PROFESSIONAL LIMITED LIABILITY COMPANY
for LICENSED PROFESSIONALS
STATE OF WASHINGTON
Electronic Version
Statutory Reference
Revised Code of Washington, Title 25, Chapter 25.15: Limited Liability Companies
§25.15.046: Professional Limited Liability Companies
http://app.leg.wa.gov/RCW/default.aspx?cite=25.15.046
(effective Jan. 1, 2016)
One person, or group of persons, all of whom are to render professional services within
Washington or any other state may organize and become a member or members of a professional
limited liability company under the Washington Limited Liability Company Act for the purpose
of rendering professional services.
Persons engaged in a profession and otherwise meeting the requirements of the Washington
Limited Liability Company Act may operate as a professional limited liability company so long
as each member personally engaged in the practice of the profession in Washington state is duly
licensed to practice the profession in Washington and:
1. At least one manager of the PLLC is duly licensed or otherwise legally authorized to
practice the profession in Washington; or
2. Each member in charge of an office of the PLLC in Washington is duly licensed to
practice the profession in Washington.
PRIOR TO FILING THE ARTICLES OF ORGANIZATION FORMING A
PROFESSIONAL LIMITED LIABILITY COMPANY, YOU SHOULD CONFIRM WITH
THE WASHINGTON STATE GOVERNING BOARD OR COMMISSION FOR YOUR
PROFESSION THAT YOU ARE IN FULL COMPLIANCE WITH ALL OF ITS RULES
AND REGULATIONS.
Steps to Form PLLC
Step 1: It is recommended that you reserve a professional limited liability company name
in order to assure that your Certificate of Formation is not rejected because the
name you have selected is not available.
You may skip this step and go to step 2, but if the professional limited liability
company name you have selected is not available, the Certificate of Formation
will be returned to you.
See FORM 1 - APPLICATION FOR RESERVATION OF WASHINGTON
(DOMESTIC) NAME.
* This form should be typed or printed or printed in dark ink.
* You must file the original and one copy.
* Check the box beside PROFESSIONAL LIMITED LIABILITY COMPANY.
* Provide the PLLC name you wish to reserve.
* The name of a professional limited liability company must contain either
the words "Professional Limited Liability Company," or the words
"Professional Limited Liability" and the abbreviation "Co.," or the
abbreviation "P.L.L.C." or "PLLC".
* Note: You may list alternated choices if you wish.
* Provide the name and address of the applicant.
* If the reservation is for someone other than the applicant, provide the name and
address of that person or entity.
* Sign the Application, print your name and title, and date the Application.
* A name is reserved for a 180-day period.
Mail the original and one copy of your APPLICATION FOR RESERVATION
OF WASHINGTON (DOMESTIC) NAME along with the filing fee (make
check payable to the Secretary of State) , to:
CORPORATIONS DIVISION
801 CAPITOL WAY SOUTH - PO BOX 40234
OLYMPIA, WA 98504-0234
Telephone: (360) 753-7115
Step 2: Once you have reserved the professional limited liability company name, or if you
have chosen to proceed without reserving a name, complete the form entitled
“Application to Form Professional Limited Liability Company/Certificate of
Formation.”
SEE FORM 2 – APPLICATION TO FORM A LIMITED LIABILITY
COMPANY/CERTIFICATE OF FORMATION
Follow the instructions on the form.
Step 3: Mail the original and one copy of the APPLICATION TO FORM A LIMITED
LIABILITY COMPANY/CERTIFICATE OF FORMATION to
CORPORATIONS DIVISION
801 CAPITOL WAY SOUTH - PO BOX 40234
OLYMPIA, WA 98504-0234
Telephone: (360) 753-7115
A sample cover letter to send with the Certificate of Formation is included in this
packet. Make sure you include an original and one copy of the Certificate of
Formation.
SEE FORM 3 – SAMPLE TRANSMITTAL LETTER
Step 4: Upon return of the Certificate of Formation complete an Operating Agreement.
SEE FORM 4 – SAMPLE OPERATING AGREEMENT
Step 5: Apply for a Federal Tax Identification Number. This is done with form SS-4.
Mail to your regional IRS office.
SEE FORM 5 – IRS-SS-4 & IRS-SS-4-I (instructions)
Step 6: Open a bank account and conduct business.
