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Show THE OGDEN VALLEY NEWS Page 18 Volume V, Issue I October 15, 2001 Sweeping Changes in Limited Liability Company Laws Now In Effect By Celeste C. Canning, Attorney at Law The 2001 Utah Legislature repealed the Utah Limited Liability Company Act (the “Old Act”) and replaced it with the Revised Utah Limited Liability Company Act (the “Revised Act”) which became effective on July 1, 2001. At the risk of over-simplification, the changes in the laws governing limited liability companies (LLCs) fall into three broad categories. The first category consists primarily of organizational or housekeeping changes. The second category may be loosely described as changes affecting the relationships with non-members, including government. Finally, the third category comprises rules affecting the relationship between members. This article focuses on the second category of changes—those affecting relationships with non-members. Every LLC had to file Articles of Organization meeting statutory requirements before it could become an LLC. The Revised Act changes some of those requirements. LLCs are no longer required to specify a principle place of business, but must instead identify a “designated office.” An LLC’s principle place of business would be location where work was performed. In the case of a retail establishment, the principle place of business would be the store. In contrast, the designated office is simply the location where the books and records of the LLC are maintained. The designated office may be a member’s home, the accountant’s office or any other locations the members determine. Under the Old Act any member could make commitments to an outsider on behalf of the LLC whether or not properly authorized to do so, so long as the outsider had no knowledge of specific limitations on the member’s authority. There were no provisions for putting outsiders on notice of limitations on the members or managers. Under the Revised Act, the Operating Agreement may contain provisions putting the world on notice of limitations in authority. Making use of these provisions may make sense for many LLCs. One of the pitfalls many business people encounter when their businesses are organized as corporations is the necessity for regular meetings and minutes recording those meetings. The Revised Act offers some relief for businesses operated as LLCs. LLC members will not lose their liability shield should they decide not to observe the formalities applicable to corporations. The freedom from required meetings, etc., can be a great benefit, reducing the time costs of running a business. However, there are many occasions when members should record decisions for the record for a variety of reasons, including tax issues and liability issues. Finally, the Old Act did not clarify what interest a member’s judgment creditor could obtain in the LLC. The Revised Act states that the judgment creditor may only receive a “charging order” against the debtor/member’s interest. In plain English, this means that creditors only have the right to receive whatever income the member becomes entitled to receive, but does not receive a voting interest in the LLC. Therefore, if one member has a money judgment against him, the business may continue without outside interference. Because of the sweeping nature of the changes every LLC should review its organizational documents (Articles of Organization and Operating Agreement) in light of the Revised Act to ensure compliance with the Revised Act. This may also be a good time to make any other changes the members may have been considering. For more information contact Celeste C. Canning, Attorney at Law at 791-1092. This article is not legal advice. It is for informational purposes only and is not intended to be a substitute for legal advice. LLCs and their members should consult with an attorney prior to making changes to their organizational documents. You can also e-mail Canning at: ccanninglaw@aol.com Super Fall Blowout Sale CARPET REMNANTS 739 Wall Avenue Ogden, UT 84404 FREE BUY 1 GET 1 Blinds 1/2 PRICE with any full room remodel 399-1616 Cool Spaces 2002 Program Being Launched SALT LAKE CITY, Utah. The Salt Lake Organizing Committee for the Olympic Winter Games of 2002 (SLOC) has collaborated with Utah Power and the Utah Energy Office to launch the Cool Spaces 2002 program. The Cool Spaces 2002 program is a multi-faceted effort which advocates urban forestry projects by encouraging tree planting around the Salt Lake City Community in an effort to “cool our community.” University of Utah students and Olympic hopeful Mark Hoaglin launched Cool Spaces 2002 recently by planting 50 trees at the Olympic Village. In 1998, SLOC worked with National Aeronautics and Space Administration (NASA) scientists to identify “hot spot” areas in the Salt Lake region. NASA pilots flew over the valley in planes equipped with high-definition infrared cameras. The photographs measured the amount of heat radiating from the landscape, and also identified barren hot spots where tree-planting efforts are most needed. The University of Utah is a demonstration site for the Cool Spaces program after the 1998 NASA thermal images showed the Olympic Village is a hot spot. “The planting and caring of trees in the urban environment has many social, environmental and economic benefits,” said Diane Conrad Gleason, SLOC director of Environmental Programs. “We are excited to launch this program and to plant trees to bolster air quality, prevent erosion, beautify the landscape and cool our communities.” Utah Power, a 2002 Olympic Environmental Champion, supports SLOC in meeting its environmental goals. Utah Power shares many of the same goals, which include promoting urban forestry by “putting the right tree in the right place.” Being a SLOC Environmental Champion is a natural extension of Utah Power’s existing and ongoing environmental activities. As an Environmental Champion, Utah Power is contributing 500 trees to the Cool Spaces initiative. In 1994, the International Olympic Committee (IOC) added “environment” to “sport” and “culture” as the third principle of Olympism. SLOC is committed to protecting and enhancing the environment while staging the 2002 Olympic and Paralympic Winter Games. To achieve a zero emissions goal for Games-time and to leave a lasting environmental legacy, SLOC has set a goal of planting 100,000 trees in Utah and 2,000,000 internationally by Games-time. PUBLIC NOTICE The TV/Translator Board announces that the UHF channels will be changed in the near future. Look forward to more information. 801-745-4000 2555 WOLF CREEK DR. 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