Nevada Corporation Strategies

Mortgage-re-financing

North American Companies,

July, 2006
California Investors Acquired Proven West Texas Oil and Natural Gas Reserves.
Today North American Companies announced it has closed on the purchase of the Kerrville based Oil and Natural Gas company. The partners Peter Woodard and Michael Llamas announced that they intend on drilling on the 27,000 acre as soon as possible while reworking existing wells. The proven reserves at the time the partners had contracted to purchase the company was at $29.00 a barrel and was worth in excess of $3 Billion Dollars according to the study conducted by Nova Resources, a leading Certified Petroleum engineering, exploration and geological firm located in Dallas Texas. Calculating that into Today’s Price of $69.50 a barrel, the reserves are worth nearly two and a half times that amount. The Partners today announced that they will privately finance the company without any outside capital. The partners have kept local Oil and gas Entrepreneur Crag Vankirk on as President of the company. Mr. Vankirk said today that he is “Pickled that the oil market has continued to rise steadily over the past few years and at a costs basis of less than $10.00 a barrel for us to produce ,We cannot afford to sit back at prices like this, who knows how long prices will remain this high”. Craig also stated that the company is actively looking for more properties and production packages to acquire.
For more information please contact Craig Vankirk at Cvankirk@casoilandgas.com

November, 2005
Real Estate Handy Capping!
Foreclosure and Trustee Note Buyers Michael Llamas and Peter Woodard announce today the purchase of over $50,000,000 in California distressed real estate this year, and at a time when properties are increasing a double digit number per quarter. What makes this a great story is not the number of properties Michael and Peter have been able to acquire but how they have been able to acquire them, the background of their team, the partners, the timing of the market, and the story of how the partners came together and started purchasing distressed real estate in a market like this when distressed undervalued deals are unbelievably hard to find and purchase at any significant discounts. That makes for hard Work!
To start this story off Peter Woodard has been a principal of an international produce brokerage, supplier, shipping company, grower and contract seller for over 25 years. He has also for the past 25 years purchased real estate privately. He is a strong minded, reserved and seasoned businessman. Michael Llamas is a young, witty, deal maker with an eye for a great buy. Michael has spent the last few years purchasing foreclosures and trustee sales with family and since then has amassed quite a track record for himself. He acquired his first property less than a year outside of high school. Peter was one of Michael’s first partners and since acquiring their first property together, have set out to change the way real estate is purchased. The two call the process “wholesale” with a handy cap! A term not too often used when talking about Real Estate. They call it wholesaling because every deal they purchase has to have enough of a discount so they can afford to sell the property at 10-20% below the current market value, and they call it handy capping because they have to take into consideration all of the variables that can affect the purchase, the remodel, the hold, the sell then they discount their purchase to reflect the necessary costs associated with the different sales and hold strategies.
I find it fascinating that in a market this fast paced, with values continuing to increase as fast as they have been, that the pair continues to sale, their properties at below market prices. When asked why they sale the properties below market price Michael stated “were risk adverse and we want to have a guaranteed exit for our homes right away, we don’t want to hope for someone to purchase our homes, we want to know, that’s why we purchase properties at large enough discounts and sell them at a Wholesale price, and we call that Wholesale with a handy cap.”
After looking at the properties they have been able to purchase, I need to evaluate the way I have been buying!
-P.Singh

August 1, 2006
Property Line to Invest in Clarion Hotels.
Real Estate and distressed opportunity company, PLI to invest in Clarion Hotels in San Jose California. The company is led by Partners Michael Llamas and Peter Woodard. The partners have agreed today to capitalize the local Hotel Chain and its San Jose based holding Companies Rosemary Land Co, Delta Hotel Group and other related entities with the necessary capital to expand the company’s position into three additional properties. Delta Hotel group owned by Noor Billawala was unavailable for comment. The Hotel group per public record has 6 properties in the Greater San Jose area consisting of several lots parcels, a golf course and driving range and hotels. The portfolio is estimated to be valued in excess of $300 Million Dollars. The PLI Partnership said today that the Hotel Groups position on their assets is all in areas with tremendous growth and have little leverage. PLI plans on acquiring additional positions in the company as well as the surrounding real estate parcels.