Disclaimer: If you are not an attorney, you are advised to seek the advice of an attorney for all
serious legal matters. The information and forms contained herein are not legal
advice and are not to be construed as such. Although the information contained
herein is believed to be correct, no warranty of fitness or any other warranty shall
apply. All use is subject to the U.S. Legal Forms, Inc. Disclaimer and License
located at http://www.uslegalforms.com/disclaimer.htm
FORM 1
APPLICATION FOR RESERVATION OF
WASHINGTON (DOMESTIC) NAME
see download page, below.
FORMS DOWNLOAD
To access the download page please do the following:
IMPORTANT NOTE : WRITE DOWN THE USERNAME AND PASSWORD SHOWN
BELOW BECAUSE YOU WILL NEED TO ENTER IT EXACTLY (case sensitive) TO
DOWNLOAD THE FORMS.
The download page you will access by using the link below contains links to download the forms
for this package, as well as a brief description of each form. Once you reach the download page,
the easiest procedure to download the forms is to right-click on the form links and select “save
target as” to save each form to your hard drive.
To access the download page you are required to use the following login (PLEASE WRITE
THIS DOWN):
USERNAME: waz321
PASSWORD: zaw123
The download link can be accessed by any of the following methods:
- Copy the link below and paste into your browser URL location.
- Type the link below exactly (case sensitive) as shown into your browser.
- Click on the highlighted link below.
Download Link:
http://www.uslegalforms.com/data/corp/WA-00LLC/WA-00PLLC.htm
http://www.uslegalforms.com/data/corp/WA-00LLC/WA-00PLLC.htm
FORM 4
SAMPLE OPERATING AGREEMENT
This agreement is a sample operating agreement and should be modified to meet your needs. It
provides for the PLLC to be operated by one or more managers OR by the members. You will
have to decide how you want your PLLC to operate.
Read carefully and make appropriate changes to suit your
individual needs and purposes.
OPERATING AGREEMENT
OF
_______________________________
A WASHINGTON
PROFESSIONAL LIMITED LIABILITY COMPANY
THIS OPERATING AGREEMENT ("Agreement") is entered into the _____ day of
__________, 20___, by and between the following persons:
1. _______________________________________________________________
2. _______________________________________________________________
3. _______________________________________________________________
4. _______________________________________________________________
hereinafter, ("Members" or “Parties”).
FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which is hereby
acknowledged, the Parties covenant, contract and agree as follows:
ARTICLE I
FORMATION OF PROFESSIONAL LIMITED LIABILITY COMPANY
1. Formation of PLLC . The Parties have formed a Washington professional limited liability
company named ___________________________________________________
("PLLC"). The operation of the PLLC shall be governed by the terms of this Agreement
and the applicable laws of the State of Washington relating to the formation, operation
and taxation of a PLLC, including the Washington Limited Liability Company Act
(Revised Code of Washington, Title 25, Chapter 25.15) hereinafter referred to as the
"Act". To the extent permitted by the Act, the terms and provisions of this Agreement
shall control if there is a conflict between such Act and this Agreement. The Parties
intend that the PLLC shall be taxed as a partnership. Any provisions of this Agreement,
if any, that may cause the PLLC not to be taxed as a partnership shall be inoperative.
2. Certificate of Formation . The Members acting through one of its Members,
_____________________________________, filed a Certificate of Formation,
("Certificate") for record in the office of the with the Washington Secretary of State on
_________________________, thereby creating the PLLC.
3. Business . The business of the PLLC shall be to engage in practice of
__________________.
4. Registered Office and Registered Agent . The registered office and place of business of
the PLLC shall be ___________________________________________________
______________________________________ and the registered agent at such office
shall be ________________________________________________________. The
Members may change the registered office and/or registered agent from time to time.
5. Duration . The PLLC will commence business as of the date the Members contribute
their capital investment in the PLLC and will continue in perpetuity.
6. Fiscal Year . The PLLC's fiscal and tax year shall end December 31.
ARTICLE II
MEMBERS
7. Initial Members . The initial members of the PLLC are all licensed to engage in the
practice of ___________________ in Washington. The initial members of the PLLC,
their initial capital contributions, and their percentage interest in the PLLC are:
Initial Percentage Interest Capital
Members in PLLC Contribution
________________________ _________________ ___________________
________________________ _________________ ___________________
________________________ _________________ ___________________
________________________ _________________ ___________________
8. Additional Members. New members may be admitted only upon the consent of a
majority of the Members and upon compliance with the provisions of this agreement. All
new members of the PLLC shall be licensed to engage in the practice of
___________________ in Washington.
ARTICLE III
MANAGEMENT
9 Management . The Members have elected to manage the PLLC as follows:
The management of the PLLC shall be vested in the Members without an appointed
manager. The members shall elect officers who shall manage the company. The
President and Secretary may act for and on behalf of the PLLC and shall have the
power and authority to bind the PLLC in all transactions and business dealings of any
kind except as otherwise provided in this Agreement.
