ContractsCounsel Logo

Texas LLC Operating Agreement

Updated: February 9, 2024
Clients Rate Lawyers on our Platform 4.9/5 Stars
based on 9,787 reviews
No Upfront Payment Required, Pay Only If You Hire.
Home Blog Texas LLC Operating Agreement

Jump to Section

A Texas LLC operating agreement provides essential information such as an LLC 's financial structure, company rules, and different regulations in the U.S. state. Texas LLCs with multiple members must make sure to sign an operating agreement. It helps limit the possibility of disputes or misunderstandings among the members while doing business. Let us learn more about the essential aspects of a Texas LLC operating agreement below.

Operating Agreement Templates

Purchase and download templates drafted by lawyers in our network that match your needs.
TX Operating Agreement
Single Member (one member)
TX Operating Agreement (2 members)
Multi-Member - Two Members
TX Operating Agreement (3 members)
Multi-Member - Three Members
TX Operating Agreement (4 members)
Multi-Member - Four Members
TX Operating Agreement (5 members)
Multi-Member - Five Members
*By purchasing a template, you acknowledge that you have read and understood ContractsCounsel's Terms of Use.

Steps to Draft a Texas LLC Operating Agreement

Crafting an operating agreement is essential to establishing the foundation and internal framework for a Texas Limited Liability Company (LLC). This document, required by the Texas Secretary of State, outlines the rights, responsibilities, and operational procedures governing the LLC. The following detailed steps offer insight into constructing a comprehensive Texas LLC operating agreement.

  1. Obtain the Official Operating Agreement Form. Access the Texas Secretary of State website to download the official operating agreement form. Insert the LLC's name in the designated space to personalize the document.
  2. Establish the Effective Date. Clearly define the effective date of the operating agreement, marking the initiation of its legal applicability.
  3. Provide Location and Owner Information. Specify the LLC's state and furnish detailed information for each owner, including full names and business addresses.
  4. Outline Capital Contributions for Multiple-Member LLCs. For LLCs with multiple members, articulate the capital contribution amount expected from each member. This section solidifies the financial commitments of individual members.
  5. Define Distribution Percentages for Multiple Members. Clearly articulate the distribution percentages for each member concerning profits or losses. This stipulation outlines how financial outcomes are distributed among LLC members.
  6. Detail Operating Procedures. Provide thorough guidelines for important operational facets, including:
    • Annual meetings and their scheduled dates
    • Assigning interests within the LLC
    • Ownership and management of company property
    • Admission protocols for new members
    • Establishing the right of first refusal for member interests
    • Procedures for Member Withdrawal Events
    • Protocols for liquidation and dissolution
    • Member representation in decision-making processes
    • Notification processes
    • Dispute resolution through arbitration
    • Indemnification mechanisms for members
    • Procedures for amending the operating agreement
  7. Secure Signatures and Maintain Records. Ensure each member and the appointed company representative sign the operating agreement. Keep a copy of the signed agreement on file for comprehensive record-keeping.

Types of Texas LLC Operating Agreements

Businesses in Texas must always choose the right type of limited liability company (LLC). It is also recommended to consult with a qualified business attorney. It will help align the business plan with the most suitable LLC structure. Various forms of LLCs cater to different business needs in Texas.

  • Traditional LLCs: Traditional LLCs include all LLCs that do not fall under series LLCs, professional LLCs, S-Corp LLCs, or C-Corp LLCs. It offers simplicity and flexibility in management and taxation. These are chosen for businesses without specialized needs or complex ownership structures.
  • Series LLC : It allows investors to classify assets and liabilities into series, resembling sub-businesses within the overall structure. The agreement also operates as a single legal entity, paying one filing fee and filing one franchise tax report. It allows passing through profits and losses while separating assets and liabilities into distinct series.
  • Professional LLC (PLLC): This agreement is exclusive to licensed professionals, such as doctors, attorneys, and dentists, who must hold a Texas license for their respective professions. It provides liability protection while allowing professionals to conduct business within the regulatory framework of their licensed professions.
  • S-Corp LLC: An S-Corp LLC agreement helps elect taxation as an S-Corp by filing Form 2553 with the IRS. It combines the benefits of an LLC with pass-through taxation, allowing income to pass through to members. The S-Corp election must be made within specific timeframes to go into effect.
  • C-Corp LLC: This agreement works similarly to an S-Corp and helps elect taxation as a C-Corp by filing Form 8832 with the IRS. It also assists in electing C-Corp status and provides a separate legal entity for tax purposes. The election must have a designated effective date, subject to specific time constraints.
Meet some lawyers on our platform

Benjamin W.

