Operating Agreement
ocstoc Legal Agreements
This LLC (limited liability Company) operating agreement lays out
important terms for the operation of the LLC including investment capital,
shares in the LLC, boards of advisors, and day to day management. Kindly
follow the instruction to insert your company’s specific information in the
spaces to customize to your needs. Please use other document for a Single
member LLC.
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Entire document © Docstoc, Inc., 2010, 2011
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Attorney Drafted
OPERATING AGREEMENT OF ___________________ LLC [Instruction: Insert the full
name of the LLC]
The undersigned Members of the ___________________ LLC [Instruction: Insert the name of
company] do hereby enter into this Operating Agreement effective the _____ [Month] _____
[Date], 20_____.
1. Office
The principal office of the Company shall be located at ______________________________
[Instruction: Insert the address of company]. The Company may have such other offices as
the Members may designate or as the business of the Company may require. The registered
office of the Company required by the Utah Code, Title 48 – Chapter 02c – Utah Revised
Limited Liability Company Act to be maintained in the State of Utah may be, but need not
be, identical with the principal office, and may be changed from time to time by the
Members.
2. Purpose
This Limited Liability Company is organized solely to conduct any lawful business that is
permitted under the Utah Code, Title 48 – Chapter 02c – Utah Revised Limited Liability
Company Act, Section 105 – Purpose.
3. Duration of the Company
The Company shall commence upon the filing of its Articles of Organization with the
Secretary of State and shall continue perpetually unless
(a) extended by the Members;
(b) sooner dissolved by the Members, or
(c) dissolved by a statutory event of dissolution.
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4. Capital Contributions
The Members agree for themselves and their successors, assigns and heirs, that their
participation is considered a long-term investment, and that any return of capital prior to the
termination and winding up of the Company is in the sole discretion of the Board of
Members. The undersigned Members agree to share in all post formation profits and surplus
of the Company pro-rata according to their share of ownership in the Company. The
issuance of _______________ (______) shares [Instruction: Insert the amount of shares]
of capital stock is authorized in the Articles of Organization of this Company, and
_______________ (______) shares [Instruction: Insert the amount of shares] having a
book value of ___________ dollars ($______) [Instruction: Insert the book value of each
shares] per share have been issued to the undersigned as follows:
_____ _______ Shares
_____ _______ Shares
_____ _______ Shares
_____ _______ Shares
5. Additional Capital Contributions
The Members may, but are not required to, contribute any additional capital deemed
necessary by the Board for the operation of the Company, provided, however, that in the
event that any Member deems it advisable to refuse or fails to contribute their proportionate
share of any or all of the additional capital requested by the Board then other Members or
any one of them may contribute the additional capital not paid in by such refusing Member,
and shall receive therefore an increase in the proportionate share of the ownership or interest
in the entire Company in direct proportion to the said additional capital contributed. Unless
otherwise agreed, the right to make up additional capital contributions of a refusing Member
shall be available in the same portion order as the right to share in distributions of the
remaining Members.
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6. Meetings - Board of Members
The annual meeting of the Members shall be held at the principal place of business of the
Company on ________ of ___________ of each year, commencing in the year 20_____
[Instruction: Insert the period of annual meeting]. If the day fixed for the annual meeting
shall be a legal holiday, such meeting shall be held on the next succeeding business day. Special
meetings of the Members, for any purpose or purposes described in the meeting notice, may be
called by any Member. Unless waived, as herein provided and allowed, written or printed notice
stating the place, day, and hour of the meeting, and, in case of a special meeting, the purpose or
purposes for which the meeting is called, shall be delivered to each Member not less than ten or
more than sixty days before the date of the meeting. Members may participate in meetings by
telephone. Any action which may be taken at a meeting of Members may be taken without a
meeting by written action signed by all Members. [Instruction: Annual meeting is not
mandatory in Utah. This clause may be removed, if not required by the Members].
7. Distributions
Each of the Members shall have an interest in the capital of the Company and share in
distributions in proportion to their share ownership, as set forth in Paragraphs 4 and 5. Prior
to dissolution and at least annually as income has been received by the Company accounts
determined and tax returns filed, the Board of Members shall determine funds available for
distribution.
8. Board of Members and Appointment of Officers
Control and management of the business of the Company is vested in the Board of Members.
