Worksheet 17.2: LLC Management and Operation & Dissociation and Dissolution of an LLC

1. What are the options that exist for management of an LLC? (Select two)

b. Member-managed

c. Manager-managed

2. The manager-managed LLC form of management in which:

c. the managers may be members, nonmembers, or a combination of both.

3. Under the ULLCA, managers in a manager-managed LLC owe fiduciary duties (the duty of loyalty and the duty of care) to the LLC and its members, just as corporate directors and officers owe fiduciary duties to the corporation and its shareholders.

a. True

4. A member of an LLC has the ___ to dissociate from the LLC at any time, but he or she may not have the ___ to dissociate.

power, right

5. The events causing a member to be dissociated from the LLC include voluntary withdrawal, expulsion by members or by court order, incompetence, and death.

a. True

6. If a member dies or otherwise dissociates from an LLC, the LLC ___ .

may continue if the remaining members agree

7. When a member dissociates from an LLC, he or she loses the right to participate in management.

a. True

8. When a member dissociates from an LLC, he or she retains the right to participate as an agent for the LLC.

b. False

9. Normally, the dissociated member has the right to have his or her ___ bought out by other members.

interest

10. In what order are proceeds from the sale of an LLC's assets distributed?

b. Pay off debts to creditors, return members' capital contributions, distribute remainder to members in equal shares