Scope of Services for Entity Reviews
Highland Law Corporation (the “Firm”) offers pre-defined entity review services (“Entity Reviews”) to LoanDocSolutions (“LDS”) customers at scheduled flat fees (“Scheduled Fees”). The current Scheduled Fees, terms and scope of services for Entity Reviews are set forth on this web page. The Firm reserves the right to revise the Scheduled Fees, terms and scope of services for Entity Reviews from time-to-time. Unless otherwise agreed by the Firm, the current Scheduled Fees for Entity Reviews are: $525 for one entity, plus (if applicable) $265 for each additional entity to be reviewed in a particular transaction.
All requests for Entity Reviews must be submitted by a client of the Firm (“Client”) via the LDS customer website. Accordingly, Client must be an LDS customer with login access to the LDS customer website in order to submit requests for Entity Reviews. By submitting an Entity Review request, Client agrees that the Firm’s Entity Review services (whether charged at Scheduled Fees pricing or on an hourly basis) shall be limited to the terms and scope of services in effect at the time the request is submitted by Client.
The full amount of the Scheduled Fees for Entity Reviews, including rush surcharges, if applicable, shall be fully earned at the time the Firm first begins work on any Entity Review matter, regardless of whether Client thereafter instructs the Firm to stop work on the matter or cancel the Entity Review request. No refunds or discounts are available for Entity Review matters that are cancelled if any work has been commenced on the matter at the time the notice of cancellation is received by the Firm.
The scope of pre-defined Entity Review services consists of the review of entity documents provided to the Firm in order to determine suggested signatories to loan documents on behalf of entity borrowers, sub-entities and/or entity guarantors.
The Firm will issue an email to Client with the suggested signature blocks. The Firm’s signature block email may also note any member, director, officer and/or partner approvals the Firm deems necessary to authorize the execution of the documents by the entity(ies) in question. The entity review email is based on the limited review and subject to the limitations described in these scope of services and does not constitute a legal opinion of the Firm (which would involve much more extensive due diligence and formality as well as significantly higher fees). Firm attorneys are licensed to practice law in the state of California only. Any comments or suggestions in entity review emails pertaining to entities governed by the laws of any other jurisdiction should, if required by the laws of such jurisdiction, be verified by legal counsel licensed to practice law in such jurisdiction. The Firm shall have no liability or responsibility for any matters or issues that are outside the terms and scope of services in effect at the time each Entity Review request is submitted by Client. The entity review email is a privileged and confidential communication to Client only and may not be disseminated to or relied upon by any party other than Client.
If, in the course of its review of entity documents to determine proper signature blocks, the Firm notes any major deficiencies or problems with the entity documents, which the Firm believes may be material to the lender in the subject transaction, the Firm may note such deficiencies or problems in the signature block email, along with suggestions for additional documents that in the Firm’s judgment should be obtained and/or corrections which in the Firm’s judgment should be made, prior to the closing of the loan transaction in question.
Completion of each Entity Review is contingent upon receiving from Client all documents required by the Firm to complete its review. In performing its review, the Firm shall assume, without any independent investigation, the genuineness, authenticity, accuracy and completeness of all entity documents supplied to the Firm, and Client hereby consents to such assumptions.
Special terms applicable to review of certain trust documents:
For certain trusts that present special legal issues the Firm may require that Client obtain and furnish to the Firm a legal opinion from the trust’s legal counsel. In such cases the Firm shall be entitled to rely upon the correctness of such legal opinion and the Firm’s entity review shall consist solely of a review of such legal opinion.
Such legal opinion should include opinions as to: (a) the identity of the trust and the trustee(s), (b) the authority of the trust and the trustee(s) to enter into the loan transaction and perform the trust’s obligations under the loan documents, (c) the legal counsel’s recommendation as to the proper signature block for the trust, and (d) recommended title vesting.
Trusts in this category include, without limitation, all trusts in which one or more of the original trustees/trustors has died or become incapacitated and, pursuant to the trust provisions, the trust has been or is to be split into two or more sub-trusts.
If the Firm notes deficiencies or problems which it deems to be significant and relevant to the lender in the subject transaction, or if the Firm is missing any necessary documentation, the Firm may elect not to issue its signature block email, in which case the Firm will typically issue an email outlining the deficiencies, problems or additional documentation required (“Deficiency Email”). When the Firm so elects not to issue its signature block email, the Scheduled Fees (or Hourly Charges, if greater) will have been exhausted and fully earned at the time of the issuance of the Deficiency Email. Any further work required after issuance of the signature block memo or the Deficiency Email will be billed as Hourly Charges.
At the time a Deficiency Email is issued, the Firm may include an invoice for the Scheduled Fees (or Hourly Charges, if greater), or at the Firm’s discretion, may leave the matter open for a time (not to exceed thirty days) so that the Entity Review may be completed once the problems are rectified, with additional time being billed as Hourly Charges.
The scope of Entity Review services do not include: (a) tracing the history of the ownership or management of entities, (b) any express or implied opinion on the due formation, valid existence or good standing of the entity(ies) reviewed, (c) any express or implied opinion on the identity or proper election of managers or officers, or specific authorization of the signatories to sign the particular transaction documents on behalf of the entity(ies) in question, (d) the review of entity documents for sub-entities, members, partners, shareholders or other equity owners of borrowers or guarantors that are not relevant to the issue of authority to sign the transaction documents for the subject loan, or (e) any review or analysis of provisions in entity documents which may trigger the dissolution or termination of the entity upon the occurrence of certain events such as death, withdrawal or dissolution of a manager, member, partner or other equity owner or signatory.
Unless the Firm otherwise expressly agrees in writing to the contrary, the Firm shall have no concern, liability or responsibility, and will not provide Client with any advice or representation, relating to the following issues or matters:
1. Litigation services of any kind, whether in court, arbitration, administrative hearings, or government agency hearings, or the rendering of advice in contemplation or in connection with existing or potential litigation.
2. Advice concerning the federal or state income tax ramifications of any past or contemplated transaction.
3. Advice concerning usury laws or similar laws regulating the amount of interest or other charges that may be lawfully collected.
4. Advice concerning the laws of any jurisdiction other than California when, pursuant to the laws of such jurisdiction, an attorney licensed in such jurisdiction must be engaged to render such advice (it shall be the responsibility of Client to engage local counsel if required by such laws).
5. Advice concerning legal, licensing or regulatory restrictions, disclosures, registrations or qualification requirements applicable to Client’s lending business, or to any Lender or investor in any transaction.
6. Advice concerning (a) any truth-in-lending or other consumer protection laws or disclosures applicable to consumer transactions, (b) loans for a non-business purpose, or (c) loans secured by a borrower’s or guarantor’s residence.
7. Advice concerning compliance or non-compliance with any state “unauthorized practice of law” statutes or other statutes requiring that local legal counsel be retained in connection with matters in which the Firm is retained or for other services related to the closing of Client’s loan transactions. Client shall be responsible to retain local counsel as required by the laws of the state where the security property is located, and/or other applicable jurisdictions, in order to perform any services which, under the laws of the such state or other jurisdiction, are required to be performed by legal counsel licensed in the such state or other jurisdiction.
8. Review of or advice concerning the capitalization or assets of the entity subject to review.
9. Changes to the law that may affect Client’s matter after completion of the services to which such change pertains (the Firm shall not have any affirmative obligation to notify Client of such changes to the law).