LLC with multiple 'members' but only one 'voting member'?

[MikeFFG]

Hi!

I'm new here, and this is probably an obvious, simple question. Is there any reason I can't start an LLC with multiple owners/members, but have myself be the only 'voting' member, where everyone else is most likely a silent partner? I don't see anything anywhere saying I can't set this up in the operating agreement, but I don't see anything alluding to it either. Since single-member llcs are allowed, I don't see why this wouldn't be. Just looking to be sure.

Thanks!

Mike

[nealrm]

I can't address if you can set this up, but will question why the other owners/members would want to join into such an arrangement. They would put up their money, have no say in how the business is ran, and if they wanted to leave risk losing their investment. I really don't see an upside for them at all.

[Evan]

Of course you can set that up, as the LLC is flexible. You're probably best wording it by stating there there are two types of "members" -- A & B. You can set the parameters of the rights for each of these membership classes. As long as the members ultimately agree to it, then it'd be binding.

It is important to know that you should definitely seek legal counsel for preparing such an agreement, and also to be advised if there may be some decisions affecting the partnership which they MUST still agree to even though they may not have that right per the agreement. State law may preempt that contract and require their consent on certain legal matters, and it's important to know that in the context of the laws of the state you reside.

Good luck with your business.

[Business Attorney]

As Evan said, the LLC is very flexible and allows you to give whatever bundle of rights you want to various members. Every state's LLC Act is slightly different, however, and there are some limitations. In addition, the default rules typically give voting rights, so you need to be very careful in drafting the LLC operating agreement. Any multiple member LLC should definitely have a knowledgeable attorney prepare its operating agreement.