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Limited Liability Companies-Operating agreements-Partnerships

Author johnbsims3
Admin Male

#1 | Posted: 20 Oct 2006 20:53 
Limited Liability Companies

Operating agreements


The members of the limited liability company may enter into an operating agreement, which need not be in writing, to regulate the affairs of the company and the conduct of its business, establish duties in addition to those set forth in the Florida Limited Liability Company Act, and to govern relations among the members, managers, and company.[FN1] Any inconsistency between written and oral operating agreements must be resolved in favor of the written agreement.[FN2] To the extent the operating agreement does not otherwise provide, the Florida Limited Liability Company Act governs relations among the members, managers, and company.[FN3]
The operating agreement may not unreasonably restrict a right to information or access to records.[FN4] Also, the operating agreement may not eliminate the duty of loyalty.[FN5] However, the agreement may identify specific types or categories of activities that do not violate the duty of loyalty, if not manifestly unreasonable,[FN6] and may specify the number or percentage of members or disinterested managers that may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty.[FN7]
The operating agreement may not unreasonably reduce the duty of care.[FN8] Similarly, the operating agreement may not eliminate the obligation of good faith and fair dealing, but the agreement may determine the standards by which the performance of the obligation is to be measured, if the standards are not manifestly unreasonable.[FN9]
The operating agreement may not vary the right to expel a member[FN10] nor the requirement to wind up the limited liability company's business in a case specified by statute.[FN11]
The power to adopt, alter, amend, or repeal the operating agreement of a limited liability company must be vested in the members of the company, unless vested in the manager or managers of the company by the articles of organization or operating agreement.[FN12] The operating agreement adopted by the members or by the manager or managers may be repealed or altered, [FN13] and a new operating agreement may be adopted by the members.[FN14] The members may prescribe in any operating agreement made by them that such operating agreement may not be altered, amended, or repealed by the manager or managers.[FN15]

[FN1] Fla. Stat. 608.423(1).

[FN2] Fla. Stat. 608.423(1).

[FN3] Fla. Stat. 608.423(1).

[FN4] Fla. Stat. 608.423(2)(a).

[FN5] Fla. Stat. 608.423(2)(b).
As to duty of loyalty, see 448.

[FN6] Fla. Stat. 608.423(2)(b)1.

[FN7] Fla. Stat. 608.423(2)(b)2.

[FN8] Fla. Stat. 608.423(2)(c).
As to the duty of care owed by management, see 448.

[FN9] Fla. Stat. 608.423(2)(d).
As to the obligation of good faith and fair dealing, generally, see 448.

[FN10] Fla. Stat. 608.423(2)(e).

[FN11] Fla. Stat. 608.423(2)(f).

[FN12] Fla. Stat. 608.423(3).

[FN13] Fla. Stat. 608.423(3).

[FN14] Fla. Stat. 608.423(3).

[FN15] Fla. Stat. 608.423(3).

Limited Liability Companies

Company operating agreement

The operating agreement of a limited liability company consists of provisions adopted to regulate the affairs of the company and the conduct of its business, to establish additional duties, and to govern relations among the members, managers, and company[FN1] The members of a limited liability company may enter into an operating agreement before, after, or at the time the articles of organization are filed, and the operating agreement takes effect on the date of the formation of the limited liability company or on any other date provided in the operating agreement.[FN1.5] The operating agreement need not be in writing, but any inconsistency between written and oral operating agreements must be resolved in favor of the written agreement.[FN2]
Unless the articles of organization or operating agreement vest the power in the manager or managers of the company, the members of a limited liability company have the power to adopt, alter, amend, or repeal the operating agreement of the company. However, any amendment to a written operating agreement must be in writing.[FN3] When members adopt an operating agreement, they may prescribe that the operating agreement may not be altered, amended, or repealed by the manager or managers.[FN4]

[FN1] FS 608.423.

[FN1.5] Fla. Stat. 608.423(1).

[FN2] FS 608.423(1).

[FN3] FS 608.423(3).

[FN4] FS 608.423(3).

