PURPOSE CLAUSES IN LLC OPERATING AGREEMENTS

By , October 13, 2017 8:11 pm

As Peter Mahler has written in his post under the link below, countless thousands of LLC operating agreements provide that the purpose of the LLC is “any lawful purpose.”  This language can be a problem when a member seeks statutory dissolution of an LLC on the ground that the LLC cannot achieve its lawful purpose.  In the August 16, 2017 New York appellate decision discussed in Peter’s post, the court held that a member may introduce extrinsic evidence as to the actual purpose of the LLC.  For LLC lawyers, Peter’s post raises the difficult question whether they should include the above standard purpose in operating agreements they draft for their LLC formation clients.

Here’s the link:  http://www.nybusinessdivorce.com/2017/08/articles/llcs/llc-agreement-purposeless-purpose-clause/

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