March, 2007
Tahoe, Nevada
Heavenly Ski Resort Condominium Projects to be acquired
Today LW Premier Holdings announced it has reached an agreement to acquire a condominium project in the Heavenly Ski Resort, located in Tahoe Nevada. The company owned by North American Companies principals Peter Woodard and Michael Llamas plan on selling the units over the course of the next few months. The project was acquired for just over $4 million dollars. LW Premier plans on selling the units below retail market value in order to sell the units over the next few months and create demand. The company said it currently has sales reservations on half of the units prior to the closing. LW Premier Holding specializes in the acquisition and repositioning of distress real estate throughout the United States.
To contact LW Premier Holdings please email Arleen@LWPremier.com

December, 2007
Phoenix, Arizona
California Based distressed real estate Buyout Company to acquire a rolling option on Mountain Canyon Condominiums in Phoenix Arizona from Florida based Sunvest Communities. LW Premier Holdings signed a contract to acquire the remaining units located in the exquisite Mountain Canyon Condominium complex today. The deal worth over $17 Million dollars is set to close in several phases over the next few months. LW stated that the market is right to acquire projects that allow you to reposition them for Wholesale liquidation. LW is actively acquiring options on well positioned projects over the next few years in anticipation of a softening market. LW said that it has presold the first phase of its acquisition to wholesale buyers and anticipates doing so on the subsequent phases as well. LW Premier Holdings is a subsidiary of North American Companies of San Francisco, which is owned by Michael Llamas and Peter Woodard.

Founding Partners

Peter Woodard

President and Co-Founder

Steven Llamas

Co-Founder

Michael Llamas

Chief Executive Officer and Co-Founder

Legal Department

Michelle Sides, Esq

Vice President and General Counsel

Executive Team

Peter Woodard

President and Co-Founder

Michael Llamas

Chief Executive Officer and Co-Founder

Michelle Sides, Esq

Vice President and General Counsel

Zion Jerge

President of Acquisitions

Managing Partner, Regency Capital Partners

Vernon Darrimon

Vice President, Business Development

Managing Partner, North American Acquisitions

Kim Carranza

Operations Manager

Steven Llamas

Co-Founder

Gary Ciampi

President, Montgomery Stone

Acquisitions and Dispositions

Neil Malkin

Business Development

North American Exchange

Michel Piette`

Principal, President of Finance

North American Finance

Abderrazak “Abdou” Boughanmi

Senior Partner

North American Partners

Dana Wolfe

Director Of Operations

North American Partners

Laila Merchant

Acquisitions Manager

South East Division

Michael Zuliani

Principal

North Rock Holdings

Lance Burt

Principal

North Rock Holdings

Bruce Christy

Director

North American Acquisitions

Jayme Moffett

Director

North American Global

Lloyd McFarlin

Director

North American Global

For more more information on the executive team or individual biographies please email Legal@northamericompanies.com

Contact

Thank you for taking the time to visit North American Companies corporate website. Below you will find North American Companies office locations and Contact information.

Corporate Offices

North American Acquisitions

425 Market Street, 22nd Floor

San Francisco, California 94105

Telephone: 1-877-80-NAACO

Facsimile: 1-866-763-6414

11501 Dublin Blvd, Suite 200

Dublin, California 94568

Telephone: 1-877-80-NAACO

Facsimile: 1-866-763-6414

North American Finance Co

1000 de la Gauchetiere, Suite 2400

Montreal, Quebec, Canada H3B 4W5

Telephone: 514-448-5030

Facsimile: 514-448-5101

North Rock Holdings

6260 S. Rainbow Blvd. Suite 100

Las Vegas, Nevada 89118

Corp Office: 1-877-80-NAACO

Toll Free: 1-877-415-2111

Facsimile: 702-314-2811

For mailing addresses, Overnight Service, or Service, please call for instructions. Some locations will not sign for delivery.

