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Legal Operating Agreement Form for the State of New York

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New York Operating Agreement Sample

New York Limited Liability Company Operating Agreement

This Operating Agreement is made and entered into as of the ___ day of __________, 20__, by and between the following member(s):

  • Name: ______________________
  • Address: ______________________

Whereas, the members wish to form a Limited Liability Company (the “Company”) under the laws of the State of New York, and desire to set forth the terms of their agreement with respect to the operation of the Company, they hereby agree as follows:

Article I: Formation

This Agreement governs the rights and obligations of the members and the management of the Company. The Company is formed under the New York Limited Liability Company Law.

Article II: Name

The name of the Company shall be: ____________________

Article III: Purpose

The purpose of the Company is to engage in any lawful business permitted under the laws of the State of New York.

Article IV: Principal Office

The principal office of the Company shall be located at:

____________________

Article V: Members

The members of the Company shall be as follows:

  1. Name: ______________________, Ownership Percentage: __________%
  2. Name: ______________________, Ownership Percentage: __________%
  3. Name: ______________________, Ownership Percentage: __________%

Article VI: Management

The management of the Company shall be vested in the members. Decisions shall be made by a simple majority of the ownership interests unless otherwise provided herein.

Article VII: Fiscal Matters

The fiscal year of the Company shall end on the 31st day of December of each year. The accounting method to be used shall be cash or accrual based on what the members decide unanimously.

Article VIII: Indemnification

To the fullest extent permitted by law, the Company shall indemnify any member or manager against expenses and liabilities incurred in connection with the Company.

Article IX: Amendments

This Agreement may only be amended by a written agreement signed by all members.

Article X: Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

In witness whereof, the members have executed this Agreement as of the day and year first above written.

Member Signatures:

  • ____________________ (Member Name)
  • ____________________ (Member Name)
  • ____________________ (Member Name)

____________________ (Date)

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Instructions on Utilizing New York Operating Agreement

Filling out the New York Operating Agreement form is an important step for any business entity. This form helps outline the management structure and operational procedures of your company. Follow these steps carefully to ensure that you complete the form correctly.

  1. Begin by downloading the New York Operating Agreement form from the official website or obtaining a hard copy.
  2. Fill in the name of your business at the top of the form. Make sure it matches the name registered with the state.
  3. Provide the principal office address of your business. This should be a physical address, not a P.O. Box.
  4. List the names and addresses of all members involved in the business. Include their roles if applicable.
  5. Specify the percentage of ownership for each member. This reflects their stake in the company.
  6. Outline the management structure. Indicate whether the business will be member-managed or manager-managed.
  7. Detail the voting rights of each member. Clarify how decisions will be made within the company.
  8. Include provisions for adding new members or removing existing ones. This helps in managing changes in the business.
  9. Address how profits and losses will be distributed among members. This is crucial for financial transparency.
  10. Sign and date the form at the bottom. Ensure all members also sign if required.

After completing the form, review it for accuracy. Once you are satisfied, you can proceed with any necessary filings with the state or keep it for your records as required by law.

Misconceptions

Here are ten common misconceptions about the New York Operating Agreement form, along with explanations for each:

  1. All LLCs in New York are required to have an Operating Agreement. This is not true. While it is highly recommended, New York law does not require every LLC to have one.
  2. The Operating Agreement must be filed with the state. This is incorrect. The Operating Agreement is an internal document and does not need to be submitted to the state.
  3. Only multi-member LLCs need an Operating Agreement. This is a misconception. Single-member LLCs can also benefit from having an Operating Agreement to outline the management structure and operational procedures.
  4. The Operating Agreement can be oral. While an oral agreement is possible, it is not advisable. A written Operating Agreement provides clarity and legal protection.
  5. Once created, the Operating Agreement cannot be changed. This is false. The Operating Agreement can be amended as needed, following the procedures outlined within the document itself.
  6. The Operating Agreement does not need to address financial matters. This is misleading. It is essential to include financial arrangements, such as profit distribution and member contributions, in the Operating Agreement.
  7. Members cannot be added or removed after the Operating Agreement is established. This is incorrect. The Operating Agreement can specify procedures for adding or removing members as the business evolves.
  8. The Operating Agreement is the same as the Articles of Organization. This is not true. The Articles of Organization are filed with the state to create the LLC, while the Operating Agreement governs the internal operations.
  9. The Operating Agreement is only necessary for legal protection. While it provides legal benefits, the Operating Agreement also helps in managing relationships and expectations among members.
  10. All Operating Agreements must follow a specific template. This is a misconception. While templates can be helpful, each Operating Agreement should be tailored to fit the unique needs of the LLC and its members.

Documents used along the form

The New York Operating Agreement is a crucial document for limited liability companies (LLCs) as it outlines the management structure and operational procedures of the business. Alongside this agreement, there are several other forms and documents that are often utilized to ensure compliance and clarity in business operations. Below is a list of common documents that may accompany the Operating Agreement.

  • Articles of Organization: This is the foundational document that officially establishes the LLC with the state of New York. It includes basic information such as the LLC's name, address, and the registered agent.
  • Member Consent Forms: These forms are used to document the approval of significant decisions made by the members of the LLC, ensuring that all members are on the same page regarding important matters.
  • Bylaws: While not mandatory for LLCs, bylaws serve as an internal guide for the governance of the company, detailing procedures for meetings, voting, and other operational aspects.
  • Membership Certificates: These certificates can be issued to members to signify ownership interest in the LLC. They provide a tangible representation of a member's stake in the company.
  • Tax Identification Number (TIN) Application: This document is necessary for obtaining a TIN from the IRS, which is required for tax purposes and opening a business bank account.
  • Operating Procedures Manual: This manual outlines the day-to-day operations of the LLC, providing guidance on how tasks should be performed and ensuring consistency in operations.
  • Bill of Sale Form: For secure asset transfers, consider utilizing our comprehensive bill of sale form instructions to ensure compliance with legal standards.
  • Annual Reports: Many states, including New York, require LLCs to file annual reports to maintain good standing. These reports typically include updated information about the business and its members.

These documents collectively support the structure and function of an LLC, ensuring that all members understand their rights and responsibilities. Properly managing these forms helps maintain compliance with state regulations and can contribute to the overall success of the business.