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Operating Agreement – Transformus, L.L.C

The undersigned owners (hereinafter referred to as “Members”) of Transformus, L.L.C., a North Carolina Limited Liability Company (the “LLC”), hereby declare this as their Operating Agreement. This agreement shall take effect as soon as signed by all Members.

Purposes and Powers:

The LLC may engage in any lawful business for which limited liability companies may be organized under the North Carolina Limited Liability Company Act unless a more limited purpose is stated in the Articles of Organization.  An initial purpose of the LLC shall be to further artistic expression and community formation by planning, organizing, managing and overseeing regional burn events.  The LLC shall have any and all powers necessary or desirable to carry out the purposes and business of the LLC, to the extent the same may be legally exercised by limited liability companies under the North Carolina Limited Liability Company Act.  

Membership:

There are up to nine Members of the LLC. The Interests of the Members in the Company shall be personal property for all purposes.  Each Member shall have an equal interest in the LLC. All Members of the LLC shall sit on the Board of Directors (the “BOD”).  New Members may be admitted to the LLC when elected to the BOD, as described below. A Member leaving the BOD after the expiration or earlier termination of their term as a Director, shall surrender their ownership interest as provided in this agreement.  Unless otherwise specified at the time of admission, all subsequent Members of the LLC shall have an equal interest in the LLC and the right to sit as a Director on the BOD.

As of the effective date of this agreement, the Members and any positions they may hold as Officers of the LLC, are as follows:

Treat, President

Lisa, Vice President

Tanya, Treasurer

Mufasa, Secretary

Jellyfish

Bryan

Snacks

Governing Body:

The BOD shall have general charge and control of the affairs, funds and property of the LLC and shall manage the business and affairs of the LLC.  Such powers shall include, without limitation, all powers which may be exercised by the managers of an LLC including: the making of expenditures; borrowing money or guaranteeing indebtedness and other liabilities; conducting litigation; acquiring or disposing of the assets of the LLC; negotiating contracts binding on the LLC; selecting and dismissing employees, volunteers, and independent contractors, with and without cause.  Only the BOD acting unanimously may dissolve the LLC, distribute assets, dividends, earnings, or property to the Transformus and Ignite! burn communities at large.  Unless otherwise agreed by unanimous written consent of the BOD, no distributions shall be made to the Members.  

The BOD shall designate one or more of its Directors to sign such documents necessary to purchase, transfer, or encumber real or personal property. If no signee has been designated, any of the elected officers may sign all documents pertaining to the LLC.

The BOD shall consist of all the current Members of the LLC.  Directors of the LLC shall be elected by unanimous vote of the Directors currently serving. Directors should be selected, ideally, prior to the annual Board retreat, in order for new members to be “on-boarded” at the annual retreat. Persons may be nominated to serve as Directors pursuant to such criteria as may be established by the BOD from time to time. Upon being elected to the BOD, a Director shall be admitted as a Member of the LLC and granted an equal interest in the LLC.

There will be up to five (5) autonomous members of the BOD (i.e. a person who is not a member of any planning committee), and the remaining members will be selected from the two planning committees (described below), with up to two representatives from each of the two events, to reach up to nine (9) Directors. 

A Director elected by the BOD shall serve an initial term of three (3) years, and shall hold such position until their death, resignation, retirement, removal, or disqualification. Directors may be re-elected to serve one (1) additional, consecutive term of three (3) years, however, no Director shall serve more than six (6) consecutive years on the BOD without having a one (1) year recess before being eligible for re-election.

A Director may resign from the BOD at any time by giving notice of their resignation in writing to the President of the LLC. A vacancy occurring on the BOD may be filled, only by unanimous vote of the remaining Directors. 

Directors may not be removed from their seat on the BOD except for cause. Cause for removal must consist of either a breach of fiduciary duty, intentional tortious misconduct, or being inactive in the operations of the LLC. A Director shall be determined to be inactive by a majority vote of the other Directors. In the event of removal or resignation of a Director, the Director must resign from any position as an Officer of the LLC, and surrender their ownership interest as a Member as provided in this agreement. 

