What constitutes a majority vote for a multi-member LLC?
Full Question:
Answer:
The rights of members to vote and how votes on issues affecting the LLC are governed by the LLC's operating agreement. An operating agreement is essentially a contract between the members. The method of voting and rights of each member are often spelled out in the operating agreement.
Traditionally, "majority" is, by definition, more than 50%. However, the operating agreement should state if a majority is the standard.
Furthermore, the operating agreement should define majority as to whether it includes ALL members or only those voting. Most basic operating agreements say that a majority means a majority of the members, based upon their percentage ownership. “Majority of the Members" often means a majority of the ownership interest of the LLC as determined by the records of the LLC on the date of the action or vote.
It would be recommended that you review the terms of your operating agreement. If the LLC does not have an operating agreement, it would be prudent to execute one before issues arise.
