A single-member LLC operating agreement in Wisconsin is essential for sole proprietors who plan to establish a company as the sole owner. This document outlines how the business will be managed, owned, and governed, including rules and conduct. Although primarily used to meet the requirements of financial institutions and other agencies to open bank accounts, accept credit cards, and obtain insurance, this agreement plays a crucial role in the company’s future. To ensure validity, the agreement should be signed in the presence of a notary public or via electronic signature with a timestamp.
Step 1: Company Name
Carefully fill in the name of your LLC, ensuring it is not unique and representative of your business but also adheres to state naming requirements. Filling in the name of your LLC is an essential aspect of the operating agreement as it is a fundamental requirement for forming your business. The name you choose for your LLC should reflect the nature of your business and comply with state naming requirements.
To give an example, let’s say you are starting a business that provides graphic design services. You could choose a name like “Creative Designs LLC” or “Designs by Manuel LLC” that reflects your business’s nature and brand.
Step 2: Company and Member Information
Accurately enter the date when this operating agreement is executed and signed by the parties involved. In addition, rewrite the LLC name and include your name as well. Filling in the date when the operating agreement is executed and signed is important because it establishes a clear and specific timeline for its validity. It serves as a reference point for future amendments or modifications, providing a clear record of when changes were made and who was involved. With a clear timeline, it can be easier to determine the current version of the agreement or when changes were made, which can lead to clarity and potential legal issues.
For example, if the operating agreement is signed on January 1, 2023, you would enter “This operating agreement is entered into on January 1, 2023 by Manuel Smith and Creative Designs LLC.”
Step 3: Formation of LLC
In this section, provide information about the formation of your LLC, including the name of your LLC and the exact date the Articles of Organization were filed. Documenting the name of your LLC ensures that it is properly registered with the state and legally recognized as a distinct entity. This is important because it allows you to conduct business under a unique name and protects your assets from business liabilities.
For example, “The Articles of Organization for Creative Designs LLC were filed with the Wisconsin Secretary of State on February 1, 2023.”
Step 4: Purposes and Powers
Thoroughly outline the purpose(s) of your LLC and the powers it possesses by providing a specific and detailed description of your LLC’s intended business activities.
By defining your LLC’s purpose(s), you establish a foundation for decision-making and ensure that everyone involved is working towards the same goals. Additionally, providing a detailed description of your LLC’s intended business activities helps establish your company’s powers, giving you the legal authority to conduct your operations.
For example, “The purposes of Creative Designs LLC are to provide consulting services in business strategy, marketing, and human resources to clients in the technology sector.”
Step 5: Authority
Explicitly include your name in this section, affirming your authority as the sole member of the LLC. The Authority section of the operating agreement is crucial because it establishes the decision-making power within the company. By explicitly stating your authority as the sole member of the LLC, you can ensure that all parties involved understand who has the final say in critical business decisions. This can help prevent disputes and misunderstandings down the line.
For example, “Manuel Smith has full authority and responsibility for managing the business affairs of Creative Designs LLC as its sole member.”
Step 6: Managing Member’s Signature and Print Name
At the end of the document, sign and print your name, confirming your agreement to the terms and conditions outlined in the Sole Member Operating Agreement. This signature is legally binding and signifies your commitment to abide by the agreement and adhere to the applicable laws and regulations governing your LLC.
Signature: Manuel Smith and Print Name: Manuel Smith
Following these key steps will ensure your Wisconsin single-member LLC operating agreement contains all the necessary sections to legally establish your business and grant you full authority as the sole member. Be sure to execute it properly with your signature to make it fully binding.