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LLC question
Posted on 3/7/17 at 7:09 pm
Posted on 3/7/17 at 7:09 pm
Me and a buddy have an LLC and bought a rental property. He is single with no family. If he dies we have agreed I would get 100% of LLC. I don't want some 3rd cousin trying to get a piece of the pie if something was to happen to him. Is this something simple that a notary can do? TIA
2
Posted on 3/7/17 at 7:51 pm to 7LSU7
He could sign a will that leaves it to you, but he could change that the next day.
Folks in this situation often get a business lawyer to prepare the LLC operating agreement up front to contain provisions such as a buy-sell agreement, which triggers on events such as death, divorce, bankruptcy, etc. You also want transfer restrictions/right of first refusal so he can't sell his share to some idiot if he gets hard up for money or tired of the company. And you want some form of tie-breaker if you own the LLC 50/50 (popular, but often a bad idea).
Review your operating agreement and see if it already has such provisions. If a decent lawyer drafted it, you may already be covered in some fashion.
Folks in this situation often get a business lawyer to prepare the LLC operating agreement up front to contain provisions such as a buy-sell agreement, which triggers on events such as death, divorce, bankruptcy, etc. You also want transfer restrictions/right of first refusal so he can't sell his share to some idiot if he gets hard up for money or tired of the company. And you want some form of tie-breaker if you own the LLC 50/50 (popular, but often a bad idea).
Review your operating agreement and see if it already has such provisions. If a decent lawyer drafted it, you may already be covered in some fashion.
Posted on 3/7/17 at 9:23 pm to Twenty 49
Buy /sell as stated.
Posted on 3/8/17 at 12:18 pm to 7LSU7
This should be covered in the LLC's operating agreement where is talks about what to do when a member departs the LLC. Sometimes these are left pretty vague to give the LLC the power to do whatever is in the best interest of the company. In this case, I would think it should explicitly be stated in the death of a member or withdrawal of a member sections of your operating agreement that the remaining interest is transferred to other members of the LLC (you may have it worded this way if other people join as members, that way you don't have to re-do the operating agreement).
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