There are two major LLC documents that you need in order to register your limited liability company: the Articles of Organization, and the LLC Operating Agreement. The serve different functions, but together they encompass virtually all of the crucial information about your LLC. Let’s take a look at both documents.
Articles of Organization
Your Articles of Organization are an LLC’s version of the Articles of Incorporation—basic information about the company that will be provided to the Secretary of State and available to the public. Information provided in these Articles of Organization is typically as follows:
- LLC name
- Business purpose
- Principle office address (not always mentioned)
- Registered agent name and address
- Member- or manager-managed
- Incorporator name and signature
Most, if not all, of the information contained in the Articles of Organization is a matter of public record—anyone can search the Secretary of State’s business database for the details of your organization. Because of this, many LLCs and other businesses hire a third-party registered agent, as registered agent’s physical addresses are required, and small business owners—especially those operating out of their own home—may not want their home information available to the public.Once your Articles of Organization are filed with the state, you’ll receive a filing date and state identification number. Your LLC is now a legal entity unto itself, capable of entering into contracts, taking out loans, bringing legal action, and other rights of a legal person.
That takes care of the basic information. But what about the process and procedures by which your LLC will be run? How do day-to-day business transactions take place? How, in essence, will your LLC operate?
LLC Operating Agreement
Between the two LLC documents, if your Articles of Organization is the introduction section of a book that is your business, the LLC Operating Agreement is the rest of the chapters. The Operating Agreement contains not just answers but detailed descriptions of the following:
- Formation of the LLC
- Capital contributions by the members
- Allocation of losses and profits
- Location of the LLC’s corporate records and financial paperwork
- Information on member meetings and voting
- Transfer of membership interest
- Any additional information or amendments
With both of these documents in hand, your LLC will have a reference point to move forward for any foreseeable contingency.
Ready to start an LLC? Click&Inc can help!