74 projects on CC
View Profile

Kelvin R.

22 projects on CC
View Profile

Forest H.

184 projects on CC
View Profile

Tabetha H.

29 projects on CC
View Profile

Inclusions in a Texas LLC Operating Agreement

Developing a comprehensive Texas LLC operating agreement requires attention to key elements. This foundational document not only delineates the operational structure of the LLC but also serves as a legal guide for its members. Below, we delve into the essential components to incorporate into a Texas LLC operating agreement.

  • Basic Information: The initial step involves articulating fundamental details such as the official name of the Texas LLC, as registered in the organization's articles. Specify the operational address and provide information about the designated registered agent for the service of the process.
  • Members Ownership: It is imperative to elucidate the methodology for determining ownership interests among members. Unlike corporations, ownership in an LLC is not solely contingent on financial contributions; factors such as work contributions also play a role. This section clarifies the nuanced nature of ownership distribution.
  • Responsibilities: Delineate the responsibilities of both members and managers within the LLC. It includes articulating day-to-day operational responsibilities and managerial roles. By providing detailed information, this section ensures a comprehensive understanding of each member's and manager's roles in the LLC.
  • Meetings and Voting: This section establishes the procedural framework for member meetings, encompassing frequency, location, and voting procedures. It also defines the voting mechanisms, outlining the quorum requirements and majority needed for decision-making. Consideration is given to whether voting is based on equal member status or weighted by percentage of interest.
  • Profit Distributions: A vital facet is defining the profit distribution method among members. It specifies that profits may be allocated in percentages rather than equal shares. Furthermore, legal ramifications related to disputes over profit distribution are addressed in this section.
  • Capital Contributions: Documenting all capital contributions is vital, including details about the contributor and the value of the contributions. This section specifies the permissible contribution forms: cash, property, or services. Consideration is also given to the possibility of additional capital contributions and whether they are obligatory.
  • Admission and Withdrawal of Members: The agreement establishes the criteria and procedures for admitting new members and outlines the process and requirements for voluntary member withdrawal. Specific rules for the expulsion of a member, if applicable, are also clarified in this section.
  • Procedures for Transferring Interest: This section provides explicit procedures for transferring ownership interest among members, emphasizing the agreement requirements for approving or disapproving a transfer. Special procedures for events such as the death or departure of a member are also addressed.

Key Terms for Texas LLC Operating Agreements

  • Quorum: The minimum number of members must be present at a meeting to conduct official business as defined in the Texas LLC operating agreement.
  • Right of First Refusal: A provision granting existing members the opportunity to purchase the departing member's interest before it is offered to external parties.
  • Indemnification: The process outlined in the operating agreement protects members from legal liabilities incurred during LLC activities.
  • Operating Address: The physical location where the day-to-day business activities of the Texas LLC are conducted, as specified in the operating agreement.
  • Amendments: The procedures and requirements outlined in the operating agreement for making changes or additions to the agreement ensure a formal and documented modification process.

Final Thoughts on Texas LLC Operating Agreements

The Texas LLC operating agreement is the cornerstone of a limited liability company's effective governance and functioning. By meticulously outlining key elements such as ownership structure, responsibilities, and operational protocols, this document provides clarity and transparency among members. It establishes a legal framework and mitigates potential disputes by addressing essential aspects of the LLC's operation. Seeking legal guidance during the creation of the operating agreement is advisable to ensure compliance with Texas laws and to tailor the document to the unique needs of the LLC. A well-crafted operating agreement is not only a legal requirement but a strategic tool that fosters a clear understanding of roles, responsibilities, and decision-making processes, contributing to the long-term success of Texas LLC.

