ___________ percent (___%) ownership in the Company and to add him as a new Member to the Membership list.

RESOLVED FURTHER, that [incoming member] be, and he hereby is, appointed a Manager of the Company until such time as the Annual Meeting of Members is held and his successor is elected and qualifies.

RESOLVED FURTHER, that the Manager of the Company be, and hereby is, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as she may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ______(date)________.

 

____________________________

Current Member

I, [incoming member], agree to abide by the terms of the Operating Agreement for [name of company] as of _______________, 2010.

_____________________________
[name of incoming member]


Example of resolution to borrow funds

Written Consent of Action Without Meeting
of The Members of
[name of company]

 

The undersigned, being a majority of the Members of [name of company] (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Company does not have sufficient funds to pay its current obligations (or whatever other reason you have); and

WHEREAS, [your name], a Member of the Company has offered to lend the Company the money required;

IT IS THEREFOR

RESOLVED, that the loan from [your name] in the amount of $____________, evidenced by the promissory note attached, is approved.

This note is secured by the Company’s assets and receivables.

RESOLVED FURTHER, that the Manager of the Company be, and hereby is, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as she may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ______(date)________.

 

____________________________

Member

____________________________

Member

Adjust details and sections 7, 8 and Waivers to reflect your specific situation. Speak to your accountant for clarification.

[SECURED]

PROMISSORY NOTE

 

$XX,XXX.00                                                                                                                         Date   __________, 20___

City, State

 

  1. Borrower’s Promise to Pay. FOR VALUE RECEIVED, the undersigned Company, having a primary address located at _________________________________________ (“Borrower”), hereby promises to pay to the order of _______________________________________ (the “Lender”), in lawful money of the United States of America constituting legal tender in payment of all debts and dues, public and private, the principal amount ______________ Thousand Dollars and zero cents ($XX,000.00).

[IF SECURED BY PROPERTY: This Note is issued pursuant to and secured that certain mortgage agreement dated as of the date hereof between the Borrower and the Note Holder relating to the property commonly known as _______________________________ (the “Mortgage”). All capitalized terms not defined herein shall have the respective meanings assigned to them in the Mortgage.

IF SUPPORTED BY A GUARANTOR: This Note is further supported pursuant to Section 7, by the guaranty of _________________, (the “Guarantor”).]

Borrower understands that the Lender may transfer this Note. The Lender, or any successor in interest thereof, is called the “Note Holder”.

  1. Interest. From and after the date hereof (until maturity or default as hereinafter provided), interest on the principal amount outstanding shall accrue at a fixed rate equal to _____________percent (__%) per annum, and computed on the basis of a 365-day year.
  2. Maximum Interest Rate. It is the intention of the Holder that the interest on the Loans that may be charged to, collected from or received from the Company shall not exceed the maximum rate permissible under applicable law.  Accordingly, anything in this Note or any other Loan Document to the contrary notwithstanding, in the event any interest (as so defined) is charged to, collected from or received from the Company by the Holder pursuant hereto or thereto in excess of such maximum lawful rate, then the excess of such payment over that maximum shall be applied to the reduction of the outstanding principal balance of the Loans (without any prepayment premium or penalty), and any portion of such excess payment remaining after payment and satisfaction in full of the Loans shall be returned by the Holder to the Company.
  3. Payment.

(a)          Borrower agrees to pay principal of $XX,XXX with the then accrued interest on or before ________________, 20__.  Borrower shall make its payments to [name of lender], located at [lender’s address] (the “Payment Address”), or at such different place if notified by the Note Holder in writing.

(b)          Said interest shall be payable annually on the [date]  day each and every calendar year  in lawful money of the United States beginning on the [date]  day of  [month] , 20xx , in annual installments of  _____________________________ Dollars ($XXXX), and continuing thereafter until the Maturity Date (as defined below), or until said principal and interest have been paid in full, at [lender’s address] the Payment Address, or at such other place as the holder hereof may designate in writing from time to time.  Each installment payment shall be credited first to the interest then due, and the remainder to the principal.

 

(c)          On _______________, 20__ (the “Maturity Date”), the entire outstanding principal balance of the indebtedness evidenced hereby and all accrued and unpaid interest shall be due and payable in full.

