Keynote slides from my 2-part continuing legal education (CLE) presentation LLC Formation and Operation, and How to Draft the LLC Operating Agreement. Presented December 12, 2016 in Columbus, Ohio for the National Business Institute, Inc. (NBI) seminar LLCs From Start to Finish.

1. LLC Formation
and Operation:
How to Build an
Unsinkable
Company

2. BRADLEY
MILLER
Miller Law LLC ∙
@bradleymiller
#WatchForIcebergs

4. ALL businesses
can fail.

5. Part 1:
Formation &
Operations
-
INTERMIS
SION -
Part 2:
Operating
Agreements

6. PREPARING
TO LAUNCH

9. Articles of
Organization
1. Name of the LLC
2. Duration of
existence
3. Statutory agent
4. Optional provisions

10. WHO IS
STEERING
THE SHIP?

14. Management
Member-managed

16. Management
Member-managed

17. Management
Member-managed
Manager-managed

18. Why member-
managed?
Simpler.
Active owners.
Have a voice.

19. Why manager-
managed?
Limit power.
Passive investors.
Non-member managers.
Employee equity.
Future control.

20. RIGHTS &
DUTIES OF
THE CREW

28. MEMBERS
Members owe a duty
of loyalty and a duty of
care

29. MANAGERS
Managers must
perform in good faith
with the care of an
ordinary prudent
person

30. OFFICERS
If a member, has the
duties of a member
If not a member, has
the duties of a
manager

31. INDENTURED
SERVITUDE

33. A membership
interest is
personal
property,
assignable in

34. - TELEVISION TIMEOUT

35. BANKROLLIN
G THE
OPERATION

36. Capital
Contribution
s

37. Member
Loans
In writing
No ownership
Return
Return of cash

38. Third Party
Loans

39. Investors
Intra-state Offering
Private Placement
Crowdfunding

40. IT’S NOT MY
FAULT!

41. Unremitte
d Sales
Tax and
Employee
Withholdi
ng

42. Personal
Acts of
Members
and
Managers

43. Wrongful
Distributio
ns

44. Personal
Guarante
e

45. Pledge of
Property

46. Piercing
the LLC
Veil

48. SAILING IN
FOREIGN
WATERS

49. What constitutes
“transacting
business” in
Ohio?

51. - INTERMIS

52. Drafting the
Operating
Agreement:
How to Build an
Unsinkable
Company

54. Operating
Agreement
1. Formation
provisions
2. Management &
voting
3. Transfer, impasse, capital call,

55. Format
ion
provisi
ons
1.

56. Manage
ment &
voting
2.

57. Why member-
managed?
Simpler.
Active owners.
Have a voice.

58. Why manager-
managed?
Limit power.
Passive investors.
Non-member managers.
Employee equity.
Future control.

59. Manage
ment &
voting
2.

60. Transfer,
impasse,
capital call,
& dissolution
3.

61. Transfer
restrictio
ns
3a.

62. Transfer
prohibition.

63. Right of first
refusal.

64. Push-pull
provision.

65. Redemption and
interest
purchase rights.

66. Anti-dilution
rights.

67. Tag-along and
drag-along
rights.

68. Mandatory sale
triggering
events.

69. Involuntary
transfers.

70. Impasse
3b.

71. Capital
calls
3c.

72. Dissoluti
on
3d.

73. Distribut
ion &
allocatio
n
4.

74. Operating
Agreement
1. Formation
provisions
2. Management &
voting
3. Transfer, impasse, capital call,

75. Operating Agreem

76. COMMON
MISTAKES
Using a non-
customized or DIY
operating agreement

77. COMMON
MISTAKES
Missing essential
provisions

78. COMMON
MISTAKES
Failure to finalize and
execute the operating
agreement

79. COMMON
MISTAKES
Failure to periodically
review and update the
agreement

80. COMMON
MISTAKES
Failure to have new
members execute the
operating agreement

82. Thank you.
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