How to Change the Operating Agreement for a Limited Liability Corporation?
If your LLC is governed by an operating agreement, it must be amended if any changes are enacted. The operating agreement outlines the rights, privileges and responsibilities of every member of the LLC. Additionally, it dictates if the company is managed by all members unanimously or a single managing member. While not all states require an operating agreement, if you choose to use one, it should be amended accordingly if the members deem a change is necessary.
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Instructions
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Arrange a meeting among all members of the LLC with voting rights. Create an agenda outlining each proposed change to the operating agreement.
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Present the proposed changes to the voting members at the meeting. Give the members an opportunity to weigh in on the proposals. Vote on each change. The outcome is dependent on the voting procedures detailed in the original operating agreement, such as unanimous consent or simple majority.
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Engage an attorney or legal professional to draft or — at minimum, review — an amendment to the operating agreement. While you can accomplish this autonomously, the guidelines set forth in the document will be legally binding.
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Open the amendment by reiterating the original terms of the operating agreement. Identify the LLC by name and principal business address. List each member along with his particular capacity, e.g., member, managing member, non-voting member.
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Insert a clause attesting that the members have agreed to make the desired changes.
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Outline each change in its own section. For example, insert the header “Extensions of Credit.” Indicate that under the old operating agreement, all members must sign for the LLC on all credit applications. State that under the new agreement, John Doe is managing member and duly authorized to sign all credit applications on behalf of the LLC.
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Circulate the amended agreement among the LLC members. Each member needs to sign the amended agreement.
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Distribute a copy of the amendment to each member of the LLC to retain for individual records.
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