Membership in the LLC
An LLC has to have at least one member, and each member must be a natural person or a recognized business entity. A member may be admitted as a member of the LLC when it is formed, at a later time specified in the operating agreement, after formation directly from the LLC in compliance with the operating agreement, or with the written consent of all members.
To become a member, the newcomer normally needs to make a contribution, pay cash, or transfer property to the LLC, or take on an obligation to do so. However, a person may be admitted as a member of the LLC without acquiring a membership interest if there is such a provision in the articles of organization or operating agreement, or if all members consent and the person’s admission is documented in the LLC’s records.
Members’ contributions to the LLC can be in the form of cash, property, promissory notes, services previously rendered, or some other valuable consideration.
A member can only resign from the LLC in the way that the articles of organization or operating agreement specify. In the case of Maryland LLCs, a member may only withdraw or resign after six months’ written notice to the other members at their respective addresses-and the operating agreement can stipulate that the member does not have the power to withdraw at all, or it may specify another time or condition for withdrawal.
Unless otherwise specified in the operating agreement, members manage the LLC. The Maryland LLC Act does not mention managers or manager management as such, but it does allow the LLC’s operating agreement to delegate management to persons who are not members. In effect, this allows LLCs to choose manager management, and to assign management to one or more persons (who may or may not be members).
Unless otherwise provided in the articles of organization or operating agreement, members must vote in proportion to their relative interests in the LLC’s profits. The approval of members owning a majority of such interests is required for membership action.