  1. Prepayment. This Note may be prepaid in whole or in part at any time without penalty. If any partial prepayment is made, the Maturity Date and the interest payment dates shall remain in full force and effect.
  2. Event of Default. If Borrower fails to make any payment of principal or interest as the same becomes due and payable, and such failure is not cured within thirty (30) days after  receipt of  written notice thereof or at any time thereafter during the continuance of any such event, the Note Holder may, with or without notice to Borrower, declare this Note and the indebtedness evidenced hereby to be immediately due and payable, whereupon this Note and the indebtedness evidenced hereby shall become immediately due and payable, without presentment, demand, protest, or other notice of any kind, all of which are hereby expressly waived.

[7.           Guaranty.  The Guarantor, does hereby personally, irrevocably and unconditionally guarantee all obligations under this Note, including the prompt and complete payment when due (whether at the stated maturity, by acceleration or otherwise) of all indebtedness, obligations and liabilities of the Borrower to the Note Holder, whether now existing or at any time hereafter incurred which arise out of or are in connection with this Note whether for principal, interest, premium, fees, expenses, attorneys’ fees or otherwise. Any person, who takes over these obligations, including the obligations of a guarantor, surety or endorser of this Note, is also obligated to keep all of the promises made in this Note. The Note Holder may enforce their right under this Note against the Guarantor. For the purposes hereof “demand” shall include the commencement and continuance of any legal proceedings.]

[8.           NOTE SECURITY AND TRANSFER

If all or any part of the property securing this Note or any beneficial interest in it is sold or transferred without complying with the terms of this Note, as set forth in Paragraph One (1), the Note Holder may at its option require immediate payment in full of all sums owed under this Note.

In the event that the Note Holder is required to defend any action in State or Federal Court seeking to forfeit the rights of the Borrower, pursuant to any State or Federal forfeiture statute, the Borrower agrees to pay any attorneys’ fees which the Note Holder incurs defending the nature and priority of Note Holder’s lien. This Note may not be transferred by Borrower without the written consent of the Note Holder.

This Note is secured by a Mortgage on the real property as legally described in the Mortgage. ]

  1. Waivers. Borrower hereby waives demand, presentment for payment, notice of dishonor, protest, and notice of protest and diligence in collection or bringing suit and agree that the holder hereof may accept partial payment, or release or exchange security or collateral, without discharging or releasing any unreleased collateral or the obligations evidenced hereby.  Borrower further waives any and all rights of exemption, both as to personal and real property, under the constitution or laws of the United States or the State of _______________________.
  2. No Waivers By Lender. The Note Holder’s course of dealing, or forbearance from, or delay in, the exercise of any of the Note Holder’s rights, performance privileges or right to insist upon the Borrower’s strict performance of any provisions contained in this Note, or other loan documents, shall not be construed as a waiver by the Note Holder, unless any such waiver is in writing and is signed by the Note Holder.  The rights and remedies of the Note Holder under this Note shall be cumulative and not alternative.  Neither the failure nor any delay in exercising any right, power or privilege under this Note will operate as a waiver of such right, power or privilege and no single or partial exercise of any such right, power or privilege by the Note Holder will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege
  3. Attorneys’ Fees. Borrower agrees to pay reasonable attorneys’ fees and costs actually incurred by the Note Holder hereof in collecting on this Note, whether by suit or otherwise.

 

  1. Miscellaneous. As used herein, the terms “Borrower,” “Lender” and “Note Holder” shall be deemed to include their respective successors, legal representatives and assigns, whether by voluntary action of the parties or by operation of law.  This Note has been negotiated, and is being executed and delivered in the State of _________________. Borrower hereby submits to jurisdiction in the State of ____________.  This Note shall be governed by and be construed in accordance with the laws of the State of ______________.   This Note may not be modified except by written agreement signed by the Borrower and the Holder hereof, or by their respective successors or assigns. Any notice required to be sent to a party under this Agreement will be in writing, effective on receipt by that party, and will be sent by fax, first-class mail or personal delivery to the addresses for such party as set forth in Section 1 hereof.  Either party may change its notice address by giving written notice to the other party at the other party’s notice address.

 

IN WITNESS WHEREOF, Borrower has caused this Note to be executed and delivered as of the date first set forth above.

