IC2 – Operating Agreement Video 1

0:00
Well, thanks for joining.
0:00
This is going to be part one of my discussion of the operating agreement that I typically use for limited liability companies, and I wanted, I really wanted to explain what the function of this is for it, really.
0:12
Because we don't give this to anybody, except in a few cases, we might, we might co-author it, revise it with a partner, or it might have to be produced in discovery.
0:24
Very, very seldom you'll run into that.
0:26
So, the first thing about an operating agreement is to establish the contractual rights of whoever has an interest in the company, and I'm talking about a limited liability company. This is more like your, your trust document, but it's not trust.
0:40
Literally, it is the terms of the property rights of a limited liability company. It is the Operating Agreement.
0:50
So as you can see here, I have my standard Operating agreement.
0:57
and I use this term here with a hyphens because the software I'm using here, which is Leiber Office, that allows me to modify the document as I need to. And I'm gonna explain how to do that.
1:09
But first, I wanted to explain the different features of this document.
1:12
Now, I started years ago, gosh, I don't know how long, years ago? with a standard operating agreement.
1:18
And I first started modifying them based upon what I perceived that, what kind of risk certain clients had, or whoever I was working with.
1:26
So, most of the time, we're going to start off with a standard operating agreement, as is this document here, basically.
1:32
And as you can see, it's, you know, probably the dates can be something like, you know, whatever whatever the current date is going to be.
1:41
We're going to update that.
1:44
And this, the date of the Operating Agreement, doesn't need to be it particular date.
1:49
It doesn't have to match the date you file the articles.
1:52
So we'll get into in just a second here.
1:53
So, let's just see, This is your standard where you'd put the name. So, what I would do is, I want to change the name of this Operating Agreement.
2:01
Let's say the name of my company is XYZ Company, OK, I would just use this leiber office here, and I would do edit.
2:08
And I would say, Find replace.
2:11
And I would match the case. actually, in this document, you don't have to match the case in this situation.
2:15
But, so, I have that in here, and I'm going to change it to basically X, Why is the company, OK?
2:27
And if I replace everything, I'm gonna get that.
2:31
You get the idea, I don't have to demonstrate this anymore, I don't think.
2:34
Same thing with the date now.
2:36
In this particular document, the way I have, this is, I can't change the date, just the whole one piece like this, I actually have to change the month, and then I have to change the number.
2:48
Sometimes I actually change this OK, together, separately, and then I changed the year all separately, because I have it formatted differently. And it just worked out that way. I mean, if you're smarter than I am, you can, you can fix all that you want, if you want.
3:01
So, that's the idea.
3:03
Now, in this example, I'm using a private membership association as the owner of the LLC that makes the client, let's say his name is William T Smith.
3:14
That makes the client William Smith, Bill Smith, that makes him the authorized signatory.
3:19
This can be done different ways.
3:21
You can have two members, you can have five members.
3:24
You can have a PMA, that consists of five members, there's all kinds of combinations for William T Smith.
3:32
That is the name of an entity that is not registered with the State, OK?
3:35
It's a PMA, and it doesn't have a tax number. It never will, never will need to have one. It doesn't do business with anyone that just owns the property rights of the LLC.
3:45
So it's kind of a layer of protection I really don't like layering, but this is convenient for many, many situations. So that's why I use.
3:51
So in any case, what you do is you do Edit, find, replace, and then you would do match case.
3:57
And then you would this phrase right here with the name.
4:01
You want to call your PNA, if you're going to use a PMA.
4:05
If you're not, you would just replace this whole phrase with the two or more members that you want to be.
4:13
Now if you want to be a single member LLC, no problem.
4:17
Just go ahead and replace all this with Bill Smith, right or William T Smith.
4:22
In Title case.
4:23
Now, the caps and title case is not so important. I just use that to make a distinction.
4:30
As you can see, if we scroll down a little bit, get ahead of myself, See how we have William T Smith as the registered agent?
