Operating Agreement Template California

LIMITED LIABILITY COMPANY OPERATING AGREEMENT

Document ID: LLC-CA-2024-001
Effective Date: [Effective Date]
Version: 1.0
Governing Jurisdiction: State of California

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LEGAL DISCLAIMER

This document is a sophisticated template drafted to comply with the California Revised Uniform Limited Liability Company Act (RULLCA). It does not constitute legal or tax advice. The user assumes all liability for the final execution of this document. It is strongly recommended that this document be reviewed by licensed legal counsel to ensure alignment with the specific tax elections (e.g., S-Corp vs. Partnership status) and operational needs of the entity.

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ARTICLE 1: FORMATION AND PARTIES

1.1 Formation. The Members have formed a Limited Liability Company (the "Company") pursuant to the laws of the State of California by filing Articles of Organization with the Secretary of State.

1.2 Identification of Parties.

• Company Name: [Company Full Legal Name]
• Principal Business Address: [Principal Address]
• Members: Member 1 Name, [Member 1 Address]; Member 2 Name, [Member 2 Address].

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ARTICLE 2: CAPITAL CONTRIBUTIONS AND OWNERSHIP

2.1 Initial Capital Contributions. Each Member shall contribute the following initial capital to the Company:

• Member 1 Name: [Amount in USD]
• Member 2 Name: [Amount in USD]

2.2 Membership Interests. Ownership interest in the Company shall be allocated as follows:

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ARTICLE 3: MANAGEMENT AND VOTING

3.1 Management. The Company shall be [Member-Managed / Manager-Managed]. If Manager-Managed, the Manager shall be [Manager Name].

3.2 Voting. Except as otherwise provided herein, all decisions regarding the business and affairs of the Company shall be made by a majority vote of the Members based on their respective Membership Interests.

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ARTICLE 4: ALLOCATIONS AND DISTRIBUTIONS

4.1 Profits and Losses. Net Profits and Net Losses shall be allocated to the Members in proportion to their respective Membership Interests.

4.2 Distributions. Distributions shall be made at such times and in such amounts as determined by the [Manager/Members], provided that the Company has sufficient cash flow after accounting for reasonable reserves and obligations.

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ARTICLE 5: TRANSFERS AND WITHDRAWALS

5.1 Restriction on Transfer. No Member may sell, assign, encumber, or otherwise transfer their interest in the Company without the prior written consent of the non-transferring Members, unless otherwise provided for in a Buy-Sell agreement.

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ARTICLE 6: DISSOLUTION AND TERMINATION

6.1 Events of Dissolution. The Company shall be dissolved upon: (a) the written agreement of all Members; (b) the entry of a decree of judicial dissolution; or (c) the occurrence of any event that makes it unlawful for the business of the Company to be continued.

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ARTICLE 7: INDEMNIFICATION AND LIABILITY

7.1 Limitation of Liability. No Member or Manager shall be liable to the Company or any other Member for any loss, damage, or claim incurred by reason of any act or omission performed in good faith on behalf of the Company.

7.2 Indemnification. To the fullest extent permitted by California law, the Company shall indemnify and hold harmless any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding by reason of the fact that they are or were a Member or Manager of the Company.

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ARTICLE 8: MISCELLANEOUS PROVISIONS

8.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California.

8.2 Dispute Resolution. Any dispute arising out of this Agreement shall be settled by binding arbitration in [County, California] under the Commercial Arbitration Rules of the American Arbitration Association.

8.3 Entire Agreement. This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements, understandings, or representations.

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EXECUTION

FOR [COMPANY FULL LEGAL NAME]: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Company: [Company Legal Name] Date: [Date]

FOR MEMBER 2 NAME: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Date: [Date]

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STEP-BY-STEP EXECUTION AND FILING GUIDE

1. Document Preparation: Copy the above text into a word processor. Replace all bracketed text (e.g., [Company Full Legal Name]) with actual data. Do not leave any brackets unfilled.
2. Verify Authority: Ensure the individuals signing the agreement have the legal authority (as per Articles of Organization or Corporate Resolution) to bind the entity.
3. Execution: Use a secure digital signature platform (DocuSign, Adobe Sign, or HelloSign) to execute the document. This provides an audit trail of the signing process.
4. Record Retention: Maintain the executed original in the Company’s "Minute Book." Under California law, you are required to keep copies of this agreement at the principal place of business.
5. State Filings: This document does not need to be filed with the Secretary of State, but you must ensure your Statement of Information (Form LLC-12) is current and filed every two years (or within 90 days of formation).