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Arizona Law Arizona LLC Library Operating Agreement HeadingsHeadings of KEYTLaw's Comprehensive Operating Agreement
Our 80+ page comprehensive Operating Agreement is the end result of Richard Keyt's 27 years of practicing business law and forming Arizona limited liability companies and partnerships. Because the Operating Agreement is the most important agreement among the members of a multi-member LLCs, it should not be a fill-in-the-blanks form taken off the internet or from a commercial legal form software package or be a document prepared by anyone other than an experienced business and tax lawyer. The following are the section headings of KEYTLaw's comprehensive Operating Agreement.
Article 1 - FORMATION, NAME, PURPOSES, DEFINITIONS
1.1 Formation.
1.2 Treatment as Partnership or Corporation for Federal Income Tax Purposes.
1.3 Name.
1.4 Known Place of Business.
1.5 Purpose and Powers.
1.6 Term.
1.7 Agent for Service of Process.
1.8 Definitions.
1.9 Title to Property.
1.10 Payments of Individual Obligations.
Article 2 - CAPITALIZATION OF THE COMPANY
2.1 Initial Capital Contributions.
2.2 Additional Capital Contributions.
2.3 Remedies for Nonpayment of Capital Contributions.
a. Optional Reduction of Percentage Interests.
b. Optional Loan by Nondefaulting Members.
c. Optional Buy-Out Provision.
d. Timing and Use of Options.