http://www.michaelllamas.com/

http://www.northamericompanies.com

RSS feed: http://www.michaelllamas.com/index.xml

Positioned for Takeover

Some Juniors are More Keen than Others for a Partner or Buyout

By Melissa Pistilli, Resourcex.com

The female lion, when attempting to attract the attention of the male, adopts a seductive position: belly pressed hard to the ground, hindquarters prominently displayed, her tail swept anxiously to the side. In the animal kingdom this tempting act is known as â??presentingâ??. While the actions of most junior exploration companies are not as base as this, some are keen to position themselves to best expose their assets if the right partner comes along.

The large financial burden and necessary experienced management involved in taking an exploration project to full production makes such mergers a natural and economically wise decision. The playing field has changed dramatically since many of the larger companies like Barrick Gold Corp. or Tech Cominco were first breaking ground.

â??Itâ??s a very different process,â? said John E. Watson, CEO of Pan-Nevada Gold Corp. â??The small minor canâ??t do it anymore. If youâ??re going to compete in that universe you have to be able to compete on a level footing with [the bigger companies]. You need an operation thatâ??s big enough and sophisticated enough so that you can attract the right kind of people to operate it.â?

Last Thursday, after only four months of takeover negotiations and a near unanimous vote on March 27, Pan-Nevada Gold became a fully owned subsidiary of Midway Gold Corporation [MDW: TSX V.]. Both Watson and Midwayâ??s President and CEO, Alan Branham have described the acquisition as mutually amiable. And it certainly is mutually beneficial, as well.

Two of Pan-Nevadaâ??s properties are conveniently located near Midwayâ??s Spring Valley and Midway projects. The Pan Project reported over 500,000 ounces in a 43-101 compliant resource report released February 8th of this year. By acquiring full ownership of Pan Nevadaâ??s assets, Midway has a larger resource base along with various opportunities for quick exploration and further expansion. The former Pan Nevadaâ??s shareholders will gain 28% of one Midway share (trading at $3.36) for every Pan Nevada share held (trading at $0.84). And with that comes the benefit of security that a larger more stable company has to offer.

The old real-estate adage â??location, location, locationâ? applies in the mining business, too. International PBX Ventures [PBX: TSX V.] is one junior exploration company whose location may be one of its prime advantages. PBXâ??s Chilean Copaquire property is positioned on the productive west fissure which supports some of the worldâ??s largest copper-molybdenum porphyry mines. But it is not only its geological location that makes it a clear takeover target. In a classic case of â??closeologyâ?, Copaquire is fortuitously situated between several industry heavies.

The Collahuasi mine, owned by joint venture partners Xstrata, Anglo American, and Mitsui & Co., is about 20km to the east of Copaquire. The Quebrada Blanco mine, operated by Aur Resources, is 15km to the south east. Teck Cominco owns property immediately north and east of Copaquire. To the west lies Rio Tintoâ??s Escondida project.

Gary Medford, President and CEO of PBX, says that, regardless of the obvious fact that â??thereâ??s a good chance a much larger company will be interested in taking a run at itâ?, PBX is moving ahead to put the property into production itself. â??The first thing is to define our resource on the property,â? he said. Currently, two drill programs for molybdenum on the Cerro-Moly Molybdenum zone are in progress. Last year PBX completed drilling of a leachable copper deposit on the north side of the property and is waiting for a 43-101 resource report.

The cost of bringing a project into full production today is economically unfeasible for many juniors and most hope to catch the eye of a larger company some day. But successful companies donâ??t make this their primary focus. Bill McCartney, CFO of Dynasty Metals and Mining [TSX: V.DMM], says basing your whole business plan on setting yourself up for takeover is â??a failing strategy.â? Dynastyâ??s objective is to build a successfully operating company with a valuable resource. Of course, meeting that goal will most likely attract an acquirer. â??But thatâ??s not our primary objective,â? said McCartney.

