DGAA bLAWg

Why Your LLC Needs an Operating Agreement

Web Admin - Tuesday, March 18, 2014

illinois corporate attorney llcsLimited Liability Companies (LLCs) are a form of business structure that allows owners to have some of the benefits of a standard corporation, but with more flexibility to control the particulars of the business. This flexibility makes it important to make thoughtful choices about things like voting rules and members’ rights and responsibilities at the start of the formation process. That is where the LLC operating agreement comes in. While operating agreements are not required by law in Illinois, it is still highly beneficial to have them because of the extra control that they provide.

What is an Operating Agreement?

An operating agreement is a document that controls the structure of the company and the members’ relationships. This can mean many different things, but operating agreements often include provisions related to:

  • - Each member’s percentage of ownership;
  • - Management of the LLC- Member Managed v. Manager Managed;
  • - The rights and responsibilities of the different members;
  • - Voting powers and dispute resolution mechanisms;
  • - Voting and meeting procedures; and
  • - Conditions relating to the sale of the LLC and the members’ related rights.

The Benefits of an Operating Agreement

Given the importance of the types of provisions that operating agreements contain, each LLC should have one, even if it is not technically required by law. The law forgoes this requirement because the legislature drafted a set of default rules to apply to LLCs for cases in which the members decide not to draft an operating agreement. While people often rely on these default rules, that is not the best strategy for their business. The major benefit of the LLC is the freedom and control provided by the operating agreement, so skipping the drafting of the operating agreement defeats the purpose.

This is especially problematic because often times the default rules do not make the most sense for a particular business. For instance, most actions under the default rules require only a simple majority vote of the members to be approved. Drafting an operating agreement would allow the members to introduce supermajority votes and other control provisions on more important issues. Similarly, another central issue to any business is the distribution of profits.

In Illinois, the default rule is that distributions must be made in equal shares to all of the members. This rule seldom makes sense for businesses in which different members have invested different amounts. People often want to tie their distribution to the members’ stakes in the company, which requires a separate provision in the operating agreement. Of course, these are just some of the many choices that operating agreements allow LLC members to make about their business and its structure.

If you are in the process of forming an LLC and need an operating agreement tailored to your business’s specific concerns, contact an Illinois corporate law attorney. We help businesses across the northwest suburbs in towns like Rolling Meadows, Palatine, Schaumburg, and Inverness.

About the Author: Attorney Jay Andrew is founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.

Registered Agents for Business: Why You Need One

Web Admin - Friday, October 18, 2013

In most states, including Illinois, business law requires corporate owners to have a registered agent represent their corporation or limited liability company (LLC). A registered agent is the third-party who is listed in the same state in which the business was established. This go-between is chosen to receive service of process notices, communication from the Secretary of State, tax forms, and lawsuits on behalf of the business.

According to the Illinois Limited Liability Company Act (805 ILCS 180/1-35), a registered agent’s name and location must be included in the paperwork filed with the state. This allows the public to access information about a business and to send any important documents to the agent registered for the company. This is especially useful for small businesses without a physical address. The state must have a physical address on file in case the business is served with a lawsuit.

How Registered Agents Help in Illinois

Not only is a registered agent the third-party representative for a business, but they stand as barrier between a business and the state government. This allows a business owner to focus solely on their corporate front. A registered agent in Illinois will accept tax or legal documents privately so business owners do not have to do so in front of clients.

An additional benefit is that a registered agent’s office address will remain the same even if a business moves to a new location. With a registered agent, there is no need to file more paperwork with the state for every Illinois business relocation. Opening a new business office in another state, however, presents more challenges. Every state requires a business to maintain a registered agent and registered office in that state.

Lawsuits can be complex and have serious consequences for missed deadlines. A registered agent is a qualified professional who knows the laws and regulations for the State of Illinois. Assigning the role of registered agent to a law firm can ensure that service of process is properly received and handled.

If you are interested in appointing a qualified law professional as your registered agent, contact a Palatine corporate law attorney today. Call 847-934-6000 to speak to a business lawyer serving the Northwest Suburban areas including Rolling Meadows, Buffalo Grove, Barrington, and beyond.


