Overview of How the Limited Liability Company Operates
Limited liability company laws between the states vary only slightly because
they all conform to the model Uniform Limited Liability Company Act (ULLCA)
of 1995. Its provisions are as follows:
— A limited liability company is considered a legal entity −
one separate from its members.
— A limited liability company may be for either for-profit or non-profit purposes.
— Some states allow one-member limited liability companies; others
require two or more members.
— A member interest in a limited liability company is non-transferable
without the unanimous consent of the other members.
— A member can transfer his or her interest in future distributions
and returns of capital.
— Managers and members have limited liability. They can lose only
their investment if the company is sued or goes bankrupt.
— A limited liability company can be in existence for a fixed or
— A limited liability company is dissolved upon:
- consent of its members;
- dissociation of a member;
- occurrence of a specific event stated in the operating agreement or
- a fixed dissolution date
— A limited liability company's operating agreement may not:
- Unreasonably restrict a member from inspecting company records.
- Eliminate or reduce a member's duty, loyalty, care, or good faith when
dealing with or on behalf of the company.
- Restrict the rights of third parties.
- Override the legal right of the company to expel a member convicted of
wrongdoing, breach of the operating agreement or making it impractical
for the limited liability company to continue its business with further
YES, YOU CAN LOSE EVERYTHING!
You may think that your wealth is safe and that you don't need protection.
But don't delude yourself and accept reality — for every 60
minutes you spend making money, spend 60 seconds thinking about how to