50/50 LLC Operating Agreement Template

(Your Company Name)

This Operating Agreement ("Agreement") is made and entered into on (Date) by and between the following parties:

​[Member1.FirstName][Member1.LastName], residing at [Member1.StreetAddress][Member1.City][Member1.State][Member1.PostalCode], hereinafter referred to as "Member 1," and [Member2.FirstName][Member2.LastName], residing at [Member2.StreetAddress][Member2.City][Member2.State][Member2.PostalCode], hereinafter referred to as "Member 2."

Collectively, Member 1 and Member 2 shall be referred to as the "Members." This Agreement is pursuant to the terms and conditions outlined below.

Definitions

The capitalized terms below have the following meaning:

• “Act” – This refers to the State LLC Law, which will be amended from time to time.

• “Affiliate” – It means (i) a person who is controlling, is controlled by, or falls under the common control of another person, (ii) an individual who controls or owns 10% or more of outstanding voting securities of another person, (iii) the director, partner, or officer of such a person, or (iv) any company which acts in the interests of such a person. When referring to a person, it includes any natural person, partnership, corporation, trust, legal entity, or unincorporated association.

• “Code” – The Internal Revenue Code of 1986, the regulations and rulings issued thereunder, and can sometimes be amended.

• “Membership Interest” – This term shall mean the ownership interest the Member holds in the Company.

Terms of Partnership

1.1) Formation – On the Date of Formation, the Members filed the Company articles of organization with the Secretary of State of (State.Name) in accordance and pursuant to the Act.

1.2) Name and Place of Business – The Company name is (Company.Name), with its principal place of business as (Address). The Members, following the correct procedures of the Act, can change the Company name and address or add areas of business as required or desired.

1.3) Registered Office and Agent – The registered address of the Company is (Registered.Address), while the Registered Agent is (Registered.Agent). This address and agent can change occasionally, but Members must file the appropriate documentation of the new address and agent following the Act.

1.4) Business and Purpose of Company – The Company engages in any lawful act or activity under which the Act organizes a limited liability company.

1.5) Term – This Agreement shall remain valid until the Members dissolve the Company according to the terms of this contract.

1.6) Required Filings – Members are required to acknowledge, execute, file, record, or publish the certificates and documents connected to the formation of this Company, as required by law or this Agreement.

Capitalization and Financing

The Members will contribute the following in non-cash items and cash, which is always in US Dollars, to the capital contributions:

Earnings of Net Income and Net Loss

The Members will divide the daily, weekly, monthly, and annual net income and net losses in the following way:

Accounts for Partner Income

The Membership will create and keep up-to-date the income accounts of Members. The income accounts will be credited or debited depending on their Gains/Loss percentage and the Membership Interest. Losses are credited against the capital account of the Member if the income account is negative. The Company does not pay interest on any Member income account.

Salary and Drawings for Partners

The Membership does not deduct any salary from the income or capital account of a member. The Membership will distribute profits to Members at year’s end in the agreed-upon amounts and intervals.

Accounts for Partnership

The Membership holds its funds in an account by the name of the Company at (Bank.Name). Checks signed by (Signatory.Name) are required to withdraw funds from this account.

Company Expenses

The Company shall reimburse or directly pay Members who used personal funds to pay for expenses and costs of Company operations. The Membership will deliver this reimbursement within (Repayment.Term) of the initial receipt date.

Authority and Responsibility

Members shall have authority over the Company operations as outlined below.

Management

The Members manage the Company’s business and affairs. They have complete authority to manage and control the business at their discretion. Members have the right to make any management decisions and perform any management activities, provided they have the written consent of other Members.

Member Authority

Members have an equal say in the runnings of the business and will give it the time and attention required to achieve the Company’s goals. The Members have the rights, authority, and powers conferred by (State) law to manage the business of the Company.

By way of illustration but not of limitation, it includes the right to cause the Company to complete the following actions, provided they deem it to be in the best interests of the Company.

• Acquiring, holding, developing, leasing, renting, operating, selling, exchanging, or subdividing of Company property.

