Free Member‑Managed LLC Operating Agreement Template
If your LLC is run by active members rather than designated managers, our member‑managed operating agreement template outlines clear rules for member roles, profit distribution, decision‑making authority, and dissolution procedures. Perfect for LLCs where members take on day‑to‑day governance.
DOWNLOAD MEMBER‑MANAGED OPERATING AGREEMENT
When to Use a Member‑Managed Operating Agreement
This type of operating agreement works best for LLCs where all members actively participate in managing the business. It documents how decisions are made, how profits and obligations are shared among members, and the procedures for business continuation or dissolution.
Though not required to be filed with your state, this agreement protects your limited liability status and provides a clear internal governance structure.
Key Sections Your Agreement Will Cover
- Formation & Purpose: Confirms legal formation, state jurisdiction, registered agent, duration, and business purpose.
- Member Contributions: Records each member’s capital investment and clarifies whether additional contributions are required.
- Profits & Distributions: Outlines how income and losses are allocated and timing of distributions.
- Management Structure: Defines how members vote on policies, appoint officers, and make decisions—typically by majority vote.
- Powers & Duties of Members: Specifies member authority and limitations, including what members can and cannot sign or bind the LLC to.
- Transfer & Dissolution Rules: Details the protocol for transferring member interests and how to handle dissolution.
Frequently Asked Questions
Is this agreement required?
Not in most states. However, a member‑managed operating agreement is highly recommended to avoid confusion and ensure that your LLC’s internal rules align with actual practices.
Do all members need to sign?
Yes—members who participate in management should sign the document. Many operating agreements require all members’ approval to prevent disputes.
What situations call for this agreement?
Use it for member-managed LLCs when onboarding new members, opening bank accounts, obtaining financing, or formalizing internal decision-making structures.
