Permits a member or members of a limited-liability company to avoid dissolution by buying the membership interest owned by the other member or members seeking dissolution.
Impact
With the passage of H5566, the legal framework surrounding LLCs in Rhode Island will become more accommodating, particularly for members looking to retain ownership and control. By allowing members to buy out those seeking dissolution, the bill encourages stability in business partnerships and prevents abrupt interruptions of operations that could arise from a single member's desire to exit the company. This is particularly beneficial for small businesses reliant on close-knit partnerships to operate effectively.
Summary
House Bill H5566 seeks to amend the Rhode Island Limited-Liability Company Act by introducing provisions that allow members of a limited liability company (LLC) to prevent dissolution of the entity. Specifically, if a member petitions for dissolution, other members will have the right to buy out that member's interest at fair market value. This adjustment aims to provide a mechanism to maintain the continuity of LLCs, which play a significant role in local economies.
Conclusion
Overall, H5566 reflects an effort to enhance the operational flexibility of LLCs by reducing the likelihood of forced dissolutions due to disagreements among members. As it stands, the proposed amendment will have implications for the governance and financial arrangements within LLCs, ensuring that business continuity can potentially be preserved amid internal disputes.
Contention
There may be potential points of contention among LLC members regarding the determination of fair market value for membership interests. The bill proposes that if an agreement on value cannot be reached voluntarily, the court will intervene to establish the fair market price, which might lead to disputes regarding valuation methods and differing assessments of a member's contributions to the business. Moreover, concerns may arise regarding the financial capacity of remaining members to buy out their peers, which could reshape the dynamics of LLC partnerships.
Restructures RI Housing and Conservation Trust Fund, increase its membership to 15 members, 11 of whom are to be from the general public and reallocate the percentage of the funds for housing, conservation and other goals.
Restructures RI Housing and Conservation Trust Fund, increase its membership to 15 members, 11 of whom are to be from the general public and reallocate the percentage of the funds for housing, conservation and other goals.
Increases the membership of the energy facility siting board from 3 to 5 members and would revise the process of energy facility siting to mandate inclusion/participation of the host community of the facility as well as of the public and cities and towns.
Increases the membership of the energy facility siting board from 3 to 5 members and would revise the process of energy facility siting to mandate inclusion/participation of the host community of the facility as well as of the public and cities and towns.
HOUSE RESOLUTION AMENDING THE MEMBERSHIP OF THE PERMANENT ADVISORY COUNCIL FOR THE RHODE ISLAND HOUSE VETERANS' AFFAIRS COMMITTEE (This resolution would amend the membership of said commission by increasing the number of members to seventeen (17), all of whom would be honorably discharged veterans and be qualified electors of this state, to be appointed by the Speaker.)
Housing cooperatives; organization and operation provided for seniors, low and moderate income people, and limited equity cooperatives and leasing cooperatives for designated members.