Service
Companies Best Practice Summary Virtual Paralegal Services provides senior level corporate paralegal assistance. If you’d like to discuss how VPS can assist with your closing, please contact us at [email protected]. Learn more about Virtual Paralegal Services
Service companies service the legal industry as third
party vendors that function between the law firms and government agencies, primarily
the secretary of state, by providing resident agent services, document filing
and retrievals, authentications and apostilles and a wealth of information regarding
procedures of the secretaries of state and some other governmental agencies.
Generally, service companies do not provide services in relation to securities
issues, blue sky or federal securities filings. Some major national registered
agent service companies are CT Corporation System ("CT"), Corporation
Service Company ("CSC"). There are many others.
Legal professionals can be very passionate about
their preferred service company. Developing a relationship with a service
company and in particular, a customer service representative is an issue of
trust. You need to feel that the person on the other end of the phone is knowledgeable
and cares about making you look good because making you look good (or bad) is
the ultimate power of a service
company. As legal professionals, LeapLaws management
and contributors realize the important role service companies play in the day-to-day
life of corporate legal professionals and the very personal nature of that relationship.
We understand that service companies can essentially make you or break you in
the eyes of your attorney or client as the case may be. We also know the pain
of the exorbitant invoices of the larger resident agent service companies for
representation and corporate/UCC services.
Need assistance? Virtual Paralegal Services provides paralegal services including preparation and filing services in all 50 states. For more information contact us at [email protected].
What
a horrible feeling to act on information provided by a trusted customer service
representative only to learn that the information was inaccurate! The worst part
is that no attorney wants to hear that the job wasn't accomplished because a service
company provided bad information. Knowing how to filter inaccurate information
is a valuable skill developed by experienced paralegals and attorneys. Experience
teaches, usually through the school of hard knocks, how to use service companies
to your advantage and avoid pitfalls by listening with a skilled ear, verifying
information provided, knowing who you are talking to on the other end of the phone.
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Resident Agent (or Representation) Services
Major registered agent companies provide resident agent services in 50 states
and the District of Columbia. Resident agents are appointed when an entity is
formed, qualified or incorporated. The resident agent is often a company, that is qualified in the
target state and has been appointed by a vote of directors to accept service of
process and other information such as tax notices, notices from the secretary
of state on behalf of the company.
It is an important time-saving
measure to take time immediately following the incorporation, formation or qualification
to provide the resident agent with appropriate forwarding instructions as to who
should receive service of process and other legal notices; tax notices, secretary
of state notices and any other correspondence. Check with your resident agent
to learn about their preferred method for handling forwarding instructions. Legal
Notices Typically the lawyer responsible for the client will receive all
legal notices and service of process. Tax Notices, Annual Reports
and other Correspondence Tax notices, annual reports and other correspondence
may be sent to either a responsible paralegal or attorney in the firm representing
the company; or it may be determined that such notices be sent directly to a tax
accountant, in-house paralegal or general counsel at the company. Taking
the outside law firm out of the loop is usually preferred. Forwarding notices
and annual reports can become burdensome particularly if the company is not an
immediately recognizable client (i.e. a subsidiary of the client or a merger vehicle)
or if the paralegal or attorney assigned to receive such notices leaves the firm.
Notices and annual reports may end up in an overwhelming pile to be sorted and
forwarded resulting in missed deadlines for filing annual reports and forfeiture
of the company's good standing. This can be simply and easily avoided by completing
forwarding instructions at the beginning of the process. For your reference, it
may be helpful to keep a copy of the forwarding instructions in the minute book.
Pricing May Vary
Resident agent service fees vary greatly
from company to company and companies will generally offer discounts when there is large volume. Agents may or
may not allow for group discounting. For purposes of providing resident agent
services, it may provide considerable savings to a client operating in 50 states
to use a more cost-effective resident agent.
