Commercial Law Counseling - CLIENT ALERT

June 18, 2009

The recent Chancery decision In re NextMedia Investors, LLC looked at the amendment provisions of an LLC agreement.  The amendment provision in question provided that certain sections of the LLC agreement could not be amended "to adversely affect any Member" without the consent of each Member to be adversely affected.  The LLC had adopted an amendment extending the date on which it would dissolve by four years.  The amendment was overwhelmingly approved by the members, but the petitioners did not consent and brought an action to have the LLC declared dissolved in accordance with the original agreement.  The court’s decision adds a new and important take on two issues that frequently arise –the specific form with regard to the extension of a dissolution date and, what constitutes an adverse effect.

Click here to read an analysis of the implications of the In re NextMedia Investors, LLC decision (and to download a copy of the Court’s opinion).