4:38
Usually, I just make my client the agent, because that saves them $150 a year and have to deal with having to deal with a registered agent, filing fees and all that stuff.
4:47
If you really want to have a registered agent, like if you're running a business, for example.
4:51
Are your partners, you probably want a registered agent?
4:54
So, you would actually hire a registered agent and then that party would be Providing you with an authorization to use its name here in this spot, right.
5:05
But if I'm doing this for a client, or you're doing it for yourself, you can just name yourself. In fact, you can name anybody.
5:11
You can even put a fictitious name, OK, As long as you're responsible for that name, nobody cares, And This has to be a physical address. It could be a residential, or it could be business, it could be a strip mall.
5:21
You don't have to have a deal there, like a lease agreement.
5:24
It's assumed that you do, but you can actually use any valid address.
5:30
And just keep in mind, whatever address you put in a document, doesn't need to be the address where mail is sent.
5:38
Mail is sent, where you tell people to send mail, no one's going to see this document.
5:41
So, I would just recommend having it accurate here, so, that all works together, OK?
5:48
This isn't a New Mexico example.
5:51
So, now, if you'll notice in Section one here, this basically looks has a lot of the information that's going to be in the articles. The most important thing when you start out is filing the articles correctly.
6:01
You want those to identify when it was formed its name.
6:05
The owners, names, partners, names, if it's a PMA or a trust that owns it, you want that in the articles.
6:11
You see here, you want the purpose. You see, you can copy this here.
6:16
In some states, they want you to give more information. I always like to use the backstory of investing in real estate.
6:22
The office location, again, I just recommend this is the address that it's a physical location, maybe it's going to match your ID, maybe not. Maybe it's going to be the same address that you put on your EIN application for your LLC, it doesn't matter.
6:37
Maybe that's a good rule of thumb.
6:39
Just keep in mind, the more times you use the same address when you're dealing with the banks, the less addresses you're using, the better it is to get through and get your account open.
6:47
Your KYC requirements.
6:49
So just keep that in mind.
6:50
Again, this section one is all about the information that's going to appear in the articles.
6:55
So if you don't have an operating agreement, you don't need one to make it work.
7:01
OK, but I'm gonna tell you why that's a problem, but your company will still function just fine. So you can collect whatever information is needed here to form the articles, and you can file the articles and register it.
7:13
Or if you're not sure yet, you can just reserve the name and go do it later.
7:17
But this this basically is the information that would appear in your articles the rest of this in the opting agreement, this talking about who's going to contribute?
7:26
How much money if it's refundable or if they can get it back, if it's no given irrevocably.
7:35
Um, there's going to be terms as to whether or not there's interest paid out on the contribution.
7:41
So when you form a new company, they're usually, it's for the purpose of acquiring some asset or investing at something. So maybe it needs to be funded at least operating costs, so maybe you need to put $100 into the account for the LLC, right?
7:54
So that's a contribution.
7:56
Maybe it's going to be $50,000, right, So, if it's $50,000, I would, I would want to put some terms on that.
8:02
Right, Especially if you have partners, and that's the purpose of this section here.
8:07
That's the most important part.
8:08
Now, you'll notice as I, If you compare what I'm doing here, two, it's standard operating agreement that you'll find on the Internet for free, or at Legal Zoom, or something like that.
8:17
They have a lot of nonsense in there about Treasury regulations and just garbage.
8:20
You don't need all that in there because talking smack, it doesn't do anything to establish and maintain and express the property rights and obligations of the interested parties for the LLC, In my opinion, that is really the only purpose of the operating agreement.
8:36
It sets forth how a company is going to operate by the parties Who have an interest in the company.
8:45
Not non parties like Servicers like the bank. The bank is not a party to your company.
8:51
So that's what you're gonna find with mine. You can see that I've stripped out everything that has to do with Treasury regs and nonsense like that.
8:57
I also take out things such as, And, you'll see distributions, right?
