How to Create an LLC Agreement

How to Create a Company Agreement

If you own a company, it's very important to have a written company agreement.


This agreement outlines how your company works and how disputes are handled. Why is it so important? A clear company agreement can save your (ahem) assets someday.


Do you need a company agreement?

Maybe. There are a few situations where it's important to have a written company agreement:

If youʼre forming a company with another person, you need a written company agreement. A clear company agreement is the best way to prevent costly problems between owners.

If you're forming a c corporation, you typically need written bylaws in place to protect shareholders.

If youʼre looking to attract investors, you will always need a written agreement that governs how the company works.


What needs to be included?

When creating your Company Agreement, youʼll want to discuss the following areas:

What is the company's purpose?

How long do you want the company to last?

Who are the owners?

Will each owner be contributing a certain amount of time or money?

How will owners split up profits and losses?

What corporate officers will you have? (President, Vice President, Treasurer, Secretary)

How often will officers be elected? How can they be removed? Will officers be compensated for their work?

Will you be using cash or accrual methods of accounting?

Can owners sell their ownership interests?

Can new owners be added?

How can you end the company?

How can you amend this agreement?

Nicole SwartzFormation