Forming Limited Liability
Companies
A.
Organization.
Limited liability companies are organized by filing a Certificate or
Articles of Formation with the Secretary of State of the State of
Formation. For example, in a Certificate of Formation, N.J.S.A.
42:2B-11 requires the following:
(1) Name of the company
(2) Registered office and
agent
(3) Certification of the
founding members
(4) Date of dissolution of
limited liability company
(5) "Other matters"
In other sections of the Certificate or Articles of Formation, it may
be appropriate to the list the name of the "Tax matters
member" for dealing with the Internal Revenue Service. Additional
provisions resting borrowing by members of the LLC, indemnification of
the managing members, and the purpose may also be included.
B.
Operating Agreement.
The Operating Agreement is an agreement between
the members of a limited liability company, and governs the affairs of
the business. However, unlike
corporate By-laws, there is great flexibility in the Operating
Agreement. The creativity of the business attorney in identifying and
reflecting the needs of the owners determines the content of the
Operating Agreement.
C.
Conclusion. The
Limited Liability Company is an extremely flexible tool which
has the limited liability advantages of a corporation and the tax
advantages of a partnership or sole
proprietorship.