Business Organizations Code revisor's report, part 4

organization.
Revisor's Note
The source of Section 101.356(c) is
Article 2.23.D, Texas Limited Liability
Company Act. Article 2.23.D lists
transactions that require approval of a
majority of all members of the limited
liability company. Certain transactions
listed in Article 2.23.D have not been
included in Section 101.356(c) in order to
correct inconsistencies in the Texas Limited
Liability Company Act. For example, Article
2.23.D specifies that changing the status of
a limited liability company from one in which
management is reserved to the members to one
in which management is vested in managers, or
vice versa, requires approval of a majority
of the members. Yet, such a change would
require an amendment to the articles of
organization, which requires consent of all
members. A second inconsistency is found in
the provision of Article 2.23.D that provides
for majority member authorization of an act
that is unrelated to a limited liability
company's purpose or that otherwise
contravenes the regulations. Since amendment
of the regulations requires the unanimous
vote of the members, a majority of the
members should not be able to authorize an
act that contravenes the regulations. By
eliminating these provisions, Section
101.356(c) eliminates these inconsistencies.
The vote required to authorize the issuance
of additional membership interests is
addressed in Section 101.105. See the
Revisor's Note under that section regarding
the change in law in that respect. There are
other provisions included in Article 2.23.D,
Texas Limited Liability Company Act, that are
not included in Section 101.356(c) but are
addressed in other provisions of Chapter 101.
This section of the revised law may be
modified or waived by the company agreement
or certificate of formation.
Section 101.356(c) requires that a
fundamental business transaction receive
approval of a majority of the members. The