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Tyler and Stacie are each starting a business. Tyler’s business is a candy store. Stacie’s business is an internet start-up, and she needs millions of dollars in venture capital. She expects to go public soon. Tyler has borrowed $15,000 from his grandfather, which he hopes to pay back soon. Explain whether either of these businesses should organize as an LLC. If not, what form of organization would you recommend and why.

8. Johnny and Stevie formed an LLC to buy and renovate motels. They did not sign an operating agreement, but they orally agreed that they would dissolve the LLC if they could not get along. The two owners argued repeatedly, and Johnny refused to meet with Stevie, although he was willing t o take her phone calls. Johnny continued to work on the renovation that was then underway. Stevie asked a court to dissolve the LLC. Under state law, an LLC without an operating agreement could only be dissolved if (1) the management of the entity is unwilling to reasonably promote the stated purpose of the entity or (2) continuing the entity was financially unfeasible. What result is Stevie’s lawsuit? What is the moral of the story?

9. In their spare time, Jocelyn and Twyla like to sew quilted jackets. After this sideline becomes profitable, Jocelyn tells Twyla that she is going to start quilting jackets on her own without her – she thinks she is more creative than Twyla. Does Jocelyn have a right to exclude Twyla? Are they partners?

10. Mullins hired Mutt, a young carpenter, to build his new veterinary clinic. A week after they signed the contract, Mutt incorporated Mutt Construction, Inc. Dr. Mullins made payments to the corporation. Unfortunately

the work on the clinic was shoddy and not completed timely. Dr. Mullins filed suit against Mutt and Mutt Construction, Inc. Mutt argued that if the corporation was liable, he, as an individual, must not be. Who is liable to Dr. Mullins? Does it matter if Mutt signed the contract in his own name or in the name of the corporation?