Company decisions and actions shall be decided by a majority in interest of the Board of
Members at meetings regularly called with notice to all Members. A quorum for any such
meeting shall require the presence in person or by telephone of a majority in interest of the
Members. The Board of members may delegate any of their functions to one or more of the
directors and may appoint one or more officers to carry out any act on behalf of the
Company, including, without limitation, the execution of documents on behalf of and binding
the Company. Any action which may be taken at a meeting of the Members may be taken
without a meeting by a written action signed by all of the Members.
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9. Admission of New Members
New Members who take their interest directly from the Company may be admitted by a majority
in interest of the Members. For purposes of determining a "majority in interest," a Member's
interest will be his interest in profits and losses as set forth in Paragraphs 4 and 5, and a majority
will mean fifty-one percent (51%) or more.
10. Board Duties and Restrictions
The Board of Members are all the Members. No Member, without the consent of the Board,
shall endorse any note or act as an accommodation party, or otherwise become surety for any
person in any transaction involving the Company. No Member shall on behalf of the
Company borrow or lend money, or make, deliver or accept any commercial paper, or
execute any mortgage, security agreement, bond, or lease, or purchase or contract to
purchase, or sell or contract to sell any property for or of the Company. No Member shall
mortgage, grant a security interest in the assets or property of the Company, or do any act
detrimental to the best interests of the Company, or which would make it impossible to carry
on the ordinary purpose of the Company. Each Member shall be reimbursed by the
Company for all expenses incurred on behalf of the Company and shall be paid a fee for
attendance at meetings of the Members. The member fee for physical attendance at a
meeting shall be of ___________ dollars ($______) per day [Instruction: Insert the fee of
member for physical attendance E.g., twenty five dollars only ($25)], and the fee for
attendance by telephone shall be of ___________ dollars ($______) per hour [Instruction:
Insert the fee of member for attendance by telephone E.g., fifty dollars only ($50)].
11. Banking
All funds of the Company shall be deposited in its name in such bank account or accounts as
shall be designated by the Board of Members. All withdrawals there from are to be made
upon the authority of such person or persons as may be authorized by the Board of Members
from time to time.
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12. Books
The Company books shall be maintained at the offices of ___________________ [Instruction:
Insert the name of company], and each Member shall have access thereto. The fiscal year of
the Company shall be the calendar year, and the books shall be closed and balanced at the end of
each fiscal year. The Company will furnish annual financial statements to the Members, and
prepare tax returns in a timely manner. Each member may inspect and copy the limited liability
company records.
13. Voluntary Termination
The Company may be dissolved at any time by Resolution passed by a majority interest at a
meeting of its Members, in which event the Members shall proceed with reasonable
promptness to liquidate the Company. The assets of the Company shall be distributed in the
following order:
a. To pay or provide for the payment of all Company liabilities to creditors other than
Members, and liquidating expenses and obligations;
b. To pay debts owing to Members other than for capital and profits;
c. To pay the remaining funds to the Members in proportion to their share ownership.
14. Death of Member
In the event of the death of a member, then the deceased members’ heir or heirs shall be
entitled to succeed to the economic share and interest of the deceased member. The
Company may, upon unanimous consent of the remaining members, as soon as practicable,
provide a document by which the heir or heirs personally affirm and accept all the terms,
conditions and provisions of this Operating Agreement binding themselves to the same in
writing, and select a designated representative of the deceased member as a Member.
15. Continuation
Upon the occurrence of a statutory event of termination, the remaining Members of the Company
have the right to continue the Company by a majority vote unless a higher vote is required by the
state statute or by the IRS classification regulations allowing avoidance of the corporate
characteristic of continuity of interest.
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16. Amendment
This Operating Agreement is a written contract of the Members. Amendments must be
written and executed by all Members. Meeting of the Members, or at any adjournment of the
meeting, the Members will cause the election to be held at a special meeting of the Members
as soon thereafter as it may be held conveniently.
17. Violation of this Agreement
Any member who shall violate any of the terms, conditions, and provisions of this agreement
shall keep and save harmless the Company property and shall also indemnify the other then
Members from any and all claims, demands and actions of every kind and nature whatsoever
which may arise out of or by reason of such violation of any of the terms and conditions of
this agreement.
IN WITNESS WHEREOF, the parties have hereunto set their hands effective the day and first
above written. This Operating Agreement may be executed in counterparts with each
counterpart constituting one and the same instrument.
Signed:
____________________________ ____________________________
____________________________ ____________________________
[Instruction: Insert the name and signature of the members of the company
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