LLC Operating Agreement Requirements in Colorado

At a glance

Requirements one by one

Multi-member agreements may be oral; sole-member form is narrower

Section 7-80-102 generally permits a multi-member operating agreement to be oral and defines it as an agreement of all members. Article 80 imposes no general witness, acknowledgment, or notary condition. Section 7-80-108 also removes the ordinary statute-of-frauds barrier while preserving any specific Article 80 writing requirement.

A sole member has three statutory routes: a signed writing, a written agreement between the member and LLC, or an oral member-LLC agreement when a nonmember manager manages the company. A purely oral sole-member declaration without that nonmember-manager relationship does not fit the definition.

The agreement may begin at formation or later

Colorado Revised Statutes § 7-80-108 permits the agreement before, at, or after the articles filing. Preformation terms may become effective when the LLC forms, or the agreement may specify a later effective time. The LLC itself is bound by the members' agreement.

Formation is separate. Colo. Rev. Stat. §§ 7-80-203, -207 make the entity arise when its filed articles become effective; an agreement cannot make the LLC exist earlier.

The articles make the management and agency choice public

Colorado Revised Statutes §§ 7-80-204 and -209 govern the public articles and their amendment. Section 7-80-204 requires the articles to say whether management is vested in members or managers. Under Colo. Rev. Stat. §§ 7-80-401–402, ordinary decisions require a majority of the members or, for manager management, a majority of managers; § 7-80-402 specifically makes manager designation and removal a member-majority decision.

Colorado Revised Statutes § 7-80-405 follows the articles for outsider-facing agency. Members are ordinary-course agents in a member-managed LLC. In a manager-managed LLC, membership alone creates no authority and each manager has the ordinary-course agency role.

Headcount voting and contribution economics are different defaults

Colorado's ordinary vote is a majority of members or managers, not automatically a capital-weighted vote. Section 7-80-706 lets the agreement create per-capita or another voting basis, subject to Article 80's majority and unanimity rules.

Sections 7-80-503 and -504 use a different measure for economics: profits, losses, and distributions default in proportion to the recorded value of contributions. A drafted percentage schedule can replace that formula, but it is not the statutory fallback merely because a form calls it “ownership.”

Assignment transfers economics before governance

Colorado Revised Statutes §§ 7-80-701–702 and -706 govern admission, assignment, and agreement-set voting. Section 7-80-702 gives an unadmitted assignee profits, income compensation, and return of contributions, but no management or membership rights. Admission after filing requires every member's consent under § 7-80-701.

Colorado adds an assignor consequence: transferring all of a membership interest ends the transferor's membership even when the transferee has not yet been admitted.

Duties are contractible, but not without limits

Colorado Revised Statutes § 7-80-404 supplies the default duties. Section 7-80-108 permits duties, including fiduciary duties, to be restricted or eliminated only when the provision is not manifestly unreasonable. It does not permit elimination of good faith and fair dealing, though reasonable performance standards may be stated.

The agreement also cannot unreasonably restrict § 7-80-408 information rights, alter the protected last-member continuation rule beyond the stated extension, or affect nonparty rights or duties without consent. Sections 7-80-404, -705, and -810 separately supply the default conduct standards, entity-liability shield, and member/manager judicial-dissolution route.

Amendment is unanimous unless the agreement changes the route

Section 7-80-401 defaults both agreement and articles amendment to every member's consent. Section 7-80-209 allows the agreement to provide another articles-amendment method; amendments to the public articles are then filed separately.

The operating agreement itself is private. Section 7-80-408 makes any written agreement inspectable by members but does not make it an articles filing.

What trips people up

• “Need not be in writing” has a special sole-member definition and does not erase Article 80's specific writing rules.
• A private manager arrangement does not replace the articles' required management statement.
• Majority voting by headcount and contribution-based economics are separate statutory formulas.

Common questions

Can members authorize an act outside the ordinary course by majority vote?

No, unless a valid agreement changes the rule. Section 7-80-401(2)(c) defaults an outside-course act to the consent of every member.

Does assigning all of an interest automatically make the assignee a member?

No. The assignor ceases membership, but the assignee receives only economics until admitted under § 7-80-701.

Can the agreement eliminate every fiduciary duty?

Not categorically. Section 7-80-108 allows restriction or elimination only if the term is not manifestly unreasonable and separately preserves good faith and fair dealing and other statutory limits.

Statutes and sources

• Colo. Rev. Stat. §§ 7-80-102, -108 — defines multi- and single-member forms and governs scope, timing, binding effect, duty changes, nonwaivable rules, and statutes of frauds. Official 2025 Title 7 PDF (accessed July 26, 2026).
• Colo. Rev. Stat. §§ 7-80-203–204, -207, -209 — governs formation, the articles' management statement, and public amendment. Official 2025 Title 7 PDF (accessed July 26, 2026).
• Colo. Rev. Stat. §§ 7-80-401–405, -408 — governs management, voting, manager designation, duties, agency, records, information, and accounting. Official 2025 Title 7 PDF (accessed July 26, 2026).
• Colo. Rev. Stat. §§ 7-80-503–504, -701–702, -706 — supplies economic, admission, transfer, and agreement-voting rules. Official 2025 Title 7 PDF (accessed July 26, 2026).
• Colo. Rev. Stat. §§ 7-80-705, -810 — supplies the liability shield and judicial-dissolution route. Official 2025 Title 7 PDF (accessed July 26, 2026).