A Managing Member is the owner of a share of the economic interest in a limited liability company or a person, including profits, losses or distribution of assets (or a noneconomic member who does not have economic interest in the company but may have voting right and other rights and privileges pursuant to the articles of organization or operating agreement).
A Managing Manager is a person or persons designated in the articles of organization or operating agreement to manage the company.
An LLC is managed by either a manager, who need not be a member, or its members.
Members of an LLC may be individuals, partnerships, limited partnerships, trusts, estates, associations, corporations, other limited liability companies, or other entities, whether domestic or foreign.
An LLC may be formed with only a single member thereby providing the owner with limited liability protection not offered by a sole proprietorship. When there are multiple members, the structure is much like a partnership.
If the members are in a passive role, a manager is appointed to run the LLC’s business on a daily basis. A manager‑managed LLC is more like a corporation with a board of directors and officers.
The members have great flexibility through a written operating agreement to define their respective rights and responsibilities, powers, profit and loss‑sharing arrangements, and rights or restrictions on transferring ownership interests.
Certain fundamental rights of members cannot be changed and other rights may be changed only by a written operating agreement. If no operating agreement is prepared, state LLC Acts contain “default” provisions that will apply.
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