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CALIFORNIA LEGAL INFORMATION

LLC Links -- Forms and Statutes

LLC Operating Agreement Form Price: $16.99 (free trial)
PLLC Operating Agreement Form Price: $20.99 (free trial)

Note: for Professional Services LLC called "PLLC".


Selected California Statutes--LLC

  • 17051. Article of Orgnaization. (a) The articles of organization shall set forth:
    1. The name of the limited liability company.
    2. The following statement: The purpose of the limited liability company is to engage in any lawful act or activity for which a limited liability company may be organized under the Beverly-Killea Limited Liability Company Act.
    3. (RESERVED)
    4. The name and address of the initial agent for service of process on the limited liability company who meets the qualifications specified in paragraph (1) of subdivision (b) of Section 17061, unless a corporate agent is designated, in which case only the name of the agent shall be set forth.
    5. If the limited liability company is to be managed by one or more managers and not by all its members, the statement referred to in subdivision (b) of Section 17151. If the limited liability company is to be managed by only one manager, the articles of organization shall contain a statement to that effect.
    (b) It is not necessary to set out in the articles of organization any of the powers of a limited liability company enumerated in this title.
    (c) The articles of organization may contain any other provision not inconsistent with law, including, but not limited to:
    1. A provision limiting or restricting the business in which the limited liability company may engage or the powers that the limited liability company may exercise or both.
    2. Provisions governing the admission of members to the limited liability company.
    3. The time at which the limited liability company is to dissolve.
    4. Any events that will cause a dissolution of the limited liability company.
    5. A statement of whether there are limitations on the authority of managers or members to bind the limited liability company, and, if so, what the limitations are.
    6. The names of the managers of the limited liability company.
    (d) No limitation upon the business, purposes, or powers of the limited liability company contained in or implied by the articles of organization or the operating agreement may be asserted by any person, except in one of the following types of proceedings:
    1. In a proceeding by a member or the state to enjoin the doing of unauthorized business by the limited liability company or its managers or officers, if third parties have not acquired rights thereby.
    2. In a proceeding to dissolve the limited liability company.
    3. In a derivative proceeding by the limited liability company or by a member suing on the company's behalf against the officers or managers of the limited liability company for violation of their authority. However, the limitation may not be asserted if the person asserting the limitation had actual knowledge of the limitation at the time of the act or event complained of.
    (e) The Secretary of State may cancel the filing of articles of organization if a check or other remittance accepted in payment of the filing fee is not paid upon presentation. Upon receiving written notification that the item presented for payment has not been honored for payment, the Secretary of State shall give a first written notice of the applicability of this section to the agent for service of process or to the person submitting the instrument. Thereafter, if the amount has not been paid by cashier's check or equivalent, the Secretary of State shall give a second written notice of cancellation and the cancellation shall be effective at that time. The second notice shall be given 20 days or more after the first notice and 90 days or less after the original filing.

  • 17052. The name of each limited liability company as set forth in its articles of organization:
    (a) Shall contain either the words "limited liability company" or the abbreviation "LLC" or "L.L.C." as the last words in the name of the limited liability company. The words "limited" and "company" may be abbreviated to "Ltd." and "Co.," respectively.
    (b) May contain the name of one or more members.
    (c) Shall not be a name that the Secretary of State determines is likely to mislead the public and shall not be the same as, or resemble so closely as to tend to deceive, (1) the name of any limited liability company that has filed articles of organization pursuant to Section 17050, (2) the name of any foreign limited liability company registered to do business in this state pursuant to Section 17451, or (3) any name that is under reservation for another domestic limited liability company or foreign limited liability company pursuant to Section 17053. However, a limited liability company may adopt a name that is substantially the same as that of an existing domestic limited liability company or foreign limited liability company that is registered pursuant to Section 17451 upon proof of consent by that domestic limited liability company or foreign limited liability company and a finding by the Secretary of State that, under the circumstances, the public is not likely to be misled.
    (d) Shall not contain the words "bank," "trust," "trustee," "incorporated," "inc.," "corporation," or "corp.," and shall not contain the words "insurer" or "insurance company" or any other words suggesting that it is in the business of issuing policies of insurance and assuming insurance risks.
    (e) The use by a limited liability company or a foreign limited liability company of a name in violation of this section may be enjoined, notwithstanding the filing of its articles of organization or its registration with the Secretary of State.
    (f) A limited liability company may record in the office of the county recorder of any county in this state, and county recorders, on request, shall record a certified copy of the limited liability company articles of organization and any exhibits or attachments, or any amendment or correction thereto, that has been filed in the office of the Secretary of State. A foreign limited liability company may record in the office of the county recorder of any county in the state a certified copy of the limited liability company application for registration, certificate of registration, or any amendment thereto, that has been filed in the office of the Secretary of State. The recording shall create a conclusive presumption in favor of any bona fide purchaser or encumbrancer for value of the limited liability company real property located in the county in which the certified copy has been recorded, of the statements contained therein.

