Delaware LLC

Delaware Has a Favorable Legal Climate for LLCs Outside of state legislature, the fair legal climate is nurtured in Delaware courts that attract businesses with predictability and well-reasoned decisions. There is a good explanation why in eight separate studies conducted by the US Chamber of Commerce, Delaware has been ranked #1 in state legal systems. […]

What Is LLC Membership Interest? In short, your LLC interest is your bundle of rights and privileges defined by the LLC operating agreement. LCC membership interest is not usually held in the form of a membership certificate like corporate stock. Instead, it is usually set forth in the operating agreement under the term “units”. Like […]

The Operating Agreement Should Address an Exit Strategy In limited liability companies involving a small number of members, the Operating Agreement will need to restrict transfers. That restriction assures that the parties will continue to do business with the same people, and not strangers. Restrictions on transfers of interests by small passive investors are less […]

A Delaware LLC is protected from creditors that target a member The charging order that allows creditors of a member to pursue their distributions, but not LLC assets or other member assets, applies uniquely to LLCs in Delaware. Creditors are not entitled to LLC property or an ownership stake in the LLC, while The Uniform […]

LLC Charging Order: Two-Way Protection Unlike many other states, one key benefit of the Delaware LLC not available to corporations in any state is that the Delaware LLC also offers a second type of protection: the “reverse shield.” Choosing to form a Delaware LLC creates a two-way shield. Unlike the traditional shield, the reverse shield […]