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Operating Agreement for Limited Liability Company (LLC)

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Operating Agreement for Limited Liability Company (LLC) Powered By Docstoc
					This is a sample LLC Operating Agreement that can be modified to fit any type of
business. LLCs are often the most beneficial classification for business entities
because they provide for the limited liability of corporations while having the benefits of
partnership taxation. In order for the LLC to be valid, it must have an operating
agreement and must file the Articles of Organization with the Secretary of State. This
sample short-form operating agreement is ideal for small businesses that want to
operate as an LLC.
                            OPERATING AGREEMENT
                                      OF
                               ____________, LLC
The undersigned Members of ______________, LLC (the “Company”), do hereby enter into this
Operating Agreement effective as of the ____ day of ______________, 20____.

I.     OFFICE

The principal office of the Company shall be located at _________________. 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 ____________ [Comment:
specify state] Limited Liability Act to be maintained in the State of ____________ may be, but
need not be, identical with the principal office, and may be changed from time to time by the
Members.

II.    PURPOSE

This Company is organized for all lawful purposes and is intended to involve all Members in the
ownership and management of the Company and to________________________________
[Comment: briefly set forth the purpose of the LLC].

III.   DURATION OF THE COMPANY

The Company shall commence upon the filing of its Articles of Organization (the “Articles”)
with the Secretary of State and shall continue indefinitely, unless (i) dissolved by the Members
or (ii) dissolved by a statutory event of dissolution. The right to continue after a statutory event
of dissolution is reserved in the Articles.

IV.    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 “Board”). 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 of capital stock is authorized in the Articles, and
_______________ (______) shares, having a book value of ___________ dollars ($______) per
share, have been issued to the undersigned as follows:

       _____           _______ Shares
       _____           _______ Shares
       _____           _______ Shares
       _____           _______ Shares




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V.     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.

VI.    MEETINGS OF THE BOARD

The annual meeting of the Board shall be held at the principal place of business of the Company
on _______________ of ______ of each year, commencing in the year 20__. 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 Board, 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 ___ (__) or more than ___ (__) days before the date of the meeting.
Members may participate in meetings by telephone. Any action which may be taken at a
meeting of the Board may be taken without a meeting by written action signed by all Members.

VII.   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 IV and V. Prior to
dissolution and at least annually as income has been received by the Company accounts
determined and tax returns filed, the Board of shall determine funds available for distribution.

VIII. BOARD OF MEMBERS AND APPOINTMENT OF OFFICERS

Control and management of the business of the Company is vested in the Board. Company
decisions and actions shall be decided by a majority in interest of the Board 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 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.

IX.    ADMISSION OF NEW MEMBERS




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Description: This is a sample LLC Operating Agreement that can be modified to fit any type of business.  LLCs are often the most beneficial classification for business entities because they provide for the limited liability of corporations while having the benefits of partnership taxation. In order for the LLC to be valid, it must have an operating agreement and must file the Articles of Organization with the Secretary of State. This sample short-form operating agreement is ideal for small businesses that want to operate as an LLC.
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