Compliance Bulletin

New Bill Revises Law on LLCs
October 19, 2015

The state Legislature enacted AB 506, which amends certain provisions of the California Revised Uniform Limited Partnership Act (“LLC Act”). Many of the revisions will make it easier for lenders making a loan to a limited liability company or to a member of limited liability companies secured by liens on the borrower’s membership interest. Also, the revised statute gives greater deference to the LLC’s operating agreement. Kevin Gould was CBA’s lead lobbyist on the bill. Peter Munoz, partner with Reed Smith and member of CBA’s Legal Affairs Committee, prepared an analysis of AB 506, which can be found here.