LLC Operating Agreement
This LLC Operating Agreement (the "Agreement") is entered into on 2024-01-01 (the "Effective Date") by and among the members listed below (the "Members") of My LLC, LLC (the "Company").
1. Formation and Name
Company Name: My LLC, LLC
State of Formation: Delaware
Formation Date: 2024-01-01
Articles of Organization: Filed with the Secretary of State on 2024-01-01
Principal Office: 123 Main St, City, State, Zip
Registered Agent: Agent Name at Agent Address
Business Purpose: General Business
Duration: The Company shall continue in existence Perpetual (perpetually / until 2099-12-31)
2. Members and Membership Interests
Member Information and Capital Contributions:
| Member Name | Address | Initial Capital Contribution | Percentage Interest | Class |
|---|---|---|---|---|
| Member 1 Name | Address 1 | $10000 | 33.33% | Class A |
| Member 2 Name | Address 2 | $10000 | 33.33% | Class A |
| Member 3 Name | Address 3 | $10000 | 33.34% | Class A |
Total Initial Capital: $30000
Form of Contribution: Contributions made in the form of: Cash (cash, property, services, promissory note)
Additional Contributions: None
Membership Certificates: Certificates evidencing membership interests: Not Issued
3. Membership Classes
Class Definitions: (if applicable)
Class A Members: Voting Members
- Voting Rights: 1 Vote per Share
- Distribution Rights: Pro Rata
- Management Rights: Full Rights
Class B Members: Non-Voting Members
- Voting Rights: None
- Distribution Rights: Pro Rata
- Management Rights: None
4. Management Structure
Management Type: The Company shall be managed by Member-Managed (the Members / one or more Managers)
Option A: Member-Managed
Management Authority: All Members have equal authority to manage the Company and bind it in transactions within the ordinary course of business
Major Decisions: Require approval of Members holding 51% of membership interests
Day-to-Day Operations: Managed by Managing Member
Option B: Manager-Managed
Manager(s):
- Manager 1: CEO
- Manager 2: CFO
Manager Authority: Managers have full authority to manage the Company and bind it in transactions
Manager Compensation: Salary
Manager Term: 1 Year
Manager Removal: Managers may be removed by vote of Members holding 66% of interests
Member Rights in Manager-Managed LLC: Members who are not Managers do not have authority to bind the Company or manage day-to-day operations
5. Voting Rights and Meetings
Voting Rights: Each Member has voting rights proportionate to their percentage ownership interest (unless specified otherwise for classes)
Annual Meeting: Members shall meet annually on annual meeting date at annual meeting location
Special Meetings: May be called by special meeting authority with meeting notice days days notice
Notice: Written notice including date, time, location, and purpose
Quorum: quorum requirement (majority of interests / quorum percentage%)
Voting Methods: voting methods (in person, by proxy, by written consent)
Actions Requiring Unanimous Consent:
- Amendment of this Operating Agreement
- Admission of new Members
- Sale of substantially all Company assets
- Dissolution of the Company
- additional unanimous actions
Actions Requiring Supermajority (supermajority percentage%):
- Change in business purpose
- Merger or consolidation
- Loans over loan approval threshold
- additional supermajority actions
Actions Requiring Majority Vote:
- Election/removal of Managers (if manager-managed)
- Approval of annual budget
- additional majority actions
6. Capital Contributions and Capital Accounts
Initial Contributions: As specified in Section 2
Additional Capital Calls: The Company may require additional capital contributions: capital call terms
Failure to Contribute: If a Member fails to make required additional contribution: failure to contribute remedy
Capital Accounts: A separate capital account shall be maintained for each Member
Capital Account Adjustments: Adjusted for:
- Additional contributions
- Share of profits and losses
- Distributions received
No Interest on Capital: Members shall not receive interest on capital contributions
Return of Contributions: No Member entitled to withdraw or receive return of capital contribution except as provided in this Agreement
7. Allocation of Profits and Losses
Profit Allocation: Net profits shall be allocated to Members in proportion to their percentage ownership interests: profit allocation
Loss Allocation: Net losses shall be allocated to Members in proportion to their percentage ownership interests: loss allocation
Special Allocations: special allocations (if applicable)
Tax Allocations: For tax purposes, items shall be allocated in accordance with the capital account provisions and applicable tax regulations
8. Distributions
Timing: Distributions shall be made distribution timing (quarterly / annually / as determined by Members/Managers)
Amount: Distribution amounts determined by distribution authority
Proportionate Distributions: Distributions made in proportion to percentage ownership interests (unless otherwise specified for classes)
Limitations: No distributions if:
- Company unable to pay debts as they become due
- Company's liabilities exceed fair value of assets after distribution
- Violation of loan covenants or other agreements
Tax Distributions: Company shall make distributions sufficient for Members to pay taxes on allocated income: tax distribution policy
Priority: Distribution priority among classes (if applicable): distribution priority
9. Transfer of Membership Interests
Transfer Restrictions: No Member may transfer all or part of their interest without:
- Written notice to all Members and Managers
- Compliance with right of first refusal (Section 10)
- Consent of transfer consent requirement (all Members / majority of Members / Managers)
Prohibited Transfers: Transfers to competitors: competitor transfer prohibition
Permitted Transfers: Transfers to the following permitted transferees without consent:
- Immediate family members
- Trusts for benefit of Member or family
- additional permitted transferees
