tag:blogger.com,1999:blog-74436484680116037692012-01-10T11:07:21.023-08:00Blog Upon Operating Agreement Drafting Issues<br>And LLC Formationjjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.comBlogger491100tag:blogger.com,1999:blog-7443648468011603769.post-46209366104756924192011-11-09T14:13:00.000-08:002011-11-09T14:54:23.683-08:00

Q. I own 65% of an LLC and want to sell. Other member agreed but is now making certain demands or he will block the sale. Can he do that even if I own the majority ownership interest in the LLC? Scott, OregonA. To my knowledge, one LLC member cannot block the sale of a limited liability company interest by another member unless such authority is granted in a buy-sell agreement between the members

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-13137899399308387122011-09-07T15:19:00.000-07:002011-09-07T16:01:26.439-07:00

Question: We have an LLC in California with 4 equal members. Two members are going through Ch.13 bankruptcy. Our operating agreement states that the LLC shall be dissolved by bankruptcy of a member. It also states that if at least two members remain they can vote to continue the company within 90 days. If the two remaining members vote to continue the company does that mean the two members in

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com2tag:blogger.com,1999:blog-7443648468011603769.post-40282797406189338412011-07-06T07:59:00.000-07:002011-07-06T16:18:34.464-07:00

Q. How can I show evidence of a sale or transfer of an LLC in MO? My son and I own 50% of a family LLC and my husband has either given or sold the LLC to his brother in KS who did own only 1%. Sandra, MoA. I am a little confused by the question; however, I read the situation as one where your husband has attempted to sell an LLC ownership interest to his brother that you believe you and your son

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com3tag:blogger.com,1999:blog-7443648468011603769.post-16292837079954508742010-02-17T11:15:00.000-08:002010-02-17T11:29:40.855-08:00

Question: Is this document sold on your web site filed with the state of Florida? Is it what I use to start my LLC? Stan, Orlando.I often receive this question. No, the document you linked to is an LLC operating agreement. That is an agreement between the members setting forth such things as ownership percentages, method of allocation of profits and losses, voting procedures, et cetera. The

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-55345030615994164992009-11-19T13:11:00.000-08:002011-12-13T12:31:15.374-08:00

LLC's taxed as partnerships must meet the "substantial economic effect" test of Treasury Reg. § 1.704-1(b)(2) for the allocation of income, losses and other items. This is an especially important point in regard to pass-through LLC losses as a deduction could be denied by the IRS if it finds the allocation lacks substantial economic effect. There are two alternative tests for providing that

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-85646027966702603782009-10-11T07:24:00.000-07:002009-11-06T07:51:32.685-08:00

Question: I'm a 1/3 partner in an LLC - we are having credit problems getting a loan because of my credit - not too bad, just not good enough. We need this $65,000 loan for biz improvements - the broker suggested taking me off the LLC paperwork just until the loan is approved then putting me back on. Your thoughts or suggestions would be greatly appreciated. thank you. Barry, CAAnswer: My

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-42248167647104857012009-09-15T11:20:00.000-07:002009-09-15T11:49:58.041-07:00

Question: I co-own a Maryland LLC with three other people. We are looking to dissolve and do not know where to begin. Where can we find the best information, and where is the best place to start? Are the Articles of Cancellation the same as the Articles of Dissolution? Stephalauren, MarylandResponse: In responding, I'll assume all members wish to dissolve the LLC. Basically, here are the steps

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com2tag:blogger.com,1999:blog-7443648468011603769.post-58579685456294436802009-09-04T07:27:00.000-07:002009-09-04T08:26:43.163-07:00

Question: We have come across some judges classifying an LLC as a type of corporation or an association which requires the use of an attorney for representation in court. Can an LLC represent itself through one of it's members (partnership) or through it's sole member (single member LLC) pro se without a lawyer in a court of law or other civil proceeding? Herman, New York.Response: "The general

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com1tag:blogger.com,1999:blog-7443648468011603769.post-40795762581272693612009-09-03T07:25:00.000-07:002009-09-03T08:08:11.910-07:00

Question: Can the managing member of an LLC be another unrelated LLC? Michael, California.Answer: The nice thing about LLCs is their flexibility. The answer to your question is found in the definitions section of the California Limited Liability Company Act (Section 17001 of the California Corporations Code). Section 17001(w) defined "Manager" as "a person elected by the members of a limited

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-47206225314912119422009-08-26T13:57:00.000-07:002009-08-26T14:21:50.553-07:00