The Members hereby delegate the management of the PLLC to Manager(s), subject
to the limitations set out in this agreement.
a) The Members shall elect and may remove the Manager(s) by majority vote.
b) A Manager shall serve until a successor is elected by the Members.
c) The Manager(s) shall have the authority to take all necessary and proper
actions in order to conduct the business of the PLLC.
d) Except for decisions concerning distributions, any Manager can take any
appropriate action on behalf of the PLLC, including, but not limited to
signing checks, executing leases, and signing loan documents.
e) In determining the timing and total amount of distributions to the Members,
the action of the Manager shall be based on a majority vote of the Managers,
with or without a meeting.
f) The c ompensation to the Manager(s) shall be in the discretion of the majority
of the Members of the PLLC.
g) There shall be _________ initial Managers.
h) All managers of the PLLC shall be licensed to engage in the practice of
___________________ in Washington.
i) The initial Managers is/are:
___________________________________________________
___________________________________________________
___________________________________________________
10. Officers and Relating Provisions . In the event the Members elect to manage the PLLC,
rather than appointing a manager, the Members shall appoint officers for the PLLC and
the following provisions shall apply:
a) Officers . The officers of the PLLC shall consist of a president, a treasurer and a
secretary, or other officers or agents as may be elected and appointed by the
Members. Members may hold more than one office. The officers shall act in the
name of the PLLC and shall supervise its operation under the direction and
management of the Members, as further described below.
b) Election and Term of Office . The officers of the PLLC shall be elected annually by
the Members by a majority vote. Vacancies may be filled or new offices created and
filled at any meeting of the Members. Each officer shall hold office until his/her
death, until he/she shall resign, or until he/she is removed from office. Election or
appointment of an officer or agent shall not of itself create a contract right.
c) Removal . Any officer or agent may be removed by a majority of the Members
whenever they decide that the best interests of the Company would be served thereby.
Such removal shall be without prejudice to the contract rights, if any, of the person so
removed.
d) Vacancies . A vacancy is any office because of death, resignation, removal,
disqualification or otherwise may be filled by the Members for the unexpired portion
of the term.
e) President . The President shall be the chief executive officer of the PLLC and shall
preside at all meetings of the Members. The President shall have such other powers
and perform such duties as are specified in this Agreement and as may from time to
time be assigned by the Members of the PLLC.
f) The Treasurer . The Treasurer shall be the chief financial officer of the PLLC. The
Treasurer shall not be required to give a bond for the faithful discharge of his/her
duties. The Treasurer shall: (i) have charge and custody of and be responsible for all
funds and securities of the PLLC; (ii) in the absence of the President, preside at
meetings of the Members; (iii) receive and give receipts for moneys due and payable
to the PLLC from any source whatsoever, and deposit all such moneys in the name of
the PLLC in such banks, trust companies or other depositaries as shall be selected by
the Members of the PLLC; and (iv) in general perform all the duties incident to the
office of treasurer and such other duties as from time to time may be assigned by the
President or by the Members of the PLLC.
g) Secretary . The secretary shall: (i) keep the minutes of the Members meetings in one
or more books provided for that purpose; (ii) see that all notices are duly given in
accordance with the provisions of this Agreement or as required by law; (iii) be
custodian of PLLC records; (iv) keep a register of the post office address of each
Member; (v) certify the Member’s resolutions; and other documents to the PLLC as
true and correct; (vi) in the absence of the President and Treasurer, preside at
meetings of the Members and (vii) in general perform all duties incident to the office
of secretary and such other duties as from time as may be assigned by the President or
the Members.
11. Member Only Powers . Notwithstanding any other provision of this Agreement, only a
majority of the Members may: (a) sell or encumber (but not lease) any real estate owned
by the PLLC, or (b) incur debt, expend funds, or otherwise obligate the PLLC if the debt,
expenditure, or other obligation exceeds $_____________________.
ARTICLE IV
CONTRIBUTIONS, PROFITS, LOSSES, AND DISTRIBUTIONS
12. Interest of Members . Each Member shall own a percentage interest (sometimes referred
to as a share) in the PLLC. The Member’s percentage interest shall be based on the
amount of cash or other property that the Member has contributed to the PLLC and that
percentage interest shall control the Member’s share of the profits, losses, and
distributions of the PLLC.
