SB 1795

Abstract

Amends the Limited Liability Company Act. Provides that the statutory fiduciary duties a member owes to a member-managed company and its other members do not limit any fiduciary duties owed at common law. Removes a provision requiring a member to discharge his or her duties to a member-managed company and its other members under the Act or under the operating agreement and to exercise any rights consistent with the obligation of good faith and fair dealing. Instead provides that the implied contractual covenant of good faith and fair dealing applies to the operating agreement and members of a member-managed company in the same manner and to the same extent that it applies at law to other contracts and parties to the contracts. Makes changes concerning the extent to which an operating agreement of a limited liability company may restrict or eliminate a fiduciary duty owed at common law or under the Act. Makes other changes.