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Operating Agreement Ownership Percentage vs Capital Account - Female Owned LLC

Forum|Forum|6 years ago
March 1, 2020
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We have an LLC. Our operating agreement states that our female member ownership is 51%. We want to claim to be a female-owned business. Profits and Loss are allocated at a different percentage. After a few years, based on her capital account, she is no longer the majority owner. From a voting and legal (contracting) perspective, which takes precedent: operating agreement ownership percentage or capital account percentage?

Best answer by Anonymous_

You should consult an attorney in your jurisdiction.

Generally, the articles of organization, operating agreement,and state law control, not typically whatever is randomly entered as a "capital account percentage".

A

Anonymous_Answer

You should consult an attorney in your jurisdiction.

Generally, the articles of organization, operating agreement,and state law control, not typically whatever is randomly entered as a "capital account percentage".

LudwigVan_fan

I agree with tagteam...consultation with an attorney with expertise in this area.

What does the operating agreement say as to voting power? Capital account or per P&L percentage?

Corporations have this in the form of preferred and common stock...or, voting/non-voting stock...do you have something similar in the agreement?

**Disclaimer: Effort has been made to offer correct information; but due to the discussion forum limitations, the poster disclaims any legal responsibility for the accuracy of the poster's response**