13. Contributions . The initial contributions and initial percentage interest of the embers are
as set out in this Agreement.
14. Additional Contributions . Only a majority of the Members of the PLLC may call on the
Members to make additional cash contributions as may be necessary to carry on the
PLLC's business. The amount of any additional cash contribution shall be based on the
Member's then existing percentage interest. To the extent a Member is unable to meet a
cash call, the other Members can contribute the unmet call on a pro rata basis based on
the Members' percentage interests at that time, and the percentage interest of each
Member will be adjusted accordingly.
15. Record of Contributions/Percentage Interests . This Agreement, any amendment(s) to this
Agreement, and all Resolutions of the Members of the PLLC shall constitute the record
of the Members of the PLLC and of their respective interest therein.
16. Profits and Losses . The profits and losses and all other tax attributes of the PLLC shall
be allocated among the Members on the basis of the Members' percentage interests in the
PLLC.
17. Distributions . Distributions of cash or other assets of the PLLC (other than in dissolution
of the PLLC) shall be made in the total amounts and at the times as determined by a
majority of the Members. Any such distributions shall be allocated among the Members
on the basis of the Members' percentage interests in the PLLC.
18. Change in Interests . If during any year there is a change in a Member's percentage
interest, the Member's share of profits and losses and distributions in that year shall be
determined under a method which takes into account the varying interests during the
year.
ARTICLE V
VOTING; CONSENT TO ACTION
19. Voting by Members . Members shall be entitled to vote on all matters which provide for a
vote of the Members in accordance with each Member’s percentage interest.
20. Majority Required . Except as otherwise required, a majority of the Members, based upon
their percentage ownership, is required for any action.
21. Meetings - Written Consent . Action of the Members may be accomplished with or
without a meeting. If a meeting is held, evidence of the action shall be by Minutes or
Resolution reflecting the action of the Meeting, signed by a majority of the Members.
Action without a meeting may be evidenced by a written consent signed by a majority of
the Members.
22. Meetings . Meetings of the Members may be called by any Member owning 10% or more
of the PLLC, or, if Managers were selected, by any Manager of the PLLC.
23. Majority Defined . As used throughout this agreement the term “Majority” of the
Members shall mean a majority of the ownership interest of the PLLC as determined by
the records of the PLLC on the date of the action.
ARTICLE VI
DUTIES AND LIMITATION OF LIABILITY MEMBERS, OFFICERS AND
PERSONS SERVING ON ADVISORY COMMITTEES; INDEMNIFICATION
24. Duties of Members: Limitation of Liability . The Members, Managers and officers shall
perform their duties in good faith, in a manner they reasonably believe to be in the best
interests of the PLLC, and with such care as an ordinarily prudent person in a like
position would use under similar circumstances. No Member or officer shall have any
liability to the PLLC or any other Member by reason of being or having been a Member
or officer. No Member or officer shall not be liable to the PLLC or to any other Member
or officer for any loss or damage sustained by the PLLC or any other Member or officer
unless the loss or damage shall have been the result of fraud, deceit, gross negligence,
willful misconduct, or a wrongful taking by that Member or officer.
25. Members Have No Exclusive Duty to PLLC . The Members shall not be required to
participate in the PLLC as their sole and exclusive business. Members may have other
business interests and may participate in other investments or activities in addition to
those relating to the PLLC. Neither the PLLC nor any other Member shall have any
right, by virtue of this Agreement, to share or participate in another member’s business
interests, investments or activities or the income or proceeds derived therefrom. No
Member shall incur liability to the PLLC or to any other Member by reason of
participating in any such other business, investment or activity.