Notes:

The operating agreement of a limited liability company consists of provisions adopted to regulate the affairs of the company and the conduct of its business, to establish additional duties, and to govern relations among the members, managers, and company. FS 608.423. The operating agreement need not be in writing, but any inconsistency between written and oral operating agreements must be resolved in favor of the written agreement. FS 608.423(1). The members of a limited liability company may enter into an operating agreement before, after, or at the time the articles of organization are filed, and the operating agreement takes effect on the date of the formation of the limited liability company or on any other date provided in the operating agreement. Fla. Stat. 608.423(1).

Unless the articles of organization or operating agreement vest the power in the manager or managers of the company, the members of a limited liability company have the power to adopt, alter, amend, or repeal the operating agreement of the company. However, any amendment to a written operating agreement must be in writing. FS 608.423(3). When members adopt an operating agreement, they may prescribe that the operating agreement may not be altered, amended, or repealed by the manager or managers. FS 608.423(3).



Business Relationships
Partnership

Statement of partnership authority


A partnership may file a statement of partnership authority, which must include the name of the partnership, as identified in the records of the department of state, and the names of the partners authorized to execute an instrument transferring real property held in the name of the partnership.[FN1] The statement may also state or include the authority, or limitations on the authority, of some or all of the partners to enter into other transactions on behalf of the partnership and any other matter.[FN2] A statement of authority supplements the authority of a partner to enter into transactions on behalf of the partnership.[FN3]
Except for transfers of real property, a grant of authority contained in a filed statement of partnership authority is conclusive in favor of a person who gives value without knowledge to the contrary, so long as and to the extent that a limitation on that authority is not then contained in another filed statement.[FN4] A filed cancellation of a limitation on authority revives the previous grant of authority.[FN5]
A grant of authority to transfer real property held in the name of the partnership contained in a certified copy of a filed statement of partnership authority recorded in the office for recording transfers of such real property is conclusive in favor of a person who gives value without knowledge to the contrary, as long as and to the extent that a certified copy of a filed statement containing a limitation on such authority is not then of record in the office for recording transfers of such real property.[FN6] The recording in the office for recording transfers of such real property of a certified copy of a filed cancellation of a limitation on authority revives the previous grant of authority.[FN7]
Except as otherwise provided by statute, a person not a partner is not deemed to know of a limitation on the authority of a partner merely because the limitation is contained in a filed statement.[FN8] However, a person who is not a partner is deemed to know of a limitation on the authority of a partner to transfer real property held in the name of the partnership if a certified copy of the filed statement containing the limitation on authority is of record in the office for recording transfers of such real property.[FN9]
Unless earlier canceled, a filed statement of partnership authority is canceled by operation of law five years after the date on which the statement, or the most recent amendment, was filed with the department of state.[FN10]


Statutes:
Fla. Stat. 608.422, as amended in 2002, provides requirements for a member-managed company, and for appointing a proxy.
Fla. Stat. 608.423, as amended in 2002, provides requirements for operating agreements by members of a limited liability company.
Fla. Stat. 608.4229, as amended in 2002, provides for indemnification of members of a limited liability company.
Fla. Stat. 608.4231, as amended in 2002, provides that managers or managing members of a limited liability company may vote in person or by proxy, unless otherwise provided by the company's articles of organization or operating agreement.
Fla. Stat. 608.4235, as amended in 2002, authorizes a managing member to act as an agent of the limited liability company.



[FN1] Fla. Stat. 620.8303(1)(a).

[FN2] Fla. Stat. 620.8303(1)(b).
The department of state must collect a fee when a statement of partnership authority is delivered to the department of state for filing. Fla. Stat. 620.81055(1)(b).

[FN3] Fla. Stat. 620.8303(3).

[FN4] Fla. Stat. 620.8303(3)(a).

[FN5] Fla. Stat. 620.8303(3)(a).

[FN6] Fla. Stat. 620.8303(3)(b).

[FN7] Fla. Stat. 620.8303(3)(b).

[FN8] Fla. Stat. 620.8303(5).

[FN9] Fla. Stat. 620.8303(4).

[FN10] Fla. Stat. 620.8303(6).
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Business Entities Florida Homestead Services - Florida Homestead Exemption Act Forum / Business Entities /
Limited Liability Companies-Operating agreements-Partnerships
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