BORROWER:

By: __________________________________

Its: President/Manager

READ AND APPROVED: [lender] _________________________________________

 

DATE: ______________________________


Example of resolution to authorize Real Estate Transactions

WRITTEN CONSENT OF ACTION WITHOUT MEETING
OF THE MEMBERS OF

[name], LLC
a limited liability company

 

The undersigned, being all the Members of [name], LLC (hereinafter referred to as the “Company”) approve the following actions by written consent in lieu of meeting.

WHEREAS, the Members desire that they should have the power and authority to act for the Company individually in any matter on behalf of the Company;

IT IS THEREFOR

RESOLVED, that any Member be, and hereby is authorized and empowered to act individually on any matter on behalf of the Company, including the acquisition, purchase, management, maintenance and sale of real and personal property, regardless of its value.

RESOLVED FURTHER, that the Members of the Company be, and hereby are, authorized, empowered and directed in the name and on behalf of the Company, to execute such agreements, instruments and other documents, and to take such other actions, as any of them may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolution, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of [date].

 

____________________________
[name], Member

 

_____________________________
[name], Member


WRITTEN CONSENT OF ACTION WITHOUT MEETING
OF THE SOLE DIRECTOR AND SHAREHOLDER OF
[name], INC.
a Corporation

 

The undersigned, being the Sole Director and Shareholder of _______________, Inc. (hereinafter referred to as the “Corporation”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Director and Shareholder desires that the President should have the power and authority to act for the Corporation individually in any matter on behalf of the Corporation;

IT IS THEREFOR

RESOLVED, that the President be, and hereby is authorized and empowered to act individually on any matter on behalf of the Corporation, including the acquisition, purchase, management, maintenance and sale of real and personal property, regardless of its value.

RESOLVED FURTHER, that the Officers of the Corporation be, and hereby are, authorized, empowered and directed in the name and on behalf of the Corporation, to execute such agreements, instruments and other documents, and to take such other actions, as any of them may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolution, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ________________, 20xx.

 

____________________________
, Director & Shareholder


Example of resolution to change Tax election to sub-Chapter S

WRITTEN CONSENT OF ACTION WITHOUT MEETING
OF THE MEMBERS OF

[name], LLC
a limited liability company

 

The undersigned, being all the Member[s] of [name], LLC (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Members deem that it would be advantageous to the Company to be taxed under Subchapter S of the Internal Revenue Code of 1986, as amended

IT IS THEREFOR
RESOLVED, that this limited liability company hereby elects to be treated as a Small Business Corporation for federal income tax purposes under Subchapter S of the Internal Revenue Code of 1986, as amended, commencing January 1, 2015.

RESOLVED FURTHER, that the amended Operating Agreement, suitable for a limited liability company taxed under Subchapter S of the Internal Revenue Code of 1986 be, and hereby is, approved, ratified and adopted by the Member and that it be inserted into the Minutes Book in place of the Operating Agreement adopted _____________.

RESOLVED FURTHER, that the Manager of the Company be, and hereby is, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as any of them may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of [date].

 

____________________________
[name], Member

 

_____________________________
[name], Member


Example of resolution to dissolve the Company

WRITTEN CONSENT OF ACTION WITHOUT MEETING
OF THE MEMBERS OF

[name], LLC
a limited liability company

 

The undersigned, being all the Member[s] of [name], LLC (hereinafter referred to as the “Company”) approves the following actions by written consent in lieu of meeting.

WHEREAS, the Members no longer wish to pursue any business interests in the Company;

IT IS THEREFOR

RESOLVED, that the affairs of the Company be wound down and that the Company be dissolved.

RESOLVED FURTHER, that the Managers of the Company be, and hereby are, authorized, empowered and directed in the name and on behalf of the Company, to execute such other agreements, instruments and other documents, and to take such other actions, as they may approve as necessary, appropriate or desirable in order to perform and otherwise carry out the intents and purposes of the foregoing resolutions, the execution of any such document or the taking of any such action, as applicable, to be conclusive evidence of that approval.

IN WITNESS WHEREOF, the undersigned have executed this Action by Written Consent as of ______(date)________.

 

____________________________
Member

 

____________________________
Member