Chapter 3 - § 3.1 • GENERAL REQUIREMENTS FOR FORMING LIMITED LIABILITY COMPANIES, PARTNERSHIPS, LIMITED PARTNERSHIPS, OR LIMITED LIABILITY PARTNERSHIPS

• Jurisdiction: Colorado

§ 3.1 • GENERAL REQUIREMENTS FOR FORMING LIMITED LIABILITY COMPANIES, PARTNERSHIPS, LIMITED PARTNERSHIPS, OR LIMITED LIABILITY PARTNERSHIPS

§ 3.1.1—Statutory Filing Requirements — General

Part 3 of the Colorado Corporations and Associations Act (CCAA) applies to every document that is required or permitted to be filed in the records of the Secretary of State.¹ One requirement of part 3 is that "[t]he document shall state the true name or true names, and mailing address or mailing addresses, of any one or more of the individuals who cause the document to be delivered for filing, but the document need not state the true name and address of more than one such individual."² Further, part 3 provides that:

Causing a document to be delivered to the secretary of state for filing pursuant to this part 3 shall constitute the affirmation or acknowledgment of each individual causing such delivery, under penalties of perjury, that the document is the individual's act and deed, or that the individual in good faith believes the document is the act and deed of the person on whose behalf the individual is causing the document to be delivered for filing, taken in conformity with the requirements of this part 3, the constituent documents, and the organic statutes, and that the individual in good faith believes the facts stated in the document are true and the document complies with the requirements of this part 3, the constituent documents, and the organic statutes.³

Note that the quoted statutory language requires that, in the case of, for example, an entity formation document or an amendment to an entity formation document, the delivery of the document or amendment constitutes the affirmation or acknowledgment under penalties of perjury of each individual causing the delivery that the "individual in good faith believes the document is the act and deed of the person on whose behalf the individual is causing the document to be delivered for filing." Accordingly, if an attorney puts his or her own name down as the person causing the document to be delivered for filing, the attorney should take care to be sure the filing has been properly authorized in accordance with the statutory requirements for approval of various documents to be filed with the Secretary of State.⁴

As part of amending Title 7 to facilitate the Secretary of State's online filing system, the implementation of which began in 2004, CCAA § 7-90-302(1) was amended to permit the Secretary of State to prescribe and require forms and cover sheets for any document that is permitted to be filed with the Secretary of State. CCAA § 7-90-302(2) provides that any required form or cover sheet is deemed to be part of the filed document that uses such form or cover sheet, and that information in such form or cover sheet controls over any contrary information contained elsewhere in the filed document, including in any attachment describing "[a]ny other matters relating to the limited liability company or the articles of organization the persons forming the limited liability company determine to include therein."⁵ For example, if the information entered in the online articles of organization states that management of the LLC is vested in one or more managers,⁶ but the attachment states that management of the LLC is vested in the members, the information entered in the online articles of organization and not in the attachment controls, and the LLC will be manager-managed. As discussed in § 3.2.2, "Management of LLCs — Manager-Managed or Member-Managed?," the distinction between manager-managed and member-managed has significant consequences.

§ 3.1.2—Statutory Requirements for Forming a Limited Liability Company, Partnership, Limited Partnership, or Limited Liability Partnership

Limited Liability Companies

A limited liability company is formed by delivering articles of organization to the Secretary of State.⁷ The articles of organization must state:

• The LLC's name and principal office address;
• The registered agent name and address;
• The true name and mailing address of the person(s) forming the LLC;
• Whether the LLC is manager-managed or member-managed; and
• That there is at least one member of the LLC.⁸

C.R.S. § 7-80-204(1)(h) also permits (but does not require) the articles to disclose "[a]ny other matters relating to the [LLC] or the articles of organization the persons forming the [LLC] determine to include therein."

Partnerships

General partnerships may still be formed by a handshake under CUPA;⁹ no filing with the Secretary of State is necessary. Indeed, formation does not even require a handshake: § 7-64-202(1) states that "the association of two or more persons to carry on as co-owners a business for profit forms a partnership, whether or not the persons intend to form a partnership" (emphasis supplied).¹⁰

Limited Partnerships

Formation of a limited partnership requires the filing of a certificate of limited partnership with the Secretary of State.¹¹ All general partners must approve the filing of the certificate of limited partnership.¹² A limited partnership formed at any time under CULPA will be governed by either CUPA or CUPL for any case not covered by CULPA; however, all limited partnerships formed after August 10, 2016, will be governed by CUPA for any case not covered by CULPA.¹³ A limited partnership formed on or before August 10, 2016, that does not elect to be governed by CUPA will be governed by CUPL for any case not covered by CULPA.¹⁴

C.R.S. § 7-62-201(1) sets forth the information that a certificate of limited partnership must include:

• The limited partnership's name and principal office address of the limited partnership's initial principal office;
• The registered agent name and address;
• The true name and mailing address of each general partner LLC; and
• That there are at least two partners in the partnership, at least one of whom is a general partner.

C.R.S. § 7-62-201(1)(e) also permits (but does not require) the certificate of limited partnership to disclose "[a]ny other matters relating to the limited partnership or the certificate the general partners determine to include therein."

Limited Liability Partnerships and Limited Liability Limited Partnerships

General partnerships may become limited liability partnerships (LLPs), and limited partnerships may become limited liability limited partnerships (LLLPs), by filing a statement of registration with the Secretary of State.¹⁵ During the period that a statement of registration is in effect, general partners of general and limited partnerships do not have liability solely by being a general partner for partnership obligations that are incurred, created, or assumed by the partnership while the partnership is an LLP or LLLP.¹⁶ Similarly, limited partners who take part in the control of a limited partnership during the period it is an LLLP will not thereby become liable.¹⁷

§ 3.1.3—What Are the Requirements that an Entity's Name Must Satisfy?

C.R.S. § 7-90-601(2) requires that the name of an entity to be formed be distinguishable on the records of the Secretary of State from every other entity name and every name that is reserved with the Secretary of State for another person as an entity name pursuant to C.R.S. § 7-90-602.

In addition, C.R.S. § 7-90-601(3)(c) requires that "[t]he entity name of a limited liability company shall contain the term or abbreviation 'limited liability company', 'ltd...