Best
Practice Tip: Changing resident agents can be time consuming. It is important
to know that most resident agents will complete the necessary state paperwork
and incur fees for changes of resident agent to their company. If you are interested
in changing resident agent companies for any reason, talk to competitors to determine
the potential value of a switch. Technology
Resident agents offer web sites to their subscribers that have become valuable
resources. Web sites vary from company to company, and will generally include
state forms, jurisdictional information, company records information, and free
recordkeeping services and tickler systems. The sites are free
to any company using them as resident agents. A password may be requested online
at the web sites. It is best to have passwords to each web site in the event that
one is sluggish, not working when you're in a rush or does not provide the necessary
form. These sites may be used virtually interchangeably for form preparation.
Best
Practice Tip: Once a company is formed, incorporated or qualified you may
use any service company for every day business. For instance, if CSC is the resident
agent for a company, NRAI may still be used to obtain transactional documents.
Document
Preparation and Filing Service companies may assist in the preparation
and filing of all state filings such as incorporations, qualifications, financing
statements, merger certificates, certificates of revival usually for additional
fees.
In some states, powers of attorney may be granted so that
the service company may sign on behalf of the client in order to expedite filings.
This option would not be available for filing amendments to charter or other documents
that require director and/or stockholder votes and officers signatures. It may
be used for filing incorporations and revivals and perhaps some other miscellaneous
filings requiring the signature of an interested party rather than an officer.
Virtual
Paralegal Services provides professional paralegal assistance that goes beyond
the state filing level. We provide the same assistance as a paralegal in your
office would provide. Contact
us for more information regarding virtual paralegal services. Advancement
of Filing Fees Advancement of filing fees is a great convenience
of using a service company for filing since it prevents you from running through
the check approval process each time you need to make a filing. The dollar limit
a service company will advance generally depends upon specific arrangements between
your firm and the service company. Typically service companies will advance filing
fees for standard filings of $500 or less. Check with your service company to
determine the maximum amount the company will advance for your filings. This service
can save considerable time and enable faster filing times when necessary. Document
Retrieval Service companies will retrieve documents from all state, federal
and local government offices and agencies such as: - Certified
or plain copies of corporate, limited liability company, limited partnership,
limited liability partnership filings and annual reports.
- Apostilles
and Authentications
- Court documents; case dockets, index listing and
case file.
- Federal and/or state tax liens
- UCC financing statement
searches
Note:
Dates of incorporation, the exact legal name or preliminary searches may be performed
free at many secretary of state's web sites available at LeapLaw's Corporate
Connection.
Network Connections Service
company researchers are often stationed at the secretary of state's office or
at least are constantly in secretary of state's offices nationwide. Bonds are
created with the state workers and therefore, service companies can sometimes
pull off miracles just when you need them most. If a filing being
presented to the secretary of state is deficient in some manner, a service company
representative can fix the document right there at the secretary of state's office.
For instance, if a referenced date of incorporation is inaccurate, the representative
can call you and recommend the change. You approve it over the phone. They make
the change in the secretary of state's office and the filing is made without rejection.
Accountability Calling a secretary of state's office
directly can be unreliable and you may not be familiar with the person on the
other end of the phone. Asking to whom you are speaking doesn't ensure accountability
with a state worker. They may just not care if faulty information causes you professional
embarrassment or a client's delay. Service companies generally want your business
and they care. Information is more likely to be correct and when it is not, there
is accountability. Cost and Time Efficiency Service
companies charge one retrieval/service charge for retrieving a document so long
as the correct company name and jurisdiction is initially provided. Charges are
not incurred for cost of transportation or waiting time if the right record cannot
be quickly located. Service companies also front the fees for document retrieval
so there is no need for petty cash, expense reports or ordering a check from accounting.
- Using
the Resident Agent
Filing incorporations, formations and qualifications
with the service company that is providing resident agent services saves a step.