Economic vs. Full Transfer: Unless full membership rights are transferred, transferee receives only economic rights (distributions and allocations) without voting or management rights
10. Right of First Refusal
Offer to Sell: Member desiring to transfer must provide written offer to Company and other Members including:
- Proposed purchase price and terms
- Identity of proposed transferee
- Other material terms
Company Right: Company has first right to purchase within company option days days
Member Right: If Company declines, other Members have right to purchase (pro rata) within member option days days
Third-Party Sale: If all decline, Member may sell to third party on same terms within third party sale days days
Valuation: If no bona fide offer, fair market value determined by: valuation method
11. Buy-Sell Provisions
Triggering Events: Upon the following events, the buy-sell provisions apply:
- Death of Member
- Disability of Member
- Bankruptcy of Member
- Attempted involuntary transfer
- Deadlock (if applicable)
- additional triggering events
Purchase Option: Company or remaining Members have option (not obligation) to purchase departing Member's interest
Purchase Price: Determined by: buyout valuation method (e.g., independent appraisal, formula, book value)
Payment Terms: buyout payment terms (lump sum / installments over buyout payment months months)
Life Insurance Funding: Company/Members maintain life insurance: life insurance funding
12. Admission of New Members
Requirements: New Members may be admitted only upon:
- Unanimous consent of existing Members (or new member approval)
- Execution of this Operating Agreement or joinder agreement
- Payment of agreed capital contribution
Rights: New Members receive rights as specified in their admission terms
13. Books, Records, and Accounting
Accounting Method: Company uses accounting method (cash / accrual) method
Fiscal Year: Company's fiscal year ends fiscal year end
Books and Records: Company shall maintain:
- Accurate books and records
- Bank account records
- Member capital accounts
- This Operating Agreement and amendments
- Tax returns and financial statements
- Meeting minutes
Access: Members have right to inspect books and records upon reasonable notice
Annual Financial Statements: Company shall provide annual financial statements within financial statement days days of fiscal year end
Tax Returns: Company shall provide K-1s by k1 distribution date
14. Banking and Finances
Bank Accounts: Maintained at bank name
Signatory Authority: check signing authority
Expenditure Limits: Expenditures over expenditure limit require large expenditure approval
Borrowing Authority: Authority to borrow on behalf of Company: borrowing authority
15. Tax Treatment
Tax Classification: Company elects to be treated as: tax classification (partnership / S-corp / C-corp) for federal tax purposes
Tax Matters Partner: tax matters partner (for partnerships)
Tax Elections: Company authorized to make tax elections as determined appropriate by Members/Managers
Tax Filings: Company responsible for timely filing all required tax returns
16. Duties and Obligations of Members/Managers
Duty of Loyalty: Members/Managers owe duty of loyalty to Company and other Members
Duty of Care: Members/Managers must discharge duties in good faith with care ordinary person would exercise
Competing Business: non compete terms
Corporate Opportunities: Members/Managers must present business opportunities to Company: corporate opportunity policy
Conflicts of Interest: Must disclose conflicts and: conflict resolution
17. Indemnification
Indemnification: Company shall indemnify Members, Managers, officers, employees, and agents against:
- Expenses, judgments, fines, settlements in proceedings
- If person acted in good faith and in Company's best interests
- Not for willful misconduct, fraud, or breach of fiduciary duty
Advancement of Expenses: Company may advance expenses subject to undertaking to repay if not entitled to indemnification
Insurance: Company may purchase D&O insurance: do insurance
18. Dissolution and Winding Up
Events Causing Dissolution:
- Vote of Members holding dissolution vote threshold% of interests
- Sale of all or substantially all Company assets
- Occurrence of any event making it unlawful to continue
- additional dissolution events
Winding Up: Upon dissolution:
- Liquidator appointed: liquidator designation
- Assets liquidated
- Debts and liabilities paid
- Remaining assets distributed to Members per ownership percentages
Distribution Priority:
- Creditors (including Member creditors)
- Members for unpaid distributions
- Members for return of capital contributions
- Members per ownership percentages
Certificate of Dissolution: Filed with state within dissolution filing days days
19. Dispute Resolution
Good Faith Negotiation: Disputes first addressed through good faith negotiation
Mediation: If not resolved, binding mediation in mediation location under mediation rules
Arbitration: If mediation fails, arbitration terms (binding arbitration / litigation)
Governing Law: This Agreement governed by laws of governing jurisdiction
Venue: Exclusive venue in venue location
Attorney Fees: Prevailing party entitled to reasonable attorney fees
20. Miscellaneous
Entire Agreement: This Agreement constitutes entire understanding and supersedes all prior agreements
Amendments: Must be in writing signed by all Members (or Majority Vote)
Waiver: Failure to enforce any provision does not waive future enforcement
Severability: Invalid provisions do not affect remaining terms
Binding Effect: Binds and benefits Members and permitted successors and assigns
Notices: Written notice to addresses in Section 2
Counterparts: May be executed in counterparts
Headings: For convenience only
Joint Liability: Members are not jointly and severally liable for Company debts and obligations
21. Signatures
IN WITNESS WHEREOF, the Members have executed this Agreement as of the Effective Date.
Member 1
Date: default
Name: Member 1 Name
Signature: _____________________________
Member 2
Date: default
Name: Member 2 Name
Signature: _____________________________
Member 3
Date: default
Name: Member 3 Name
Signature: _____________________________