Recent Posts


Tags

rest breaks uninsured motorist Illinois elder law attorney Crystal Lake traffic attorney Illinois job attorney drug crime traffic laws field sobriety test ken apicella suspended license Crystal Lake will lawyer medical marijuana Crystal Lake car accident attorney Schaumburg insurance lawyers Schaumburg injury lawyer license revocation blood alcohol content severance agreements drug crimes Crystal Lake medical malpractice law firm top life insurance claim denials low-ball insurance settlement Riverwoods estate planning lawyer PTSD Crystal lake insurance dispute attorney Palatine real estate lawyer Illinois trucking safety Barrington estate planning lawyer vacation home bad faith insurance claims traumatic brain injuries power of attorney for healthcare liability claims golf accidents insurance attorney Palatine drug lawyer gift tax exemption, estate planning, estate planning strategies, Illinois estate planning, South Barrington estate planning attorneys right to work medical malpractice compensation Rolling Meadows employment law attorneys Schaumburg wrongful death attorney institutional trustee Illinois insurance claim attorney healthcare claims boating accidents Inverness insurance attorney car crash CAM Chicago life insurance attorney preventable medical errors car crashes civil litigation Illinois Probate Act of 1975 elder law slip and fall accidents probate claims process criminal defense Barrington criminal defense lawyer Buffalo Grove injury lawyer rollover car crashes Des Plaines accident attorney Rolling Meadows tax attorney LLCs real estate attorneys construction accidents Mount Prospect wills and trusts lawyers Schaumburg employment attorney living trust vs will Illinois medical malpractice case disability benefits filing a medical malpractice claim employment law, meal breaks, rest breaks, hotel employees, Des Plaines employment law attorneys Illinois trusts attorney real estate zoning personal injury claims Palatine construction attorney Crystal Lake personal injury lawyer new real estate form Arlington Heights wills and trusts attorneys Policy Cancellation Illinois tax attorney Rolling Meadows DMV DUI penalities cause-of-death exclusions Barrington real estate lawyer Crystal Lake employment attorney Arlington Heights wills and trusts lawyers Crystal Lake estate planning lawyer pain and suffering Inverness civil lawyer foreclosure appealing an insurance claim federal regulations for LLCs estate attorney Inverness probate lawyer Buffalo Grove personal injury attorney Deer Park medical malpractice attorney Colin Gilbert Long Grove estate planning insurance claim denial crossover accidents guardianship attorney insurance dispute Crystal Lake injury attorney Rolling Meadows DUI lawyer pedestrian injuries, pedestrian fatality TBI Illinois employment attorneys workers compensation Inverness real estate attorney Des Plaines insurance attorney personal injury, auto accident injuries, delayed injuries, serious injuries, Des Plaines personal injury attorneys Palatine Attorney jet ski accidents Super Mario social media after death food poisoning Illinois insurance claim dispute lawyers Palatine traffic lawyer Rolling Meadows personal injury attorney Illinois small business drunk driving statistics Rolling Meadows life insurance claim denial attorney Inverness accident lawyer BAC IRA benefits Barrington employment attorney Chicago biking tips digital media accounts, estate planning, Arlington Heights estate planning attorney, wrongful death Illinois speeding lawyer denial of life insurance Barrington workers compensation attorney Palatine civil litigation lawyer personal injury accidents insurance claims Illinois boating accident lawyer Palatine employment attorney underage DUI employment law, Illinois employment laws Inverness corporate attorney Federal Food Drug and Cosmetic Act Illinois Wage Payment and Collection Act Deer Park real estate law firm Buffalo Grove medical malpractice lawyers Barrington injury attorney Long Grove estate planning attorney privacy boating under the influence Des Plaines Traffic Lawyer digital assets, digital fiduciary, estate planning, digital content, Long Grove estate planning lawyers DGAA Chicago insurance claim attorneys Colin H. Gilbert breathalyzer test Des Plaines collections attorney denied insurance claims Illinois business law atorneys Illinois Arlington Heights wills and trusts attorney real estate Des Plaines real estate attorney Arlington Heights trucking lawyer Rolling Meadows criminal lawyer life insurance cell phone accidents Barrington estate planning attorney Inverness real estate lawyer startup company Mount Prospect elder law attorney Crystal Lake bike accident lawyer Deer Park motorcycle accident lawyer Crystal Lake business law attorneys comp time Illinois pet lawyer Illinois workplace lawyer car accident