Question: With a DE LLC, since LLC agreements are not required, how do you determine who are the authorized persons acting on behalf of the LLC if there is no LLC agreement? Is the person who executed the certificate of formation the only person responsible for the entity in the absence of any operating agreement? Kayla, DE.Response: A run on Delaware questions lately. I'm not sure what you

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-54520318482191212472009-08-24T08:08:00.000-07:002009-08-24T10:51:22.536-07:00

Question: We formed a Delaware LLC in June 2006. We have no operating agreement, nor are our 3 members recorded. Two of us file our schedule K-1's listing us at 45% each and the 3rd at 10%. Can the (2) 45% members remove the 10% member for lack of participation and contribution? If so, how can this legally be accomplished? Tracy, CA.Response: This is a frequent question / complaint in LLCs. The

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com1tag:blogger.com,1999:blog-7443648468011603769.post-25853873485203545292009-04-16T10:53:00.000-07:002009-04-16T11:05:25.226-07:00

Question : Do I have to pay taxes on my initial investment in an LLC if I want to now start receiving some of the money? Basically I paid in with taxed dollars so do I have to pay taxes again if I remove the intial investment? Brent, Missouri.Response: The taxation of a multi-member LLC is very similar to that of a partnership. Members are taxed on their distributive share of LLC income each

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-60625945842128223752009-04-14T06:43:00.000-07:002009-04-14T06:58:55.587-07:00

Question: We have father and son LLC. The son started an independent practice and no longer wants to continue with LLC as member.What is the procedure for withdrawal from membership of the LLC? DOLAT, NEW YORKResponse: New York Consolidated Laws, LLC § 606 covers withdrawal of LLC members. It states, in pertinent part:§ 606. Withdrawal of a member. (a) A member may withdraw as a member of a

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-34594971354478108012009-03-31T15:21:00.000-07:002009-03-31T15:43:28.442-07:00

Question: Once I have completed the ORGANIZING AGREEMENT, do I need to send it to the Texas Dept. of State to have it legalized? If so, what is the proceedure for doing this? Jim.If I understand your question correctly, I think you have a misconception of the process. The document filed with the Texas Secretary of State's office that legally brings your LLC into being is called Certificate of

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com2tag:blogger.com,1999:blog-7443648468011603769.post-8011819601217972052009-03-04T07:27:00.000-08:002009-03-31T16:49:56.820-07:00

Question: My wife and I are members in a LLC in New Jersey. We would like to remove her so tax filing will be easier. Is this possible and how would we go about it?Answer: I assume you are referring to the fact that a single member LLC can elect to be a disregarded entity for tax purposes and, thus, not file a separate federal tax return. In the case of an LLC that is a disregarded entity for

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-51069110942195568682009-02-20T13:09:00.000-08:002009-03-31T16:50:21.761-07:00

Question: An LLC borrowed a sum of money from me for equipment for their new business in 06. The LLC still owes me $15,000 and is going to dissolve without having paid me in full. I do have a written contract. What is my recourse for collection of the funds still due? Anroln, Virginia.Two remedies come to mind. First, have an attorney review the contract to see if it forms the basis for a

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-55146957956831603142009-02-09T10:37:00.001-08:002009-03-31T16:50:36.583-07:00

They are like putting the condom halfway on. Why in God's name would anyone do this? The reason oral operating agreements make no sense is that when they are violated it's very, very difficult for the wronged party to prevail. Remember that the plaintiff has the burden of proof in American civil cases. So when you sue the other LLC member for breach of an oral operating agreement, it is your

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-47192939053902181092009-02-03T08:23:00.000-08:002009-02-03T19:58:08.565-08:00

I'm a member of an Arizona LLC. What happens if I file for bankruptcy?Unless otherwise provided for in the operating agreement, a person ceases to be a member of an Arizona LLC upon filing a voluntary petition in bankruptcy. See AZ stat §29-733(4)(b). In Chapter 13 bankruptcies, the debtor retains possession of his or her assets, therefore, there cannot be a collection action by your

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com1tag:blogger.com,1999:blog-7443648468011603769.post-57541812223735858062009-01-24T12:03:00.000-08:002009-01-24T16:01:52.246-08:00

Question: I want to form an LLC in Missouri, what do I do?It's a fairly easy process (especially for a single-member LLC). Here are the steps. Check to ensure that your name is available. The name must include "Limited Liability Company", "Limited Company", "LC", or "LLC". You can either call the secretary of state’s office or search their web site here:www.sos.mo.gov I generally search

