Operating Agreements

An Operating Agreement is a written document used by a Limited Liability Company (“LLC”) to outline the financial and functional decisions of the business; including rules, regulations, and certain provisions.  The Operating Agreement serves to govern the internal operations of the business based upon the specific needs of the given business owners.

An Operating Agreement serves a similar function as Corporate Bylaws and Partnership Agreements and it is quite common to draft them for both single-member LLCs and multi-member LLCs even though most states do not require them at all.

It is highly recommended that every LLC – regardless of the size of the business and the number of members – has an Operating Agreement drafted by a skilled attorney.  The Operating Agreement reduces the risk of disagreement between the members because it outlines the LLC’s finances and organization as well as provides rules and regulations for smooth operation of the business.

In addition, the Operating Agreement typically includes a percentage of interests, allocation of profits and losses, member’s rights and responsibilities and other important provisions as agreed upon by the members.  Once the Operating Agreement is signed by the members of the LLC, it serves as an official contract binding them to its terms.

If you are forming an LLC, then please call Brian M. Rokaw, P.A. to schedule a free no obligation consultation – (305) 722-5888.

See also; Corporate Bylaws and Partnership Agreements