Richard Wilson: separating control rights from return rights

Richard's LLC discussion assigned control and preferred economic rights to different example share classes.

The classes did different jobs

He described one class holding controlling shares and another receiving a preferred return. The explanation made the rights attached to a class the subject of the discussion.

Common ownership was only one possibility

Richard then described different payment sequences and caps. His point was that an LLC illustration could contain several kinds of rights. He also told the audience to involve an attorney when considering structures.

In Richard C. Wilson's words

"one share class might have the controlling shares" (Richard C. Wilson, recorded Rainmaker Series module)

How to use this

Describe the control right and payment right in separate fields.
Keep these examples distinct from the terms of an actual agreement.

Questions and answers

What did Richard assign to separate classes?

Control rights and preferred economic rights.