Forming an LLC
When founding an LLC – as with founding a corporation – the question of name comes up first. Finding a name is the same for the corporation as for an LLC, in that “bank” or “insurance” is not allowed in some states. However one element of the name MUST be an ending such as “Limited Liability Company, “Limited Company”, “LLC” or “L.L.C”.
The founder of the LLC must also complete the statute for his or her company, the so-called “Articles of Organization”. Often, relatively few statements are sufficient for the company being founded. Only in certain U.S. states must the founder of the company enter his or her name into the statute. In other states anonymous formation is possible. The company contract of an LLC is called an “Operating Agreement” in the U.S. It is NOT necessary in many states.
An LLC is then ready for trade even without a company contract. However, if an LLC consists of more than just one “member,” the company contract cannot be omitted. Among other things, the contract can define how profits will be distributed, which rights and obligations the individual company owners will have, and what will happen when a partner leaves the company – for example due to death. Such text passages are important because the LLC automatically will automatically dissolve without them as a result of the death or another type of departure by a partner.