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A Manager-Managed Limited Liability Company
This Limited Liability Company Agreement is made and entered into this [•] day of [•] by: [•], [•] and [•], a Spanish company, and each individual or business entity later subsequently admitted to the Company. These individuals and/or business entities shall be known as and referred to as Members and individually as a Member.
As of this date the Members have formed the [•] Limited Liability Company named above under the laws of the State of Florida. Accordingly, in consideration of the conditions contained herein, they agree as follows:
The Members hereby form a Limited Liability Company subject to the provisions of the Limited Liability Company Act as currently in effect as of this date. A Certificate of Formation shall be filed with the Secretary of State.
The name of the Company shall be [•] LLC.
The location of the registered office of the Company shall be [•].
The Company shall continue for an indefinite period unless dissolved by:
The purpose of the Company is to engage in any lawful act or activity for which a Limited Liability Company may be formed under the Limited Liability statutes of the State of Florida.
The location of the principal place of business of the Company shall be [•] or at such other place as the Managers from time to time select.
The name and place of residence of each member are contained in Exhibit [•] attached to this Agreement.
Except as otherwise expressly provided in the Agreement, no additional members may be admitted to the Company through issuance by the company of a new interest in the Company without the prior written consent of Members whose combined ownership exceeds [•]. ^
The Members initially shall contribute to the Company capital as described in Exhibit [•] attached to this Agreement. The agreed value of such property and cash is $[•].
A quorum of at least [•]% of the owners is required to approve additional capital contributions.
For financial accounting and tax purposes the Company's net profits or net losses shall be determined on an annual basis and shall be allocated to the Members in proportion to each Member's relative capital interest in the Company as set forth in Exhibit [•] as amended from time to time in accordance with Treasury Regulation 1.704-1.
A quorum of members holding at least 51% ownership shall determine and distribute available funds annually or at more frequent intervals as they see fit. Available funds, as referred to herein, shall mean the net cash of the Company available after appropriate provision for expenses and liabilities, as determined by the Members. Distributions in liquidation of the Company or in liquidation of a Member's interest shall be made in accordance with the positive capital account balances pursuant to Treasury Regulation 1.704-l(b)(2)(ii)(b)(2). To the extent a Member shall have a negative capital account balance, there shall be a qualified income offset, as set forth in Treasury Regulation 1.704-l(b)(2)(ii)(d). ^
The name and place of residence of each Manager is attached as Exhibit 1 of this Agreement. By a vote of the Members holding a majority of the capital interests in the Company, as set forth in Exhibit [•] as amended from time to time, shall elect so many Managers as the Members determine, but no fewer than two, with one Manager being from, and residing in, the United States and one manager appointed from [•] Europe. The member residing in the USA shall be tasked with daily operation. Decisions for agreements and payments exceeding those of reasonable operational acts shall be discussed, approved, signed and/or executed by both managers. Any deadlock between the Managers, or any decision about which is a reasonable operational act, will be settled by members holding at least 51% ownership.
The liability of the Members shall be limited as provided under the laws of the Florida Limited Liability statutes. Members that are not Managers shall take no part whatever in the control, management, direction, or operation of the Company's affairs and shall have no power to bind the Company. The Managers may from time to time seek advice from the Members, but they need not accept such advice, and at all times the Managers shall have the exclusive right to control and manage the Company. No Member shall be an agent of any other Member of the Company solely by reason of being a Member.
The Managers are authorized on the Company's behalf to make all decisions as to the:
In the exercise of their management powers, the Managers are authorized to execute and deliver all:
The Primary Manager shall have primary responsibility for managing the daily operations of the Company as defined in article 4.1. The Primary manager is a manager who resides in the USA.
Title to the Company's assets shall be held in the Company's name.
Upon request, the Managers shall supply to any member information regarding the Company or its activities. Each Member or his authorized representative shall have access to and may inspect and copy all books, records and materials in the Manager's possession regarding the Company or its activities. The exercise of these rights shall be at the requesting Member's expense.
Any act or omission of the Managers, the effect of which may cause or result in loss or damage to the Company or the Members if done in good faith to promote the best interests of the Company, shall not subject the Managers to any liability to the Members.
The Company shall indemnify any person who was or is a party defendant or is threatened to be made a party defendant, pending or completed action, suit or proceeding, whether civil, criminal, administrative, or investigative (other than an action by or in the right of the Company) by reason of the fact that he is or was a Member of the Company, Manager, employee or agent of the Company, or is or was serving at the request of the Company, for instant expenses (including attorney's fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding if the Members determine that he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interest of the Company, and with respect to any criminal action proceeding, has no reasonable cause to believe his/her conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, conviction, or upon a plea of "no lo Contendere" or its equivalent, shall not in itself create a presumption that the person did or did not act in good faith and in a manner which he reasonably believed to be in the best interest of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his/her conduct was lawful.
The Managers shall cause the Company to keep at its principal place of business the following:
Any Manager rendering services to the Company shall be entitled to compensation as determined by a quorum of members owning at least 51%.
The Company shall reimburse the Managers or Members for all direct out-of-pocket expenses incurred by them in managing the Company. ^
The Managers shall maintain complete and accurate books of account of the Company's affairs at the Company's principal place of business. Such books shall be kept on such method of accounting as the Managers shall select. The company's accounting period shall be the calendar year.
The Managers shall maintain separate capital and distribution accounts for each member. Each member's capital account shall be determined and maintained in the manner set forth in Treasury Regulation 1.704-l(b)(2)(iv) and shall consist of his initial capital contribution increased by a) any additional capital contribution made by him/her; b) credit balances transferred from his distribution account to his capital account; and decreased by: a) distributions to him/her in reduction of Company capital; b) the Member's share of Company losses if charged to his/her capital account.
The Managers shall close the books of account after the close of each calendar year, and shall prepare and send to each member a statement of such Member's distributive share of income and expense for income tax reporting purposes. ^
If at any time a Member proposes to sell, assign or otherwise dispose of all or any part of his interest in the Company, such Member shall first make a written offer to sell such interest to the other Members at a price determined by mutual agreement. If such other Members decline or fail to elect such interest within thirty (30) days, and if the sale or assignment is made and the Members fail to approve this sale or assignment unanimously then, pursuant to the Florida Limited Liability statutes, the purchaser or assignee shall have no right to participate in the management of the business and affairs of the Company. The purchaser or assignee shall only be entitled to receive the share of the profits or other compensation by way of income and the return of contributions to which that Member would otherwise be entitled. ^
One of our clients, a first line electronics worldwide manufacturer, was looking to expand its operations in the USA.
After the firsts commercial contacts they ask us for advice on how to manage the expansion's legal layout.
After studying many possibilities we advise to incorporate a limited liability company with local partners.
The aim of the agreement was to find a balance between our client's control of the Company and the local partner's rights.
