TEXT BOOK: Business Organizations For Paralegals 8th Edition

Ch. 6 QUESTIONS

Use the 2006 ULLCA (last amended 2013) or this text to answer the following questions.

1. A large family wishes to form an LLC to purchase four family vacation homes. Is this permissible?

2. Deep Blue, LLC, a Utah LLC, is engaged in IT consulting services. It has 20 members.

a. How will new members be admitted?

b. The operating agreement is silent on the division of profits. How will a profit of $1 million be divided?

c. One of the members designed a system for one of the business's clients. The system was hacked due to a design flaw. The design flaw was caused by a negligent (rather than intentional) error. Who is liable for this error?

d. If the operating agreement doesn't specify how the LLC will be managed, how will it be managed?

e. The LLC wishes to ensure that only four of its members are authorized to purchase real estate for the LLC. How can the LLC accomplish this goal?

f. The LLC plans to open a bank account in Nevada and to do one-week consulting project in Colorado. Must the LLC qualify or register to do business in those states?

g. The LLC has failed to hold several meetings, although the operating agreement requires the meetings. May a creditor of the LLC now hold the members liable for a debt because the LLC is not complying with the terms of its operating agreement?