Another potentially significant effect under the New LLC Act concerns distributions. The default rule of the New LLC Act is that distributions (except final distributions) must be distributed equally to all members. A.R.S. 29-3404.A. If, for example, when the new legislation comes into force, you own a 75% interest in a two-headed LLC, if the company does not have an enterprise agreement or if the enterprise agreement on distribution sharing is silent, you are only entitled to a majority stake of 50% in unselected distributions. In such a scenario, you will continue to be affected and taxed 75% of the LLC`s revenues, even though you receive only 50% of the distribution. If you are concerned about the above, check your enterprise agreement. If the terms of this agreement are not in accordance with what the members agree, amend it. To start developing your LLC operating contract, simply create a free account and use our operating contract tool.
The Arizona LLC Enterprise Agreement for Multi-Members allows an LLC with more than one (1) owner to enter into a contract with others regarding obligations, rules and percentage of interest. The form acts as a partnership contract that identifies each capital submitted by a member and the obligations of each person […] The Arizona Legislature and the Arizona Supreme Court have both recently taken steps that should encourage members of Arizona LLC to design them immediately, without enterprise agreements. Even for CTCs that already have an enterprise agreement, members should withdraw and review it in light of recent legislative developments. Simply put, the rules have changed. Recent laws and jurisprudence have redefined some of the “standard rules” that apply to your LLC. Standard rules are laws applied if your LLC does not have a business agreement or if the operating contract does not explicitly address certain topics. Operational significance: Without restrictions in an enterprise agreement, a company`s crèche can lead the company to enter into a legally binding agreement with the manager, relatives and associated companies of the manager or a person or organization.