On Monday, Dynasty announced it had â??received the last of the necessary permits from the Ecuador Ministry of the Environment to construct and operate a mill capable of processing 500,000 tonnes of ore per annum at its Zaruma Gold Project, in southern Ecuadorâ? (April 16th news release). The mine will be the first operating large-scale mining facility in Ecuador.

This success is sure to attract attention similar to that now experienced by Eland Platinum [JSE:ELD]. The companyâ??s South African Elandsfontein Project is within a year of production, has 15 million oz confirmed, and the capital necessary for development. Last Friday, Eland released a â??cautionary announcementâ? that it was in â??negotiations which, if successfully concluded, may have an effect on the price of the companyâ??s shares.â?

According to Investec securities analyst Leon Esterhuizen, these conditions have made Eland an attractive buyout target.

Bill McCartney feels construction of the Zaruma mill will certainly attract the same sort of attention. â??It would be a contributing factor if someone was seriously looking at us,â? he said.

For small companies with the inability to raise the millions needed to move a plant into production and a lack of in-house experience, the idea of a takeover becomes a more viable option. But Dynasty is confident they have what it takes to move their project into production on their own and donâ??t view the heavy financial costs as a major impediment. â??In our case,â? says McCartney, â??we have a very high grade deposit [and] low capital costs. We have the experienced in-house to do it.â? Later he added, â??If we can develop our own projects and make them profitable why would we want to give it to someone else?â?

Of course, even successful companies like Dynasty with the ability to produce on their own wouldnâ??t pass up a great offer from a larger company, especially if the trade-off is more valuable shares for their shareholders.

Willis Carrier Enabled Arizona To Develop, Expand and Prosper

In 1902, Willis H. Carrier, a recent Cornell University graduate began work in a New York print shop for the princely salary of $10.00 per week. Bright, eager, ambitious and curious, Mr. Carrier fully immersed himself in all aspects of the burgeoning American printing industry. His interest in printing, and solving problems endemic to the industry, inadvertently have resulted in the population boom in states like Florida and Arizona.commercialization  and mass availability of air conditioning.consulting firm, Duquesa Marketing, reviews hundreds of new product and invention submissions each year. Most of course, do not possess the wonderful utility of a product such as air conditioning. Nevertheless there are wonderful lessons for product developers  to learn from stories such as Willis Carrier’s. The road first taken is usually not the route we wind up taking to success. Many products meander to successful mass-market commercialization. opportunities to commercialize  and maximum your ideas, concepts and inventions. They are all around you.

Mr. Carrier’s boss, the owner of the printing shop, was constantly lamenting the difficulty he experienced with stabilizing ink, paper formatting and application of typeface to paper based on temperature and humidity swings. The printing factory of the day was innately a warm, muggy environment as the machines were large, dirty and generated immense amounts of heat. Humid summer days further extrapolated the difficulties of the printing process. The result was inconsistent print quality and many jobs had to be redone at loss of profit.

Mr. Carrier was vexed by these problems and began to reflect on potential solutions. One evening, while waiting in the fog for the train to commute home, he had, as he described, “a mental vision” of how to solve the problem of heavy, moist, humid air which hampered the printing process and made life miserable for people during humid, torpid summer days.

Mr. Carrier’s solution was based on a simple realization and study of weather patterns: cool, wind, water, fog and seasonal adjustments that Mother Nature seemed to make on cue. His theorem, which was presented to the United States Patent and Trademark Office in 1906 in his patent filing, narrative and art, contained the first description of a workable prototype for a spatial air conditioner.

The original “centrifugal chiller” was not called air conditioning for several years. Mr. Carrier worked for several more years to commercialize his invention, and in 1915, with several investors having contributed $35,000, he started the Carrier Corporation. 2007 sales were in excess of $5 billion.