26. Protection of Members and Officers .
a) As used herein, the term “Protected Party” refers to the Members and officers of the
Company.
b) To the extent that, at law or in equity, a Protected Party has duties (including
fiduciary duties) and liabilities relating thereto to the PLLC or to any other Protected
Party, a Protected Party acting under this Agreement shall not be liable to the PLLC
or to any other Protected Party for good faith reliance on:
(i) the provisions of this Agreement;
(ii) the records of the PLLC; and/or
(iii) such information, opinions, reports or statements presented to the PLLC by any
person as to matters the Protected Party reasonably believes are within such other
person’s professional or expert competence and who has been selected with
reasonable care by or on behalf of the PLLC, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities, profits
or losses of the PLLC or any other fact pertinent to the existence and amount of
assets from which distributions to Members might properly be paid.
c) The provisions of this Agreement, to the extent that they restrict the duties and
liabilities of a Protected Party to the PLLC or to any other Protected Party otherwise
existing at law or in equity, are agreed by the parties hereto to replace such other
duties and liabilities of such Protected Party.
d) Whenever this Agreement permits or requires a Protected Party to make a decision in
its “discretion” or under a grant of similar authority or latitude, the Protected Party
shall be entitled to consider only such interests and factors as it desires, including its
own interests, and shall have no duty or obligation to give any consideration to any
interest of or factors affecting the PLLC or any other Person.
e) Whenever this Agreement permits or requires a Protected Party to make a decision
using a “good faith” or under another express standard, the Protected Party shall act
under such express standard and shall not be subject to any other or different standard
imposed by this Agreement or other applicable law.
27. Indemnification and Insurance .
(a) Right to Indemnification .
(i) Any person who is or was a member or officer of the PLLC and who is or
may be a party to any civil action because of his/her participation in or with
the PLLC, and who acted in good faith and in a manner which he/she
reasonably believed to be in, or not opposed to, the best interests of the PLLC,
shall be indemnified and held harmless by the PLLC.
(ii) Any person who is or was a member or officer of the PLLC and who is or
may be a party to any criminal action because of his/her participation in or
with the PLLC, and who acted in good faith and had reasonable cause to
believe that the act or omission was lawful, shall be indemnified and held
harmless by the PLLC.
(b) Advancement of Expenses . Expenses (including attorney’s fees) incurred by an
indemnified person in defending any proceeding shall be paid in advance of the
proceeding’s final disposition. Should the indemnified member or officer ultimately
be determined to not be entitled to indemnification, that member or officer agrees to
immediately repay to PLLC all funds expended by the PLLC on behalf of the member
or officer.
(c) Non-Exclusivity of Rights . The right to indemnification and the advancement of
expenses conferred in this section shall not be exclusive of any right which any
person may have or hereafter acquire under any statute, provision of this Agreement,
contract, agreement, vote of Members or otherwise. The Members and officers are
expressly authorized to adopt and enter into indemnification agreements for
Members, officers and advisory committee members.
(d) Insurance . The Members shall cause the PLLC to purchase and maintain professional
liability insurance for the PLLC, for its Members and officers, and/or on behalf of any
third party or parties whom the members might determine should be entitled to such
insurance coverage. That professional liability insurance policy shall be in an amount
no less than _______________________.
(e) Effect of Amendment . No amendment, repeal or modification of this Article shall
adversely affect any rights hereunder with respect to any action or omission occurring
prior to the date when such amendment, repeal or modification became effective.
28. Duties of Persons Serving on Advisory Committees; Limitation of Liability;
Indemnification . The Members shall have the right to form advisory committees.
Persons serving on an advisory committee, whether or not a Member or officer, shall
perform their duties in good faith, in a manner they reasonably believe to be in the best
interests of the PLLC, and with such care as an ordinarily prudent person in a like
position would use under similar circumstances. A person serving on an advisory
committee shall not have any liability to the PLLC or to any Member or officer for any
loss or damage sustained by the PLLC or any Member or officer unless the loss or
damage was the result of fraud, deceit, gross negligence, willful misconduct, or a
wrongful taking by such person.
ARTICLE VII
MEMBERS INTEREST TERMINATED
29. Termination of Membership . A Member’s interest in the PLLC shall cease upon the
occurrence of one or more of the following events:
(a) A Member provided notice of withdrawal to the PLLC thirty (30) days in advance of
the withdrawal date. Withdrawal by a Member is not a breach of this Agreement
(b) A Member assigns all of his/her interest to a third party.
(c) A Member dies or is disqualified from being licensed by the governing
board/commission for their profession.
(d) There is an entry of an order by a court of competent jurisdiction adjudicating the
Member incompetent to manage his/her person or his/her estate.
(e) In the case of an estate that is a Member, the distribution by the fiduciary of the
estate's entire interest in the PLLC.
