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Ready. Set. Incorporate! https://www.readysetincorporate.com/faq-items/why-shouldnt-i-make-my-llc-managed-by-all-members/ Export date: Fri Apr 19 7:30:22 2024 / +0000 GMT |
Why shouldn’t I make my LLC managed by all members?It's tempting, when you're starting out, to appoint all of the members as co-managers 1 of the LLC 2. Y'all are excited and in a kind of honeymoon phase. And if you agree that all members 3 are managers, you don't have to discuss [read: negotiate] who's “in charge”. So, two things about that: First, if you can't overcome this issue, then you need to rethink being partners with each other. Second, picking someone who's in charge is a process that can raise other latent issues between the members (partners). The problem: with everyone in charge, then any member can bind the LLC. And maybe that's the idea — you want anyone to be able to sign contracts. But if one of the managers goes rogue, then you'll regret that approach. Also, third parties may require EVERY signature of every manager if they see that all members are managers. And if you have an LLC with more than 2 members, and someone has gone sideways or off-the-grid, you've got a signature problem. So, appoint one person, and if you need to, have that person agree, in writing, what acts they're permitted to engage in without a vote of the members and what acts for which they need written permission from everyone else. Think of it as appointing a CEO 4; there's usually only one. |
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Post date: 2020-08-06 04:07:48 Post date GMT: 2020-08-06 11:07:48 Post modified date: 2020-08-06 04:07:48 Post modified date GMT: 2020-08-06 11:07:48 |
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