Many business owners choose to form their business as a Limited Liability Company (“LLC”) because of the protections afforded by this business structure. LLC members are able to protect themselves from certain debts and threats (lawsuits) that they would otherwise be exposed to. In other words, an owner/operator will not generally be held personally liable for the acts of the LLC.
The operating agreement serves as the framework that will govern the inner workings of the LLC. The operating agreement should address, at a minimum, the following:
- The percentage of ownership of each member and each member’s capital contribution;
- The duties and obligations of management;
- The general mission and activities of the LLC. This can be very general;
- Restrictions on the roles and activities of the LLC;
- How voting, meetings, and disagreements are handled;
- How the LLC’s assets are managed;
- What needs to happen to amend the operating agreement;
- What happens if members do not comply with agreed upon terms.
If your operating agreement fails to address certain aspects, the Ohio Revised Code will govern the issue at hand. But the creation of an LLC with a well thought out operating agreement is a great asset. You will be able to govern the affairs of your business as you see fit.
At Wick Law, we understand that formulating a proper operating agreement can be a complex and time-consuming undertaking. It is important to ensure that you are covering your bases and adequately addressing potential issues. With our help, you can be confident that your operating agreement sets a comprehensive and clear guide for the operation of your business. Call Wick Law at 614-572-6366 to receive a confidential evaluation of your particular needs.