Newport firm closes amid alleged embezzlement
Relax & Co., which provided an array of services to property owners in the Lake Sunapee area, had already been forced to lay off workers earlier this month.
Note: If you are a New Hampshire LLC member or manager or if you plan to form a New Hampshire LLC, you and your business advisers need to have a solid basic knowledge of LLC law and tax in order for your LLC to succeed. This another in a series of columns to provide you with this knowledge.
Here’s a discussion of provisions 21 to 24 in the New Hampshire LLC Act:
Comment: Most New Hampshire multi-member LLCs that have any managers at all have only one manager. For these LLCs, Section 78 is obviously irrelevant. However, if an LLC has two or more managers, it will sometimes be appropriate for one or more of the managers — for example, the managers appointed by the major investor — to have more votes than one or more other managers. Section 78 so permits.
Comments: When an LLC wants to acquire one or more other entities, it will sometimes obtain otherwise unavailable legal and tax benefits if it makes the acquisition through a merger with these entities rather than by purchasing them.
Comments: The substantive and procedural rules in the above sections are numerous and complex. Thus, if members plan to dissent from the above types of actions under these sections, they should generally hire an LLC lawyer to advise and assist them in planning their dissent before they actually make it; and If an LLC believes that one of its members may make such a dissent, the LLC, too, should generally hire a lawyer to represent it if it believes it may want to challenge the dissenter’s claim for a buyout.
Under Section 141, II, an LLC must distribute its assets in connection with its liquidation:
Comment: In light of Section 141, II(c), it is critical that when the LLC is formed or as soon as possible afterward, the members agree in their operating agreement as to the amount of the contributions by each of them to the LLC, since this will significantly affect the liquidating distributions to which they are entitled.
Section 143 contains important liquidation provisions governing the payment of the LLC’s debts to its known creditors and to unknown creditors to ensure that if these creditors don’t provide timely claims to the LLC, they will lose any creditors’ rights they may possess with regard to the LLC.
John Cunningham is an attorney of counsel to the law firm of McLane Middleton whose practice is focused on LLC law and tax. He can be contacted at lawjmc@comcast.net, 603-856-7172 or llc199A.com.