Unsigned Operating Agreement Enforceable
An operating agreement is a contract, or creature of contract, that governs the internal affairs of an LLC. As noted in Florida's Revised Limited Liability Company Act, basic principles of contract law apply to operating agreements. See Fla. Stat. § 605.0111(1) ("It is the intent of this chapter to give the maximum effect to the principle of freedom of contract and to the enforceability of operating agreements, including the purposes of ss. 605.0105-605.0107"). Contracts are usually bilateral in nature, in that the contracting parties bargain for their agreement and come to a meeting of the minds on the terms of [...]
Operating Agreement Saves the Day in Romagnoli
An operating agreement is the governing document of the LLC. It establishes the rules and regulations for LLC operation and provides a roadmap for the members and managers regarding internal affairs. It is based on contract law and is held to apply even if its provisions conflict with Florida's Revised Limited Liability Company Act, save certain enumerated provisions in the Act that cannot be contracted out of. But a company operating agreement does much more than govern—it also serves as proof of ownership of the LLC. In fact, the operating agreement saved the day for Roberto Romagnoli (the "Debtor"). The Operating Agreement [...]
Split Your LLC Interest Into Two Parts
LLC ownership is evidenced by an LLC interest. The nature of this interest is determined by contract -- the LLC operating agreement -- or by statute. Uncommon to most, your ownership in the LLC is actually split up into two parts: (1) transferable interest and (2) nontransferable interest. Transferable Interest and Nontransferable Interest The transferable interest is your economic right to receive distributions and share in the profits of the LLC. The nontransferable interest includes your right to vote, obtain information (i.e. books and records) and that other than your transferable interest. Together, both of these interests make up your LLC [...]
Consider An LLC With A Board of Directors
It certainly isn't commonplace to think of the limited liability company (hereinafter "LLC") as having a board of directors. In fact, it may be that most individuals, upon hearing the words "board of directors," immediately assume the topic of conversation revolves around the action of some corporation. In other words, it might be thought that having a board of directors is exclusively reserved to corporations, and not LLCs. I'll take the liberty and cut through your anticipation: they are not. By way of introduction, all business entities are persons under the law by means of the contracts that create them. For example, the LLC [...]