Your South Carolina operating agreement is the legal document establishing the policies and organizational structure of your LLC. Your operating agreement is legally binding and determines how your LLC will handle important processes, including voting, transferring membership interest, allocating profits and losses, and dissolving the business (if that ever becomes necessary). You can use one of our attorney-drafted templates to fill out, save, and download your operating agreement for free.
Unlike the South Carolina Articles of Organization, the operating agreement is an internal document—you don’t need to file it with the Secretary of State—but having a strong operating agreement is essential. Creating an operating agreement can be challenging, which is why Northwest provides free, attorney-drafted operating agreement templates, specifically for South Carolina LLCs, which fit a range of ownership and management structures.
Your operating agreement provides the road map for how your South Carolina LLC will navigate major situations. While you’re allowed to cover anything in your operating agreement not prohibited by state law, there are certain topics every strong operating agreement will include:
Want to focus on your business and leave the legal hullabaloo to us? Our lawyers drafted a comprehensive operating agreement you can use for free. You can even fill it out on this page, save it in a free account for later, and download a completed draft to sign.
In order to fill out our free operating agreement template, you’ll need your:
This must be your business’ legal entity name, or the name you put on your LLC Articles of Organization.
Did an LLC member contribute $500? $5k? A storefront? Put that here.
You’ll just write in 16 here since our version has a set amount of pages.
Remember, this is an internal document, so you won’t have to submit these names to the state just because they’re on here. However, you might need to add these people to your BOI Report.
Include any initial contributions, even if it’s only a small percentage.
While we recommend having a business bank account, some banks like to actually see the operating agreement before you open the account. If that’s the case, you can leave this blank for now.
This is the place your business operates from.
You can add this in later if you aren’t sure when your meeting will be held.
There’s a few different spots where you’ll need to add at least one members’ signature. These are on pages 13, 14, 15, and 16 on our template.
A South Carolina LLC should have an operating agreement because a company cannot act for itself. In order to operate, LLCs require real humans (and other entities) to carry out company operations.
South Carolina state law says that LLCs may enter into an operating agreement—per SC Code § 33-44-112 (2019)—but doesn’t require them to do so. However, a strong written operating agreement will work in your company’s favor in many different circumstances.
In South Carolina, businesses can choose not to list the names of LLC members on the Articles of Organization. This will help you protect your privacy, but it can make it difficult to prove who actually owns your LLC—something you will probably have to do in order to open a business bank account. That’s when it’s helpful to have a written operating agreement, which lists the names and addresses of all LLC members.
To benefit from limited liability protection, all LLCs must be able to prove they are separate legal entities from their members. This requires LLCs to follow certain formalities, including keeping business and personal spending separate. Another way to demonstrate that your LLC is a distinct entity is by following the rules and procedures documented in your operating agreement.
Conflict is an inevitable part of doing business with other people, but you don’t want a minor disagreement to turn into a messy legal battle. That’s why it helps to get your initial verbal agreements down in writing, where you can refer back to them when disputes arise.
Anything you do not cover in your operating agreement will be automatically governed by South Carolina’s default LLC laws. These laws might not work well for the way you want to structure your business. If you have a thorough operating agreement, you can override default statutes and run your LLC on your own terms.
We asked our lawyers for an example of how an operating agreement can make or break your LLC. Here’s what they said.*
“Consider the case of Wilson v Gandis, where a dispute among the members resulted in extensive and expensive litigation due in large part to the failure of the members to adopt and maintain an operating agreement. When disagreements among the members emerged following cash flow problems with the LLC, the members’ failure to adopt and maintain an operating agreement or other writing that proved the membership interest of the members opened the door for some members to gang up on and kick out another member, then attempt to ‘recreate history’ with claims that the other member was actually an ’employee’ and not a member.
“Had the members taken the time to plan ahead, discuss said plans, then distill said agreed-upon plans into writing, no member could reasonably argue something to the contrary, such as another member being an employee and not a member. For these reasons (and more), a reasonably prudent business owner would (and should) adopt and maintain an operating agreement.”
Our free LLC operating agreement templates have been drafted by an attorney and are customized for a range of South Carolina LLC types. Select the one that best matches your LLC below: