A Florida LLC operating agreement is not technically a legal requirement to run a limited liability company (LLC) in the Sunshine State. That doesn’t mean, however, that you should not endeavor to have an operating agreement or bylaws for Florida LLC.
You may choose not to enter into an operating agreement. But without such an agreement in place, running your LLC will be subject to the default rules on business operations under the Florida Revised Limited Liability Company Act.
What is a Florida LLC Operating Agreement?
A Florida LLC Operating Agreement is a private written document that allows the members of the LLC to structure their financial and working relationships with one another. As an internal document, it determines the company’s internal affairs, including the activities and how those activities should be conducted.
In a nutshell, like the California operating agreement, a Florida operating agreement provides information about the name, address and jurisdiction of the company, the members and their contribution, rights and duties, and business processes such as dispute resolution, the voting process and dissolution.
Why Should You Have a Florida LLC Operating Agreement?
A Florida LLC doing business in another state or several states may think of using a generic operating agreement to govern or guide all of its businesses across the country. Florida laws, however, are unique and distinct. In fact, the Florida LLC Act has specified a number of non-waivable provisions that must be included in an operating agreement. Therefore, choosing a generic operating agreement can end up more disastrous than efficient to a Florida-based LLC.
Every limited liability company in Florida should have an operating agreement. For single-member LLC, a FL LLC operating agreement can effectively guide business operations and management. A multi-member LLC will definitely benefit from having an operating agreement, especially in times of conflict in business decisions and clash in member rights and obligations.
Florida LLC Law Limitations
The Florida LLC Act, which was enacted in 2014 and became effective in 2015, has set a number of limitations for operating agreements executed in the state of Florida. According to the Act, a Florida LLC operating agreement must not:
- Change the requirement regarding the appointment of a registered agent
- Remove the capacity of the LLC to sue and be sued in its name
- Change the jurisdiction of Florida over the LLC
- Remove the liability of a member who has acted in bad faith, committed willful misconducts, or violated the law
- Remove entirely the duty of the LLC to keep records and allow members to access such records
- Remove entirely the duty of members to care or ensure loyalty
- Remove the rights of third parties to petition a Florida court to require LLC filing
- Change the grounds for judicial dissolution of a LLC
- Change the right of a member to approve or disapprove of a merger, conversion or interest exchange
- Change the rules concerning derivative actions
- Change requirements for winding up a dissolved LLC
- Exclude provisions for indemnification of a member or a manager
Note that the above are default provisions, which means they are non-waivable.Al Florida LLC operating agreements are understood to include them, whether they are expressly written or merely implied.
In case your Florida LLC operating agreement varies in any of the provisions that may not be variable under the Florida LLC Act, any affected member or manager may seek the help of courts to remove a provision that is deemed “manifestly unreasonable.”
What to Cover in A Florida LLC Operating Agreement?
An ideal Florida LLC Operating Agreement should cover the basic requirements such as the following:
- Company details, such as the name, address and purpose of the business
- Membership, including the names and contact details of the members
- Contribution of members, which pertains to their capital contribution and percentage of share
- Distribution of profits and losses, including losses
- Management, or whether all members shall manage the LLC or there is an appointed manager
- Fiduciary duties and responsibilities
- Transfer or removal of membership, including grounds for removing a member and manager
- Grounds for and process of dissolution
- Rules on amendment or ratification of certain acts or transactions that would have violated the Florida LLC Act
The best way to draft a Florida LLC operating agreement is to write with the non-waivable provisions in mind. From there, you can insert specific provisions and rules, provided that they are not contrary to the Florida LLC Act.
Once you have finished drafting your LLC operating agreement in Florida, have it reviewed and signed by the members.
Is an operating agreement required in Florida?
A written operating agreement is not required for an LLC to do business in Florida. The Florida LLC Act does not specifically require an operating agreement before registration. Note, however, that some banks may require a Florida LLC operating agreement when opening a company bank account.
Is an operating agreement different from the articles of organization?
Yes, an LLC operating agreement in Florida is different from the articles of organization. The articles of organization is a public document that is legally required in order to register the LLC under Florida law and jurisdiction.
Can an operating agreement of FL LLC be amended?
Yes, a FL operating agreement may be amended. The consent and signature of all the members are required before the amended operating agreement can take effect. Moreover, the amendment must still be in accordance with the Florida LLC Act. In other words, the amendment cannot remove or vary the non-waivable provisions required under the Florida LLC Act.
Do we need to submit the operating agreement to the court or the government?
No, there is no need to submit the Florida operating agreement to any court or government agency.
Where should I keep a copy of the Florida operating agreement?
An original copy should be kept and secured in the registered place of business of the LLC. Moreover, as the best practice, each member should safely keep a copy of the agreement. In case of amendments, the member should keep both the original and the amended copy.
A Florida LLC operating agreement will benefit your business in many ways, especially in terms of making financial decisions and resolving disputes. An operating agreement specific to Florida and written according to Florida law will prove to be helpful in running a smooth and successful business.
It’s easy to customize your LLC operating agreement in Florida with a quick download of a Florida LLC sample agreement. CocoSign has numerous templates you can check out and use for free.
CocoSign represents a wide collection of legal templates covering all types of leases, contracts and agreements for personal and commercial use. All legal templates available on CocoSign shall not be considered as attorney-client advice. Meanwhile, CocoSign shall not be responsible for the examination or evaluation of reviews, recommendations, services, etc. posted by parties other than CocoSign itself on its platform.