The arithmetic in a Colorado LLC operating agreement is small, and it is where most home-drafted agreements disagree with themselves: an ownership clause that does not follow from the contributions, a distribution clause that ignores the reserve, a voting threshold nobody translated into names. This page works those figures for a mountain guiding outfit in Colorado owned by three guides who each brought gear and a client list, so the members' $90,000 of capital, their profit and their chosen thresholds come out as shares, distributions and a vote that agree with each other. The free worksheet on this site does the same from your own figures with no account. What the state requires the agreement to say, and what it charges, are the filing office's and your attorney's; this page publishes neither.
The contribution schedule is the clause the rest reads from
For a mountain guiding outfit in Colorado, formed by three guides who each brought gear and a client list, a Colorado LLC operating agreement usually opens with the members and what each put in, and every later clause reads from that schedule. On the worked example, three members contributing $50,000, $30,000 and $10,000 own 55.6%, 33.3% and 11.1% of the company. The worksheet takes the contributions and returns the shares, so the ownership clause is worked from the contribution clause rather than typed in beside it and later found to disagree.
Distributions after a reserve, on the profit the members enter
Most agreements let the company keep a reserve before anything is distributed, then split what is left by ownership. With $100,000 of profit and a 5% reserve, $95,000 is distributable and the largest member's share of it is $52,778. Whether a Colorado company distributes at all, and when, is the members' decision under their own agreement; the worksheet works the figure and publishes no rule about it.
The vote a major decision needs, as capital that must say yes
A major-decision clause names a share of ownership, and the worksheet turns it into money and names. At a 80% threshold on $90,000 of capital, $72,000 of contributions must vote yes, which with shares of 55.6%, 33.3% and 11.1% means particular members and not others. What a Colorado agreement should set the threshold at is the members' call and their attorney's; the arithmetic is the same at any number.
Where a Colorado agreement's rules live, and where its numbers do
Whether Colorado requires a written operating agreement, what it must contain and what the state charges to form or maintain the company are questions for the Colorado Secretary of State, Business Organizations, named below, and for your attorney; this page publishes no rule text, no fee and no legal advice. What it does publish is the arithmetic the agreement records: the shares from the contributions, the distributions from the profit and the capital a decision needs, worked free on this site from the members' own figures, and kept against the company by LLC Lane Pro when the members want the record.
Questions people ask about llc operating agreement colorado
Where do I find what Colorado requires an operating agreement to contain?
At the Colorado Secretary of State, Business Organizations, linked below, and from your attorney. This site publishes the arithmetic the agreement records and nothing about what the state requires the wording to say.
Can the members split ownership differently from their contributions?
Yes, if the agreement records the agreed split. The worksheet shows what the contributions alone imply, so a different split is a decision the members have seen rather than an accident in the blanks.
Does the worksheet store my Colorado company's figures?
The free worksheet stores nothing and needs no account; it works the figures on the page and prints them. LLC Lane Pro keeps every company, member and agreement against the record for the members who want the history.