Tag Archives: limited liability company

Daily Penalties for LLC Failing to Keep Records

If any member makes a demand that such records be kept when they are not, the LLC will be subject to a daily penalty of at least $25 per day. Continue reading

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Dissociation of LLC Member Does Not Discharge Them from Liability to LLC Members

Becoming a member in an LLC is a serious commitment and dissociation does not relieve the dissociating member from liability, whether the dissociation is voluntary or not. Continue reading

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Oral Agreements of LLC Members Can Be the Operating Agreement

A sole member of an LLC can also have an operating agreement, whether written, oral or implied. Continue reading

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Adding a Member, Shareholder or Partner to Your Business

A new member, shareholder or partner for your business might make sense. Maybe the new person adds great connections, special know-how, or deeper pockets to help capitalize the business for growth. But what exactly does it mean for you to … Continue reading

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New Rules on Withdrawing from a Limited Liability Company

California’s limited liability company (LLC) law was updated when the California Revised Uniform Limited Liability Company Act (RULLCA) went into effect on January 1, 2014.  The California RULLCA is found in California Corporations Code, sections 17701.01 et seq.  One of … Continue reading

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How a Business Should Issue Securities to its Founding Owners

When a business is organized, whether as a corporation or limited liability company, the business entity will need to issue to its founding owners their ownership interests (which are securities). The easiest and most straightforward way for founders to acquire … Continue reading

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How a Business Can be Subject to the Securities Laws

Whenever a business entity issues ownership interests, whether it is to existing owners or new investors, one must be aware that such issuance can be deemed an issuance of securities and that the securities laws may come into play.  If … Continue reading

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No Formal Operating Agreement

Frequently members (i.e. the owners) of a limited liability company (LLC) do not enter into a formal operating agreement (the equivalent of the partnership agreement).  If there is no formal operating agreement it does not mean that there are no … Continue reading

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Minority Owner Did Not Agree to Convert to a Limited Liability Company

Suppose you are a minority interest owner in a partnership (less than 50%) and the majority owners decide to convert to a limited liability company (LLC) despite your disagreement to convert. Are you now responsible as an LLC member? If … Continue reading

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