The short answer is that New Jersey law does not require you to have an operating agreement to form an LLC, but you should have one anyway (and it should be in writing). New Jersey LLCs are governed by the Revised Uniform Limited Liability Company Act (N.J.S.A. 42:2C-1, et seq.). If you do not have a written operating agreement, one may be “implied” based on oral communications between the members and/or the course of conduct. Additionally, in the absence of any operating agreement – either written or implied – the rights of the members will be determined by the default provisions set forth in the Revised Uniform Limited Liability Company Act.
To prevent confusion, uncertainty and a potential dispute regarding the rights and duties of the members, it is always advisable when forming a New Jersey LLC for the members to sign a written operating agreement. A proper operating agreement will address, among other things:
- relations among the members and between the members and the limited liability company;
- the rights and duties of the manager;
- the activities of the company and the conduct of those activities; and
- the means and conditions for amending the operating agreement.
Spector & Ehrenworth, P.C. has extensive experience assisting clients in preparing operating agreements for their limited liability companies that set forth precisely how the members would like the limited liability company to be governed. Attorneys at the firm would be happy to discuss with you the specifics of your limited liability company and advise you with respect to the preparation of your operating agreement. To schedule an appointment to speak with a business attorney, call (973) 845-6525 or e-mail firstname.lastname@example.org.
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