Starting an LLC may involve filing articles of organization with the state and establishing internal ground rules for how your business should operate. Establishing your credibility as a legal entity is a part of the plan.
Every Oklahoma LLC is encouraged, but not required, to have an operating agreement to safeguard the company’s operations, from organization to dissolution. It ensures that all LLC members understand their roles and responsibilities. This page guides you in making an Oklahoma operating agreement.
On this page, you’ll learn about the following:
Oklahoma LLC Operating Agreement Content
An operating agreement is a legal document detailing the LLC’s organizational structure and operational procedures. Topics not restricted to a single member or multi-member LLC will be covered. While these provisions might not influence day-to-day operations, they must be included for legal reasons.
- Ownership: The operating agreement details who the members are and how ownership is divided, be it a sole proprietorship or LLC. Sole proprietorship refers to a single person with total control over a business, also known as a single-member LLC. Multi-member LLC members can have either equal or varying ownership interests.
- Management: Your LLC could be member-managed or manager-managed. The former means members can decide regarding contracts with third parties; the latter means only designated managers can do so. Using “manager-managed” instead of “hands-on” can reduce administrative work. Management’s authority is also limited in the Operating Agreement.
- Voting: Define each owner’s voting rights and voting thresholds, such as a majority vote, supermajority vote, and unanimous consent. A variety of approvals are needed for each type of decision.
- Changes in Membership Structure: If someone leaves the company, how will roles and ownership be transferred? A member buyout and/or replacement procedure must be outlined in the LLC’s governing document.
- Contributions: All types of contributions are accepted. In order to fund their ownership interests, members will have to invest in the collective funds.
- Equity Splits: Determine equity for each member, taking into consideration things like their contributions, responsibilities, and fairness. Maintaining fairness in your equity split will help prevent future disagreements.
- Transfers: You may want to consider outlawing transfers of ownership interests without the consent of all owners. It’s always a good idea to include permitted transfers, such as first refusal, drag-along rights, tag-along rights, and estate planning transfers.
- Business Restrictions: To protect the privacy of the company, including confidentiality obligations. You may also ban the owners from owning competing businesses.
- Intellectual Property: Detail; the ownership of intellectual property created by members. Make sure all company-created intellectual property is owned by the company. You can find alternative ownership/license structures if necessary.
- Taxation: Determine how you will be taxed and plan accordingly. Remember, however, that you must file an LLC annual report and might be required a sales tax.
- Guaranteed Payments: Determine if any of the members should receive Guaranteed Payments, which are like a salary, particularly if your LLC is taxed as a partnership.
- Distribution & Dividends: Explain to all members how the funds will be allocated. A pass-through entity will impose tax distributions regardless of profit distributions.
- Dissolution: The LLC should be dissolved if all members elect to cease operations. It is important to identify how you will end your business in your operating agreement.
Note that the operating agreement, though not a legal requirement in most states, is vital in the operation of your LLC. Should your members have issues with the business, you can deal with it with guidance from the operating agreement.
Get Help from a Registered Agent
Developing an operating agreement could be tedious at times. Besides, since it deals with how your business operates, then it would be best to have professionals help you with it to make sure you get everything right. Getting help from registered agents would be your best bet. Here are three of our best LLC services that can provide you with registered agents to free you of worries:
Importance of an Oklahoma LLC Operating Agreement
Oklahoma doesn’t require that you create an operating agreement when you own an LLC. Most states need their businesses to sign an agreement in the order it is easy to review the structure of their business. It is possible to skip this process in Oklahoma and the LLC is not penalized by law.
This step is essential if you want the LLC to be protected from any misunderstandings or negotiations. This article will explain why LLC owners need to create an agreement.
- To safeguard the company Operating agreement: It sets out the rules for LLC. If members do not follow the rules and the operating agreement is not followed, it will regulate the operations of the LLC. The agreement can save the LLC from the rules of the government and provide extra advantages.