(f) A Member, without the consent of a majority of the Members: (1) makes an
assignment for the benefit of creditors; (2) files a voluntary petition in bankruptcy; (3)
is adjudicated a bankrupt or insolvent; (4) files a petition or answer seeking for
himself any reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any statute, law or regulation; (5) files an answer
or other pleading admitting or failing to contest the material allegations of a petition
filed against him in any proceeding of the nature described in this paragraph; (6)
seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or
liquidator of the Member or of all or any substantial part of his properties; or (7) if
any creditor permitted by law to do so should commence foreclosure or take any other
action to seize or sell any Member's interest in the PLLC.
(g) If within one hundred twenty (120) days after the commencement of any action
against a Member seeking reorganization, arrangement, composition, readjustment,
liquidation, dissolution, or similar relief under any statute, law, or regulation, the
action has not been dismissed and/or has not been consented to by a majority of the
members.
(h) If within ninety (90) days after the appointment, without a member’s consent or
acquiescence, of a trustee, receiver, or liquidator of the Member or of all or any
substantial part of the member’s properties, said appointment is not vacated or within
ninety (90) days after the expiration of any stay, the appointment is not vacated
and/or has not been consented to by a majority of the members.
(i) Any of the events provided in ARS 29-841 to 29-847 that are not inconsistent with
the dissociation events identified above.
30. Effect of Dissociation . Any dissociated Member shall not be entitled to receive the fair
value of his PLLC interest solely by virtue of his dissociation. A dissociated Member
that still owns an interest in the PLLC shall be entitled to continue to receive such
profits and losses, to receive such distribution or distributions, and to receive such
allocations of income, gain, loss, deduction, credit or similar items to which he would
have been entitled if still a Member. For all other purposes, a dissociated Member shall
no longer be considered a Member and shall have no rights of a Member.
ARTICLE VIII
RESTRICTIONS ON TRANSFERABILITY OF PLLC INTEREST;
SET PRICE FOR PLLC INTEREST
31. PLLC Interest . The PLLC interest is personal property. A Member has no interest in
property owned by the PLLC.
32. Encumbrance . A Member can encumber his PLLC interest by a security interest or other
form of collateral only with the consent of a majority of the other Members. Such
consent shall only be given if the proceeds of the encumbrance are contributed to the
PLLC to respond to a cash call of the PLLC.
33. Sale of Interest . A Member can sell his PLLC interest only as follows:
(a) If a Member desires to sell his/her interest, in whole or in part, he/she shall give
written notice to the PLLC of his desire to sell all or part of his/her interest and must
first offer the interest to the PLLC. The PLLC shall have the option to buy the
offered interest at the then existing Set Price as provided in this Agreement. The
PLLC shall have thirty (30) days from the receipt of the assigning Member's notice to
give the assigning Member written notice of its intention to buy all, some, or none of
the offered interest. The decision to buy shall be made by a majority of the other
Members. Closing on the sale shall occur within sixty (60) days from the date that
the PLLC gives written notice of its intention to buy. The purchase price shall be
paid in cash at closing unless the total purchase price is in excess of
$_______________ in which event the purchase price shall be paid in twelve (12)
equal quarterly installments beginning with the date of closing. The installment
amounts shall be computed by applying the following interest factor to the principal
amount: interest compounded quarterly at the Quarterly Federal Short-Term Rate
existing at closing under the Applicable Federal Rates used for purposes of Internal
Revenue Code § 1 274(d), or any successor provision.
(b) To the extent the PLLC does not buy the offered interest of the assigning Member,
the other Members shall have the option to buy the offered interest at the Set Price on
a pro rata basis based on the Members' percentage interests at that time. If Member
does not desire to buy up to his/her proportional part, the other Members can buy the
remaining interest on the same pro rata basis. Members shall have fifteen (15) days
from the date the PLLC gives its written notice to the selling Member to give the
selling Member notice in writing of their intention to buy all, some, or none of the
offered interest. Closing on the sales shall occur within sixty (60) days from the date
that the Members give written notice of their intention to buy. The purchase price
from each purchasing Member shall be paid in cash at closing.
(c) To the extent the PLLC or the Members do not buy the offered interest, the selling
Member can then assign the interest to a non-member who is licensed in Washington
to engage in the profession practiced by the PLLC. The selling Member must close
on the assignment within ninety (90) days of the date that he gave notice to the PLLC.
If he does not close by that time, he must again give the notice and options to the
PLLC and the PLLC Members before he sells the interest.
