Why LLCs Must Have an ALLCA Compliant Operating Agreement: Reason # 2
New Arizona Limited Liability Company Act (ALLCA) Section 29-3101.13 effective September 1, 2019, states:
“Manager” means a person that under the Operating Agreement of a Manager-managed limited liability company is responsible, alone or in concert with others, for performing the management functions stated in Section 29-3407, subsection C.
ALLCA Section 29-3105.A.1(b) states:
The Operating Agreement governs . . . the rights and duties . . . of a person in the capacity of Manager
My interpretation of these two statutes is that under ALLCA the only way a manager of a manager managed LLC can be a manager and have manager power’s is if the LLC has an Operating Agreement and the person or entity is named in that Operating Agreement as a manager.
Conclusion: When a manager managed LLC becomes subject to the new ALLCA it will not have a manager unless the LLC has an Operating Agreement that names one or more managers.
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