Limited Liability Company Agreement
An LLC (limited liability company) operating agreement determines what the financial and working relationships are between co-owners in a company. The agreement is where percentage ownership, responsibilities, rights, and profit distribution are detailed.
Why a LLC is needed
A LLC agreement helps to safeguard limited liability status and resolve misunderstandings. Without a LLC, for example, a court may determine that a one-person LLC is a sole-proprietorship. Without a LLC as guide for misunderstandings, an issue that could easily be solved could end up in court. Some of the issues include: profit and loss sharing and duties and responsibilities.