lawyer probate claims traumatic brain injury owner responsibility Chicago insurance law firm Arlington Heights TBI attorney pedestrian accident underfunded trust civil rights violation Illinois employment lawyer Rolling Meadows drug defense attorney first degree murder defective products Illinois collections attorney Crystal Lake insurance lawyer Jay Andrew Palatine punch death dynasty trusts traffic deaths Illinois DUI attorney estate tax Des Plaines drug lawyer elder abuse clemency life insurance claim denial, denial of life insurance claim Chicago will attorney employee discrimination digital evidence Illinois personal injury attorney Crystal Lake tax lawyer advance healthcare directive Crystal Lake civil litigation lawyer license defective products lawyer child safety Illinois wills and trusts attorneys trucking accidents most common reasons for life insurance claim denials Barrington boating accident attorney Arlington Heights employment attorney Deer Park traffic lawyer Crystal Lake pet attorney Schaumburg life insurance attorney digital assets financial advisors Illinois living will civil litigation attorney Arlington Heights employment law attorneys fiduciary rule Chicago employment attorney Whistleblower Claims Schaumburg construction accident lawyer Legal Info operating agreements Inverness estate planning lawyer Arlington Heights lawyer Inverness traffic law firm insurance dispute, insurance dispute lawyers, insurance claim denial, insurance claim delays, Rolling Meadows insurance dispute attorneys Kenilworth estate planning attorney Rolling Meadows insurance dispute lawyers, insurance dispute subcontractor Barrington life insurance lawyer Illinois traffic ticket lawyer wills and trusts Barrington medical malpractice lawyers South Barrington real estate lawyer Schaumburg personal injury lawyer probate Schaumburg civil litigation attorney Illinois Transfer on Death Instrument Buffalo Grove traffic lawyers Kenilworth estate planning attorneys Illinois estate planning Schaumburg criminal law attorney Illinois probate lawyer bicycle dooring accidents hiring employees Home Remodeling Repair Act Arlington Heights personal injury lawyer Illinois lawyer estate planning, death tax, succession plans, business estate plans, Barrington estate planning lawyers Barrington business law firm Liquor Control Act real estate attorney trucking accident lawyers trusts Palatine life insurance lawyer workers compensation benefits Illinois traffic attorney murder charges comparative negligence revenge porn Illinois construction accident attorney dog bites Chicago will attorney, social media platforms, Illinois estate planning lawyer, trust payments Buffalo Grove car accident lawyer fiduciary rule delay insurance agents natural gas explosion landlord tenant law Illinois traffic laws Long Grove estate planning attorneys insufficient documentation POA Barrington civil litigation attorney Arlington Heights traffic attorney tax attorney Illinois registered agent Illinois Workers’ Compensation Commission unauthorized overtime spinal cord injuries brain injury Illinois traffic accident lawyer Chicago employment lawyer Rolling Meadows marijuana attorney Rolling Meadows personal injury lawyers IRA trust transfer Illinois Human Rights Act pizza emoji Food and Drug Administration's Food Safety Modernization Act Palatine elder law attorney cell phone tower data estate planning for college students Des Plaines personal injury attorney Arlington Heights real estate lawyer hit and run accident Schaumburg criminal attorney Palatine traffic accidents creditors life insurance claims pay when paid contract Deer Park criminal attorney Illinois personal injury lawyers pregnant women spinal cord injury medication errors dealing with problem employees Rolling Meadows personal injury lawyer wills Rolling Meadows estate planning attorney Rolling Meadows probate lawyer product liability sexual harassment DNR trustee estate planning attorney Arlington Heights pedestrian accidents living wills insurance claim delay Retaliatory Discharge gift taxes Illinois defective products attorney Fair Labor Standards Act Illinois personal injury coronavirus Rolling Meadows accident lawyer minimum wage Illinois law Rolling Meadows traffic attorney Illinois insurance dispute lawyers insurance agent negligence preventing accidents Palatine probate lawyer IRS denial of insurance claim Des Plaines personal injury lawyers residential real estate Schaumburg estate planning attorney medical malpractice claims wage theft Buffalo Grove probate lawyer marijuana crimes attorney Schaumburg medical malpractice lawyer car crash injuries Rolling Meadows traffic law firm estate planning, digital assets, Revised Uniform Fiduciary Access to Digital Assets Act, Illinois digital assets, Illinois estate planning, products liability Schaumburg car accident attorney