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-39132756488241331622008-12-11T15:07:00.000-08:002008-12-11T15:25:15.093-08:00

Question: Can I sell my interest in a Missouri LLC that does not have a signed written operating agreement? I am an equal 1/3 member in the LLC. Do I need approval from the other members? Dan.Below are relevant provisions from the Missouri LLC Act.Mo. Stat. §347.115. Interest in company is personal property, assignability. 1. The interest of a member in a limited liability company is personal

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-33683188633984185342008-12-08T17:43:00.000-08:002008-12-11T11:50:41.990-08:00

Question: I need to know how to go about taking a member off of the LLC Operating Agreement. The members name is Sandra who is no longer going to be with the company. Any information you could give me to help us go about dropping a member would be very much appreciated. Phil.I'll assume Sandra is voluntarily withdrawing from the LLC as a member or otherwise being bought out. The method by

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-1546335785589171212008-12-03T12:26:00.000-08:002008-12-03T13:04:28.201-08:00

Q. Hello, I am a CPA in Colorado, thinking about forming a single member LLC that provides tax, bookkeeping, payroll, etc. services (no independent audits). Am I required to form a PLLC? What are the differences between an LLC and a PLLC? Could you please explain the extent of the limited liability protection? (I had heard that the protection does not cover personal assets in the event of a

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-9034619860988548012008-11-14T06:26:00.001-08:002008-11-15T10:31:25.286-08:00

Q. I am the managing member of a 4 member Delaware LLC. The other three members apparently are in discussion to sell their interest in the LLC. Can they do that? What happens to the loan we took out to purchase the business in 2006?The place to start is your LLC operating agreement. Does it contain any restrictions upon the sale or transfer of LLC interests by members? If not (or you don't

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-34832115050313413792008-11-13T16:49:00.000-08:002008-12-03T13:12:23.608-08:00

In all states except one, LLCs are divided into two categories--those managed by the members and those managed by managers appointed by the members (aka "manager-managed"). In a quest to offer LLCs the face of a corporation, Tennessee goes a different route. Their LLCs are either member managed or governor managed. Further, in a LLC with governors, the governors may appoint managers who serve

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com2tag:blogger.com,1999:blog-7443648468011603769.post-41694650709822492612008-10-26T08:30:00.000-07:002008-10-28T07:54:40.448-07:00

LLCs come in two basic flavors: member-managed and those managed by managers. Conflating the distinction between the two types is the fact that members may also serve as managers in an LLC that elects to be managed by managers. See Section 101(10) of the Uniform Limited Liability Company Act. Member-managed LLCs operate much as traditional partners in that management of the entity's business

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-53924531972744447402008-10-24T09:54:00.000-07:002008-10-24T11:10:04.215-07:00

In today's economic environment, small business is looking for additional capital. With the credit markets in turmoil, bringing in additional owners is option many shall look at. For an existing LLC, the operating agreement should address the preconditions for admission of new members. Typically, there are three drafting options for member vote necessary to admit a new memeber: (a) simple

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-23933400424227689482008-10-22T09:34:00.000-07:002008-10-22T10:17:57.461-07:00

The default rule under Uniform Limited Liability Company Act Section 404 is that each member gets an equal vote. Not every state follows the uniform act on this point. California, for example, mandates that members "shall vote in proportion to their interests in current profits of the limited liability company" unless otherwise stated in the articles of organization or operating agreement. See

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com1tag:blogger.com,1999:blog-7443648468011603769.post-44851929528517991192008-10-21T11:45:00.000-07:002008-10-21T13:18:05.156-07:00

It's a common question from LLC members and, in these troubled financial times, the issue shall become even bigger. The general rule for member liability upon LLC debt is set forth in the LLC act of the state where your LLC was organized. California's Corporate Code Section 17101 is typical of what one finds in other states.Except as otherwise provided in Section 17254 or in subdivision (e),

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-37340942548176877452008-10-20T14:32:00.000-07:002008-10-20T15:50:51.844-07:00

I answer questions on business law and estate planning topics over at my commercial web site and thought I would post some of those Q&As here to give them wider circulation."I read Sec 101.107 of TX LLC Act, however one of the members deserted (literally walked out one night and has not returned) the business almost a year ago, and actually has worked with competitors as an advisor... What

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-4994375501388098802008-10-15T07:21:00.001-07:002008-10-15T08:23:39.379-07:00

