On June 14, 2013 Governor Scott signed into law Chapter 605 of the Florida Statutes, the Florida Revised Limited Liability Company Act (the “Act”).
The Act will be effective for every LLC formed or registered to do business in Florida on or after January 1, 2014. All LLCs in existence before that date can continue to operate under the provisions of the existing law unless they elect to be governed by the new act until December 31, 2014. After that date, ALL LLCs formed or registered in Florida will be subject to the new law.
The Act is a “default statute” just like the existing law. A notable example is that, if not addressed in the operating agreement, the default rules provide that distributions are to be made to members on a per capita basis – i.e., in equal shares, without regard to capital contributions or ownership percentages.
Furthermore the Act expands the list of non-waivable default rules that cannot be overridden by the operating agreement: e.g., a member is allowed to have the non-waivable right to dissociate from an LLC and the dissociated member will only have the rights of an un-admitted transferee (with certain exceptions). However the Act gives LLCs a cause of action for “wrongful dissociation”; meaning than an LLC may be entitled to damages if a member dissociates in any manner defined as wrongful, including contrary to an express provision of the operating agreement.
A notable improvement will now permit, for the first time, LLCs to file statement of authority to delineate the authority of a member, manager and/or officer.
Also for the first time, companies based outside the United States that want to domesticate as Florida LLCs will be allowed to do so while keeping their status of foreign entity.
The new act permits interest exchanges and also eliminates the term “managing-member”, it explicitly addresses direct actions by members against the LLC as well as actions against other members and managers, to enforce a member’s rights and protect a member interests.
Cav. Piero Salussolia, Esq.
Avv. Gemma A. Caterini (admitted only in Italy).
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