9:02
There's no distribution schedule.
9:04
I do that so that if there's some situation way in the future, which rarely rarely ever ever happens and I can't remember when it ever has happened to any of my clients or even people that I've heard of earn or no, I just want a fail-safe.
9:19
So, that way, if anyone were to subpoena this operating agreement under court order, which is the only time you're going to disclose it to non parties, it's under court order.
9:29
They're going to see that there's no distribution schedule, so which means it defeats the creditors collection efforts and also having no distribution schedule puts it a tax liability.
9:39
It could be a large one on the creditor because if the creditor gets a judgement and then a charging order to attach your personal claim liability, OK, to the property of the company, if someone was stupid enough to try that.
9:54
and they get past that process and they get the judge to agree to that.
9:59
Then they subpoenaed this opening agreement and then it says there's no distribution schedule.
10:03
That means there's there's no reason why the order that the judge gave that creditor should be sustained until money is distributed to the debtor.
10:17
So what will happen is that person, whoever did it, is going to be in big trouble, because the creditor has to pay taxes on that amount of money because there's nothing to collect because I didn't have a distribution schedule. This is so important, OK?
10:31
This is so important.
10:32
You're going to find out, OK, this operating agreement is the firewall.
10:38
Everything else fails.
10:40
So here's the first thing that is supposed to protect you.
10:42
It's the articles that would supposedly discourage litigation. And so far, 99.99, 9% of the time, I've always seen that it works.
10:55
There are other factors out there that preclude creditors from trying to reach into the company. Some stupid credit where it will do it once in awhile.
11:01
But mostly, they don't.
11:03
But if they did, this operating agreement, part of part of the purpose of it is to be that last, you know, firewall and shut it down.
11:16
Over the years, and I would say, it's over 10000 of these, I've done, probably 20,000 of these, but there's been like 30,000 cases or so. I know you guys hear me say that. I don't know if the number is larger by now.
11:29
Basically, only a few times, I've had to go and modify or create an operating agreement because the person came to me and was already in a collection process and either had an attorney who was an idiot, or he didn't know what he's doing, managed to end up in the situation, where now he's got to produce the operating agreement, He didn't have one. But here's the problem with that.
11:52
If I have articles, that's one thing.
11:54
But if someone wants to try to test the see if those articles are reflected in an actual operating agreement, and he gets the court to order me to produce it and I don't have one.
12:02
And I don't know any better, and I just confess, and I say I don't have one, What will happen is, the court will treat my LLC, it could, it doesn't, I'm not saying it's guaranteed that this will happen.
12:13
But the court can treat my LLC as a sole proprietorship or an alter ego and, well, I'll have no protection at all.
12:20
Whatever's in that company is fair game for the creditor.
12:24
That's how important this is.
12:26
So I've had to come in after the fact and create one.
12:29
That was perfect, because I saw, you know, once the attorney gets an order from the court and says, OK, now you have 20 days to do this, or else, I'm going to ask for contempt order.
12:39
And then the client comes to me and I see the situation and I've got 15 days left or five days left or even up until eight. If I'm late, I can still fix it. Right? I can ask the court to give me a little more time.
12:49
I will write the perfect operating agreement to make sure that that creditor can't pierce.
12:56
And I'll backdate it.
12:58
And they're going to have to accept at face value, because my client's going to testify that that's the opting agreement.
13:03
And if you're concerned about telling the truth or not, what I would just suggest to you is that just because it wasn't in writing, doesn't mean it wasn't the agreement.
13:13
So we don't want to tell them that we didn't have any writing until they asked for it, but we just want to want you to know that.
13:20
I want you to understand that, for all practical purposes, who says it has to be in writing, OK?
13:26
Who says that this whole written agreement wasn't already in your brain, or in you, and your partners brain, and that, now, this attorney came along and started trying to pierce the corporate veil.
13:35
And you had to put it in writing so that you can express the terms and show that you're protected, just saying.
