Corporations Bar Practice Exam 2026 - Free Bar Exam Practice Questions and Study Guide

An LLC (Limited Liability Company) is typically dissolved according to the terms set forth in its operating agreement or by the unanimous consent of its members. This reflects the fundamental principle that the governance of an LLC is largely determined by internal agreements among its members.

Dissolution can occur through a specified process in the operating agreement, which may outline conditions or events that trigger dissolution. If no specific provisions exist in the operating agreement, the general rule often defaults to requiring the unanimous consent of all members. This ensures that all members have a say in significant decisions, such as the winding down of the company, which aligns with the collaborative nature of LLCs.

In contrast, while a majority agreement could lead to dissolution under certain circumstances, it may not represent the full consensus necessary according to standard rules or statutory requirements. Other options, such as state regulatory decisions or achieving financial goals, do not represent typical or widely accepted reasons for the dissolution of an LLC. Thus, the correct understanding rests on the internal governance structure established by the members themselves.