Preferred Stock Checklist by kle20980


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Please complete as many items as possible. This information will be used to prepare the various
documents needed to incorporate, so the information must be accurate. If the residence or mailing
address is entered once, you do not need to enter it again.
Names must be the legal names of the persons who are to be shareholders. Those who wish to use
middle initials or middle names, please fill those in.
Addresses are street addresses. If there are no street addresses, please indicate "None"

1.     Client 1 Name             ________________________________

       Client 1 Res. Address _________________________________

       Mailing Address        ________________________________________

2.     Client 2 Name             ________________________________

       Client 2 Res. Address __________________________________

       Mailing Address        ________________________________________

3.     Client 3 Name             _________________________________

       Client 3 Res. Address __________________________________

       Mailing Address        ________________________________________

Give preferred names for corporation - first choice name may not be available

4.     Corporation Name
       First Choice                   _________________________________

       Second Choice                  ________________________________

4A.    Give at least one person who will sign the Articles of Incorporation which are filed with
       State DCCA to create corporation.


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5.     Duration


6.     Corporate Seal. Will corporation have a corporate seal?

       Yes (      )    No (     )

7.     Incorporators (list names and if not shareholders, list addresses




8.     Directors and Officers

Officers (check applicable officers)

       President       ( )
       Vice President ( )
       Secretary       ( )
       Treasurer       ( )
       Other officers (write in)      _____________________________

Provide number of directors. Minimum number if only one shareholder is 1 director, if two
shareholders minimum 2 directors, if three or more shareholders, minimum 3 directors; no
maximum. At least one director must be Hawaii resident

        8.1.   Number of Directors      _____________

        8.2. Initial Directors and Officers and residence addresses (under position, use P for
President, V for Vice President, S for Secretary, T for Treasuruer, D for Director., e.g., for person
who is President, Treasurer and Director, write P/T/D. One person may hold several offices).

       Name                     Office Residence Address
1.     _____________________________________________________________
2.     _____________________________________________________________
3.     _____________________________________________________________
4.     _____________________________________________________________

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9.      Stock

        9.1.    Common Stock type (par value or no par)         _______

                If par, par value (per share) $________________

        9.2.    Initial capitalization

                $1,000                   ___________

                or Other amount          ___________

        9.3.    Initial shareholders and residence address



                (add sheets for additional)

        9.4.    Other provisions for common stock (describe)


If you wish to have preferred stock, describe the desired features of that stock.

        9.5.    Preferred Stock type (describe)


        9.6.    Preemptive rights (yes or no). Unless specified, there are no preemptive rights

                Common stock             Yes (    )     No (    )
                Preferred stock          Yes (    )     No (    )

        9.7.    Stock redemption provisions

                Do you want to restrict stock transfers or require stock be returned to the corporation
                      in certain cases?

                Yes (    )        No (   )

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               If yes, describe desired restrictions to apply on lifetime transfers, on disability
                        or retirement, whether gifts to family should be restricted, on death of


If Nakamoto, Okamoto & Yamamoto to obtain federal identification number and State
identification, provide following information. Otherwise provide name of person to obtain such
identification numbers.

10. SS4 and State BB1 forms.

       10.1.   Person signing applications and corporate office (with social security number)


       10.2.   Nature of business ______________________________

       10.3.   Anticipated start date of business _______________

       10.4.   First date corporation has employees _____________

       10.5.   Maximum number of employees first 12 months ______

               Type of employees” agriculture (         )        non-agriculture (     )

               Other employees (describe)       ____________________________

       10.6.   End of tax year if not calendar year     _____________

       10.7.   GET frequency of reporting _______________________

If S election to be made, the S election applies to income tax treatment of corporations and
shareholders. If you are not sure, indicate not sure.

11.    S election      Yes (    )      No (     )       Not sure (     )

       11.1.   If yes, are all shareholders qualified shareholders (yes or no)
               Yes ( )           No ( )         Not Sure ( )

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      11.2.   Any shareholders not individual persons          Yes ( )     No ( )
              If so, describe type of entity of non-individual shareholder

      11.3.   Names, residence addresses and social security numbers of all shareholders.




      10.4.   List names of any shareholders not US citizens or US resident aliens

      10.5.   If corporation to use non-calendar fiscal year, state reason


      10.6.   Name and address of CPA for corporation


11.   BE 13. If any shareholders nonresident aliens, who will file BE13?

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                        Corporation Intake Formation Checklist Instructions.

