Q: Dissolving of LLC partnership
Hello,
I have a question regarding dissolving of LLC partnership.
We have LLC with 4 members registered in Maryland. We don’t have operating agreement signed despite the fact that company operates for 3 years already. Recently, we had a conflict situation with one of the members, and majority of the members don’t want to continue to work with him. The three members want to dissolve the partnership and close the company. One out of 3 members doesn’t want to dissolve company, wants to conduct business and suggests to the other 3 members just leave it to him.
Our question – can we dissolve the partnership by majority voting on the next members meeting and if yes, will it be enough if one of members won’t want to sign the dissolution agreement?
A:
No, dissolution on your facts (no operating agreement providing otherwise), requires either unanimous agreement of the members, or a judicial dissolution upon filing a petition to dissolve the LLC on the grounds that it “is not reasonably practicable to carry on the business in conformity with the articles of organization.”
To lay the foundation for a success petition for judicial dissolution, you should call a meeting of the members, submit one or more resolutions for voting upon, such as to discontinue operations and dissolve the company, listing the reasons why, and appoint one member to take the minutes of the meeting. Record all actions in the minutes, the vote results, and thereby document that the members are deadlocked. You would then have the minutes to support your petition.
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