A limited liability company is a business organization structure with the features of both a partnership and corporation. An LLC cannot do business legally in California until the conditions set forth by state laws and procedures are fulfilled. California does not place restrictions on the number of members an LLC must have, so the company can consist of just one or multiple members.
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A California LLC must select a name to do business under that is not already in use by or too similar to another business in the state. The end of the company's name must be "Limited Liability Company" or "Ltd. Liability Co." The abbreviation "LLC" or "L.L.C." can be used in place of the words. Certain words cannot be used in the name of an LLC, like "bank" and "credit union."
An LLC must designate a registered agent and maintain the agent's information on file with the California Secretary of State. A registered agent accepts legal notices and documents on behalf of the LLC. The agent may be an individual living in California or another entity authorized to conduct business in the state. An LLC cannot act as its own agent in California.
An LLC may be managed by all members, an outside manager or a team of outside managers. The LLC must designate one of the three management types when filing for creation with the Secretary of State, but the type selection is decided by the members of the company.
Articles of Organization
A domestic LLC must file Articles of Organization, Form LLC-1, containing information about the company. The articles must contain the LLC's name, the registered agent, the management type and the signature of the organizer, or the person preparing the articles. The organizer does not have to be a member of the LLC. The filing fee for the articles is $70 as of 2010, and they must be filed with the California Secretary of State's office.
A foreign LLC, or an LLC created in another state, must apply for registration with the California Secretary of State. Form LLC-5, Application to Register a Foreign Limited Liability Company, must set forth the name the foreign LLC wants to use in California, and the name is subject to the same provisions and restrictions as domestic LLC names. The LLC's creation date and place, name, principal office address, registered agent and the filer's name and signature are requested on the registration. The foreign LLC must include a certificate of good standing from the authority where the LLC was formed. The fee for filing the registration is $70 as of 2010.