(a)Member-managed LLC. In a member-managed LLC:

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Terms Used In Tennessee Code 48-249-401

  • Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
  • articles of organization: means , in the case of an LLC, articles of organization or, to the extent applicable with respect to an LLC initially formed under and governed by the Tennessee Limited Liability Company Act, compiled in chapters 201-248 of this title, articles of conversion, taken together with all of the following, to the extent they modify, correct, restate or otherwise affect the articles of organization or articles of conversion: articles of amendment, articles of correction, certificates of merger and all documents required to be filed with any of the articles of amendment, articles of correction and certificates of merger, as part of the formation and continuation of an LLC. See Tennessee Code 48-249-102
  • board of directors: means the governing board of a corporation, whether denominated the board of directors or otherwise, except that no person or group of persons is the board of directors because of powers delegated to that person or group pursuant to §. See Tennessee Code 48-51-201
  • Business: means every trade, occupation, profession, investment activity, and other lawful purpose for gain or the preservation of assets, whether or not carried on for profit. See Tennessee Code 48-249-102
  • Director: means an individual who is vested with authority as a director under §. See Tennessee Code 48-249-102
  • Directors: means natural persons, designated in the charter or bylaws or elected or appointed by the incorporators, and their successors and natural persons elected or appointed to act as members of the board, irrespective of the names or titles by which such persons are described. See Tennessee Code 48-51-201
  • Governance rights: means a member's right to vote on one (1) or more matters, all of a member's other rights as a member in the LLC under the LLC documents or this chapter, other than financial rights, and the right to transfer the voting and other rights described in this subdivision (13). See Tennessee Code 48-249-102
  • Interest: means either or both of the following rights under the organic law of an unincorporated entity:
    (A) The right to receive distributions from the entity either in the ordinary course or upon liquidation. See Tennessee Code 48-11-201
  • LLC: means a limited liability company, organized under chapters 201-248 of this title. See Tennessee Code 48-202-101
  • LLC documents: means either, or both:
    (A) An LLC's articles. See Tennessee Code 48-249-102
  • Majority vote: means , with respect to a vote of the members, managers, or directors, as applicable:
    (A) If voting on a per capita basis, a majority in number of the members, managers or directors, as applicable, entitled to vote on a specific matter. See Tennessee Code 48-249-102
  • Manager: means a person who is vested with authority as a manager under §. See Tennessee Code 48-249-102
  • Member: means a person that has been admitted to an LLC as a member, as provided in §. See Tennessee Code 48-249-102
  • Member-managed: means an LLC organized pursuant to this title that has elected pursuant to §. See Tennessee Code 48-202-101
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Operating agreement: means an agreement described in §. See Tennessee Code 48-249-102
  • Person: means an individual or an entity. See Tennessee Code 48-249-102
  • Property: includes both personal and real property. See Tennessee Code 1-3-105
  • Transfer: means an assignment, conveyance, deed, bill of sale, lease, mortgage, security interest, encumbrance, gift and transfer by operation of law. See Tennessee Code 48-249-102
(1) Each member has equal rights in the management and conduct of the LLC’s business; and
(2) Except as otherwise provided in subsection (e) or (f), any matter relating to the business of the LLC shall be decided by a majority vote of the members.
(b)Manager-managed LLC. In a manager-managed LLC:

(1) Each manager has equal rights in the management and conduct of the LLC’s business;
(2) Except as otherwise provided in subsection (e) or (f), any matter relating to the business of the LLC shall be exclusively decided by the manager, or, if there is more than one (1) manager, by a majority vote of the managers; and
(3) A manager:

(A) Shall be designated, appointed, elected, removed, or replaced by a majority vote of the members;
(B) Holds office until a successor has been designated, appointed or elected and qualified, unless the manager sooner resigns or is removed; and
(C) Need not be a member of the LLC.
(c)Director-managed LLC. In a director-managed LLC:

(1) All LLC powers shall be exercised under the authority of, and the business and affairs of the LLC shall be managed under the direction of, its board of directors;
(2) Except as otherwise provided in subsection (e) or (f), any matter relating to the business of the LLC shall be exclusively decided by the director, or, if there is more than one (1) director, by a majority vote of the directors; and
(3) A director:

(A) Shall be designated, appointed, elected, removed, or replaced by a majority vote of the members;
(B) Holds office until a successor has been designated, appointed or elected and qualified, unless the director sooner resigns or is removed; and
(C) Need not be a member of the LLC.
(d)President of director-managed LLC. A director-managed LLC shall have a president who is appointed or elected by a majority vote of the directors and is authorized to act as an agent of the LLC under § 48-249-402(d).
(e)Delegation. The LLC documents or the members, managers or directors of an LLC, by a resolution or other writing, may delegate rights and powers to manage and control the business and affairs of the LLC to one (1) or more officers, agents or employees, who need not be members of the LLC; provided, that such delegation is reasonable under the circumstances and made in good faith.
(f)When unanimous consent required. The only matters of an LLC’s business requiring the consent of all of the members are:

(1) The amendment of an LLC’s operating agreement, if the LLC documents do not provide for the method by which the operating agreement may be amended, as provided in § 48-249-204(c);
(2) Any amendment of an LLC’s articles of organization that requires approval of all the members under § 48-249-204(c);
(3) The compromise of an obligation to make a contribution under § 48-249-302(a);
(4) The compromise, as among members, of an obligation of a member to make a contribution or return money or other property paid or distributed in violation of this chapter;
(5) The admission of a new member, including without limitation by transfer of any of a member’s governance rights to any person not a member, as provided in § 48-249-508(b)(3);
(6) The use of the LLC’s property to redeem an interest subject to a charging order; and
(7) An election by an LLC formed prior to January 1, 2006, to be governed by this chapter, as provided in § 48-249-1002(b).
(g)Proxies. A member or manager may appoint a proxy to vote or otherwise act for the member or manager, by signing an appointment instrument.
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