A Limited Liability Company (LLC) is a separate legal entity that can conduct business just like a corporation with many of the advantages of a partnership. It is taxed as a partnership. Its owners are called members and receive income from the LLC just as a partner would. There is no tax on the LLC entity itself. The members are not personally liable for the debts and obligations of the entity like partners would be. Basically, an LLC combines the tax advantages of a partnership with the limited liability feature of a corporation.
An LLC is formed by filing articles of organization with the secretary of state in the same type manner that articles of incorporation are filed. The articles must contain the name, purpose, duration, registered agent, and principle office of the LLC. The name of the LLC must contain the words Limited Liability Company or LLC. An LLC is a separate legal entity like a corporation.
Management of an LLC is vested in its members. An operating agreement is executed by the members and operates much the same way a partnership agreement operates. Profits and losses are shared according to the terms of the operating agreement. In Tennessee, an Operating Agreement is a crucial legal document that governs the internal operations and management of a limited liability company (LLC) that operates in states adopting the Uniform Limited Liability Act (UCLA) or the Revised Uniform Limited Liability Act (SULLA). This agreement outlines the rights, responsibilities, and relationships between the LLC's members and managers, and it provides a framework for decision-making and dispute resolution within the company. There are different types of Tennessee Operating Agreements depending on the specific enactment of the UCLA or the SULLA in the state. Let's explore them further: 1. Tennessee Operating Agreement Under the Uniform Limited Liability Act: — This type of Operating Agreement is specifically designed for LCS operating in Tennessee following the UCLA. — ThUCLALA provides a comprehensive set of default rules for LCS in Tennessee, which can be modified or expanded upon through the Operating Agreement. — This agreement allows LLC members the flexibility to tailor the company's management structure, profit distribution, voting rights, and other important provisions according to their specific needs. 2. Tennessee Operating Agreement Under the Revised Uniform Limited Liability Act: ForcesCs operating in Tennessee under the SULLA, this Operating Agreement variation is applicable. — ThSULLALA is an updated version of the UCLA and provides a more modern legal framework for LCS. — This Operating Agreement allows for greater customization of business operations, including the allocation of profits and losses, admission and withdrawal of members, voting requirements, managerial responsibilities, and dispute resolution processes. Regardless of the type of Tennessee Operating Agreement adopted, it's essential to include certain key provisions: — Business purpose and duration: This section outlines the primary goals and objectives of the LLC and specifies its intended lifespan. — Membership interests and contributions: Clearly establish each member's ownership percentage, their capital contributions, and any provisions related to the transfer or sale of membership interests. — Management structure: Define whether the LLC will be managed by members themselves (member-managed) or delegated to managers (manager-managed), outlining their roles, authority, and decision-making powers. — Profits and losses distribution: Detail how profits and losses will be allocated among LLC members, including any preferred returns or special distributions. — Voting rights: Set forth the voting rights of members, including the number of votes required to pass resolutions or elect managers if applicable. — Meeting and decision-making procedures: Establish procedures for calling and conducting meetings, voting on important matters, and resolving conflicts or deadlocks among members or managers. — Dispute resolution and dissolution: Include provisions for resolving disputes through mediation, arbitration, or litigation if necessary, as well as procedures for dissolving and winding up the LLC. To ensure the Tennessee Operating Agreement adheres to the specific requirements and provisions dictated by the UCLA or SULLA, it is recommended to consult with a qualified attorney knowledgeable in LLC law and regulations in Tennessee.
In Tennessee, an Operating Agreement is a crucial legal document that governs the internal operations and management of a limited liability company (LLC) that operates in states adopting the Uniform Limited Liability Act (UCLA) or the Revised Uniform Limited Liability Act (SULLA). This agreement outlines the rights, responsibilities, and relationships between the LLC's members and managers, and it provides a framework for decision-making and dispute resolution within the company. There are different types of Tennessee Operating Agreements depending on the specific enactment of the UCLA or the SULLA in the state. Let's explore them further: 1. Tennessee Operating Agreement Under the Uniform Limited Liability Act: — This type of Operating Agreement is specifically designed for LCS operating in Tennessee following the UCLA. — ThUCLALA provides a comprehensive set of default rules for LCS in Tennessee, which can be modified or expanded upon through the Operating Agreement. — This agreement allows LLC members the flexibility to tailor the company's management structure, profit distribution, voting rights, and other important provisions according to their specific needs. 2. Tennessee Operating Agreement Under the Revised Uniform Limited Liability Act: ForcesCs operating in Tennessee under the SULLA, this Operating Agreement variation is applicable. — ThSULLALA is an updated version of the UCLA and provides a more modern legal framework for LCS. — This Operating Agreement allows for greater customization of business operations, including the allocation of profits and losses, admission and withdrawal of members, voting requirements, managerial responsibilities, and dispute resolution processes. Regardless of the type of Tennessee Operating Agreement adopted, it's essential to include certain key provisions: — Business purpose and duration: This section outlines the primary goals and objectives of the LLC and specifies its intended lifespan. — Membership interests and contributions: Clearly establish each member's ownership percentage, their capital contributions, and any provisions related to the transfer or sale of membership interests. — Management structure: Define whether the LLC will be managed by members themselves (member-managed) or delegated to managers (manager-managed), outlining their roles, authority, and decision-making powers. — Profits and losses distribution: Detail how profits and losses will be allocated among LLC members, including any preferred returns or special distributions. — Voting rights: Set forth the voting rights of members, including the number of votes required to pass resolutions or elect managers if applicable. — Meeting and decision-making procedures: Establish procedures for calling and conducting meetings, voting on important matters, and resolving conflicts or deadlocks among members or managers. — Dispute resolution and dissolution: Include provisions for resolving disputes through mediation, arbitration, or litigation if necessary, as well as procedures for dissolving and winding up the LLC. To ensure the Tennessee Operating Agreement adheres to the specific requirements and provisions dictated by the UCLA or SULLA, it is recommended to consult with a qualified attorney knowledgeable in LLC law and regulations in Tennessee.