13:42
So, that's the idea here, We get into indemnification, the whole purpose of an LLC or any corporate structure, and he trust.
13:54
Is to do this one thing.
13:55
I'm going to highlight it for you, so that no member is individually responsible for what the company does.
14:03
And then, here, here's how that plays out.
14:06
We're very specific here, I'm not going to read all that stuff to you.
14:08
But you can see this is the whole purpose for a company to give you indemnification, the fee that you're paying, when you register the articles, for the state to identify you.
14:21
The state, meaning the court, the court system, the executive Branch, the, you know, if you operate the company within the bounds of the law, you can do whatever you want, and you will get indemnification.
14:34
The State will uphold your your agreement, put it that way.
14:38
So if your agreement is consistent with what I'm telling you here, that's going to protect you.
14:43
Court's going to back you up.
14:47
We get into little more detail here.
14:50
We always have this situation. We get into Section five where they're duties of the people that are running the company now.
14:56
They can either run the company and not have an interest, or they can run the company and have an interest.
15:01
Or they can have an interest and have someone else run the company.
15:04
There's all kinds of waste member managers, non member managers, OK, serve two roles.
15:08
This is how it's expressed here, OK?
15:13
I'm not going to read it here.
15:15
You get the idea, I hope, certainly, we're going to do Q&A on this too. Anyways.
15:18
This is just my introduction to show you the basic layout here.
15:22
So then we get into, you know, how, how we get money, how we get salary's, how we get compensated, if we have an expense.
15:29
It's a good idea to put things in writing.
15:31
The most important thing about an Operating Agreement, once you understand the basics of what you're really trying to do, is to document the relationship you have with people that are involved with the company.
15:39
And if they have an interest in the company, if they have an interest in the profits, the company makes, you want to put that into this operating agreement.
15:46
So this one is a very simple version, in my opinion.
15:49
I can add more provisions if I have a partner, for example, or if I have a, a contributor, Maybe someone maybe have an equity partner, right? Maybe have someone that wants to contribute $150,000 and just wants to sit back and get dividends, or whatever. You wanna call it, a return on capital. Right.
16:06
Well, I would express the terms, that $150,000 inside this Operating Agreement, and he would get a copy of it.
16:12
All right?
16:13
So, that's what we do there for section six, And then, we're going to talk about here, about accounting.
16:21
I like to use, I hope this be very vague here, but that company will use the method of accounting previously determined by the members that says nothing, right? So, mostly for most of the people I've worked with in the last 30 years is going to be cash basis accounting.
16:38
That just means that you, there's, let's call it a gain, OK, let's call it taxable gain, if there's profit, When there's a disposition of property or when money is received for something. Maybe the company provided a service, OK?
16:57
So that's cash basis. Accrual basis would be something like, the company owns, owns some property, and increases in value and then that would be accounted for as a gain.
17:07
That's accrual based accounting.
17:08
You have a choice to do something here Now as far as the LLC goes, the way I'm normally recommending the use of how this works is going to be using treating all money that comes in as Unsettled Funds.
17:20
And so the LLCs that I typically setup are for the purpose of managing an investment or just cash flow and they don't file returns. The LLCs do not file returns.
17:30
So, the Operating Agreement doesn't have much to do with that.
17:33
Your, your accounting tax treatment accounting practice has to do with whether or not it's filing returns.
17:40
And there is no need to follow return, but you can, if you want, but I'm just saying, here, you should do accounting, but it doesn't mean you have to file a tax return, OK?
17:50
The LLC can get a 1099, it doesn't mean has to file a tax return.
17:54
The LLC can pay you money, and you can report that money on your 10 40.
17:58
It does not have to give you a 1099.
18:00
You just have to report as miscellaneous income, OK?
18:03
And the other should be an accounting period that keeps you're responsible.
18:07
I like to have a bookkeeper, on an intermittent basis, OK, maybe quarterly or annually, I prepare my Balance sheet Income statement, just to, just, to be honest. Right, just to be organized, just to be respectable, OK? Now, if I take on a partner, or we do a joint venture, we form a new company, I'm certainly going to have someone else do the accounting.