If you want free pricing proposals from vetted lawyers that are 60% less than typical law firms, Click here to get started. By comparing multiple proposals for free, you can save the time and stress of finding a quality lawyer for your business needs.

Meet some of our Lawyers

Michael O. on ContractsCounsel
View Michael
5.0 (4)
Member Since:
February 14, 2022

Michael O.

Managing Attorney
Free Consultation
Los Angeles
17 Yrs Experience
Licensed in CA, NY
University of Southern California

A corporate and commercial attorney with experience in transactional legal services including corporate and finance transactions, mergers and acquisitions, real estate, commercial contracts, bankruptcy, restructuring, international business transactions and general counsel services. Additional background skills and experience include investment banking, financial analysis, and commercial litigation. Sectors covered include technology, media, franchises, and business services providers, from start-ups to medium and large enterprises.

Sara S. on ContractsCounsel
View Sara
4.9 (56)
Member Since:
July 14, 2023

Sara S.

Free Consultation
Washington, D.C.
4 Yrs Experience
Licensed in DC, MD
American University Washington College of Law

With over ten years of intellectual property experience, I’m happy to work on your contractual matter. I am very diligent and enjoy meeting tight deadlines. Drafting memoranda, business transactional documents, termination notices, cease and desist letters, licenses and letter agreements are all in my wheelhouse! Working in a variety of fields, from construction to pharmaceutical, I enjoy resolving any disputes that come across my desk.

Ayelet F. on ContractsCounsel
View Ayelet
5.0 (5)
Member Since:
June 9, 2021

Ayelet F.

Free Consultation
Coral Springs, FL
11 Yrs Experience
Licensed in FL
Nova Southeastern University

Ayelet G. Faerman knows what influencers mean to brands today. With experience as legal counsel for a beauty brand for over 5 years, and overseeing multiple collaborations, Ayelet has experienced the rise of influencer marketing. As the founder and managing partner of Faerman Law, PA her practice focuses on influencer relations including a specialization in contract negotiations.

Thomas L. on ContractsCounsel
View Thomas
5.0 (1)
Member Since:
March 21, 2023

Thomas L.

Free Consultation
Wethersfield, Connecticut, USA
40 Yrs Experience
Licensed in CT
University of Connecticut Law School

I am a Lawyer/CPA/Technology Startup Advisor/Executive with experience in global corporate law and finance, startup finance, accounting, technology, and business operations with a focus on startups of all kinds and non-profits. I have worked at a large international finance law firm, one of the Big Four Accounting firms, technology startups and non-profits. I help startups and non-profits get organized, get funded, and get going. I've seen all the mistakes made (often more than once), and so I can help you learn from, rather than repeat, history. I know all the insider rules, so you end up getting a fair start and a fair deal, rather than getting taken advantage of (whether an entrepreneur or an investor). My expertise includes: - organization of corporations | organizations of llcs | non-profits and dealing with the IRS - splitting equity | founder structure | founder equity | founder disputes - startup valuation | pitch decks and forecasts | raising capital | finding angel investors, accelerators and venture investors - SAFEs | convertible notes | preferred stock | restricted stock | stock options | 409A - Advisors - setting up cyber-secure business operations - trademarks | patents | intellectual property - employment law - cyber liability and ecommerce including privacy policies and terms of service - accounting and tax - litigation management References: LION: LinkedIn Open Networker / connect with me at

Curt B. on ContractsCounsel
View Curt
5.0 (3)
Member Since:
March 25, 2023

Curt B.