The company will immediately pick up the appointment, open a file and bill for
services from the filing. If another service company is used for the filing, you
will need to notify the resident agent that it has been appointed to serve in
a particular jurisdiction. Send an original and at least one copy to the service
company. Request the copy be date-stamped by the filing officer and returned to
you. Best
Practice Tip: If the name of the corporation has been reserved by a company,
it is important to use that company for filing. Otherwise, the service company
who has reserved the name must release the name before the other service company
may file. - Filing Fees
Unless your firm provides
a checkbook for you to write checks for the exact amount or your client has provided
a check, letting the service company advance the fees is a time-saving measure.
- Confirmation of Filing
Make sure the service company
understands that you want confirmation of the filing. Providing an extra plain
copy of the filing with the documents to be filed can be date-stamped and returned
to you for evidence of filing. Ask your service company to provide a date-stamped
copy or some other evidence of filing. - Are You In a Rush?
Call your service rep and get the address of the out-of-state office that
will receive your filing so that there is no time lost in additional shipments
(from the Delaware office to mail a filing to Nebraska, let's say.) - Fax
and E-Filing
Ask your service rep if fax or e-filing is an option.
- Conformed Signatures
While we wait for electronic and digital
signatures and online filings to become standard, conformed signatures can be
very helpful. Essentially, a conformed signature denotes that the signature on
file. This option can be a lifesaver if all the signature on the fax is illegible.
A proper format for conformed signatures is shown below. To see if the state you're
working on accepts conformed signatures, check LeapLaw's 50 state pages.
Sample Conformed
Signature: | /s/ John Doe John Doe, President |
- Filter Information
Don't take everything a
customer service representative says as truth. Customer service representatives
in service companies consider themselves to be experts and many of them are a
fantastic resource. If you are not familiar with the representative you're speaking
with, think about the answers. Think about what you need. Make sure you ask if
expedited service is available if you need quick-turnaround. You may check citations
at LeapLaw's Corporate
Connection (corporation), LeapLaw's LLC
Connection (LLC) . Remember, it is your job (and crucial to your reputation)
to be sure that the information you are about to rely on is indeed reliable.
- Don't take NO for An Answer
If you feel inaccurate information
has been provided or a quoted filing fee is too high or any other uneasiness,
you may want to (a) verify the information with another service company, (b) check LeapLaw's 50 state pages (c) or call the Secretary
of State directly.
- Extended Hours
Though local
service company offices typically close at 5:00 EST, the Delaware offices of service
companies may be opened until 8:00 EST in order to service the west coast. If
you are an east coast client with a question after 5:00, you may typically call
the Delaware office of your preferred service company after until 8:00 p.m. EST.
The opposite holds true for west coast legal professional who may be in the office
early. Paralegals and attorneys form relationships with
customer service representatives based on reliability, trust and past performance.
Each service company has something to offer and which company is used tends to
be a personal preference. That being said, it is wise to use more than one service
company so that in the event you need to verify information, you'll know someone
else to call and if your favorite service company severely disappoints you, you'll
have someone you're familiar with to call. Every legal professional
should have a strong relationship with a registered agent customer service representative.
Prior to filing a trademark or service mark application
with the US Patent Trademark Office, trademark searches may be performed to help
assure that a similar trademark, particularly deceptively similar, is not already
registered.
A preliminary trademark searches may be done at the
LeapLaw's Intellectual
Property Connection. More information than can be provided on a preliminary
search may be obtained from trademark search companies.
A popular trademark search ordered from these
companies is called a "full search" which is a comprehensive search
of the proposed trademark against current federal and state registrations, common
law trademarks and domain names. The search provides information necessary to
determine any potential infringement risks and conflicts concerning proposed marks
that will be used or registered in the US a full search costs approximately $300
for a 5-day turn-around. Expedited services are available for a premium fee. More
information on trademark and service mark filings and searches can be found at
LeapLaw's Trademark
and Service Mark Best Practice Summary.
SEC document such as Forms 10-K, 10-Q,
Schedules 13D and other SEC filings may be retrieved online at SEC
Search EDGAR.
Documents filed
prior to May 6, 1996 or filed via paper may be obtained using:
Thomson
Financial (800) 983-4636 Washington Service Bureau (800) 955-5217
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