18:26
It depends on my partner that mean, sometimes the partners like to do the accounting. I've had partners, they love to do the accounting.
18:32
Sometimes, neither of us want to do it, and we have a third party to do the counting, so we would just want to specify how this is going to play out. OK, there's an accounting period.
18:41
You have Capital Accounts.
18:43
I liked the idea of, I'm going to read this to you, The company will maintain one capital account for all members.
18:51
That just means that there's an undivided interest even if the article say: well, owner has 100% interest, or three members have 33.3% interest each.
19:04
It doesn't matter what the article say. I can account for it however I want.
19:10
two different things, and of course, this is my language, the purpose of the company is to manage risk by holding property rights collectively, That's just one way of doing it, and I just put it here as a standard thing, OK, you might find a different way, this is my standard thing, OK? Everyone starts out this way, unless you come to me with a specific situation, I may change this.
19:30
And then banking, of course, you can use whatever tool that's convenient, whatever works.
19:35
And this has happed comes from the, the use of the LLC in crypto exchanges, third parties.
19:42
What I did here is I described the trust relationship that you would have with a cryptographic or virtual currency exchange, This describes it, that trust relationship already exist, I call this a blockchain tax immunity trust, I use those keywords, So, people want to know more, and it kind of describes what's going on there.
20:00
Because there's no tax situation, and you're going to see.
20:02
I mean, if you've already watched my video on the request for determination letter, you'll see why there's no tax liability with the kryptos on the exchanges, OK?
20:19
Yeah.
20:22
So, anyways, I'm just explaining that relationship here.
20:27
There's no trust document.
20:29
I used to have a trust document. It's not necessary.
20:33
The trust relationship is what's important. A trust is a relationship. It can be described, in words, you can document it in words, a lot of times, you need that.
20:41
It's not completely, always necessary.
20:43
It just turns out that the trust arrangement with the exchanges, it looks a lot like this.
20:49
OK, So now, let's look down here at Section eight where we're talking about transferring Membership interest.
20:55
So the Saylor Encumbrance is prohibited except as otherwise permitted.
20:59
So you don't want partners to come in. They're like, here's a crazy example.
21:03
Let's say there's this great opportunity.
21:05
And, and you take out a partner and he puts up to $250 million or $250,000, and you guys go into a venture, you know, it's matching funds, so you've got half a million dollars running.
21:14
And then six months later, this partner decides to assign, sell, or convey otherwise his interests in the company that you guys are a partner of, to a stranger.
21:29
Where his interests now change, because he no longer has the same interests he did when he came to the table with his money.
21:36
And let's just say hypothetically that the person he conveyed his interests to is a criminal, or is, has a conflict of interest with the U, the original partner, that the other one didn't know about.
21:52
This is the reason why, partly, to have this in the contract, so that we can, we can track, right, even have a spelling mistake here, I'm at L here, we can track, we can keep track, and see if anybody, if anybody wants to make changes in its beneficial interests, and give them over to somebody else. We want to make sure that somebody else is vetted.
22:15
So, we also want to make it to where someone has the first right of refusal.
22:19
So, for example, if my partner wants to convey his interest, he has to come to me first, and offer me the option, to do that, to accept the interest or purchase it from him, buy him out, or something.
22:32
That's what this is for.
22:33
And then if I decline or if it doesn't work out, he can then be free to go to the other person.
22:38
So, you really want to have control over this. If it's important, I mean, if it's a, if it's a company that it's managing something important, some assets or something.
22:46
This is, these are the types of things you want to have in here, and this is why I have them in here.
22:49
And, over the years, I've modified them for different situations.
22:53
As you can imagine, I have kind of a bird's eye view of all kinds of problems that people run into, not mid-level type operations, but small business and consumer level.
