Limited Liability Company

Front 1

LLC

Back 1

Hybrid of partnership and corporation
2) LLC has some characteristics of a partnership (especially LLP) and some of a corporation.
3)There may be one owner or more called members.

Front 2

Formation

Back 2

Certificate of formation must be filed with the state and name must include LLC
2) Optional document- establish rules of governance, distribution of control, allocation of profits.

Front 3

Members

Back 3

Members can be admitted to an LLC only by unanimous vote of other members.
2) Members cannot withdraw unless all the other members agree.
3) members may sell or transfer their membership interests in which case the seller is dissociated, buyer now has rights to profits but is not a member.
4) All remaining members must agree to continue or dissolve in 90 days

Front 4

Liability

Back 4

An LLC is a separate legal entity responsible of its own contract and tort obligation. Members are not liable for LLC obligation, except in unusual circumstances (pierce the veil)

Front 5

Management

Back 5

Unless otherwise specified, an LLC is managed by its members (much like a partnership)
Each member can participate in management, each member is an agent for the business.
3) Can designate a manager, member must select and name on certificate

Front 6

Voting power

Back 6

Based on proportion of ownership, not equality. More money more power.

Front 7

Dissolution

Back 7

LLC must file certificate of dissolution with the state creditors within 3 months.
2) LLC may opt to require known creditors to file claims within 120 days.