Willis H. Carrier created the air conditioning system with intended applications for wide industrial placement and usage. Medical products, food preparation, cosmetics, transport of spoilable products and finely calibrated machinery were a few of the markets and industries that Carrier initially targeted. The idea of using the new air conditioning system for personal comfort did not take hold until 1924. In that year, the original J.L. Hudson Department Store in Detroit installed the system and shoppers flocked to the store.

In the early 20th century Henry Flagler was building the first railroad system through Florida. At the time Florida was a relative backwater, sparsely populated, remote, with little industry other than citrus groves. The heat and humidity in most of the state was oppressive for most of east year. Mosquito’s and insects were oppressive. Windows had to be kept open to circulate the vapid, humid air.

Mr. Flager dreamt that some day Florida, Palm Beach, the Keys and Naples, would become world class resort destinations. He just needed to be able to safely; and comfortably transport visitors to the resorts he was building, and have them enjoy the wonders of Florida sunshine while the rest of the country was suffering from the winter blues. What to do about the bugs and humidity?

Arizona, much of Texas, New Mexico and Nevada were climatically challenged in different ways than Florida. Oppressive heat, no or little humidity and vast arid plains and desert made these states very difficult places to comfortably live for all but the heartiest few. Industry, technology, population growth and tourism were not likely to occur in such uninviting environments.

Henry Flager saw his opportunity to pioneer the rapid development of Florida immensely enhanced by the invention of the “centrifugal chiller”.

Finally, his vacationers could spend their days in his tourist palaces in splendor and total comfort. The air conditioner enabled people to visit and enjoy Florida, and, upon returning home, spread the word about the beaches and opportunities to live in such a place. The stampede to relocate to such a suddenly inviting locale would have been unthinkable without the invention,

Arizona and much of the southwest would still be Indian reservations, cactus and scrub ranches without Mr. Carrier’s invention. The mass migration of population to these states in the second half of the 20th century would have never been possible. Can you imaging Las Vegas without air conditioning.

Willis H. Carrier invented his air conditioning system to enable industry and manufacturers to function more efficiently. As so often happens, however, the device was adapted in ways that benefited the population in many alternative uses. Cars, planes, and trains were air-conditioned and the result was that long distance travel could be comfortably enjoyed for the first time in history. Arid and tropical environments around the world became hospitable.

Industries that we take for granted today could never have evolved without the ability to control excessive heat and climate. A silicon computer chip manufacturing facility creates huge amounts of heat that must be controlled. There could be no modern computer industry without air conditioning. The bio-technology, nano-technology, pharmaceutical and laser industries would not exist with Willis Carrier’s invention.

My marketing,

The next time you walk inside on a hot summer day, remember that the blast of comforting cool air you feel was originally meant to enable printers to more productively place ink on paper. Keep your mind open and eyes focused for alternative, hidden

Which Business Structure Is Best For You?

The type of business structure you organize for your new enterprise is greatly determined by your personality, realities, needs and experience. Millions of people in the United States never enter into any type of formal business structure. This includes the bulk of the black or underground economy. 

It is estimated that the underground economy consists of about 10% of all commercial activity in the United States. This includes legal and illegal activities. A kid cutting your grass for $20 is technically working black. The handyman that repairs your patio for cash might be working black. Drug dealers are definitely kingpins of the underground economy. 

Entrepreneurs should not want to work black, but should seek to be totally transparent for many reasons. The reason a person typically seeks to become an entrepreneur is to maximize the opportunity our capitalist system offers each person willing to try. This means playing by the rules, competing and pursuing success utilizing every available legal tool. The opportunity to sell a successful entrepreneurial business is almost zero without complete books, records and tax returns, typically details that underground business works hard to avoid.