23:03
Where a lot of people don't even run a business or they're not investors, they're just consumers. And I use this as a tool in their situations. And so, I have a bird's eye view of all the different problems someone could encounter, and that's why you see this agreement this way.
23:15
It's funny, because some people, This will be floating on the internet, and they'll, they'll criticize it. They'll say, Well, this guy doesn't know what he's doing.
23:22
Well, it's because the person reading, it doesn't understand why I wrote this, and why I modified it this way, because of the crazy, wide range of problems that I've seen people have over the years.
23:32
And so, if I write this up, and I want to be available for you as for as long as you need me to, but there's a chance that I may not be right. So, in three years, I might disappear, Who knows, I'm still here after 30, but, who knows what's going to happen next year.
23:44
So, I want to make this set up in a way where, if you do nothing to it, it's pretty much going to cover almost every situation you could expect.
23:53
Without you having to freak out and go to an attorney and try to rewrite stuff.
23:57
If you just use it the way I instructed, it's pretty much going to be good, that's why I have this like this.
24:03
And so we have all these new conditions on conveying interest, OK?
24:09
You can make it more complicated. There's key man Insurance. You guys want to check that out.
24:17
We go into all these conditions if someone dies or becomes crazy.
24:22
I love how they said this in competency.
24:24
Files bankruptcy goes into receivership. It's possible that someone may never want to file bankruptcy.
24:28
But the, that it may, there may be a situation where someone who is with the LLC, one of the members, is forced into what's called involuntary bankruptcy.
24:39
That could happen if in some states, if you have so many creditors, you can actually force someone into receivership which is bankruptcy without him asking to file bankruptcy, OK.
24:50
So, we always want to have this provision in here.
24:56
And so forth and so on.
24:57
So we have death buyout, no exit strategies, and we can get into more detail again. This is a lot of standard language, a lot of this stuff I didn't even write.
25:11
But it's good enough as is, OK for most people.
25:14
And I like to just replace any reference to the dollar with gold.
25:18
Why not?
25:20
Why? Because people that use this, they asked me, John, wanted to do that.
25:25
Now I'd just say it asked me why, because I think we should do things with money. We should talk about contracts, and using money.
25:32
And I do mentioned cash.
25:33
And I also mentioned kryptos, but I think we should talk about precious metals.
25:39
You don't have to do it that way.
25:42
Anyways.
25:44
So more of those terms.
25:49
And then there's a dissolution winding up at the company. That's a good idea.
25:52
Have a, you know, exit strategy.
25:54
What are you guys going to do when you wind it up?
25:57
How are we going to split the split it up right? Whatever monies leftover, what about obligations who's going to handle that stuff? You got to handle that stuff because if you don't handle the obligations that could still come to the individual partners.
26:08
You want to make it clean winded, winded up, start everything. Do what you want to do, Winded down, move on.
26:16
Nothing no baggage after that, OK, So, these are standard provisions.
26:22
I don't want to get too far into this.
26:25
I just so, I think, what you, what you really want to hear is the reason why I have some of these things in here, I think, is really what a lot of people are interested in.
26:33
And then, of course, you know, governing law, I mean, we could talk about the governing lobbying, the jurisdiction in which the company is going to be registered or operate in.
26:43
So, that could be, you know, whatever state that is, That's fine.
26:46
Um.
26:50
It also has to do with just the right to contract, right, To the right of association, so it could be recognized internationally. We've taken some of these and set them up in other countries too.
27:00
So.
27:02
You want to look and see what makes sense here.
27:04
Now, remember, this assumes that you're going to end up going into court to resolve a dispute.
27:09
I'm, I'm gonna suggest to you that that's really not a good plan.
27:13
Don't let that happen.
27:14
If you can possibly avoid it, OK? Don't worry. You don't let a dispute go into the court system if you can avoid it. That's why I put international law and things like that in here.
27:23
But that, this is why I'm explaining it because you have a right to contract, OK? It's a property, right?
