It depends on the situation. If, for example, you are selling your business by way of selling membership interest to a third party or bringing in investors, the process can require a complex set of documents including a Letter of Intent, Subscription Agreement, and a complex Membership Transfer Agreement. On the other hand, if the transfer is relatively straight forward between 2 people already involved in the business (i.e. you originally specified a 50/50 split and would like to modify to a 60/40 split), the paperwork is much more simple. A simple LLC membership transfer process typically involves the following documents:
- Authorizing Resolution (we need to make sure the action proposed is properly approved);
- Membership Transfer Agreement (documents the terms of the transfer);
- Assignment of Membership Interest (effectuates the transfer);
- Amend the Company Agreement (the governing document will need to be updated…amending the ownership percentages at a minimum);
- File a Certificate of Amendment or Restated Certificate of Formation (only when the information in the certificate of formation has changed);
- Update the Responsible Party with the IRS, if applicable;
- Update the Membership Transfer Ledger, if applicable; and
- Issue new Membership Certificates, if applicable.
We can often handle the membership transfer on a flat fee basis. Feel free to reach out to us to discuss you specific situation.