Question

A(n) ________ refers to a document that states the terms for converting an existing business to an LLC.

1) articles of organization
2) articles of termination
3) agreement of conversion
4) operating agreement

Answer 1

An agreement of conversion is the document for converting a business to an LLC, while articles of organization establish the LLC, and the operating agreement details its operations.

Step-by-step explanation:

A document that states the terms for converting an existing business to a Limited Liability Company (LLC) is known as an agreement of conversion. This document outlines the process by which the business transitions from its current form, whether it be a sole proprietorship, a partnership, or a corporation, into an LLC. The articles of organization are another crucial document, filed with the state, which legally establishes the LLC as a registered business entity.

It's important to differentiate among the various documents related to LLCs:

• The articles of organization are the founding documents of an LLC.
• The operating agreement outlines the internal operations of the LLC.
• The articles of termination are filed to dissolve an LLC.