- The LLC looks credible: Investors always look at the professionalism of the company when they are looking for businesses. Operating agreements make the LLC professional. It shows members that they care about the company. They want all the regulations and rules to be legal. This provides the opportunity for more investors to invest in the company and this will lead to expansion.
- To be legally valid: LLCs enjoy limited liability status. The operating agreement must specify this clearly so that the government doesn’t misunderstand. Because it is very easy to misunderstand a one-member LLC with a sole proprietorship, but an operating agreement can show they are different.
- To resolve any conflict: There might be future conflicts about decisions and distributions. The operating agreement outlines the procedures and requirements for each employee of the company. If they are required to perform a task, they can check the details in the agreement before they proceed with the task.
- LLC flexibility: Limited Liability Companies should be flexible. This is their nature. Operating agreements are what allow these LLCs to have such a nature. The validity of an operating agreement provides the LLC with freedom.
- To open bank accounts in your company, you’ll require an official copy of your operating agreement. If the business does not have this, it will be difficult to open a bank account.
How to Edit Operating Agreement of LLC in Oklahoma
Operating Agreement of LLC in Oklahoma can be edited when all the members agree to the amendment(s). You do not need to file it with the state.
Whether you’re new to the business world or you’re planning to expand, it is important to create an operating agreement for your LLC. Operating agreements provide a framework for your business and set clear expectations for members of the company. These documents also protect your business from any potential disagreements between partners. It is possible to edit your operating agreement for Oklahoma to meet your specific business needs.
Before forming an LLC, you may want to consult with an expert in business matters to help you with all the details. This can be a tax advisor, lawyer, or accountant. It is also important to make sure your LLC is registered to do business in the state where you are doing business. This will ensure that you are legally recognized and have the ability to enforce contracts in your home state.
Oklahoma businesses need to file an amended or restated Articles of Organization whenever they have a change to their business structure. This includes changes in the number of shares of stock or the number of managers or directors. These changes are reported on an Oklahoma LLC Amended Articles of Organization form. This can be done online or by mail. Processing times can vary depending on the workload of the Secretary of State. A mail-in filing typically takes 10 to 14 business days to process. If you are filing online, you can expect to have your amendments processed in two business days.
The name of your LLC must be available and distinguishable from other business names in Oklahoma. You also need to be sure that your LLC’s name does not contain any trademarks that are already in use. If you have any doubts about whether your name is available or not, check with the United States Patent and Trademark Office. They will be able to tell you if your name is available and whether you can register it with the United States Patent and Trademark Office.
The registered agent for your Oklahoma LLC will be responsible for receiving and serving legal documents. They may also be the person who files your legal documents with the state. If you plan to change your registered agent, you will need to file an amendment and other changes.
The initial documents that you need to file to start your LLC are the certificate of formation and the articles of organization. The certificate of formation will set up your LLC’s purpose and will also outline the financial obligations of the company. It is also necessary to file an annual certificate on the anniversary of the formation date. The certificate of good standing demonstrates that your LLC is legal and meets the requirements of the state. This is important for attracting investors and bank loans.
When you file an amended or restated Articles of Organization in Oklahoma, you will need to submit the amendment to the Secretary of State. This process is easy and can be completed online. If you’re filing by mail, you will need to include a filing fee of $50.
In order to clearly state the purpose of a business as well as its ownership interests, a written operating agreement is strongly advised in Oklahoma.
You and other members of the LLC will be unable to reach any agreements if you do not have an operating agreement. Even worse, your LLC must follow the state’s default operating conditions.
It is required by law in California, New York, Maine, and Missouri, but it is not in Oklahoma. Although it is not legally required, creating a written agreement is strongly advised. You may self-notarize and distribute the documents.
The operating agreement is an important document for your Oklahoma LLC. However, it is not mandatory to file in many states. It is strongly recommended to file the operating agreement even if it is not required in your state. Get a professional LLC service to file your operating agreement properly.