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An Operating Agreement sets out the rules, responsibilities, and internal workings of a business partnership or company in Australia. It's like a detailed roadmap that covers how owners will run the business, make decisions, share profits, and handle disputes.

While not legally required under Australian corporations law, having one helps prevent misunderstandings between business partners and provides clear guidance during important transitions like bringing in new owners or winding up the business. The agreement typically includes provisions for management structure, capital contributions, profit distribution, and voting rights - making it essential for smooth business operations.

Create an Operating Agreement when starting any new business partnership or company in Australia, especially before money starts flowing. This document becomes crucial during major changes like adding partners, expanding operations, or securing external funding.

It's particularly important for businesses with multiple owners, complex profit-sharing arrangements, or specific management structures. Having it in place before disagreements arise saves time and money - many partnership disputes stem from unclear expectations about decision-making authority, profit distribution, or exit procedures. Consider it essential when bringing family members into the business or mixing personal and business assets.

• Single Member Operating Agreement: Designed for sole proprietors, establishing clear separation between personal and business assets
• Partnership Operating Agreement: Covers multiple owners' roles, profit sharing, and decision-making processes
• Limited Liability Operating Agreement: Specifically for LLCs, detailing member rights and company management structure
• Shareholder Operating Agreement: Used by companies with multiple shareholders, outlining voting rights and share transfer rules
• Business Operating Agreement: General-purpose agreement adaptable for various business structures and industries

• Business Partners/Co-owners: Primary users who rely on Operating Agreements to define their rights, responsibilities, and profit-sharing arrangements
• Company Directors: Use the agreement to understand their management authority and decision-making boundaries
• Legal Counsel: Draft and review agreements to ensure compliance with Australian corporate law and protect client interests
• Business Accountants: Reference the agreement for profit distribution, capital contribution, and tax planning purposes
• Company Secretary: Maintains and updates the agreement as part of corporate record-keeping obligations
• Potential Investors: Review agreements during due diligence to understand business structure and governance

• Business Details: Gather full legal names, addresses, and ownership percentages of all members or partners
• Capital Structure: Document initial investments, asset contributions, and funding arrangements
• Management Structure: Define roles, voting rights, and decision-making processes
• Financial Planning: Outline profit distribution methods, tax arrangements, and accounting procedures
• Exit Strategy: Plan procedures for member departure, business sale, or dissolution
• Compliance Check: Our platform ensures your Operating Agreement meets Australian legal requirements while using clear, enforceable language
• Review Process: Have all parties review the draft and discuss any concerns before finalizing

• Company Information: Legal business name, ABN, registered address, and formation date
• Ownership Structure: Member details, ownership percentages, and capital contributions
• Management Provisions: Decision-making processes, voting rights, and meeting procedures
• Financial Terms: Profit distribution, loss allocation, and tax treatment policies
• Operating Procedures: Day-to-day management responsibilities and authority limits
• Transfer Provisions: Rules for selling interests, adding members, or transferring ownership
• Dispute Resolution: Conflict management procedures and mediation protocols
• Dissolution Terms: Procedures for winding up the business and asset distribution

Operating Agreements are often confused with Consortium Agreements, but they serve distinct purposes in Australian business law. While both govern business relationships, their scope and application differ significantly.

• Purpose and Scope: Operating Agreements govern internal company operations and member relationships, while Consortium Agreements specifically manage temporary partnerships between multiple organizations for specific projects
• Duration: Operating Agreements last throughout a company's existence, whereas Consortium Agreements typically end when the project completes
• Legal Structure: Operating Agreements create permanent business structures with ongoing obligations, while Consortium Agreements maintain separate entity independence
• Decision Making: Operating Agreements cover all aspects of business governance, but Consortium Agreements focus solely on project-specific decisions and resource sharing
• Risk Distribution: Operating Agreements address overall business liability, while Consortium Agreements specifically allocate project-related risks among partners