• To borrow amounts of money on specific terms.

• To pledge, mortgage, or subject the Property of the Company to security devices. Members can also obtain replacements for mortgage or security devices. They can further prepay, partially or in whole, refinance, modify, increase, extend, or consolidate any mortgage or security device.

• Enter into contracts and agreements concerning the business and purpose of the Company, Affiliates, and Members. Acquire any insurance contract for the protection of the Members and Company, including errors and omissions insurance, to conserve assets or any other beneficial purpose to the Company.

• Employ any individuals in the operation and management of the business.

• Prepare or organize the preparation of reports, statements, and other relevant information that they distribute to the Members.

• Creating accounts and depositing and maintaining funds in the name of the Company at banks and other financial institutions. To “money market” Company funds and other assets as the Members agree to in writing.

• Make, adjust, or revoke any of the Code elections.

• As the Internal Revenue Service approves, decide whether its accounting year is a calendar or fiscal year.

• Determine which is the appropriate accounting method(s) the Company uses.

• Add in the Company contracts that Members shall not have personal liability but that the Company and its assets carry sole liability to satisfaction with a person or entity it contracts with.

• Establish appropriate reserve funds from income the Members agree with.

• Initiate, settle, and defend legal actions.

• Admit itself as a Member.

• Execute, acknowledge, and deliver instruments to effectuate the business preceding. Members may execute any documents or instruments on behalf and in the name of the Company.

Tax Matters Member

The appointed “tax matters partner” of this Company for the purposes of the Code is (Member.Name).

Indemnification of Members

Members, Company shareholders, Affiliates, officers, partners, directors, agents, and employees (“Covered Persons”) shall not be held liable for any loss or damage incurred in connection with the business of the Company. They shall be indemnified and held harmless in all instances, including against costs, attorney fees, or any other amount expended to settle claims of loss or damage resulting from omitted acts.

Termination of Agreement

The Company can voluntarily dissolve, terminate and dispose of its assets and affairs upon determining the majority vote of the Membership Interests, according to the below terms.

Partner Withdrawal

Members can withdraw from the Agreement after giving other members a written notice of at least (Number) days in advance. Other members are allowed to purchase the Company share of the withdrawing Member.

Partner Retirement

A retiring Member must give a written notice a minimum of (Number) days in advance, and remaining Members can dissolve and liquidate the Membership with the retiring Member.

Buyout

When Members buy out other Members, the buying price is the same as that Member’s capital along with their monthly income.

Limitations on Transfer

Members cannot give, pledge, assign, transfer, hypothecate, sell, or otherwise dispose of their Company share.

Fresh Partners

New Members can join the Agreement should all existing Members agree and according to the terms and conditions set forth by the existing Members.

Records, Audits, and Reports

At the principal office, the Company shall maintain the records and accounts of all Company operations and expenditures, which includes the following:

• Member information, like their full name and last known business or residential addresses, and capital contribution.

• Copies of the Articles of Organization, its amendments, and executing powers of attorney valid on these documents.

• Copies of the federal, state, and local income tax of the Company or information returns and reports for the last six taxable years.

• Copies of this Agreement, its amendments, and its powers of attorney when executing the Agreement.

• Financial statements of the Company copies for the last six recent years.

• The internal affairs books and records of the Company for, at minimum, the current and last four fiscal years.

Miscellaneous

The terms and provisions of this Agreement are binding in the court of law and shall inure to the benefit of any assigns, successors, and transferees. Should a court of competent jurisdiction declare any part of this Agreement void, the piece is severed from the remainder of the Agreement, with the balance remaining in full force and effect.

Members must give all notices in writing using a personal service or mailed to the Members using the address the Company maintains for members or any other address they specify in writing.

This Agreement is governed by and construed under the laws of the State of (State). A court of competent jurisdiction in (State) shall oversee any suit, action, or proceeding related to or arising out of this Agreement. This Agreement, and any attachments, contains the entire understanding and Agreement between the Members.

IN WITNESS WHEREOF, the Members have executed this Operating Agreement as of the date first above written.