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Kansas LLC Operating Agreement Template
Written by: Coralee Bechteler
Coralee is a business writer with experience in administrative services, education, and software testing.
Edited by: David Lepeska
David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.
Updated on May 7, 2023
Kansas LLC Operating Agreement Template
In Kansas, your limited liability company (LLC) is not required to have an operating agreement in place. But it’s highly recommended, as an effective operating agreement can help avoid disputes and lawsuits that could threaten the stability of your LLC.
What is an LLC Operating Agreement?
A Kansas LLC operating agreement is an important legal document that details who owns the business and provides essential information pertaining to member duties. An LLC operating agreement establishes the financial relationship between members and the basics of the working relationships between those members and the managers who oversee daily operations.
The operating agreement is not filed with the state of Kansas, but instead remains private. It’s advisable to hire an attorney to ensure your operating agreement is thorough and legally binding.
We’ve provided two operating agreement templates for your use. One is for a single-member LLC if you are the sole member, and the other is for a multi-member LLC if your LLC has two or more members. The documents are customizable and should be adjusted for Kansas state and your business. These documents are for your internal use and are not filed with any governing body.
Download FREE Operating Agreement Templates
Disclaimer: These documents may need to be adjusted based on your circumstances and may not cover all situations. Your document also may need to be adjusted over time as your business evolves. These documents should not be considered legal advice. You should have your version of the document reviewed by your attorney to make sure that all necessary provisions are included to fit your business situation.
What Should Your Kansas LLC’s Operating Agreement Include?
Here is a list of some essential elements that a Kansas LLC’s operating agreement should include:
- Basic Information:
- Name and principal office address of the LLC
- Purpose of the business
- Formation date and duration (if applicable)
- Member Information:
- Names and addresses of all members
- Ownership percentage or interest of each member
- Initial capital contributions and any additional contributions required in the future
- Management Structure:
- Designation of the LLC as either member-managed or manager-managed
- Roles and responsibilities of members or managers
- Procedures for appointing or removing managers (if applicable)
- If the LLC has a board of directors, the operating agreement will also include the role and responsibilities of the board members and how they are compensated.
- Voting Rights and Procedures:
- Voting rights of each member (usually based on ownership percentage)
- Procedures for holding meetings and voting on company decisions
- Quorum requirements and rules for passing resolutions
- Allocation of Profits and Losses:
- The method for allocating profits and losses among members (usually based on ownership percentage)
- Frequency and method of distributing profits to members
- Buyout and Transfer Provisions:
- Procedures and restrictions for transferring or selling membership interests
- Rights of first refusal, buy-sell agreements, and other provisions related to buyouts
- Dissolution and Winding Up:
- Events that trigger dissolution of the LLC (voluntary or involuntary)
- Procedures for winding up and liquidating the company’s assets
- Distribution of remaining assets among members after liabilities are settled
- Dispute Resolution:
- Processes for resolving disputes among members or between members and the LLC, such as mediation or arbitration
- Amendments and Modifications:
- Procedures for amending or modifying the operating agreement, including voting requirements
- Miscellaneous Provisions:
- Governing law (typically the state of Kansas)
- Indemnification and liability limitations for members and managers
- Recordkeeping and reporting requirements
- Signatures of all members, acknowledging their agreement to the terms
An LLC operating agreement provides legal and financial recourse for a number of situations. If conflicts arise between LLC owners pertaining to any of the above issues, the operating agreement will provide clarity. The specific language of the operating agreement lays out exactly how such conflicts will be resolved, how the business is structured, the dynamics of operations, and more.
Though Kansas has default rules on the books that address some of the issues that might arise between LLC members, your LLC operating agreement would override these default laws and give you greater control. It’s important to consult with an attorney or a legal professional to tailor an operating agreement to the specific needs and requirements of your Kansas LLC.
How Much Does an Operating Agreement Cost?
Creating an operating agreement is free if you just draw it up yourself. Alternatively, you can pay for guidance from an online business advisory like ZenBusiness.
This is an extremely important document, so it’s recommended that you hire a professional service or law firm. If you choose to use an attorney to help you create this document, the price will be around $500 for a single-member LLC and $2,500 for a multi-member LLC.
Who Needs my LLC Operating Agreement?
One of the key reasons to have an operating agreement in place is that it makes your LLC more appealing to financial backers. Banks are likely to request to see your operating agreement when you apply for a loan. If you seek funding from investors, they will also want to see your operating agreement.
Though not legally required in Kansas, an operating agreement is a crucial document for LLC operations, ensuring your company is able to access adequate financing and settle any disputes. Keep in mind, you do not need to file your operating agreement with any state body. You simply need to take certain steps to ensure it’s legally binding and keep it in your records.
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