Have courage. Take the step. Be an entrepreneur. Be your own boss.
How many times have you dreamed of no longer sitting in bumper-to-bumper traffic, of jumping off the roller coaster and offering your skills to the masses . . . or, perhaps to friends and family?
When you make the decision that “you can’t afford not to,” and you establish a Virginia Limited Liability Company (an LLC) by filing Articles of Organization with the State Corporation Commission (SCC), there is a crucial next step.
Once you have formed an LLC, it is very important for your LLC to have an operating agreement in place. An operating agreement is a legal document that sets forth the financial and management policies and procedures of an LLC. It is considered the governing document of the LLC.
The range of subject matter that is often addressed in an operating agreement is broad. Examples include, but are not limited to: (1) The transfer of rights – whether a member can transfer more than his financial interest to another party, and if so, the protocols. (2) Limitations on inheritance distributions by including rights of first refusal by members. (3) The preclusion of third parties, such a agents under a power of attorney, from being able to control an interest on behalf of a member. (4) Whether incapacitation and/or death triggers dissolution of the LLC. (5) The identification of the managing member and his responsibilities.(6) How capital contributions will be handled. (7) How loans from members will be handled.
Consider the operating agreement the roadmap for the successful running of your LLC. Your business structure should not be left to chance. Set the course upfront so that your efforts are protected and you can focus on your business success.