Deer Park employment law attorney commercial leasing Illinois jet ski accident lawyer Mt Prospect Attorney Barrington criminal lawyer Barrington Traffic Lawyer Illinois medical malpractice lawyers Schaumburg probate attorney Palatine injury attorney estate planning trusts estate planning lawyer boating DUI Schaumburg car accident in terrorem provision liens Arlington Heights wills and trusts lawyer Palatine corporate attorney material misrepresentation FSLA personal injury claim Crystal Lake employment law attorney criminal law installment contracts jet ski liability Forcible Entry insurance disputes probate lawyer Kenilworth estate planning lawyer employee misclassification Illinois employment law attorney Crystal Lake medical malpractice attorneys digital information Illinois red light cameras Chicago traffic lawyer Crystal Lake law firm Chicago attorney automated cars involuntary manslaughter Buffalo Grove corporate attorney Schaumburg elder law lawyer sexual images Buffalo Grove insurance claim dispute lawyers Des Plaines drug crimes lawyer Buffalo Grove employment lawyer Self-Directed IRA Accounts manufacturing overtime violations traffic violations Employment Discrimination Law Palatine law firm Illinois workers compensation lawyer motorcycle accident lawyer Illinois attorney Crystal Lake accident attorney real estate closing Illinois rollover accident lawyers Rolling Meadows Attorney real estate lawyer Deer Park traffic accident attorney Palatine insurance lawyer workers comp mortgage Barrington attorney whistleblower protections privacy laws probate fees underinsured motorist Thanksgiving Palatine personal injury lawyer insurance negligence slip and fall insurance claim dispute DUI defense agent Des Plaines personal injury lawyer Rolling Meadows criminal attorney auto accidents traffic tickets taxes condo sole proprietorship back injuries Illinois LLC creation Palatine trusts lawyer Chicago estate planning commercial real estate real estate leasing Schaumburg estate attorney traffic crimes Chicago estate planning lawyer Rolling Meadows employment attorney FMLA murder Rolling Meadows car accident lawyers unfunded trust Rolling Meadows Traffic Lawyer Barrington Illinois estate planning lawyer Schaumburg Attorney how to avoid common denials of life insurance claims Illinois wrongful termination lawyer Chicago lawyer Rolling Meadows real estate attorney Illinois driving without license employment lawyer Rolling Meadows litigation lawyer cell phone Des Plaines real estate lawyer Illinois insurance claims lawyers personal injury lawyer drug crimes lawyer mass shooting Arlington Heights medical malpractice lawyer construction contracts Inverness elder law lawyer Schaumburg real estate lawyer Arlington Heights tax lawyer Palatine workers compensation lawyer Buffalo Grove traffic attorney Crystal Lake criminal defense attorney traffic violations defense Illinois employment law firm controlled substance capital gains tax Fourth of July Buffalo Grove law firm Class A misdemeanor Des Plaines criminal attorney small business Long Grove real estate lawyer Rolling Meadows insurance attorney Long Grove wills and trusts attorneys real estate contract Barrington employment law attorney Detainer Actions Illinois pedestrian accident attorney Des Plaines claims law firm caregiver ObamaCare traffic offenses personal injury law firm Home Sale Contingencies Illinois estate planning attorney Inverness DUI lawyer employees compensatory time pedestrian-automobile accident Illinois civil litigation lawyer Palatine business attorney Barrington employment law firm rent to own real estate contracts Illinois employment law attorneys estate plan pedestrian accidents Illinois Trust Code DUI contracts employment contract Arlington Heights estate planning attorney Family Medical Leave Act Illinois will lawyer college kids overtime pay internet Buffalo Grove criminal defense lawyer license reinstatement nursing home negligence bike accident Crystal Lake pedestrian accident lawyer Des Plaines injury law firm Arlington Heights Traffic Lawyer forming a corporation in Illinois Arlington Heights car crash attorneys health insurance dispute Illinois Sales Representative Act deed transfer natural gas drugs insurance denials Crystal Lake personal injury attorney dram shop law expungement Des Plaines pet law attorney employment law insurance dispute attorney corporate law Transfer on Death Instrument Illinois real estate lawyer murder defense insurance denial appeals Illinois medical malpractice attorney insurance claim Chicago car accident lawyer Palatine estate planning lawyer Schaumburg employment law attorneys truck collisions special needs trust Illinois business lawyer holiday statistics Crystal Lake medical malpractice lawyer llinois Real Estate Lawyers Association Crystal Lake employment lawyer Buffalo Grove