LLC Operating Agreement Louisiana | The Complete Guide

Steve Goldstein
Steve Goldstein
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Starting an LLC may involve filing articles of organization with the state and establishing internal ground rules for how your business should operate. Establishing your credibility as a legal entity is a part of the plan.

Every LLC in Louisiana is encouraged, but not required, to have an operating agreement to safeguard the company’s operations, from organization to dissolution. It ensures that all LLC members understand their roles and responsibilities. This page guides you in making a Louisiana operating agreement.

Louisiana LLC Operating Agreement Content

An operating agreement is a legal document detailing the LLC’s organizational structure and operational procedures. Topics not restricted to a single member or multi-member LLC will be covered. While these provisions might not influence day-to-day operations, they must be included for legal reasons.

  • Ownership: The operating agreement details who the members are and how ownership is divided, be it a sole proprietorship or LLC. Sole proprietorship refers to a single person with total control over a business, also known as a single-member LLC. Multi-member LLC members can have either equal or varying ownership interests.
  • Management: Your LLC could be member-managed or manager-managed. The former means members can decide regarding contracts with third parties; the latter means only designated managers can do so. Using “manager-managed” instead of “hands-on” can reduce administrative work. Management’s authority is also limited in the Operating Agreement.
  • Voting: Define each owner’s voting rights and voting thresholds, such as a majority vote, supermajority vote, and unanimous consent. A variety of approvals are needed for each type of decision.
  • Changes in Membership Structure: If someone leaves the company, how will roles and ownership be transferred? A member buyout and/or replacement procedure must be outlined in the LLC’s governing document.
  • Contributions: All types of contributions are accepted. In order to fund their ownership interests, members will have to invest in the collective funds.
  • Equity Splits: Determine equity for each member, taking into consideration things like their contributions, responsibilities, and fairness. Maintaining fairness in your equity split will help prevent future disagreements.
  • Transfers: You may want to consider outlawing transfers of ownership interests without the consent of all owners. It’s always a good idea to include permitted transfers, such as first refusal, drag-along rights, tag-along rights, and estate planning transfers.
  • Business Restrictions: To protect the privacy of the company, including confidentiality obligations. You may also ban the owners from owning competing businesses.
  • Intellectual Property: Detail; the ownership of intellectual property created by members. Make sure all company-created intellectual property is owned by the company. You can find alternative ownership/license structures if necessary.
  • Taxation: Determine how you will be taxed and plan accordingly. Remember, however, that you must file an LLC annual report and might be required a sales tax.
  • Guaranteed Payments: Determine if any of the members should receive Guaranteed Payments, which are like a salary, particularly if your LLC is taxed as a partnership.
  • Distribution & Dividends: Explain to all members how the funds will be allocated. A pass-through entity will impose tax distributions regardless of profit distributions.
  • Dissolution: The LLC should be dissolved if all members elect to cease operations. It is important to identify how you will end your business in your operating agreement.

Note that the operating agreement, though not a legal requirement in most states, is vital in the operation of your LLC. Should your members have issues with the business, you can deal with it with guidance from the operating agreement.

Get Help from a Registered Agent

Developing an operating agreement could be tedious at times. Besides, since it deals with how your business operates, then it would be best to have professionals help you with it to make sure you get everything right. Getting help from registered agents would be your best bet. Here are three of our best LLC services that can provide you with registered agents to free you of worries:

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Importance of a Louisiana LLC Operating Agreement

Operating agreements in Louisiana aren’t mandatory if there is an LLC exists. Most states require that all business entities be incorporated to validate the structure of their business. It is possible to bypass this step in Louisiana and the LLC will not be penalized by law.

This is a must to ensure that your LLC to be shielded from any disputes or misunderstandings. Below, you can read some of the main reasons you should write this contract for the LLC.

  • To safeguard the company: Basically, the operating agreement sets out the rules for an LLC. This means that the rules will be enforced by the government in case members fail to adhere to the rules. The agreement will safeguard the LLC from the government’s rules and provide other advantages.
  • The LLC appears trustworthy: Investors take a look at the professionalism of the company when they are researching businesses. The operating agreement is what makes the LLC look professional since it demonstrates that the members care about the business and are determined to make the regulations and rules legal as well. So, this provides an opportunity for growth by attracting more investors.
  • To verify the legal status of an LLCs: LLCs are recognized for their limited liability status and when the business has clearly stated that in the operating agreement, then the government cannot misunderstand. It is very simple for sole proprietorships to confuse an LLC comprised of a single member, however an operating contract can help establish that they’re distinct.
  • To resolve any conflict: There could be future conflicts regarding distributions and decisions. The operating agreement sets out the process, requirements, rules, and guidelines for all members of the company. The operating agreement allows members to review quickly the details of the agreement prior to when they start performing a task.
  • LLC flexibility is made possible due to Limited Liability Companies. Operating agreements are what allow these LLCs to have such a nature. The legality of an operating agreement provides the LLC with freedom.
  • For opening bank accounts for business: Often, the owner will need a copy the operating agreement. The company will have difficulty opening an account with a bank if it does not have the original document.

How to Edit Operating Agreement of LLC in Louisiana

Operating agreements play a crucial role in shaping the structure and operations of limited liability companies (LLCs). Often regarded as the backbone of an LLC, these agreements outline the internal workings, management, and decision-making processes of the company. However, there may come a time when the operating agreement needs modification to accommodate changes, acknowledge new legal requirements, or address evolving business needs. This editorial comment aims to provide a generic overview of the process involved in editing the operating agreement of an LLC in the state of Louisiana.

