Why All Arizona LLCs Need an Operating Agreement that Eliminates the Harmful Provisions of Arizona’s New LLC Law
On September 1, 2019, Arizona replaced the Arizona limited liability company law adopted in 1992 with an entirely new law. If you are a member of an Arizona LLC please note the following facts:
1st Warning: Arizona’s new LLC law harms members of LLCs that do not have an Operating Agreement with language that eliminates the damaging provisions of the new LLC law.
2nd Warning: If you are a member of an Arizona LLC you must read the 13 examples below because they explain 13 ways Arizona’s new LLC law can harm you.
3rd Warning: If any of the 13 examples in the table below applies to you and your Arizona LLC the only way to eliminate the harm is for all the members to sign an Operating Agreement that contains language that eliminates the bad provisions of the new law.
4th Warning: All 13 of the examples below apply to multi-member LLCs, but only examples 4, 5, 10 and 11 apply to single member LLCs and married couple owned LLCs.
5th Warning: Beware of Operating Agreements that are not drafted to eliminate the harmful provisions of Arizona’s new law. You should hire the Keyts to draft your Arizona LLC’s Operating Agreement because it is unlikely you can find anybody else who has the knowledge of Arizona’s new LLC law needed to draft a new Arizona LLC law compliant Operating Agreement. The Keyts have drafted 6,700+ Arizona LLC Operating Agreements and have 168 five star Google & Birdeye reviews. Complete our Operating Agreement questionnaire to buy our new Arizona LLC law compliant Operating Agreement that eliminates all of the problems described below.
Hypothetical LLC Facts
The table below illustrates how Arizona’s new LLC law affects three hypothetical LLC members. The members are Ned Flanders, a single man, and Homer and Marge Simpson, a married couple. The Simpsons contributed $10,0000 to the company. Ned contributed $90,000. Ned is to be paid for services he provides on behalf of the company.
Members’ Mistaken Assumptions
Ned assumes he will be allocated 90% of the profits because he contributed 90% of the capital. Ned also assumes he will have control of the company because he will have 90 votes out of 100 total votes. Homer thinks he owns his interest in the LLC as his separate property because Marge is not named as a member in the LLC’s Articles of Organization. These problems and others are explained in the table below.
Warning: If only one of the examples described below applies to your Arizona LLC you need my Operating Agreement to fix the problem.
How to Buy an Operating Agreement
Option 1: Quickest, Easiest & Most Popular – Telephone (Mon – Fri 8 am – 5 pm). Call and give your information to:
- LLC attorney Richard Keyt (father) – 480-664-7478
- LLC attorney and former CPA Richard C. Keyt (son) – 480-664-7472
Option 2 Available Online 24/7: Submit our Operating Agreement Questionnaire.
Call Us if You Have any Questions
We don’t charge to answer questions about LLCs or Operating Agreements. Call LLC attorneys Richard C. Keyt (480-664-7472) or his father Richard Keyt (480-664-7478) if you have any questions about LLC Operating Agreements.