A Washington multi-member LLC operating agreement outlines the ownership structure and standard operating procedures of a company jointly owned by two (2) or more members. The document establishes:
- Members’ initial contributions;
- The process for allocating profits and losses;
- How the company will deal with legal matters;
- Powers and duties of members;
- How members will be reimbursed;
- How expenses will be paid;
- How taxes, banking, and accounting will be managed;
- How membership will be transferred;
- How the company will be wound up;
- and more.
The operating agreement can be crucial in resolving disputes and can also shield members’ assets from liabilities to which the corporation is exposed. Each member should keep a copy on file.