Bylaws (Corporation) Or An Operating Agreement (LLC)

The basic sections of Bylaws or an Operating Agreement are:

1. Organization
Establishes Who has Ownership Interests (a percentage of 100% ownership);
When the Business Started,
Where it is located

2. Management & Voting Rights
LLC Members can manage or they can retain managers
When are Votes Necessary or Management Authority:

• Amendments to Operating Agreement
• Mergers and Acquisitions
• Sales
• Adding and Terminating Members

How Voting Works, e.g. unanimous or majority or super-majority
Who will Vote, e.g. one vote per member or votes per shares

3. Capital Contributions and Allocation of Obligations
From LLC Members in beginning and in the future in the event of debts
From New Members of LLC
Amount of shareholder contribution

4. Distributions: how profits are shared among LLC Members AFTER taxes and debts
With Money – by shares or other measure
With Hard Assets – by shares or other measure
With Real Estate – by shares or other measure

5. LLC Membership Changes
How to add or remove a LLC Member
IF LLC Membership Shares can be transferred (voluntarily or by vote)
What happens upon death

6. Dissolution: Under what circumstances should the LLC or corporation “wind up” business.