2.4 Limitations on Withdrawals of Capital Contributions.
2.5 Member Loans.
2.6 Capital Accounts.
2.7 Percentage Interests.
2.8 Character of Ownership of Membership Interests.
2.9 Assumption of Debt on Acquired Real Property.
Article 3 - PROFITS, LOSSES, DISTRIBUTIONS
3.1 Allocation of Profits.
3.2 Allocation of Losses.
3.3 Special Allocations.
3.4 Minimum Gain Chargeback.
3.5 Member Minimum Gain Chargeback.
3.6 Qualified Income Offset.
3.7 Gross Income Allocation.
3.8 Nonrecourse Deductions.
3.9 Member Nonrecourse Deductions.
3.10 Section 754 Adjustments.
3.11 Allocations Relating to Taxable Issuance of Interests in the Company.
3.12 Curative Allocations.
3.13 Loss Limitation.
3.14 Other Allocation Rules.
3.15 Tax Allocations: Code Section 704(c).
3.16 Distributions.
3.17 Limitation Upon Distributions.
3.18 Accounting Principles.
3.19 Banking.
3.20 Records, Audits and Reports.
3.21 Returns and Other Elections.
3.22 Certain Allocations for Income Tax (But Not Book Capital Account) Purposes.
Article 4 - RIGHTS AND DUTIES OF THE MANAGEMENT COMMITTEE
4.1 Managers & Management Committee.
4.2 Number, Tenure and Qualifications.
4.3 Certain Powers of the Management Committee.
4.4 Members’ Consent Required for Certain Actions.
4.5 Right to Rely on Manager.
4.6 Tax Elections.
4.7 Management Committee's Obligations.
4.8 Manager has no Exclusive Duty to Company.
4.9 Salaries, Reimbursement & Organization Expenses.
4.10 Bank Accounts.
4.11 Indemnity of the Manager.
4.12 Resignation.
4.13 Removal.
4.14 Vacancies.
4.15 No Liability for Certain Acts.
4.16 Meetings of the Management Committee.
4.17 Formation Expenses.
Article 5 - RIGHTS AND OBLIGATIONS OF MEMBERS
5.1 Rights or Powers.
5.2 Limitation of Liability.
5.3 No Right to Unilaterally Withdraw.
5.4 Company Records.
5.5 Priority and Return of Capital.
5.6 Tax Matters.
5.7 Other Instruments.
5.8 Confidentiality.
5.9 Transactions Between a Member and the Company.
5.10 Sale of the Company.
5.11 Certificate of Agreed Value.
5.12 Guaranties.
5.13 Married Members Whose Spouses Do Not Sign This Agreement.
5.14 Reimbursements.
5.15 Maintenance of Subchapter S Status.
Article 6 - MEETINGS OF MEMBERS
6.1 General.
6.2 No Required Meetings.
6.3 Meetings.
6.4 Place of Meetings.
6.5 Notice of Meetings.
6.6 Meeting of all Members.
6.7 Record Date.
6.8 Quorum.
6.9 Manner of Acting.
6.10 Votes.
6.11 Proxies.
6.12 Action by Members Without a Meeting.
6.13 Waiver of Notice.
Article 7 - TRANSFER OF INTERESTS; NEW MEMBERS
7.1 Restrictions on Transfers.
7.2 Assignee of Member's Membership Interest.
7.3 Substituted Members.
7.4 Heirs, Devisees and Legatees.
7.5 Distributions and Allocations in Respect to Transferred Interests.
7.6 New Members.
7.7 Right of First Refusal.
7.8 Transferee Not Member in Absence of Consent.
7.9 Additional Conditions to Recognition of Transferee.
7.10 Gifts of Ownership Interests.
Article 8 - TERMINATION EVENTS
8.1 Adverse Act.
8.2 Optional Treatment for Member Who Suffers an Adverse Act.
8.3 Redemption of Adverse Member’s Membership Interest.
8.4 Redemption of Member's Membership Interest Upon Death.
8.5 Purchase or Redemption of Membership Interest Upon Death of Spouse of Member.
8.6 Determination of Purchase or Redemption Price.
8.7 Payment of Purchase Price on Death.
8.8 Deferred Payment Terms.
8.9 Shot Gun Buy Out.
8.10 Insurance.
Article 9 - DISSOLUTION AND TERMINATION
9.1 Dissolution.
9.2 Effect of Filing Dissolving Statement.
9.3 Liquidation, Winding Up and Distribution of Assets.
9.4 Compliance With Certain Requirements of Regulations; Deficit Capital Accounts.
9.5 Articles of Termination.
9.6 Deemed Contribution and Distribution.
9.7 Return of Contribution Nonrecourse to Other Members.
Article 10 - MISCELLANEOUS PROVISIONS
10.1 Notices.
10.2 Application of Arizona Law.
10.3 Entire Agreement.
10.4 Attorneys' Fees.
10.5 Waiver of Action for Partition.
10.6 Amendments.
10.7 Signing of Additional Instruments.
10.8 Time.
10.9 Rights of Unadmitted Assignees.
10.10 Effect of Inconsistencies with the Act.
10.11 Power of Attorney.
10.12 Representation by Counsel.
10.13 Late Charges.
10.14 Default Interest.
10.15 Investment Representations.
10.16 Mediation & Arbitration.
10.17 Construction.
10.18 Headings.
10.19 Waivers.
10.20 Specific Performance.
10.21 Rights and Remedies Cumulative.
10.22 Severability.
10.23 Waiver of Jury Trial.
10.24 Heirs, Successors and Assigns.
10.25 Creditors.
10.26 Estoppel Certificate.
10.27 Intent of Agreement.
10.28 Consent to Jurisdiction.
10.29 Counterparts.
10.30 Incorporation by Reference.
EXHIBIT A - DEFINITIONS
EXHIBIT B - PROMISSORY NOTE
EXHIBIT C - CERTIFICATE OF VALUE
EXHIBIT D - PLEDGE AGREEMENT
EXHIBIT E - INSURANCE POLICIES
EXHIBIT F - DISCLAIMER OF MEMBERSHIP INTEREST
About the Author
Richard Keyt, J.D., LL.M. (income taxation New York University Law School) is a business, real estate, transactions, contracts and estate planning attorney licensed to practice law in Arizona. He has formed over 2,200+ Arizona limited liability companies in the last few years because his low cost high quality LLC package is second to none and it only costs $599 for everything. Rick has practiced law in Arizona since 1980. Rick can be reached by telephone at 602-906-4953, ext. 3. Email at rickkeyt@keytlaw.com and fax at 602-297-6890. Rick's web site located at www.keytlaw.com had over 3,000,000 visitors in 2006 - 2008. To follow Rick on Twitter go to www.keytlaw.com/twitter. Rick does not accept matters involving landlord / tenant disputes or litigation of any kind (other than tax lien foreclosures). Communicating with Richard Keyt via email or otherwise does not cause you to become a client or cause your communications to be confidential or subject to the attorney client privilege.
KEYTLaw LLC Formation Records: day: 17 (6/4/08); week: 27 (week ending 6/7/08); month: 64 (6/08); year: 425 (2007)
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This page was last modified on December 12, 2009.
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