Exam 30: Limited Liability Company and Limited Liability Partnership

Bill,Bob,and Susie form a limited liability corporation,and each contributes $50,000 in capital.The limited liability company is in operation for two years,but then files bankruptcy,with $500,000 in debt.How much do Bill,Bob,and Susie stand to lose?

Terry,Richard,and Connie enter into a "member-managed" limited liability company to make ice cream for distribution.Terry secretly develops his own recipe,and starts competing with the company.When Connie and Richard find out,they inform Terry that they will sue him.Terry warns that he will counterclaim against them for interfering with his business.What should Connie and Richard sue Terry for,and will they win the lawsuit,or will Terry win on his counterclaim?

A limited liability company is liable for any loss or injury caused to anyone as a result of a wrongful act or omission by a member,a manager,an agent,or an employee of the LLC who commits the wrongful act while acting within the ordinary course of business of the LLC or with authority of the LLC.

If a member disassociates from an "at-will" limited liability company,and the disassociation was not wrongful,the limited liability company must purchase the disassociated member's distributional interest.

Which of the following is true regarding conversion of an existing business to a limited liability company,assuming any applicable requirements to do so are satisfied?

Unless the operating agreement provides otherwise,a member of a "member-managed" limited liability company has the power to withdraw from the limited liability company,but a member of a "manager-managed" limited liability company does not.

Which of the following is true regarding the formation of limited liability companies?

A member's distributional interest in a limited liability company is ________ property and may be transferred in whole or in part.

Under the ULLCA,the articles of organization of a limited liability company must set forth the name of the limited liability company.

A transfer of an interest in a limited liability company:

The existence of a limited liability company begins when the articles or organization are filed.

A member is personally liable for the debts of a limited liability company if he or she personally guarantees the repayment of the limited liability company's debts.

A limited liability company can choose whether to be taxed as a partnership or as corporation.

A certificate of interest issued by a limited liability company acts the same as a stock certificate issued by a corporation.

Harrison and Susie form a limited liability corporation.Harrison makes a capital contribution of $90,000,and Susie makes a capital contribution of $10,000.They have no agreement as to how profits are to be shared.If the limited liability company makes $100,000 in profits in its first year,under the Uniform Limited Liability Act,how will the profits be divided?

A member of a member-managed limited liability company and a manager of a manager-managed LLC owe a fiduciary duty of care to the LLC not to engage in a known violation of law,intentional conduct,reckless conduct,or grossly negligent conduct that injures the LLC.

Under the Uniform Limited Liability Company Act,the articles of organization of a limited liability company must set forth whether the limited liability company is to be "manager-managed."

A non-manager member of a "manager-managed" limited liability company is never entitled to remuneration for services performed for the limited liability company.

A limited liability company is formed by delivering articles of ________ to the office of the secretary of state for filing.

Unless otherwise provided in the operating agreement,a transfer of an interest in a limited liability company does not entitle the transferee to become a member of the LLC or to exercise any right of a member.