Ask a Business Lawyer. Get Business Law Questions Answered ASAP.
You need a unit purchase agreement. We are not permitted to give legal advice on this site, so I am not able to draft an operating agreement for you, but if you like I could provide a form which you can use for your unit purchase agreement. You do not need a bill of sale. Once you have your new member, you can then get an operating agreement in place.
Yes, if you would provide the form that would be great.
I just want there to be a clean break and the person not able to be successful at claiming she owns a right to anything after selling her interest in the company.
Yes, this document will accomplish that. Just give me a moment and I'll be right back.
After you look over the form, let me know if you have any questions.
Ok. I'm reading it now. I'll let you know shortly.
in 7 - Settlmenet and RElease - what is the last blank?
the "of either ___" is confusing -- shouldn't this be " of ____"
or should it be "of either <company name> or <other owners' names>" ?
Actually, I believe it should be just "of either." No blank should be there.....does that make more sense?
It could be purchaser or seller, but I think I would just leave it at "either."
Yes it does. One more question - should i have language in there protecting the other remaining owner against the Seller's claims. E.g. the seller is selling to me, the purchaser, but there is still 1 other party who owns part of the llc - should there be a provision in 7 releasing any claims from him as well?
No, since other member is not a party to the unit purchase agreement. Any matters between you and other member should be handled in the operating agreement. You can't bind a non-selling member to this agreement and your purchase has no bearing upon his membership and vice versa. Normally, I would tell you to get a copy of the remaining member's agreement to allow a new member, since most operating agreements require it, but since you stated they do not have an operating agreement you should have no issue with the other member.
Oh wait, sorry.
I see that you are already a member, I forgot that part.
As long as there is no operating agreement you are fine and don't need anything from the third member.
Ok - yes there is no operating agreement. I will implement one after this sale between myself and the remaining owner.
Again, if you had an operating agreement already, it would likely specify the procedure for one member selling units - i.e. the company itself has first right of refusal, then each member has a chance, etc. But since you do not have that, then the seller is free to sell to you and you are free to purchase.
Agreed, you definitely need to get one in place.
this document looks good. Would it be appropriate to add something like " Seller is the owner of 100 units (the "Units") of a total of 300 units in <company name>..."
Yes, I always like to add that. I think it's a good idea.
considering we haven't laid out how many units there really are, it would probably be a good idea to say "you own 1/3, you're selling all your 1/3 interest"
or some language like that.
and i think just doing 100 out of the total of 300 would do that - there's no dispute the ownership is owned 1/3 1/3 and 1/3
Yes, if there is not a specified number of units then I would base it on 100% and use percentages.
she's selling her 1/3 to me, such that I will own 2/3 and my other partner will own 1/3 still
ah ok .. yeah, better idea.
You could just specify out of 100% you own 33.3% or whatever...
I'm doing a quick check of the TX LLC statute to make sure there's nothing in there....it is a TX LLC, correct?
right .. perhaps in words "seller is the record owner of one third (the Units) of <biz name>..." Then we can still call the 1/3 ownership the Units throughout the doc.
yeah, TX LLC
Yes, that would be good. I'm pretty sure there won' t be anything in the statute to address this but I'm just double checking.
No, there is nothing in the statutes. There are provisions governing the admittance of new members who purchase units or are assigned units, but nothing about a current member acquiring more units. So you are fine with this agreement, no problem.
Excellent. Yeah, I think all I have to do in reporting to TX Sec of State is amend the member-manager list on the next year's update filings. Great. Thank you for the document. I'll customize and fill it out. As for the op. agrmnt. Can I contact you later regarding that?
Correct as to updating the filings, you are welcome, and yes you can contact me about the operating agreement - I may be able to find a form you can use (I don't want to give you mine because not sure it's appropriate for TX law but I can see if I can find one that is).
Sounds good, Kathie. thanks so much. How do I get back in touch with you ?
You are very welcome. You can just begin a question with "for kathie russell only" and it will get to me.
Sounds great, Kathie - thanks so much!
DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.
The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).