Managing Partner
Free Consultation
Los Angeles, California
10 Yrs Experience
Licensed in CA, DC, FL, IL, MI
UCLA School of Law

Curt Brown has experience advising clients on a variety of franchising, business litigation, transactional, and securities law matters. Mr. Brown's accolades include: - Super Lawyers Rising Star - California Lawyer of the Year by The Daily Journal - Pro Bono Attorney of the Year the USC Public Interest Law Fund Curt started his legal career in the Los Angeles office of the prestigious firm of Irell & Manella LLP, where his practice focused on a wide variety of complex civil litigation matters, including securities litigation, antitrust, trademark, bankruptcy, and class action defense. Mr. Brown also has experience advising mergers and acquisitions and international companies concerning cyber liability and class action defense. He is admitted in California, Florida, D.C., Washington, Illinois, Colorado, and Michigan.

Janelle L. on ContractsCounsel
View Janelle
Member Since:
March 23, 2023

Janelle L.

Free Consultation
New York City
11 Yrs Experience
Licensed in NY
American University Washington College of Law

I am a New York attorney with 10 years as a licensed attorney and over 7 years of experience working with technology companies in the startup global ecosystem. I have direct experience advising global startups on the legal, regulatory, technology and policy issues that affect their business and competitive strategy. I am a multifaceted, globally-minded Attorney and Business Strategist who is changing the perspective of the law in business from a reactive need to a proactive tool. My legal & business strategic skill-set provides robust, forward-thinking, and solution-oriented legal services in the following areas: Drafting, Reviewing, and Negotiating (Redlining) various commercial contracts and licensing agreements; Drafting and Reviewing Employment Contracts; Contract Management using Contract Management Software; Influencer Marketing Intellectual Property Law (excluding Patent law); and Data Privacy such as GDPR, CCPA/CPRA, LGPD, and HIPAA; and Cybersecurity Law, including creating privacy by design frameworks. NOTABLE ACHIEVEMENTS: Recently achieved certifications in Ironclad Contract Management Software/Lifecycle Management, specifically: Contract Owner; Core Administration; Procurement Workflow; Sales Workflow; and Clickwrap Core Administration; Contributed to the creation of new jurisprudence in international administrative and international employment law; Drove high level contract negotiations in an international capacity where I achieved positive results for my client; and Achieved competency in Business Strategy, Business Growth Strategy, Strategic Planning and Execution, and Advanced Competitive Strategy, resulting in the publication of my legal based business strategic frameworks by leading marketplace for best business practices.

Morgan N. on ContractsCounsel
View Morgan
Member Since:
March 24, 2023

Morgan N.

Free Consultation
North Dakota and Minnesota
3 Yrs Experience
Licensed in MN, ND
Mitchell Hamline School of Law

Morgan is a real estate attorney with six years of experience in residential, land, and commercial real estate transactions. He has experience assisting municipalities, businesses, buyers and sellers in real estate related matters. He has worked on various projects including purchase agreements, contract for deed, easements, mortgages, access agreements, contract/lease review and also title review. Prior to entering private practice, Morgan was a Realtor and assisted buyers and sellers in residential sales and closing services. Morgan provides proactive, responsive and dependable work to each client and project.

Find the best lawyer for your project

Browse Lawyers Now

Need help with an Operating Agreement?

Create a free project posting
See All Business Lawyers
Learn About Contracts
See More Contracts
other helpful articles

Quick, user friendly and one of the better ways I've come across to get ahold of lawyers willing to take new clients.

View Trustpilot Review

Contracts Counsel was incredibly helpful and easy to use. I submitted a project for a lawyer's help within a day I had received over 6 proposals from qualified lawyers. I submitted a bid that works best for my business and we went forward with the project.

View Trustpilot Review

I never knew how difficult it was to obtain representation or a lawyer, and ContractsCounsel was EXACTLY the type of service I was hoping for when I was in a pinch. Working with their service was efficient, effective and made me feel in control. Thank you so much and should I ever need attorney services down the road, I'll certainly be a repeat customer.

View Trustpilot Review

I got 5 bids within 24h of posting my project. I choose the person who provided the most detailed and relevant intro letter, highlighting their experience relevant to my project. I am very satisfied with the outcome and quality of the two agreements that were produced, they actually far exceed my expectations.

View Trustpilot Review

Need help with an Operating Agreement?

Create a free project posting

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call

Find lawyers and attorneys by city