Manager Managed LLC

A manager managed limited liability company (LLC) is one in which management decisions are exclusively or primarily made by an appointed manager, or managers. The managers can be any of the owners of the company or even anyone outside of the company. In effect, they are the day-to-day executives who make sure the business is operating successfully. In a manager managed LLC, the members (i.e., the owners) can delegate to the managers as few, or as many, managing rights as they so choose. The members often ensure that they can remove the managers without much difficulty, to ensure that ultimate control in the company is still vested in the hands of the members. The members usually reserve to themselves the rights to make very significant decisions, such as whether to take on big contracts, debts, or engage in significant transactions such as mergers or acquisitions. In effect, the members act as a board of directors of sorts, stepping in to make significant decisions when the timing is correct. The decision whether to choose a manager managed or member managed LLC is purely up to the founders of the company. That decision can later be changed, subject to getting the proper consent of the company members at that time.