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LLC Member Shareholder Rules and Updates
A minority shareholder is a shareholder that owns less than 50% of the corporation's membership shares and doesn't have majority control over the corporation. Therefore, minority shareholders typically cannot affect which directors are elected, decisions regarding the company, what film content is produced, and they have no voting rights within the company whatsoever. If the company value has decreased in value, a minority owner/member can be bought out at the current value, even if that value is substantially lower than the initial purchase of membership. Minority shareholder members do not obtain "Executive Producer" credits in film or TV content.
A majority shareholder member is a shareholder that owns more than 50% of the limited liability corporation's shares and has majority control over the corporation. A majority shareholder holds more than 50% of the corporation's shares and also holds a majority of the control of the corporation. This member has full voting rights, power to make decisions that affect the business and creative direction of the company, and to sell the company without the input or permission of the minority member/shareholder. Majority shareholder members also obtain "Executive Producer" credits in film or TV content.
A "Sweat Equity Shareholder" member, is a member who has member shares based on the labor, skills, donation of property, real estate, credit, and/or barter in exchange for membership and shares. They invest with non-monetary contributions needed or desired by the company and perform certain services, providing certain tools or equipment, credit lines, or expertise in exchange for member shares. Actors will have the choice of deferred pay for equity in the gross revenue.