LLC Operating Agreement
What is an LLC Operating Agreement? An LLC Operating Agreement is a legal form that outlines how an LLC is managed and run. It is created by the owners, also known as members, and details how decisions are made, contributions are made, and the business ownership is structured. This document is signed by all members, regardless of their ownership interest, and each member keeps it for their records. An operating agreement is typically written at the formation of an LLC and is not required to be filed with any government agency. Download the free LLC operating agreement template above by clicking on the “Pdf” button.
What to Include in an LLC Operating Agreement
Many issues must be covered in the LLC operating agreement. The general format of the document includes the following:
– A breakdown of each member’s ownership percentage
– A clear outline of each member’s responsibilities and voting rights
– A comprehensive list of the duties and powers of each member
– An explanation of how profits and losses will be allocated among members
– Rules and regulations regarding meeting procedures and voting policies
– Guidelines for managing the LLC effectively
– Buyout and buy-sell provisions, including what will happen in the event of a member’s departure or death.