(d) Subject to statutory provisions, a non-member purchaser of a member’s interest
cannot exercise any rights of a Member unless a majority of the non-selling Members
consent to him becoming a Member. The non-member purchaser will be entitled,
however, to share in such profits and losses, to receive such distributions, and to
receive such allocation of income, gain, loss, deduction, credit or similar items to
which the selling member would be entitled, to the extent of the interest assigned, and
will be subject to calls for contributions under the terms of this Agreement. The
purchaser, by purchasing the selling member’s interest, agrees to be subject to all the
terms of this Agreement as if he were a Member.
34. Set Price . The Set Price for purposes of this Agreement shall be the price fixed by
consent of a majority of the Members. The Set Price shall be memorialized and made a
part of the PLLC records. The initial Set Price for each Member's interest is the amount
of the Member's contribution(s) to the PLLC as provided above, as updated in
accordance with the terms hereof. Any future changes in the Set Price by the Members
shall be based upon net equity in the assets of the PLLC (fair market value of the assets
less outstanding indebtedness), considering the most recent appraisal obtained by the
PLLC for its assets, as may be adjusted by the Members in their discretion. The initial
Set Price shall be adjusted no later than ________________. This basis for determining
the Set Price shall remain in effect until changed by consent of a majority of the
Members. The Members will consider revising the basis for determining the Set Price at
least annually.
ARTICLE IX
OBLIGATION TO SELL ON A DISSOCIATION
EVENT CONCERNING A MEMBER
35. Dissociation . Except as otherwise provided, upon the occurrence of a dissociation event
with respect to a Member, the PLLC and the remaining Members shall have the option to
purchase the dissociated Member's interest at the Set Price in the same manner as
provided in ARTICLE VIII and as if the dissociated Member had notified the PLLC of
his desire to sell all of his PLLC interest. The date the PLLC received the notice as
provided in ARTICLE VIII triggering the options shall be deemed to be the date that the
PLLC receives actual notice of the dissociation event.
ARTICLE X
DISSOLUTION
36. Termination of PLLC . The PLLC will be dissolved and its affairs must be wound up
only upon the written consent of a majority of the Members.
37. Final Distributions . Upon the winding up of the PLLC, the assets must be distributed as
follows: (a) to the PLLC creditors; (b) to Members in satisfaction of liabilities for
distributions; and (c) to Members first for the return of their contributions and secondly
respecting their PLLC interest, in the proportions in which the Members share in profits
and losses.
ARTICLE XI
TAX MATTERS
38. Capital Accounts . Capital accounts shall be maintained consistent with Internal
Revenue Code § 704 and the regulations thereunder.
39. Tax Matters Partner . The Members hereby designate ___________________________
as the "tax matters partner" for purposes of representing the PLLC before the Internal
Revenue Service if necessary.
40. Partnership Election . The Members elect that the PLLC be taxed as a partnership and not
as an association taxable as a corporation.
ARTICLE XII
RECORDS AND INFORMATION
41. Records and Inspection . The PLLC shall maintain at its place of business the
Articles of Organization, any amendments thereto, this Agreement, and all other PLLC
records required to be kept by the Act, and the same shall be subject to inspection and
copying at the reasonable request, and the expense, of any Member.
42. Obtaining Additional Information . Subject to reasonable standards, each Member may
obtain from the PLLC from time to time upon reasonable demand for any purpose
reasonably related to the Member's interest as a Member in the PLLC: (1) information
regarding the state of the business and financial condition of the PLLC; (2) promptly
after becoming available, a copy of the PLLC's federal, state, and local income tax
returns for each year; and (3) other information regarding the affairs of the PLLC as is
just and reasonable.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
43. Amendment . Except as otherwise provided in this Agreement, any amendment to
this Agreement may be proposed by a Member. Unless waived by the Members, the
proposing Member shall submit to the Members any such proposed amendment together
with an opinion of counsel as to the legality of such amendment and the recommendation
of the Member as to its adoption. A proposed amendment shall become effective at such
time as it has been approved in writing by a majority of the Members. This Agreement
may not be amended nor may any rights hereunder be waived except by an instrument in
writing signed by the party sought to be charged with such amendment or waiver, except
as otherwise provided in this Agreement.
44. Applicable Law . To the extent permitted by law, this Agreement shall be construed in
accordance with and governed by the laws of the State of Washington.
45. Pronouns, Etc . References to a Member or Manager, including by use of a pronoun, shall
be deemed to include masculine, feminine, singular, plural, individuals, partnerships or
corporations where applicable.
46. Counterparts . This instrument may be executed in any number of counterparts each of
which shall be considered an original.
