Operating Agreement LLC Nebraska

A Nebraska Limited Liability Company (LLC) Operating Agreement is an internal legal document that defines how a Nebraska LLC is owned and operated. It outlines the company’s structure, management, responsibilities, and financial arrangements among Members.

Legal Status in Nebraska

Nebraska does not require LLCs to adopt an Operating Agreement. If an LLC operates without one, disputes or operational issues are governed by the default rules under the Nebraska Uniform Limited Liability Company Act (RULLCA), including NE Code §§ 21-101 to 21-197 and §§ 21-501 to 21-542.

If a filed record with the Nebraska Secretary of State (NSS) conflicts with a provision in the Operating Agreement, the Agreement controls for Members, dissociated members, transferees, and managers. Filed records control for third parties who reasonably rely on the filing.

Why an Operating Agreement Is Important

A written Operating Agreement is strongly recommended for several reasons.

1. Customizing Internal Operations Without an agreement, the LLC follows Nebraska’s default rules, which may not reflect the Members’ intended ownership arrangements, capital contributions, or voting procedures.
2. Protecting Limited Liability Status A written agreement helps show separation between the Members and the business. This supports the LLC’s existence as a separate legal entity.
3. Establishing Proof of Ownership Nebraska does not require Member names to be listed in the Certificate of Organization. The Operating Agreement becomes the primary record of ownership percentages. Banks and lenders often request it.
4. Guiding Management and Dispute Resolution It sets out management authority, voting rules, buyout terms, and transfer procedures.

Key Information in the Agreement

• Basic Information: LLC name, effective date, business purpose, and duration. • Ownership Structure: Names and ownership percentages (“LLC Membership Interest”). • Capital and Distributions: Initial contributions and allocation of profits and losses. • Tax Designation: Federal tax classification (e.g., sole proprietorship, partnership, S corporation, C corporation). A C-corporation election requires filing Form 8832 with the IRS. Nebraska is not a community-property state, so a Nebraska LLC cannot elect Qualified Joint Venture treatment. • Management Structure: Whether the LLC is Member-managed or Manager-managed, which determines who can bind the LLC and how voting authority is assigned.

Management Structures

Member-Managed LLC Members manage day-to-day operations and have authority to bind the LLC. Voting power is typically proportional to ownership interest.

Manager-Managed LLC Members appoint one or more Managers to run the business. Managers have authority to bind the LLC. Members generally do not manage daily operations but retain voting rights on major decisions.

Execution and Maintenance

The Operating Agreement must be signed by all Members to be enforceable. Nebraska does not require notarization or filing the Agreement with any state agency. The document should be kept with the company’s internal records, and amended agreements should be signed by all Members and retained alongside previous versions.