There will be no compensation of Directors of the LLC. Directors may be reimbursed for business related expenses and annual fees for various leadership conferences and training sessions, including but not limited to the Burning Man Leadership Conference, which will be determined on an annual basis.

Official meetings of the BOD shall be held monthly, with additional meetings added as deemed necessary at any place as may be designated by the BOD, within or without the State of North Carolina. Exceptions to this schedule can be made by majority approval of the BOD at any time. All members of the BOD are expected to attend at least one of the annual events, and the annual BOD retreat. It is the BOD’s responsibility to ensure there is a representative of the autonomous Directors attending each of the events which we produce (Ignite! and/or Transformus.)

A formal meeting can only proceed if a quorum of Directors is present. Quorum is defined as more than 50% of Directors present at the meeting. All discussions during formal meetings, remote and in person are confidential. The BOD shall try to make decisions on a consensus basis, but all decisions must be by active majority. In the event of a conflict the current elected President (or ranking officer) will act as mediator and also break a tie when necessary.

The books and records of the LLC shall be kept at the corporate office, the location of which shall be determined by the BOD. Each Director (and therefore each Member) shall have the unlimited right to inspect and copy such books and records at any point in time as requested. Books and records, as practical, shall also be made available electronically, via the internet, in an open format such as a Google document folder. 

Committees:

There shall be two (2) planning committees. The Transformus Planning Committee shall be responsible for planning, organizing, managing and overseeing the Transformus Event, as such responsibility and authority is granted by the BOD from time to time. The Ignite! Planning Committee shall be responsible for planning, organizing, managing and overseeing the Ignite! Event, as such responsibility and authority is granted by the BOD from time to time. 

Each committee shall consist of no fewer than seven (7) members, who need not be Directors of the LLC.  Each committee is responsible for the selection of its committee members, provided that the BOD reserves the right to veto any of such selections at their sole and absolute discretion.  Such members shall serve an initial term of three (3) years, and shall hold such position until their death, resignation, retirement, removal, or disqualification. Committee members may be re-appointed to serve one (1) additional, consecutive term of three (3) years, however, no committee member shall serve more than six (6) consecutive years on a single planning committee without having a one (1) year recess before being eligible for reappointment unless waived by the majority of planning committee. The sitting members of each planning committee may modify these terms as to their own planning committee, subject to BOD approval. A committee member may resign from a planning committee at any time giving notice of their resignation in writing to a BOD member and their fellow Planning Committee members. A vacancy occurring on a planning committee may be filled by majority vote of the members of the committee at any regular meeting, with BOD approval, as with regular committee appointments. 

Unless otherwise provided from time to time, a majority of the members on a committee shall constitute a quorum, and the act of a majority of the committee members present at a meeting at which a quorum is present shall be the act of the committee.

Current actions of all committees shall be reported to the BOD at appropriate regular meetings of the BOD.  The BOD, from time to time, will designate members of the committees to act as signatories to ensure timely event success. In addition, each committee shall submit such reports as may be required from time to time by the BOD.

Officers:

The BOD may elect such officers as it deems necessary, who shall have such authority and perform such duties as from time to time may be prescribed by the BOD. The offices include President, Vice President, Treasurer, and Secretary.  The President, Vice President, Treasurer, and Secretary shall be elected by a simple majority of Directors at the annual BOD retreat, and the term of each office shall be one (1) year.  Each officer shall hold office until death, retirement, resignation, removal, disqualification, the next annual BOD retreat, or until their successor is elected and qualified.  Vacancies may be filled by a simple majority of Directors at any regular meeting.  There will be no compensation of Officers of the LLC. Officers may be reimbursed for business related expenses, as determined by the BOD.

Limitation of Liability and Indemnity:

No Director, Member, or Committee member of the LLC shall be liable to the LLC or its Members for monetary damages for an act or omission in such person’s capacity as a Director, Member or Committee member, except as provided in the North Carolina Limited Liability Company Act for (i) acts or omissions which a Director or Committee member knew at the time of the acts or omissions were clearly in conflict with the interests of the LLC (specifically including breach of fiduciary duty and intentional fraudulent conduct), (ii) any transaction from which a Director or Committee member derived an improper personal benefit, or (iii) acts or omissions prior to the date this provision becomes effective.

The LLC shall indemnify and hold harmless the BOD, Officers, Members, and Committee members for all liability they may incur as a result of their involvement in the LLC except for breach of fiduciary duty or intentional fraudulent conduct. The LLC may indemnify and hold harmless employees, agents, independent contractors, or volunteers for any liability they incur as a result of their involvement in the LLC except for intentional fraudulent conduct. 

Property of the LLC:

Title to all of the LLC’s property, assets, and accounts are to be held in the name of the LLC and no Member, Director, Officer, owner, manager, employee, contractor, or volunteer can claim any interest in the property, assets, or accounts of the LLC. The acting President and Treasurer will be the primary names on all financial accounts that the LLC owns and operates.  The BOD will maintain separate checking accounts for each planning committee.  Each planning committee is responsible to the BOD for a full accounting of all funds handled. 

Any misappropriation of funds, assets, or property warrants automatic removal from the BOD, any position held as an Officer and any position held as a Committee member, and such Member shall surrender their or her ownership interest in the LLC.  

Membership Interest Transfers:

Except as provided herein, no Member of the LLC may transfer their interest in the LLC. Any attempted transfer shall be void ab initio. To the extent the law requires the Members and LLC to recognize any involuntary transfer – such as an attachment, seizure, lien, garnishment, or court order, etc. – the transferee’s rights shall be limited as provided herein and to the full extent permitted by the North Carolina Limited Liability Company Act (the Act). The above notwithstanding, no transferee of an interest in the LLC shall have the right to participate in the BOD unless all other Directors have consented in writing and the transferee has agreed in writing to be bound by this Operating Agreement.

All owners of an interest in the LLC agree that their ownership interest may only be transferred to the LLC. In the event of an involuntary transfer, death of an owner, resignation of a Member, or a Member’s termination by the BOD for cause, the holder of an interest shall immediately transfer the interest to the LLC pursuant to this Operating Agreement.

The Members agree that as quid pro quo consideration for the LLC continuing to make distributions solely to the Transformus and Ignite! community at large, each Member’s interest as an owner of the LLC shall have no monetary value, and no amount shall be required to be paid from the LLC to a Member upon a transfer of an interest as contemplated herein.

Dissolution:

The LLC shall be dissolved upon the first of the following to occur: (i) unanimous vote to dissolve by the BOD, (ii) the 90th day after the day on which the LLC ceases to have any members unless a person is admitted as a Member during such period; or (iii) the entry of a decree of judicial dissolution or the issuance of a certificate for administrative dissolution under North Carolina Limited Liability Company Act.  In the event of the dissolution of the LLC all remaining Members of the LLC agree that debts and obligations of the LLC shall be determined and satisfied prior to any assets being distributed to the Transformus and Ignite! community at large or any Member. Only the BOD acting unanimously may distribute assets, dividends, earnings, or property to the Transformus and Ignite! burn communities at large.  Unless otherwise agreed by unanimous written consent of the BOD, no distributions shall be made to the Members.

Final Agreement:

This agreement replaces and supersedes all prior written and oral agreements of the Members on subjects covered by this agreement. This agreement is binding on all successors and heirs of owners of an interest in the LLC. Each party to this agreement agrees to execute such additional documents as may be necessary to carry out the terms of this agreement. This agreement may not be amended except by the unanimous written consent of all the Members of the LLC. This agreement shall be governed by the law of the state of North Carolina.