An operating agreement outlines LLC finances, roles, and policies. Multi-member LLCs should have one. Single-member LLCs also benefit from outlining rules even if not required by law.
Creation and Legality
Members can create an operating agreement together with a lawyer. They answer simple questions and sign to make it legal.
The Purpose of an Operating Agreement
The agreement maintains separation between company operations and personal assets. Essentially, an operating agreement is a binding contract dictating financial and operational rules and provisions. The more specific, the better. Flexibility to fit the LLC is also key.
FAQ
What is an operating agreement in North Carolina?
An operating agreement outlines the finances and roles of LLC members. LLCs with multiple members should have one.
Can I make my own operating agreement?
Get together with members and a lawyer. Answer questions and have everyone sign to make it legal.
Do single-member LLCs need an agreement?
Yes, it outlines company rules and includes details such as structure, contributions, and procedures.
What happens without an agreement?
Without an agreement, LLCs could default to state laws not matching intentions, jeopardizing the separation between company and personal assets.
What are the key features of an operating agreement?
It’s a contract. Once signed, bound by terms with financial and operational rules. Specificity and flexibility to suit the LLC are key.