An LLC Operating Agreement in Florida
Limited liability companies (LLCs) must have operating agreements in place. These are the documents that describe the rights and responsibilities of the LLC members. While Florida law does not require an operating agreement, the Citizen Media Law Project considers them highly advisable. An operating agreement works like a partnership agreement in that it creates an enforceable agreement between people doing business together about how a particular business relationship is going to operate.
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Basic Contents
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Unlike the LLC's articles of organization, which must include specific information required by law, there are no definite requirements for the contents of an operating agreement. Typically, such an agreement describes the management structure of the company, and the voting authority of each member, and how profits will be distributed. The flexibility of the LLC is largely due to the freedom members have in drafting a customized operating agreement.
Format
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There is no legally required format for an operating agreement, but the title of the document should reflect that it is in force for a specific LLC. It should also be dated and signed by all the members of the company as well as witnesses. The operating agreement need not be filed with the state, but copies of the current agreement should be kept at the company's registered office, and copies should be given to the members and the registered agent.
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Other Considerations
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An operating agreement typically contains provisions for how a member can exit the business or how a new member can enter. It also states the frequency of the meetings and their general format. There can also be a provision for the dissolution of the company. The members of the company should first negotiate all the terms they'd like to have in the agreement before voting to approve it.
Getting Legal Advice
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It can be helpful, though not necessary, to consult a lawyer before signing an operating agreement. A properly drafted and executed operating agreement is a legally enforceable document, meaning that a member can sue or be sued to enforce the agreement. If this occurs, a court will use standard contract interpretation to understand and interpret the agreement. Getting the opinion of a lawyer before signing the agreement can help ensure that it will be interpreted as intended.
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- Photo Credit signing a contract image by William Berry from Fotolia.com
