QUESTION
does a co-founder of an llc that is no longer a current owner have any rights?
Asked on Aug 03rd, 2012 on Business Law - Illinois
More details to this question:
I own a small company in illinois, I am currently co-owner with my fiance. We own the company 50% each. A founder of the company, stepped down as owner 5 months ago- just wanted to be an employee. Now he says he has rights to the company because he was a founder. Is that true?
1 ANSWER
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The rights of members (or former members) of an LLC are determined by the LLC's operating agreement. What does the operating agreement say? Alternatively, he may have rights under the terms of the agreement by which his membership interest was acquired when he "stepped down." What does that agreement say? As a general matter, the "organizer" of an LLC has no rights -- but this result could be varied by agreement.
Answered on Aug 04th, 2012 at 6:53 AM