WebCredenza 2024 Buying, selling and exchanging partnership and LLC interests

As LLCs have become the default choice of entity for most businesses, sales and exchanges of LLC membership interests are commonplace. Despite the frequency of sales and exchanges, exactly what rights of the seller the buyer succeeds to is often mistaken and these mistakes can lead to dispute and litigation. By default, transferees succeed only to the economic interests of the transferor. They do not succeed to the transferor’s governance rights. If governance rights are part of the underlying bargain, the consent of the LLC’s other members generally must be sought.  This program will provide you with a practical guide to drafting and planning for the sale and exchange of LLC interests.

• Selling/exchanging LLC and partnership interests and effective alternatives.
• Succession to economic rights of seller v. management and information rights.
• Tax consequences to the entity and buyers/sellers in sales/exchanges of entity interests.
• Disguised sales of LLC/partnership interests – and techniques to avoid adverse tax impact.
• Constructive terminations and their adverse tax consequences.
• Distributions and other alternative to sales and exchanges of LLC/partnership interests.

Opinions and positions stated by presenters of MoBarCLE programs are those of the presenters and not necessarily those of The Missouri Bar. This program is intended as information for lawyers in Missouri, in conjunction with other research they deem necessary, in the exercise of their independent judgment.