Should I Alter My LLC Operating Agreement During Business Succession Planning in St. Petersburg?

Most LLC owners know that their Operating Agreement is important. However, you might have forgotten about this document after setting up your business for the first time, and you might not realize the role it will play during business succession planning in St. Petersburg. To learn more about the next steps, consider speaking with an experienced St. Petersburg business succession planning attorney.

Your LLC Operating Agreement Controls What Happens to Your Business

Many mistakenly believe that their Will has the “final say” on what happens to their LLC. In reality, the Operating Agreement takes precedence over your Last Will and Testament. If you do not adjust your Operating Agreement, it may not reflect your new goals and priorities since originally forming the LLC. As a result, your business might fall into the wrong hands. Unwanted partners may also retain control over your business after you pass away.

How Should I Alter My Operating Agreement During Succession Planning?

The first step is to determine who should have control over the company after you pass away. If you want your family to have some or all control over the direction of the LLC, you must update your Operating Agreement accordingly. You should also consider the role of any remaining business partners that might be around after you pass away. Should they continue to have a role in running the company, or will your family members take over completely?

Perhaps you don’t even want your company to continue after you’re gone. Maybe you want to give your family the ability to sell the entire operation and receive the proceeds. If this is the case, you may want to consider including buy-sell provisions and other mechanisms in your Operating Agreement. If you want to prevent anyone from selling your company after you’re gone, the opposite approach is necessary.

If you want to give your family the ability to sell the LLC, your Operating Agreement can also specify the business valuation method used to determine how much it is worth.

If your family members do not have the necessary experience or credentials to run the company, you might want to prevent them from running the operation. With the right approach, you can ensure that these family members benefit financially from the continued profits of the company without exerting any actual control over day-to-day operations.

Ultimately, each LLC owner may have completely different priorities and goals when it comes to succession planning. Speak with an experienced attorney about these goals to receive targeted guidance.

Can an Estate Planning Attorney in St. Petersburg Help Me? 

If you’re serious about business succession planning in St. Petersburg, you should revisit your LLC operating agreement and make the necessary adjustments. Your lawyer can guide you through this entire process, helping you meet your business succession goals. Continue this conversation by contacting Drude Tomori Law at 727-300-8900. Outside of St. Petersburg, we serve LLC owners in Sarasota, Lakewood Ranch, and Bradenton, Florida.

Source:

dos.fl.gov/sunbiz/forms/limited-liability-company/