These are tough economic times. Entering into a business relationship with another individual is much like a marriage, for better or for worse. However, in the business relationship, one is allowed to take precautions against "the worse". What happens when one member of a multi-member LLC goes bankrupt? Absent some provision in the operating agreement to the contrary, the member's LLC

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com9tag:blogger.com,1999:blog-7443648468011603769.post-27071266885560140282008-10-12T08:38:00.000-07:002008-10-14T07:49:20.782-07:00

The correct answer is "that depends". Everyone prefers a straight up 'yes' or 'no', unfortunately, our laws come in shades of gray. Legal formation of an LLC is a relatively simple matter. The steps are outlined here. Or, if you prefer, there are services with reasonable prices that do LLC formation. Check out the ads on this Google query for a sample of incorporation companies. (One cavaet

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-23581107281779497652008-09-26T08:23:00.000-07:002008-09-26T08:57:07.469-07:00

Every lawyer will say plan up front in the member operating agreement for LLC breakups. Be that as it may, I know the majority of LLCs with more than one member do not have operating agreements that plan for member withdrawal or removal of a member who fails to perform promised services. Typically, I hear from an unhappy LLC member who feels he/she is doing all the work and the other member is

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com2tag:blogger.com,1999:blog-7443648468011603769.post-86028979807019934462008-09-16T05:59:00.000-07:002008-09-16T08:03:42.282-07:00

Question from Ali: "I want to form an LLC and I'll own 95% and a friend 5%. However when we take a contract - Profit won't be split like that. In fact, it'll fluctuate depending on time contributed. We want to avoid doing payroll taxes but will get a EIN for the purpose of getting a bank account, etc.1) Can an LLC (Delaware) pay "members" who do work through a 1099?2) Can profit be taken in and

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-34603459629451801142008-07-26T10:32:00.000-07:002008-10-15T09:37:20.563-07:00

I shy away from debtor-creditor conflicts as they are messy affairs; however, a corporate lawyer needs to have a basic understanding of collection fundamentals when creating business entities. One of the main reasons for forming an LLC is liability protection of the members from the debts of the LLC. But what about the reverse, a claim by a creditor of a member against the assets of the LLC?The

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-85166409437662836842008-07-18T10:47:00.000-07:002008-07-18T11:20:21.057-07:00

Your LLC has been formed and competing in the business world. Oops, things have not gone as smoothly as the business plan predicted. The LLC needs an additional infusion of capital to survive. Perhaps your LLC has been wildly successful and needs an additional capital infusion to grow. You basically have two options at this point for equity investment in the LLC: (a) sell an LLC ownership

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com1tag:blogger.com,1999:blog-7443648468011603769.post-14731985586323563242008-07-15T06:33:00.000-07:002008-07-16T20:45:41.070-07:00

Many an LLC operating agreement merely lists dollar values that members are to make as an initial capital contribution. But what happens if one member never makes the agreed contribution? Planning is required to put the aggrieved members in a solid position should this situation come to pass. Here are a few basic drafting points for inclusion in an operating agreement that can tighten up this

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com3tag:blogger.com,1999:blog-7443648468011603769.post-78836602777603299212008-07-11T07:01:00.001-07:002008-12-05T15:25:24.561-08:00

I received a user question from my commercial site yesterday regarding how to structure the admittance of passive investors into an existing single person LLC. In a basic, member-managed LLC, the members serve three rolls when compared to corporations: shareholder, board director, and corporate officer. In order to curtain the authority of certain members (and enhance the authority of others),

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-68881271412292222862008-07-09T05:53:00.000-07:002008-07-09T06:18:36.386-07:00

I've noticed occasional confusion between two LLC forms: (a) Articles of Organization and (b) the Operating Agreement. Here are two sample LLC articles of organization from the states of California and Florida. The articles of organization is the document filed with the state (usually in the office of the secretary of state) that initiates the legal existence of your LLC (usually the same day

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com6tag:blogger.com,1999:blog-7443648468011603769.post-44558141611761383912008-06-20T13:45:00.000-07:002008-07-03T08:15:46.370-07:00

Every state except California allows licensed professionals to run their professional services practice through an LLC. The two main differences between a professional services LLC and a standard LLC is that only professionals licensed by the state may be members of a professional services LLC and, in many states, there is not complete personal liability protection to professional from the LLC (

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com1tag:blogger.com,1999:blog-7443648468011603769.post-72141340037854148292008-06-16T19:25:00.001-07:002008-06-18T09:48:02.789-07:00

