The law of contracts generally governs the interpretation and applicability of operating agreements. If your company operates in the state of Florida, the operating agreement alone may not solely govern how your limited liability company operates.
Rules Governing Florida LLCs
The Florida Revised Limited Liability Company Act became effective January 1, 2014. The Act is a default statute, which means that it sets out a default set of rules that govern Florida LLCs. If an operating agreement speaks to a particular provision that the Act also covers, an operating agreement will trump the Act. If an operating agreement is silent on a topic, an LLC could become subject to the default provisions of the Act, which may be different than those originally contemplated by the LLC’s members.
Creating a Florida LLC Operating Agreement
When drafting an operating agreement for your LLC, keep these important changes to Florida law in mind:
– The Act increases the number of requirements that must apply to all Florida LLC agreements.
– The Act eliminates the concept of a “Managing Member.”
– Provisions regarding the dissociation of a member have been expanded. A member may dissociate at any time. An LLC is now empowered with the ability to initiate a cause of action for wrongful dissociation.
– The Act expands the categories for which indemnification of members is barred.
– The Act modifies rules governing derivative actions, which are legal actions that a member may bring on behalf of the company.
– The Safe Harbor for approving conflict of interest transactions was expanded.
– The list of events giving rise to appraisal rights was expanded. Appraisal rights are the rights of the minority shareholders to have a fair interest price determined by an independent third party so that the LLC can be sold for that price.
Read original article here