47. Specific Performance . Each Member agrees with the other Members that the other
Members would be irreparably damaged if any of the provisions of this Agreement are
not performed in accordance with their specific terms and that monetary damages would
not provide an adequate remedy in such event. Accordingly, it is agreed that, in addition
to any other remedy to which the nonbreaching Members may be entitled, at law or in
equity, the nonbreaching Members shall be entitled to injunctive relief to prevent
breaches of this Agreement and, specifically, to enforce the terms and provisions of this
Agreement in any action instituted in any court of the United States or any state thereof
having subject matter jurisdiction thereof.
48. Further Action . Each Member, upon the request of the PLLC, agrees to perform all
further acts and to execute, acknowledge and deliver any documents which may be
necessary, appropriate, or desirable to carry out the provisions of this Agreement.
49. Method of Notices . All written notices required or permitted by this Agreement shall be
hand delivered or sent by registered or certified mail, postage prepaid, addressed to the
PLLC at its place of business or to a Member as set forth on the Member's signature page
of this Agreement (except that any Member may from time to time give notice changing
his address for that purpose), and shall be effective when personally delivered or, if
mailed, on the date set forth on the receipt of registered or certified mail.
50. Facsimiles . For purposes of this Agreement, any copy, facsimile, telecommunication or
other reliable reproduction of a writing, transmission or signature may be substituted or
used in lieu of the original writing, transmission or signature for any and all purposes for
which the original writing, transmission or signature could be used, provided that such
copy, facsimile telecommunication or other reproduction shall have been confirmed
received by the sending Party.
51. Computation of Time . In computing any period of time under this Agreement, the day of
the act, event or default from which the designated period of time begins to run shall not
be included. The last day of the period so computed shall be included, unless it is a
Saturday, Sunday or legal holiday, in which event the period shall run until the end of the
next day which is not a Saturday, Sunday or legal holiday.
WHEREFORE, the Parties have executed this Agreement on the dates stated below their
signatures on the attached signature page for each individual Party.
NOTICE: EACH MEMBER HEREBY CERTIFIES THAT HE OR SHE HAS RECEIVED A
COPY OF THIS OPERATING AGREEMENT AND FORMATION DOCUMENT OF
__________________________________________________________________________, A
WASHINGTON PROFESSIONAL LIMITED LIABILITY COMPANY. EACH MEMBER
REALIZES THAT AN INVESTMENT IN THIS COMPANY IS SPECULATIVE AND
INVOLVES SUBSTANTIAL RISK. EACH MEMBER IS AWARE AND CONSENTS TO
THE FACT THAT THE INTERESTS IN THE COMPANY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR ANY SECURITIES ACT OF THE STATE OF
WASHINGTON. EACH MEMBER AGREES TO BE BOUND BY ALL OF THE TERMS
AND CONDITIONS OF THIS AGREEMENT AND THE FORMATION CERTIFICATE OR
ARTICLES.
Members:
__________________________________
Name
__________________________________
Name
__________________________________
Name
__________________________________
Name
Print Name of Member: _______________________
Address: ___________________________________
City, State, Zip: _____________________________
Phone: ____________________________________
Print Name of Member: _______________________
Address: ___________________________________
City, State, Zip: _____________________________
Phone: ____________________________________
Print Name of Member: _______________________
Address: ___________________________________
City, State, Zip: _____________________________
Phone: ____________________________________
Print Name of Member: _______________________
Address: ___________________________________
City, State, Zip: _____________________________
Phone: ____________________________________
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Sample Ownership Ledger
Name and Residence
Address of PLLC
Member Date of
Transfer %
Ownership Amount Paid Subsequen
t Transfer
Show on
separate line
Accessories
U. S. Legal Forms, Inc. offers the following accessories:
See http://www.uslegalbookstore.com/officeproducts/
The certificate below is a sample. Its use is optional.
Membership Certifiate
No. ____ PROFESSIONAL LIMITED LIABILITY COMPANY- STATE OF
WASHINGTON Perientage: __
This Certificate certifies that _____________________________________, is a true and lawful
owner of ________ percent ownership of _______________________________, a Washington
Professional Limited Liability Company. Such ownership interest is only transferable in accordance
with the Operating Agreement between the Members and in accordance with law.
THERE ARE SIGNIFICANT LEGAL RESTRICTIONS ON THE TRANSFER OF
OWNERSHIP INTERESTS IN A PLLC.
This certificate is issued by the Professional limited liability company by its duly authorized officers
on this the ____ day of _________, 20___.
__________________ ___________________