 I recommend any new entrepreneur seek consultation with an attorney familiar with the laws and regulations of the state, county, city or township of your residence. Even if you are planning to run your enterprise as a sole proprietorship, there are local zoning laws, restrictions on business activity, public announcement requirements, DBA (Doing Business As), fictitious name ordinances, etc. Do not try to avoid the pesky forms and filings required in most localities. If compliance is a hurdle for you, then success prospects for you as an entrepreneur are probably slim. 

Your investment in the attorney consultation will pay for itself. You can go online, or visit the business section of the local bookstore and find just enough information to get yourself in trouble in these areas. Occasionally, I meet an entrepreneur that did not consult professionals, and has everything in order. This is very rare. More often, I meet shortsighted dreamers trying to cut a corner and save a few dollars. Professional help will save you time, money and mistakes. 

Here are the most common business structures that entrepreneurs have access to when formalizing their new venture. 

Sole Proprietorship 

This is the most commonly utilized structure for new, small, startup business ventures. Essentially, the proprietor, you, the entrepreneur, announces that you are working alone. The sole proprietor accounts for all income from sales as personal income and is responsible for all debts incurred by the enterprise. Personal and business funds are often commingled in this structure and need to be identifiable for tax purposes. There is no formal corporate entity, but you must adhere to all local laws and statutes. A Federal Identification Number is not needed (use Social Security Number) when filing taxes. 

Partnership 

When two or more people decide to enter a partnership, they basically agree to enter a form of marriage. We all know that marriages can get messy. Partners must minimize any possibility for a messy divorce by creating a partnership agreement that details what each partner brings to the opportunity (investment, sweat equity, intellectual property, etc.). Also, the partners responsibilities (silent, working, sales, marketing, production, etc.), and an agreed split of income, profits and harvest, as well as liabilities and losses. 

I like, and often recommend, a partnership for young entrepreneurs with limited, narrow experience. Operations experience often does not translate to sales and marketing for instance. The only imperative is that there are no surprises after the enterprise succeeds, or fails. This when a cloudy division of liabilities or profits often becomes problematic. 

Limited Liability Corporation (LLC) 

Again, there are “do it yourself” methods of creating LLC’s. Use an attorney. I am no friend or fan of the legal profession. I am not a lawyer, either. I just know from experience that this is difficult: and often a contentious area of law that requires expertise.

An LLC limits the owner’s exposure to some losses. The LLC also enables the owner to treat income beneficially for tax purposes. Professional legal and accounting assistance is really important in establishing the LLC in a proper legal format.

Corporation

The Corporation offers the most comprehensive protection for the owners. Losses accrue to the Corporation, in most cases. The Corporation assumes the role of a person, even though abstract. A Corporation requires the filing of Articles of Incorporation in a state. Consult an attorney for advice on which state to file this document. Nevada offers secrecy. Delaware is most popular for large corporations. Each state has different fees and requirements. Get good help!

The Incorporation requires a fair amount of housekeeping. This includes appointing a board of directors, keeping meeting minutes, issuance of stock, etc. Many startups convert to corporate status after achieving some amount of success.

There are other intricate options, trusts and arcane structures available. However, for 99.9% of all entrepreneurs the four discussed here offer the best vehicles for properly structuring a new business. Approach each with the goal of maximizing your income and minimizing your time commitment to housekeeping the entity you choose. Remember: in order to be successful as an entrepreneur will require every scintilla of your thought, work and creativity to be concentrated on your project.

Series Llc: Where Angels Fear To Tread

There’s a lot of talk about Series LLCs. More and more people are wondering if they’re a smart idea. The short answer is that they aren’t – they haven’t been tested, giving them limited applications if they have any at all.

First, some background. LLCs alone are an excellent structure for many different uses. For instance, they work well as a method of holding high dollar assets like real estate. If you own commercial or rental property, it’s important that you hold title to that property in an entity. If this entity (most likely an LLC) is run and managed properly, it can protect you from any personal liability.