Item 4. Fill in the preferred names of the new corporation in the order of preference. One of the
following should be the last part of the name: Inc., Incorporated, Ltd., Limited, Corp., Corporation.
We will check on the availability of the names. It is possible to reserve the corporate names.
However, if that is done, the incorporation will be delayed until the reservation is made by the State
DCCA and there will also be increased filing fees. Unless you direct otherwise, we will check on
the State DCCA website and will use your choice of name which does not conflict with the names
on the website. However, there is a risk that the name is not shown on the website or that it may be
taken before the Articles of Incorporation are processed

Item 5. Almost all of the corporations we now form say the duration is perpetual, but it is possible to
limit the term to a date certain.

Item 6. There is no legal requirement for a seal for a Hawaii corporation, but one can be ordered if
you wish.

Item 9.2. The corporation must have at least common stock with a minimum of $1,000
capitalization. Many corporations are still formed with a par value per share of stock (usually from
$1 per share to $100 per share). The corporation can issue stock with no par value. Most of our
corporations do not have any preferred stock, but if that is desired, the terms of the preferred stock
must be set

Item 9.7. In many cases, owners of closely held corporations prefer to limit the ability of
shareholders to transfer stock. These provisions may be inserted into corporate bylaws or in separate
agreements between shareholders and the corporation.

        The restrictions on lifetime provisions commonly seek to limit such transfers to amounts
approximating the actual investments made in the corporation by shareholders, so absent contrary
instructions from you, the bylaws will require shareholders who wish to transfer stock in their
lifetimes to offer such stock back to the corporation for its book value. The bylaws do not cover
situations involving the disability or retirement of a shareholder. Provisions can be added to require
stock to be redeemed in those situations as well. The bylaws also provide that the estate of a
shareholder must offer the stock to the corporation at its fair market value at that time. Although
book value could be used in this situation as well, the present federal estate tax law will impose the
federal estate tax based on the fair market value of the stock, so the standard bylaws use fair market
value on death situations.

        If the corporation wishes to provide for retirement benefits to shareholder employees by
stock redemptions, the bylaws provisions should probably be replaced by agreements between the
corporation and shareholders. The same applies if shares are to be redeemed using life insurance

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proceeds. In those situations, the income tax consequences usually favor redemptions by
shareholders rather than the corporation and an agreement is usually the better vehicle to use.

        Pre-emptive rights give existing shareholders the right to purchase any future stock issued in
order to keep their share in the corporation from being reduced by the issue of that stock. Unless
you specify otherwise, the corporate documents will not create preemptive rights.

Item 10. This information is needed if Nakamoto, Okamoto & Yamamoto is to prepare the income
tax forms for identification numbers and the S election for income tax purposes (SS4 and BB1 forms
and 2553 forms for S corporation elections). Some of our clients have their accountants take care of
these forms. Those forms and any tax advice that may be needed are not part of our standard
services for setting up a corporation and there will be additional charges for that work. If we do this
work, we prefer to consult with your CPA before doing so. It is our usual practice to ask clients to
discuss this with their CPA as soon as possible.

Item 10.2. Please fill in a purpose as specifically as possible. The Articles of Incorporation will
include language to allow the corporation to carry on any other business that a corporation can do in
Hawaii, but the specific purpose(s) should be spelled out as well.

Item 11. If an S election is contemplated, we must have the social security numbers of the
shareholders since the IRS Form 2553 requires that information. If the new corporation is to be a
corporate subsidiary, the S election for income tax is not available. If an S election is desired, we
will need to check with you further on whether there will be any ineligible shareholders. In this
respect, please note that the state income tax law allows S treatment on the Hawaii income taxes but
only for Hawaii residents. We recommend that the CPA for the corporation be consulted. The S
election is an income tax election and there are a number of factors such as fiscal years and
applicable income tax rates which the CPA who will prepare the income tax returns is best suited to
consider for you.

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