KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Agreements among owners
July 25,  2017
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Ken,
    We are an LLC that files taxes as an S-Corp.   Do you have an Operating Agreement in your standard forms that you speak of in this forum?
Thank you
Megan
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Response
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    When you ordered the LLC "kit" it most likely came with a proforma Operating Agreement.  Had you ordered a corporation the "kit" would include corporate minutes and by-laws, but not a Shareholder Agreement.  The reason for this is that an LLC requires an Operating Agreement and the corporation does not require a Shareholders Agreement.  But the proforma Operating Agreement would not be sufficient to cover your needs if there are two or more members of your LLC.
    Unless you are a single owner business you should have an agreement in place between the owners.  

  • For the LLC it's the Operating Agreement
  • For a corporation it's a Shareholders Agreement
  • For a partnership it's a Partnership Agreement

    What do all these agreements have in common?  They should address:

  • operational control and limits
  • compensation
  • benefits
  • disability
  • buy-out
  • death
  • winding up and dissolution

    The time to get an Agreement in place is when you don't need it; probably right now.  If you wait until you do need it then it will be too late.  The few bucks you can spend on an Agreement now will save you tons of money later and will likely help you avoid litigation.  A solid Agreement that addresses the issues that will come up in your business will avoid litigation because no one is likely to pursue senseless litigation when the contract terms are unambiguous and the rights of the parties clear.
    Though we may start with a "standard" form, the details of each Agreement is different.  These agreements must be customized to fit the desires and needs of the client.  You should expect to pay between $1000 TO $2000 for an agreement [a little more if you want to help write it !!].  Contact our corporate department today and take care of this essential agreement for you business.  You can thank me later.  Contact Jennifer Kirschenbaum,Esq at 516 747 6700 x 302 or Jennifer@KirschenbaumEsq.com
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
516 747 6700
www.KirschenbaumEsq.com