North Dakota: LLC Operating Agreement Requirements
The short answer
North Dakota does not require an LLC to adopt an operating agreement; Chapter 10-32.1 supplies the rules for any gap. The agreement may be oral, in a record, implied, or any combination, and a sole-member or preformation agreement works upon formation; later members are deemed to assent. For LLCs created after July 31, 2017, default voting follows distribution interests and default profits and distributions follow contribution value, subject to statutory duty, information, court-remedy, and outsider-right floors.
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This is the general rule in North Dakota. Ezel applies current North Dakota law to your specific facts and answers with citations to the statutes.
| Governing law and document name | North Dakota Uniform Limited Liability Company Act; 'operating agreement' (N.D.C.C. §§ 10-32.1-01, 10-32.1-02(36)) |
|---|---|
| Required or optional | Optional; the agreement governs chosen terms and Chapter 10-32.1 governs gaps (§ 10-32.1-13(1)–(2)) |
| Permitted form and signatures | Oral, in a record (including electronic), implied, or any combination; includes a sole member; no general agreement signature, witness, or notary rule (§§ 10-32.1-02(36), 10-32.1-03) |
| Adoption timing and effect | No general deadline; initial members may agree before formation, but the terms become the agreement upon formation; the LLC forms when articles are filed or at their stated later date (§§ 10-32.1-14(3), 10-32.1-20(4)) |
| Single member and assent | Sole-member terms qualify; the LLC is bound without manifesting assent, and each person who becomes a member is deemed to assent (§§ 10-32.1-02(36), 10-32.1-14) |
| Management and authority defaults | Member-managed unless the agreement selects manager or board management; post-7/31/2017 voting follows distribution interests, majority controls ordinary matters, and unanimity controls outside-course acts; membership alone creates no agency power (§§ 10-32.1-23 to -24, 10-32.1-39) |
| Voting, economic, and transfer defaults | