Am I bound by an LLC agreement that I was not shown and then refused to sign when asked to?

I was hired as an employee in 2005 of a private equity fund. As part of my compensation package I was given a share of the fund's profits and also agreed to invest money in the fund. In 2009 as I was thinking of leaving, the firm's owners confronted me with an LLC agreement governing the partnership that managed the fund and told me to sign it. It contained many restrictive covenants and so I refused and within days left the firm. They now both refuse to pay me my share of the profits earned between 2005-9 (which were vested) as well as the fair market value of the money I invested in the fund on the grounds that I am bound by the LLC agreement which was drafted in a way that the firm's owners can strip anyone of their profit share and investment amounts at essentially their discretion. They concede that I did not sign the agreement.

2 answers  |  asked Jun 30, 2011 9:28 PM [EST]  |  applies to New York

Answers (2)

Albert Rizzo
Your entitlement to compensation is based upon the terms of your employment when you were hired. If there is no written agreement regarding your compensation, then it is generally subject to change by your employer in its discretion.

From your description of the issue, I do not know what you intend by "LLC Agreement," or why they would ask you to sign it. But the agreement should be reviewed in order to properly respond regarding its effect, if any, on the terms of your compensation. Any other agreements or documents containing the terms of your compensation and employment should also be reviewed regardless of whether you signed or "agreed" to them.

Hope this helps.

posted by Albert Rizzo  |  Jul 1, 2011 05:37 AM [EST]
Patricia Pastor
Based on the information you have provided, it wold appear you are not subject to an agreement you did not sign. However, you should contact an attorney to review the "LLC Agreement," as well as any agreement you entered into at the time you became an employee, in order to determine your rights.
If you would like to consult you may contact me directly at 631-988-4047

posted by Patricia Pastor  |  Jun 30, 2011 10:13 PM [EST]

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