REGISTERED/RESIDENT AGENT, STATUTORY AGENT
Vital preliminary notes: (1) You have the right to name your own registered agent regardless of who forms your company (2) You can change your agent (normally at no cost or inconvenience to you) if your present agent is too expensive or less reliable than you would like.
A case in point: theirTV ads tout inexpensive incorporation, but should you let LegalZoom (at $159 per year) be your registered agent when there is (as an example) a thoroughly reliable alternative available at $99 per year? The store you like for its advertised specials often makes up for them with the other things it sells to you.
Back to the topic. Move on if the following is familiar to you.
As an almost universal rule, states require corporations and LLCs to have an agent, corporate or otherwise, who is a resident of the state in question before permitting those corporations to do business in the state in question. This rule applies to people who are incorporating in the state where they live ("domestic" corporations or LLCs), as well as to "foreign" corporations or LLCs ("foreign" corporation/llc means a corporation or LLC formed in another state or in a foreign country) who seek to do business in the state in question. As to domestic corporations or LLCs, the rule applies because such entities have no physical existence, and there must be a live person upon whom service may be made.
For now, we want to deal simply with the rule as applied to foreign corporations or LLCs. For example, if you are an Ohio corporation and you want to do business in Illinois, Illinois law requires that you have a person or company who is a resident of Illinois to act as your agent in Illinois, so that residents of Illinois who have a complaint against you can serve papers on your Illinois agent just as if they were serving the papers on your Ohio corporation. When you agree to appoint your Illinois registered agent (as you must if you want to do business in Illinois) , you are agreeing that service on that Illinois registered agent confers jurisdiction on the Illinois courts to consider such complaints.
From your standpoint then, this registered agent requirement is a necessary evil. You don't really want to be sued in Illinois (or anyplace else, for that matter), but if you want to do business in Illinois badly enough, you agree (as you must) that Illinois residents who have a gripe against you can have that gripe considered in their own state courts, rather than chasing you back to Ohio. Similarly (in the case of domestic corporations or LLCs), the state wants to be certain that its residents will be able to sue your company in their own state, without permitting you to the raise lack of jurisdiction to prevent this from happening. This is accomplished by requiring that you have a registered agent, which constitutes your agreement that service upon your company's registered agent is service upon your company. For this reason, the question of who will be your registered agent is an important question.
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