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The Rhode Island LLC operating agreement is a recommended document for most LLC formations. This document organizes and outlines responsibilities, voting rights, and how the business is going to run to prevent disagreements or legal disputes amongst directors.

From RI Gen L § 7-16-2 (2019):

(23) “Operating agreement” means any agreement, written or oral, of the members as to the affairs of a limited-liability company and the conduct of its business. An operating agreement also includes a document adopted by the sole member of a limited-liability company that has only one member and may include as a party one or more managers who are not members.

Rhode Island Operating Agreement Law

Per Sec. 7-16-4 of the Rhode Island General Laws:

Each limited-liability company has the power:
(1) To sue, be sued, complain and defend in its name in all courts;
(2) To transact its business, carry on its operations and have and exercise the powers granted by this chapter in any state and in any foreign country;
(3) To make contracts and guarantees, incur liabilities and borrow money, although not in furtherance of the limited-liability company’s purposes;
(4) To sell, lease, exchange, transfer, convey, mortgage, pledge and otherwise dispose of all or any part of its property and assets although not in furtherance of the limited-liability company’s purposes;
(5) To acquire by purchase or in any other manner, take, receive, own, hold, improve, use and otherwise deal in and with any interest in real or personal property, wherever situated;
(6) To issue notes, bonds and other obligations and secure any of them by mortgage or deed of trust or security interest of any or all of its assets;
(7) To purchase, take, receive, subscribe for or otherwise acquire, own, hold, vote, use, employ, sell, mortgage, lend, pledge or otherwise dispose of and otherwise use and deal in and with stock or other interests in and obligations of corporations, associations, general or limited partnerships, domestic or foreign limited-liability companies, business trusts, and individuals or direct or indirect obligations of the United States or of any other government, state, territory, governmental district or municipality or of any of their instrumentalities;
(8) To invest its surplus funds, lend money from time to time in any manner that is appropriate to enable it to carry on the operations or fulfill the purposes set forth in its articles of organization and take and hold real property and personal property as security for the payment of the funds loaned or invested;
(9) To elect or appoint agents and define their duties and fix their compensation;
(10) To be a promoter, stockholder, partner, member, associate or agent of any corporation, general or limited partnership, domestic or foreign limited-liability company, joint venture, trust or other enterprise;
(11) To indemnify and advance expenses to any member, manager, agent or employee, past or present, to the same extent as a corporation formed under chapter 1.2 of this title may indemnify any of its directors, officers, employees or agents and subject to the standards and restrictions, if any, set forth in the articles of organization or operating agreement, and to purchase and maintain insurance on behalf of any member, manager, agent or employee against any liability asserted against him and incurred by the member, manager, agent or employee in that capacity or arising out of the member’s, manager’s, agent’s or employee’s status, whether or not the limited-liability company would have the power to indemnify under the provisions of this section, the articles of organization or operating agreement;
(12) To make and alter operating agreements, not inconsistent with its articles of organization or with the laws of this state, for the administration and regulation of the business and affairs of the limited-liability company;
(13) To lend money and to use its credit to assist its employees;
(14) To make donations for the public welfare or for charitable, scientific or educational purposes;
(15) To pay pensions and establish pension plans, pension trusts, profit sharing plans and other incentive and benefit plans for any or all of its agents and employees;
(16) To provide insurance for its benefit on the life of any of its agents or employees or on the life of any individual member for the purpose of acquiring at the member’s death the membership interest owned by the member;
(17) To cease its activities and dissolve; and
(18) To do every other act not inconsistent with law that is appropriate to promote and to attain its purposes.

Forming an LLC in Rhode Island

  1. Conduct a name search
  2. Choose a registered agent
  3. File formation articles
  4. Draft an operating agreement

To qualify as an LLC, all Rhode Island LLCs need a legally registered business name, which must include:

  • LLC
  • L.L.C.
  • LC
  • L.C.
  • Limited Liability Company
  • Std. Liability Co.

The name may not be similar to any government agencies like the US Treasury, and any LLC formation with a restricted word like bank may require verification of a licensed individual that is part of the formation. “Inc” and “Corp” are banned terms as well.

To conduct the name search, use the Rhode Island Secretary of State Business Entity Search website.

Step 2: Choose Your Registered Agent

Each Rhode Island LLC must appoint an in-state registered agent for the company. The registered agent is responsible for accepting legal documentation on behalf of the company.

The registered agent is required to:

  • Be 18 years or older
  • Be available during business hours (9am – 5pm local time)
  • Be a resident of the state
  • Have a physical (not a P.O. Box) address in Rhode Island

When using a registered agent service, the agent must be authorized to do business in Rhode Island.

Step 3: File Your Formation Articles

In order to legally establish an LLC, you must file articles of formation. The type of articles you will file depends on whether the business is new (domestic) or existing and expanding into Rhode Island (foreign)

Domestic LLC filers will submit Articles of Organization in duplicate, which can be completed through the mail or online.

Online Filing (Domestic):

  • $150 filing fee (plus $6 processing fee)
  • Turnaround time: 1-2 business days
  • Submit online

Mailed Filing (Domestic):

  • $150 filing fee
  • Turnaround time: 2-3 business days upon receipt
  • Fill out the form online or after printing and mail to:

RI Division of Business Services
148 W. River Street, Ste. 1
Providence, RI 02904-2615

Foreign LLC filers will need to complete an Application for Registration and attach their Certificate of Registration from the state of formation, then mail it in. Online filing is unavailable.

Mailed Filing (Foreign):

  • $150 filing fee
  • Turnaround time: 2-3 business days upon receipt
  • Fill out the form online or after printing and mail to:

RI Division of Business Services
148 W. River Street, Ste. 1
Providence, RI 02904-2615

Step 4: Draft a Rhode Island Operating Agreement

While not required, it is highly recommended to create an operating agreement for LLCs with a single or multiple directors. This legal documentation is recommended to document capital contributions, organization, voting rights, ownership percentage, responsibilities, profit and loss distribution, and more.

It is recommended that all directors each keep a copy, and that a copy is held with the other business records until needed. The agreement does not need to be filed with the state.