VIEWS: 136 PAGES: 7 CATEGORY: Forming an LLC - LLC Operating Agreements POSTED ON: 12/16/2011
This Limited Liability Company (LLC) Operating Agreement outlines the operating procedures and policies of an LLC. An LLC is a flexible business entity that combines the benefits of corporations and partnerships, and the operating agreement defines the members' rights, powers and entitlements. The agreement contains information regarding the members' capital contributions, the board of members, and the LLC's purpose. This operating agreement contains many of the standard provisions commonly included in LLC operating agreements, and it may be customized to fit the specific needs of the members forming the LLC. This document should be used when forming an LLC located in Michigan.
Docstoc Legal Agreements This Limited Liability Company (LLC) Operating Agreement outlines the operating procedures and policies of an LLC. An LLC is a flexible business entity that combines the benefits of corporations and partnerships, and the operating agreement defines the members' rights, powers and entitlements. The agreement contains information regarding the members' capital contributions, the board of members, and the LLC's purpose. This operating agreement contains many of the standard provisions commonly included in LLC operating agreements, and it may be customized to fit the specific needs of the members forming the LLC. This document should be used when forming an LLC located in Michigan. ® DISCLAIMERS: ALL INFORMATION AND FORMS ARE PROVIDED “AS IS” WITHOUT ANY WARRANTY OF ANY KIND, EXPRESS, IMPLIED, OR OTHERWISE, INCLUDING AS TO THEIR LEGAL EFFECT AND COMPLETENESS. 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This document is not approved, endorsed by, or affiliated with any State, or governmental or licensing entity. Entire document copyright © Docstoc®, Inc., 2010 - 2013. All Rights Reserved 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 [STATUTE] to be maintained in the State of Michigan 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 Michigan Code, [STATUTE] Nature of business permitted; powers. 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. 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 © Copyright 2011 Docstoc Inc. registered document proprietary, copy not 2 _____ _______ 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. 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 Michigan. 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 © Copyright 2011 Docstoc Inc. registered document proprietary, copy not 3 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. 9. Admission of New Members New Members who take their interest directly from the Company may be admitted with a written consent of all the Members. 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 ($25)], and the fee for attendance by telephone shall be of ___________ dollars ($______) per hour [Instruction: Insert the fee of member for attendance by telephone, e.g., fifty dollars ($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. 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 keep all books and records of a corporation for the three most recent years, and prepare tax returns in a timely manner furnishing copies to all Members and the same may be inspected by any Member or all the Members for any proper purpose at any reasonable time. © Copyright 2011 Docstoc Inc. registered document proprietary, copy not 4 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 a 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 allowing avoidance of the corporate characteristic of continuity of interest. 16. Amendment This Operating Agreement is a written contract of the Members. Amendments must be written and executed by all Members. At any 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. © Copyright 2011 Docstoc Inc. registered document proprietary, copy not 5 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 members] © Copyright 2011 Docstoc Inc. registered document proprietary, copy not 6
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