Partnership - Alternative Unincorporated Business Organizations Flashcards
Define a Limited Partnership
Partnership with at least 1 general partner and at least 1 limited partner. The limited partner has limited liability.
What is required to form a limited partnership?
Must file with the state a limited partnership certificate that includes the names of all general partners.
In a limited partnership, what is the liability and control for general partners and limited partners?
General partners: still liable for all limited partnership obligations. Absorb all liability but have the right to manage the business.
Limited Partners: Limited liability and are not liable for obligations of the partnership itself. However, in most states they cannot manage the business. But, this may be changing.
What are the formation requirements and liabilities of a Registered Limited Liability Partnerships?
Requirements: Must register with state by filing a statement of qualification and file annual report.
Liabilities: No partner is liable for the obligations of this partnership, not even general partners.
What is the definition and formation requirements for a Limited Liability Company?
Defined: A hybrid between a corporation and a partnership in which the owners (members) have the same rights and limited liabilities as shareholders plus the benefits of partnership tax treatment.
Formation: Must file the articles of organization and may adopt an operating agreement.
Who has control over a Limited Liability Company?
Members may manage the company or may delegate to a team of managers.
What is limited life and limited liquidity?
Limited Liquidity: A full membership interest may not be transferred without unanimous consent of the members unless otherwise agreed in the operating agreement;
Limited Life: The company will dissolve upon unanimous consent of the members or as provided in the articles or agreement.