27:31
And the government has monopolized the resolution of disputes.
27:37
So you can use the court system.
27:39
I'm just going to suggest to you that you look at look at alternative ways of of preventing disputes that will require the court.
27:46
So one way to do that is have pretty good written.
27:49
No understanding.
27:51
Good relationship with all people involved.
27:53
Clearly written terms.
27:55
And also possibly a non binding mediation clause, which I don't believe I have in here.
28:00
We can We can get to that those. You can find on the internet, but basically you would use a third party arbitrator in a non binding way.
28:08
So that means the arbitrator will come up with a decision and hopefully it handles Everybodys interests.
28:14
And if not, you still have the option to go to court, you can't just go to court first if you have a non binding mediation clause in the contract.
28:22
Sometimes you, most of the time, you cannot.
28:24
And there's attorneys' fees in Bayside is kept, kicked them to the curb.
28:27
I mean, you know, these guys always write themselves and don't they?
28:32
And so all I did here was kinda make fun of him. And I said, yeah, OK.
28:35
You guys get, I'm going to treat you like an employee, OK?
28:38
And you're not going to make a thousand dollars more than a thousand dollars.
28:43
Hopefully that's going to discourage your firm discourage attorneys, because if you, if you go hire an attorney and he wants to see this, he's gonna read through these. Go, hey, wait a minute. I can get one thousand dollars out of this.
28:55
So just keep that in mind, I wanted to discourage that, and here's some standard provisions, like severability, and things like that.
29:03
There's some cosmetic things that don't don't matter with the contract.
29:07
And notice is, OK, standard stuff.
29:10
And so William Smith individually, OK? He's signing by his title authorized signatory.
29:15
He could be he could be non member manager. I'd hate to use that term. He could be Vice President.
29:21
Now he could be Vice President. He could be President. He could be CEO.
29:24
He doesn't have to have an interest, OK? In this case you'll see the PMA has the interest, and you'll notice in my Readme first file I explained in there dealing with the banks it seems like the PMA designation as a target. So what I've done recently is eliminate the PMA designation, and I just put the name of the PMA.
29:44
Like in this case it would be.
29:48
This is something else and that that change right there. If you want to change that designation, that would be in the banking documents. OK, I know I had a video on that, and we'll go over that again.
29:57
But in your banking resolution documents you would you would change this in your articles That would not appear. You would eliminate PMA.
30:03
And then you. You could put this in some cases.
30:06
But really what you're going to do is just say this is the owner just like that.
30:12
If you're going to do it without the designation, I wouldn't put your name in all caps.
30:17
Even though it doesn't have to be you, I would put something like the William Smith Society or the William Smith Educational Fund.
30:28
Write something like that.
30:30
All right. So, let's see now.
30:32
I know there's a reference in this agreement to schedules, listing property rights or types of property, things like that.
30:39
So you see here, listing of the Members, Schedule one. I've seen all kinds of versions of this.
30:45
No, as of this date that we form this.
30:48
This guy is the Managing Member, all right, the ...
30:51
and Managing Member, ah, so that's a listing of the members, right?
30:56
Then we have who gave what money, or property, or value to the company in the formation of the company.
31:03
So we're just going to say, well, the PMA contributed whatever, to make 100% ownership, with an undivided amount of gold.
31:14
I don't even know if that's even We didn't even tell you that. Let's go to the next one.
31:19
Here's where we kinda tabulate it, right?
31:22
So what they did contribute, he meaning, meaning the PNA, an ...
31:27
one ounce Gold Buoyant.
31:31
That's 100%.
31:32
That's, it sounds simple that is.
31:36
So this corresponds to that provision in the Operating Agreement or where we reference it, But that's it. That is your simple version, my version of an Operating Agreement.
31:47
And, uh, this is part one now. So there is a part two, and I'm gonna get into some more aspects of this, but I just wanna give you the general idea of its purpose, and the different components that you find in here.
32:00
All right, thanks for watching.