When you own or co-own a limited liability company, it’s important to have a valid written operating agreement that covers the rights and responsibilities of the members (equity owners), managers, and addresses key issues like taxation, buyouts, rights of first refusal, etc.
Of course, you’ll want to use the right type of contract. For example, if you founded the LLC by yourself but there are now additional owners, chances are the operating agreement you used at the beginning has serious flaws because it doesn’t address issues involving multiple members.
Naturally, the terms and conditions in the operating agreement are going to be different if the LLC is run by a manager instead of being member-managed.
Are you required by law to have an LLC operating agreement?
It depends. Some states require it. Others don’t.
Yet even when it isn’t mandatory, chances are you’re going to want to have one in place to (1) address important legal issues plus (2) increase your risk protection.
And, if you plan to open up company bank accounts or purchase company vehicles, chances are the bank and car dealership are going to insist upon a copy of your agreement for several reasons (including signing authority).
Do you need a new LLC operating agreement? Or want your existing agreement fixed to reflect changes to the way you run your limited liability company? Then it’s time to schedule a phone consultation with Business Lawyer Mike Young.
