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Determining a Quorum

Discussion in 'Business & Corporate Matters' started by Will_Stuart, Jun 13, 2019 at 7:14 PM.

  1. Will_Stuart

    Will_Stuart Law Topic Starter New Member

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    This must be LLC day around here. I do have a question on what constitutes a Quorum.

    the language from our LLC art. of org. address Quorum "at any meeting of the LLC members, a majority of the equity interests as determined by each Members cert. of ownership as reflected in the books will constitute a Quorum"

    So, we have five members (all family members)

    Member A: 25%
    Member B: 25%
    Member C: 20%
    Member D: 17.5%
    Member E: 12.5%

    Which Members would need to attend a meeting to constitute a Quorum? Our issue has been, only Members A, B & C (70% of ownership) ever show up at meetings. Members D & E 30% of ownership) never want to participate
     
  2. zddoodah

    zddoodah Well-Known Member

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    This is nothing but a math problem.

    "Majority of the equity interests" means any anything larger than 50%. Based on the percentages you gave, there is no way for only two members to hold "a majority of the equity interests," and any grouping of three members (other than C, D and E) would add up to more than 50%.
     
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  3. adjusterjack

    adjusterjack Super Moderator

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    That's a quorum as defined by your articles.

    If you are A, B, or C then there is no issue with the three of you running the business.

    If you are D or E then I suggest you attend meetings.
     
  4. Tax Counsel

    Tax Counsel Active Member

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    Just enough that more than 50% of the member interests are present at the meeting.

    Since A, B, and C together have 70% that's a quorum because more than 50% of the member interests are represented. So they can run the meetings and their decisions will determine how the business is run for any issues other than those requiring approval by more than 70% of the member interests.

    If D & E want to have input and a chance to change the outcome of decisions, they need to show up. If they don't care then they don't have to bother showing up.
     
  5. PayrollHRGuy

    PayrollHRGuy New Member

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    As long as A, B, and one other member is there you are good. The only 3 members that don't establish a quorum alone are C, D, and E.
     

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