real estate attorney Illinois workplace discrimination attorney Illinois mortgages Illinois estate planning law firm head on collisions rollover accidents Illinois bicycle safety Illinois employment law Illinois traffic attorneys BUI Barrington drug crime attorney work unions Palatine employment law lawyer Inverness personal injury attorney distracted driving accidents modern family estate planning rumble strips Barrington personal injury attorney employment contract, employment law, employment at-will, Deer Park employment law attorneys, contract, anesthesia errors surgical mistakes Arlington Heights Attorney Illinois car accident attorney Buffalo Grove personal injury lawyer hands free device Illinois Smoke Detector Act Rolling Meadows medical malpractice lawyers senior citizens personal injury Arlington Heights accident attorney traffic accidents Rolling Meadows corporate lawyer Chicago trucking accident attorney condo association Palatine civil attorney living trust benefits DUI attorney bicycle accidents South Barrington real estate attorney foreclosed rental property commercial leases Schaumburg traffic lawyer fault based insurance Arlington Heights car accident lawyer Schaumburg personal injury lawyers Illinois insurance lawyer Illinois motorcycle accident lawyer employment attorney texting and driving trauma after an accident Illinois workers compensation attorney caretaker rights life insurance policy Rolling Meadows insurance dispute lawyers driving employee rights Schaumburg personal injury attorney drunk driving attorney fees insurance disputes, Illinois insurance disputes, Illinois insurance dispute attorneys, denied insurance claims, Arlington Heights insurance dispute attorneys eluding a police officer Illinois employment laws power of attorney paid sick leave Mount Prospect real estate lawyer ACA car collision Schaumburg drug defense lawyer BAIID insurance adjusters premises liability distracted driving accident victims Inverness injury lawyer probate process loopholes criminal record Des Plaines tax law firm car accident lawyers accidental death benefits insurance claim denials Illinois personal injury lawyer Rolling Meadows employment law attorney Illinois employee rights attorney. Des Plaines motorcycle accident attorney business litigation Deer Park personal injury lawyer construction accidents, personal injury, wrongful death, Arlington Heights personal injury attorneys, workers' compensation Crystal Lake car accident lawyer Barrington personal injury lawyer Schaumburg estate planning lawyer Rolling Meadows business lawyer Des Plaines DUI attorney home inspection lawyer Illinois injury lawyer drug possession estate planning Palatine criminal defense lawyer Arlington Heights injury attorney federal crimes Crystal Lake traffic lawyer job lawyers medical research breach of contract Des Plaines medical malpractice attorney Arlington Heights personal injury attorney Landlord Tenant Ordinance income distribution deducation car accidents living trust School Visitation Rights Act problem employees Arlington Heights insurance attorney no contest clauses trench injuries Deer Park accident attorney Deer Park DUI lawyer Palatine employment lawyer Illinois corporate lawyer lapse in policy consent to a search Illinois insurance disputes vacation home fines criminal speeding Schaumburg corporate attorney Affordable Care Act license suspension insurance claim dispute attorney Buffalo Grove life insurance attorney motorcycle accident icy parking lots Palatine corporate law attorneys pet law Illinois criminal defense attorney independent contractor Long Grove real estate attorney changes to mortgage law Exclusions swimming pools meal breaks life insurance lawyer Do Not Resuscitate Illinois wills and trusts Illinois medical malpractice claim personal injury attorney unpaid assessment wrongful termination Deer Park workers compensation lawyer Joliet general practice lawyers Des Plaines loss of consortium Illinois insurance claim dispute lawyer fatal car accidents Arlington Heights criminal lawyer reckless homicide Des Plaines civil attorney Illinois insurance attorney IRELA beneficiary complications GM ignition switches medical malpractice pet bites Illinois home inspection blended families denied insurance claim homestead rights irrevocable trust workplace sexual harassment medical malpractice, missed diagnosis, delayed diagnosis, medical mistake, Deer Creek medical malpractice lawyers Barrington litigation attorney Rolling Meadows boating crash lawyer marijuana Rolling Meadows insurance lawyer Attorney Ken Apicella Chicago corporate attorney texting while driving investment property unpaid overtime Illinois real estate wrongful termination, employment law, whistleblower protections, Illinois employment laws, discrimination in the workplace healthcare landlord deadly crashes

Archive