In the United States, LLCs are formed by filing a form document usually called articles of organization with a state office. This office is most often the secretary of state, corporate division. I thought it would be handy for myself and the public to have links to the web sites for the secretary of state, corporate division (or equivalent office) of all 50 US states and the District of

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-48944467771617955182008-06-16T14:11:00.000-07:002008-07-04T10:50:42.008-07:00

Got an email today from an individual who is a member of an LLC with two members and no operating agreement. The LLC operates a bar / restaurant and the other member died suddenly. Guess what? Without an operating agreement, the deceased member's LLC interest goes into his estate and, most likely, the spouse of the deceased member ends up as your new partner. Not all written operating

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com8tag:blogger.com,1999:blog-7443648468011603769.post-32234279825319052472008-05-15T11:12:00.000-07:002009-11-19T15:34:18.984-08:00

You desire limited liability protection for your business and, also, the single level of taxation afforded to LLCs and S corporations. From a tax standpoint, which is best? If you are the sole owner of the business, one advantage of a single member LLC is the option to disregard it for tax purposes allowing you to report the income and expenses from your LLC on Schedule C of your individual

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-64101916719547509542008-05-09T08:24:00.000-07:002008-05-09T09:12:05.127-07:00

LLC stands for "limited liability company". I am often asked by those forming LLCs, how much protection do I get from an LLC for my personal assets? Section 303 of the Uniform Limited Liability Company Act (upon which all state LLC acts are based) reads, in pertinent part, as follows:(a) [T]he debts, obligations, and liabilities of a limited liability company, whether arising in contract, tort,

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com1tag:blogger.com,1999:blog-7443648468011603769.post-9545908558570613062008-04-17T12:37:00.000-07:002008-11-14T07:29:41.769-08:00

You've heard of buy-sell agreements among shareholders of closely held corporations. In the case of LLCs, the operating agreement is typically the place one finds restrictions upon transfer of LLC member interests. But why have them? A small business is much like a marriage. And one carefully chooses a spouse. If a member of your LLC is allowed to sell out to anyone of the member's choosing

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-48146690390962818632008-04-16T10:07:00.000-07:002009-04-02T07:19:39.752-07:00

At common law, partners owe each other a fiduciary duty of loyalty and good faith. "A fiduciary has a duty to act primarily for the client's benefit in matters connected with the undertaking and not for the fiduciary's own personal interest." Link. "Loyalty" can be a nebulous concept to pin down but, with certainty, one can say that a partner is forbidden from competing against the partnership

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com4tag:blogger.com,1999:blog-7443648468011603769.post-28566375314030478382008-04-12T12:58:00.001-07:002008-04-12T14:00:47.065-07:00

Limited Liability Companies (LLCs) come in two basic varieties: (a) those managed collectively by the LLC members and (b) those managed by "managers" who are appointed by the LLC members. To complicate matters, LLC members can also be LLC managers. Let's take the common example of an LLC set up to own and operate an apartment complex. The owners of the LLC (i.e., the members) do not wish to

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-64188194207894974612008-04-10T06:47:00.000-07:002011-11-02T13:15:28.613-07:00

Single member LLCs are really sole proprietorships for which the law gives limited liability protection traditionally enjoyed by corporations. An LLC with two or more members is, at its core, a business marriage. And we know marriages can, and often do, go bad. The best course of action is to plan for a potential breakup. Amicable LLC breakups are easy enough to draft for in an LLC operating

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com9tag:blogger.com,1999:blog-7443648468011603769.post-45231854826507824512008-04-04T07:35:00.000-07:002008-04-04T09:13:52.298-07:00

One of the most important, but often overlooked, elements of an LLC operating agreement is provision for withdrawal of a member. In some states, an LLC member is not allowed to withdraw absent a provision in a written operating agreement specifically allowing for withdrawal. See Texas LLC law and Florida LLC law. In providing for withdrawal of a member from your LLC, two matters should be

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0tag:blogger.com,1999:blog-7443648468011603769.post-79771401911083224402008-04-03T14:01:00.000-07:002008-04-04T11:35:00.784-07:00

A limited liability company (LLC) is formed by filing articles of organization with a state that issues the charter. The articles are very basic. An LLC operating agreement is an agreement between the members (i.e., owners) of the LLC giving the operational details of the organization. Here is a survey for each state listing whether an operating agreement is required and, also, whether the LLC

jjrayhttp://www.blogger.com/profile/09951978285296375634noreply@blogger.com0