First and foremost, establishing a clear understanding of the existing operating agreement is essential. Comprehending the specific provisions, clauses, and sections within the agreement allows for a more targeted and effective editing process. Identifying the areas that need modification will help streamline the subsequent steps.

The next step involves communicating with the members of the LLC. As an LLC is usually governed by its owners, their input and consensus are vital throughout the editing process. Open and honest discussions should be encouraged to ensure transparency and mitigate any potential misunderstandings or conflicts that may arise when amendments are proposed.

After engaging in dialogue with the LLC’s members, it is recommended to consult with legal professionals well-versed in the intricacies of LLC regulations in Louisiana. While some businesses may feel inclined to make changes independently, collaborating with attorneys experienced in business law can offer invaluable guidance, help navigate the statutory requirements, and ensure compliance with state laws.

Once the modifications are agreed upon, drafting the amended operating agreement becomes the subsequent task. This revised document should embody the changes desired by the members and address any concerns identified during the discussion phase. Care should be taken to ensure that the new provisions align with the existing ones, maintain the underlying structure, and do not conflict with any state laws or regulations.

While editing, it is pertinent to be aware of the legal requirements specific to Louisiana. For example, Louisiana Revised Statutes Title 12, Section 1307 outlines the non-waivability of the statutory requirements pertaining to an LLC. Consequently, proposed changes must not infringe upon these mandatory provisions, further necessitating legal counsel to guarantee compliance with the state’s regulations.

After the final draft is prepared, it is crucial to formally adopt the amended operating agreement. This adoption can take several forms, including unanimous member agreement, written consent by all members, or the holding of a formal meeting to approve the modifications. Documenting the approval in writing, signed by the members or recorded in meeting minutes, adds legal weight to the changes.

Lastly, it is important to ensure that all members receive a copy of the amended operating agreement. By sharing the revised document, every member gains understanding and certainty about the new provisions. Failing to provide this documentation to the LLC’s members could result in lingering confusion and potential disputes in the future.

In conclusion, editing an operating agreement demands careful attention to detail, active communication among LLC members, and adherence to Louisiana’s legal framework. Whether expanding the scope of the agreement or adjusting management procedures, the editing process should follow a systematic approach that encompasses comprehension, consensus building, legal consultation, drafting, adherence to statutory requirements, adoption, and dissemination. By following these steps, an LLC operating agreement can seamlessly evolve in tandem with the business’s growth, legal requirements, and changing dynamics.


Does Louisiana require an operating agreement?

In order to clearly state the purpose of a business as well as its ownership interests, a written operating agreement is strongly advised in Louisiana.

What if an LLC has no operating agreement?

You and other members of the LLC will be unable to reach any agreements if you do not have an operating agreement. Even worse, your LLC must follow the state’s default operating conditions.

Can I write my own operating agreement?

It is required by law in California, New York, Maine, and Missouri, but it is not in Louisiana. Although it is not legally required, creating a written agreement is strongly advised. You may self-notarize and distribute the documents.

How to Edit Operating Agreement of LLC in Louisiana

First and foremost, it is important to review the existing operating agreement thoroughly before making any changes. This will help you understand the current terms and provisions, as well as identify areas that may need to be updated or clarified. Pay attention to any outdated or ambiguous language, as well as provisions that no longer align with the company’s goals and operations.

Next, discuss the proposed amendments with all members of the LLC. Transparency and open communication are key when it comes to amending the operating agreement. Make sure that all members have the opportunity to provide input and express their concerns. It may be helpful to hold a meeting or conference call to discuss the proposed changes and ensure that everyone is on the same page.

When drafting the amendments, be sure to be as specific and detailed as possible. Clearly outline the changes being made, the reasons for the changes, and how the amendments will impact the operation of the company. Avoid vague language or ambiguous terms that could lead to confusion or misinterpretation down the line.

In Louisiana, amendments to the operating agreement generally require a vote of the members. Check the original operating agreement to determine the voting requirements for making changes. Make sure to follow the proper procedures for obtaining approval of the amendments, including the necessary quorum and voting thresholds.

It is also important to update the operating agreement with the assistance of a legal professional. While it may be tempting to make changes on your own, having a lawyer review the amendments can help ensure that they are legally valid and enforceable. A lawyer can also provide guidance on any legal implications of the changes and help protect the interests of all members.

Once the amendments have been approved and finalized, make sure to distribute the updated operating agreement to all members of the LLC. This will ensure that everyone is aware of the changes and understands their rights and responsibilities moving forward. Keep a copy of the updated operating agreement in a secure location and make sure that it is easily accessible to all members.

Editing the operating agreement of an LLC in Louisiana can be a complex and time-consuming process, but it is essential for ensuring the smooth operation of the business. By carefully reviewing the existing agreement, communicating openly with all members, drafting detailed amendments, following proper procedures, seeking legal guidance, and distributing the updated agreement, you can ensure that the operating agreement accurately reflects the current needs and goals of the company.

In Conclusion

The operating agreement is an important document for your Louisiana LLC. However, it is not mandatory to file in many states. It is strongly recommended to file the operating agreement even if it is not required in your state. Get a professional LLC service to file your operating agreement properly.

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