Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell

Exercise 21

Sustainably Organized: Crimson Renewable Energy
Crimson Midstream Limited Liability Corporation (LLC) is a holding company specializing in petroleum pipelines, the shipping of petro-chemicals, and specialty asphalt products. The LLC designation allows the company to have as many members or owners as it pleases of all different types (i.e., individuals, corporations, partnerships, and so on). It also gives the company the ability to choose how much and when to pay distributions to stockholders, giving it more control over its finances.
As a holding company, it is able to generate independent business units with slightly different functions within the same industry. Denver-based Crimson Renewable Energy Limited Partnership (LP) is one such business unit that produces oil and gas with a focus on biodiesel fuels. As an LP, Crimson Renewable Energy has limited its liability to its own business, while Crimson Midstream LLC serves as the general partner that holds unlimited liability for the LP.
Crimson Renewable Energy produces 25 million gallons of biodiesel per year. It invests heavily in its ability to transform natural materials such as used cooking oil waste, vegetable oils, algae oils, animal fats, and waste corn oil derived from ethanol production into biofuels. With more than 20 years of experience, the firm oversees the quality of its operations in-house through testing and has the capacity to customize fuel for customers to meet certain price points, function requirements, or climate considerations. Crimson Renewable Energy's supply chain consists of those who are dedicated to sustainable practices. The company also sources locally when possible. 7
Crimson Midstream organized as a limited liability corporation. What are some of the advantages of an LLC?