Every minnesota LLC owner should have a business agreement to protect the operation of their business. While not imposed by the state, a company agreement establishes clear rules and expectations for your LLC, while justifying your credibility as a legal entity. The new LLC law will go into effect on August 1, 2015 and will regulate all LLCs created on or after that date, but the important question for existing LLCs is how they will affect the new law. Unless an LLC chooses to be governed by the new law, existing LLCs will be subject to the current LLC law until August 1, 2018. After this date, existing LLCs will be subject to the new law, with the exception that the existing provisions of their statutes, statutes or agreements for the control of members are considered to be included in the company agreement. The fact is that LLCs of a single member also benefit from a company agreement. A person often chooses to act as a limited liability company (and not as an individual entrepreneur) in order to limit their personal liability for the company`s debts and obligations. Compliance with corporate formalities, such as. B the acceptance of a company agreement, helps to minimize the likelihood that the company`s creditors may succeed in “penetrating the veil” to track the personal assets of each member of the LLC. The new LLC law will expressly allow the creation of “regal” LLCs, LLCs organized by law but not having members until a certain time in the future, as well as prior training agreements – agreements between potential members and others on the organization and operation of the LLC. These two attributes provide greater flexibility to plan for the use of LLCs for new businesses or, in particular, for business transactions. In accordance with the Minnesota Revised Uniform Limited Liability Company Act (Minnesota Revised LLC Act), which will apply as of January 1, 2018 to all Minnesota limited liability companies, it is recommended that a limited liability company enter into a business agreement in Minnesota. Under the Minnesota Revised LLC Act, failure to implement a company agreement can have significant negative consequences for Minnesota limited security companies.
It`s a good idea to establish a company agreement before submitting your organizational items, but the state doesn`t stop LLCs from waiting until the creation process is complete. Interestingly, some banks require you to submit a business agreement to open a bank account. Under the new 322C, distributions must be made before the end of an LLC on a “per capita” basis or in equal shares among members, unless otherwise provided in the enterprise agreement. . . .