Many people own a number of different investment properties. They want to protect both their investments and themselves by placing them into one or more LLCs. The task then is scenario, every investment is held under a different LLC. That’s not a popular answer for people who have lots of investments, but it’s built on sound reasoning. Think of LLCs as giant shoeboxes. As many investment items as you like can be placed inside, but they’re all at risk if something happens to the box. If a lawsuit happens, every investment you’ve placed into that LLC will be in danger.

The solution is to separate your investments. Ideally, you should use a separate LLC for each one. If you can’t, be sure to examine the equity you have at stake in every investment along with its liability potential. Then group them in LLCs accordingly. As an example, it’s not a good idea to include a single family beach front rental in Maui in the same LLC as a duplex on the wrong side of town. You may have several thousand dollars of equity stored in the house on Maui, which is placed at risk by including it in the same LLC as the rough edged duplex. Keep them separate. However, if you own three single family homes in Idaho, each within about twenty thousand dollars of equity, you might feel that placing them together is an acceptable risk. But that segregation strategy can get expensive.

If you have ten properties, using ten different LLCs might seem confusing and costly. Series LLCs seem to provide a solution as statutes in certain states allow you to create separate series within a single LLC, the debts and liabilities of which are only enforceable against that series. These laws allow LLCs to establish separate series of interests, members and managers, giving them separate duties, powers and rights. Those include the rights to profits and losses with respect to specific property and obligations. In states that have this kind of enabling legislation, each series within the LLC works as a separate entity under state law. This is why many people are attracted to series LLCs – they theoretically have the ability to shield property in different series from liabilities incurred in or against one another without paying state fees for multiple entities. This means that an LLC containing two properties can choose to place each into a separate series, so that liabilities from one can’t cause problems with the assets of the other. (Remember the same effect can be created using two different LLCs to hold these two properties.) Many people prefer series LLCs because at first glance they appear to be cheaper to set up. However, this assumption is false. It’s actually more complicated to set up a series LLC, making it more expensive than the basic type. In California you might find a series LLC appealing because the Franchise Tax Board charges an annual fee of eight hundred dollars for each entity. Many people think that setting up a single series LLC means paying only one fee in California. However, the Franchise Tax Board takes the position that each series counts as its own LLC for fee purposes, meaning you’ll have to pay the same whether you set assets up in series or in their own separate LLCs.
The biggest problem with series LLCs is that many states (including California) don’t have series legislation and may choose to ignore the laws of the state where the series was created. That’s because you’re subject to their rules when doing business in their state. The example of the attitude of the California Franchise Tax Board applies to fees, but liability protection is also an issue. Since series LLCs are so new they’ve never been tested by courts, even in the states that permit them. That means there’s no guarantee that limited liability protection will be extended to each series until every state rules on the subject. It’s hard to see how a court would choose to grant this kind of protection inside one entity, and only time will tell if courts will do this. But do you want this type of uncertainty when you are trying to protect your assets?

Again, one should be concerned about how series LLCs will be treated by the states that don’t have laws permitting them. If you set up a series LLC in Nevada then register it as a foreign entity conducting business in the state of Massachusetts, each series in the LLC own a separate piece of property. If there’s a lawsuit in regards to one of these properties you can’t be sure that the Massachusetts court will honor the series structure of the LLC, applying Nevada’s law to the real estate and activities that are located in Massachusetts. If they do, the claimant can collect only against the property in that series. If they don’t, the claimant can collect against the properties in other series as well. States are expected to give full faith and credit to legislation of other states, but the answer is uncertain. Exceptions do happen. It is also important to note that the American Bar Association did a review of series LLCs and declined to endorse them. You can be certain that future court cases will take note of this development.

Since the laws about creating series LLCs are different in every state that permits them, it might take a long time before enough case law is accumulated to give us any level of comfort about using them. If you want to make sure your assets have good, solid protection, it’s a much better idea to avoid corporate structures that don’t provide reliable protection. Avoid series LLCs as a form of protection until a definitive case law is established and rely instead on known, tested entities such as individual LLCs.