Forming an LLC: Figuring Out What’s Really Required
Here (slightly edited) are a LinkedIn question and my answer (which no longer are available at LinkedIn because it Q&A feature was discontinued). Q. I need to get an operating agreement for my Nevada LLC startup. I plan on selling membership in the future. There are online services that do this for cheap, but I’m unsure about doing that. This is a bootstrapped startup, so I have very little/no cash to pay for an attorney at this point in time. Plus I haven’t been able to find a good referral to a NV business attorney.
A. I’m afraid that I can’t provide a useful direct answer to your question (I don’t know how to get something – especially something good – for nothing), but I can provide some warnings because I see several red flags popping up.
First, I see that you are in the Seattle area but formed a Nevada LLC. I am concerned that you may have chosen Nevada for reasons that will not provide any actual benefit to you – please see “Why (not) form an LLC in Nevada (or Wyoming)?”.
Second, even if you find some generic operating agreement, it probably will not be suitable for a multi-member LLC – please see “Can I form an LLC without a lawyer?”.
Third, the “I plan on selling membership in the future” statement suggests that you must be very careful about compliance with securities laws and regulations – this is not a do-it-yourself issue.
In summary, if you take your plan any further without retaining competent business counsel, you will be asking for legal trouble and, quite possibly, personal liability – precisely what you, no doubt, expect to avoid with the LLC.
I’m sorry that all I can deliver is bad news.
Check out all posts about LLCs.
Dana H. Shultz, Attorney at Law +1 510-547-0545 dana [at] danashultz [dot] com
This blog does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact a lawyer directly.
Business Entities, Startup