Several people have decided to go into business as an LLC. To cover all contingencies, they want to specify what constitutes an act of dissociation and outline the procedures upon dissolution. This information would be included in?

Full Question:

Several people have decided to go into business as an LLC. To cover all contingencies, they want to specify what constitutes an act of dissociation and outline the procedures upon dissolution. This information would be included in

A) common law-the members may not negotiate these rights.

B) the Uniform Limited Liability Company Act.

C) the certificate of organization.

D) the operating agreement.

Answer:

This information would be included in Operating Agreement.

Option D

Explanation:

The operating Agreement is a formally structured, established and agreed upon statement or agreement by a set of individuals, who enter into a lawful relationship. In business terminologies, it is a statement containing the guidelines, code of conduct and courses of action to be taken into consideration, during the life of a company.

With respect to the process of dissolution, the agreement will contain the entire course of action, each partner's individual share in capital and other necessary information.