  • 17254. (a) No distribution shall be made if, after giving effect to the distribution, either of the following occurs:
          (1) The limited liability company would not be able to pay its debts as they become due in the usual course of business.
          (2) The limited liability company's total assets would be less than the sum of its total liabilities plus, unless the operating agreement provides otherwise, the amount that would be needed, if the limited liability company were to be dissolved at the time of the distribution, to satisfy the preferential rights of other members upon dissolution that are superior to the rights of the member receiving the distribution.
    (b) The limited liability company may base a determination that a distribution is not prohibited under subdivision (a) on any of the following:
          (1) Financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances.
          (2) A fair valuation.
          (3) Any other method that is reasonable in the circumstances.
    (c) Except as provided in subdivision (e), the effect of a distribution under subdivision (a) is measured as of (1) the date the distribution is authorized if the payment occurs within 120 days after the date of authorization, or (2) the date payment is made if it occurs more than 120 days after the date of authorization.
    (d) (1) If terms of the indebtedness provide that payment of principal and interest is to be made only if, and to the extent that, payment of a distribution to members could then be made under this section, indebtedness of a limited liability company, including indebtedness issued as a distribution, is not a liability for purposes of determinations made under subdivision (b).
          (2) If the indebtedness is issued as a distribution, each payment of principal or interest on the indebtedness is treated as a distribution, the effect of which is measured on the date the payment is actually made.
    (e) A member or assignee of a member is obligated to return a distribution from a limited liability company to the extent that (1) the member or assignee had actual knowledge of facts indicating the impropriety of the distribution, and (2) immediately after giving effect to the distribution, and notwithstanding the compromise of an obligation referred to in subdivision (b) of Section 17201, all liabilities of the limited liability company, other than liabilities to members or assignees on account of their interest in the limited liability company and liabilities as to which recourse of creditors is limited to specified property of the limited liability company, exceed the fair market value of the limited liability company's assets, provided that the fair market value of any property that is subject to a liability as to which recourse of creditors is so limited shall be included in the limited liability company assets only to the extent that the fair market value of the property exceeds this liability.
    (f) A cause of action with respect to an obligation to return a distribution pursuant to subdivision (e) is extinguished unless the action is brought within four years after the distribution is made.

  • 17255. (a) A member or manager who votes for a distribution in violation of the operating agreement or Section 17254 or 17353 is personally liable to the limited liability company for the amount of the distribution that exceeds what could have been distributed without violating Section 17254 or 17353 or the operating agreement if it is established that the member or manager did not act in compliance with Section 17254 or 17353.
    (b) Each member or manager held liable under subdivision (a) for an unlawful distribution is entitled to compel contribution:
          (1) From each other member or manager who could be held liable under subdivision (a) for the unlawful distribution.
          (2) From each member for the amount the member received with knowledge of facts indicating that the distribution was made in violation of Section 17254 or 17353 or the operating agreement.
    (c) A proceeding under this section is barred unless it is commenced within four years after the date on which the effect of the distribution is measured under Section 17254 or 17353.

  • 17355. (a) (1) Causes of action against a dissolved limited liability company, whether arising before or after the dissolution of the limited liability company, may be enforced against any of the following:
          (A) Against the dissolved limited liability company, to the extent of its undistributed assets, including, without limitation, any insurance assets held by the limited liability company that may be available to satisfy claims.
          (B) If any of the assets of the dissolved limited liability company have been distributed to members, against members of the dissolved limited liability company to the extent of the limited liability company assets distributed to them upon dissolution of the limited liability company.
          Any member compelled to return distributed assets in an amount that exceeds the sum of the member's pro rata share of the claim and the amount for which the member could otherwise be held liable under Section 17254 or 17255 may seek contribution for the excess from any other member or manager, up to the sum of that other person's pro rata share of the claim and that other person's liabilities under Section 17254 or 17255.
    (2) Except as set forth in subdivision (c), all causes of action against a member of a dissolved limited liability company arising under this section are extinguished unless the claimant commences a proceeding to enforce the cause of action against that member of a dissolved limited liability company prior to the earlier of the following:
          (A) The expiration of the statute of limitations applicable to the cause of action.
          (B) Four years after the effective date of the dissolution of the limited liability company.
    (3) As a matter of procedure only, and not for purposes of determining liability, members of the dissolved limited liability company may be sued in the name of the limited liability company upon any cause of action against the limited liability company. This section does not affect the rights of the limited liability company or its creditors under Sections 17254 and 17255, or the rights, if any, of creditors under the Uniform Fraudulent Transfer Act, that may arise against the member of a limited liability company.
    * * *

Library of Informational Legal Articles


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