Is An Llc Operating Agreement An Executory Contract

This is a crucial issue, as a non-voting LLC stake is less attractive to a receiver trying to maximize profits for the bankruptcy estate because it prevents the agent from selling the LLC. But life and code are not so simple. When the agreement on which the interest of the LLC is based is executed, section 365 of the Code becomes superior to section 541 based on the non-economic elements of LLC`s interest and if the debtor, trustee or third assignee can retain such non-economic interests, becomes a complex analytical function resulting from the application of different provisions of section 365. If you are not already familiar with ยง 365 (c), 365 (e) and 365 (f), the curious reader may want to take a look at such subsections. .

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