| Keeping the Business Compliant
On a larger scale, compliance means keeping your business compliant with the rules and regulations of the Department of Labor, including such areas as Workers Compensation, Contract Compliance, Americans Disability Act. and all the other agencies involved in the DOL. However, for a discussion on small LLCs, even those without employees, there is another very important area of compliance, and that is keeping your records correctly, up-to-date, and establishing a paper trail between decision and action. This is why it is so criticallly important to keep minutes in your business. Stand Alone Buiness
LLCs and corporations are stand alone business entities. They are favored as a business form by many people because they provide extensive protection for business debts. These debts can include judgments from lawsuits and debts owed to vendors. The basis for this protection is the fact that LLCs and Corporations are considered to be an individual separate from the members or shareholders. And as such, all decisions must be listed and approved before any action takes place. Legal Fiction of a Business
The legal fiction of individuality of the LLC or corporate entity is not absolute, and the idea of a separate individual can be challenged. In a corporation, this process is known as piercing the corporate veil of protection—in an LLC, it is known as setting aside the liability protection. This can happen when a company is not in compliance with the rules and regulations that covers its existence. Again, this is the critical role the minutes play in keeping a company compliant and unchallengeable by the IRS and the Courts. Remaining Compliant
Assuming that members of an LLC take the necessary steps to keep the business healthy, there has to be some proof that the steps were taken. Naturally, this is where the Minutes come in. These minutes are the all-important record of when meetings occurred, who attended, what was discussed and what decisions were made. The minutes of the meeting are kept by the Secretary of the company. He or she then presents them to the Members for approval, usually at the next meeting. Assuming the minutes are approved as being accurate, they are then filed in the Minutes or Record Book where they remain as long as the company exists. During audits, or court litigation, these minutes may well be the basis of decisions. Without them, the liability protecton an LLC offers can easily be set aside. In keeping Minutes
The Secretary should follow the requirements listed in the Operating Agreement of the LLC. It is important that the Secretary record at least a summary of the subjects discussed at the meetings, who was there, what decisions were made, and the vote regarding the resolution(s). The larger the business, the more complete and exact the minutes should be. It should also be noted that the size of the business, in this case, is not so much on how many people are involved, as to the weight and monetary value of the decisions being made. It is important in weightier matters that the minutes strictly follow the dictates in the Agreement or Bylaws. Resolutions
The listing of resolutions, which is nothing more than decisions made by the members/managers of an LLC, may sound a bit confusing or difficult when you first hear about them. However, they really are not--especially when one uses the format templates provided in our LLC packages. | | Types of Resolutions Required in Minues
Resolution to Obtain Corporate Credit Card
Resolution to Open Bank Accounts
Resolution to Acquire Assets of Business
Resolution to Spend Money on Equipment
Resolution to Borrow Against Accounts Receivable
Resolution to Assign Lease
Resolution to Authorize Borrowing on a Line of Credit
Resolution to Authorize Contract
Resolution to Authorize Franchise Agreement
Resolution to Authorize Sale-Leaseback transaction
Resolution to Borrow Against Accounts Receivable
Resolution to Borrow Capital
Resolution to borrow from a Designated Bank
Resolution to Borrow on Inventory and Equipment
Resolution to Commence Litigation
Resolution to Convert Excess Depreciation to Surplus
Resolution to Defend Suit
Resolution to file for Receivership
Resolution to Hire an Employee
Resolution to Issue Option to Purchase Shares
Resolution to Issue Release
Resolution to Lease as Corporate Lessor
Resolution to Lease Equipment
Resolution to Purchase or Lease Motor Vehicles
Resolution to Lease Premises
Resolution to Loan Funds
Resolution to Purchase Equipment
Resolution to Purchase Real Estate
Resolution to Retain a Professional Consultant
Resolution to Retain an Accountant
Resolution to Retain an Attorney
Resolution to Sell Assets Subject to Shareholder Approval
Resolution to Sell Business Assets
Resolution to Sell Company Shares
Resolution to Acquire Shares of Stock
Resolution to Appoint a Purchasing Agent
Resolution to Sell Equipment
Resolution to Settle Litigation
Resolution to Enter into or Terminate a Contract
Resolution to Hire, Promote, or Terminate an Employee
Resolution to Terminate Lease
Resolution to Waive Restrictions on Transfer Standard LLC Business Resolutions (by category)
Authorization of Treasurer to Open and Use LLC Accounts
Authorization of Treasurer to Open and Use Specific LLC Account(s)
Authorization of LLC Account and Designation of Authorized Signers
Authorization of Rental of Safe Deposit Box
Adoption of a Change in the Assumed LLC Name
Approval of Contract
Approval of Lease of Premises by LLC
Purchase of Real Property by LLC
Authorization of Sale of Real Property by LLC
Delegation of LLC Authority
Ratification of Contract or Transaction
Rescission of Authority
Certification of LLC Resolution
Affidavit of LLC Resolution
Acknowledgment LLC Tax Resolutions
LLC Election of Corporate Tax Treatment
Approval of Independent Audit of LLC Financial Records
Approval of LLC Tax Year Resolutions to Amend the LLC Articles and Operating Agreement
Approval of Amendment to Articles of Organization
Approval of Restatement of Articles of Organization
Amendment of Articles Form
Amendment of LLC Operating Agreement Membership Resolutions
Approval of LLC Distribution
Approval of Additional Contributions of Capital by Members
Admission of New Member
Approval of Transfer of Membership
Approval of LLC Purchase of Interest of Withdrawing Member LLC Hiring and Compensation Resolutions
Approval of LLC Hiring
Approval of Bonuses and Salary Increases
Approval of Independent Contractor Services
Appointment of LLC Officers
Authorization of Payment for Attending LLC Meetings
Annual Stipend for Attendance at LLC Meetings
LLC Indemnification and Insurance Loans to the LLC
Authorization of Loan to LLC at Specific Terms
Authorization of Maximum Loan Amount to LLC
Authorization of LLC Representative to Borrow Funds on Behalf of LLC as Needed
Authorization of Loan Terms Secured by LLC Property
Authorization of Line of Credit
Authorization of Line of Credit With Cap on Each Transaction
Authorization of Line of Credit Secured by LLC Property
Approval of Loan to the LLC
LLC Promissory Note: Installment Payments of Principal and Interest (Amortized Loan)
LLC Promissory Note: Installment Payments of Principal and Interest (Amortized Loan) Secured by LLC Property
LLC Promissory Note: Installment Payments of Principal and Interest (Amortized Loan) With Balloon Payment
LLC Promissory Note: Periodic Payments of Interest With Lump-Sum Principal Payment
LLC Promissory Note: Lump-Sum Payment of Principal and Interest on Specified Date
LLC Promissory Note: Lump-Sum Payment of Principal and Interest on Demand by Noteholder
LLC Promissory Note: Non-Uniform Schedule of Payments of Principal and Interest Loans by the LLC
Approval of LLC Loan to Insider
Individual Promissory Note: Installment Payments of Principal and Interest (Amortized Loan)
Individual Promissory Note: Installment Payments of Principal and Interest (Amortized Loan) Secured by Property
Individual Promissory Note: Installment Payments of Principal and Interest (Amortized Loan) With Balloon Payment
Individual Promissory Note: Periodic Payments of Interest With Lump-Sum Principal Payment
Individual Promissory Note: Lump-Sum Payment of Principal and Interest on Specified Date
Individual Promissory Note: Lump-Sum Payment of Principal and Interest on Demand by Noteholder
Individual Promissory Note: Non-Uniform Schedule of Payments of Principal and Interest
Release of Promissory Note | |
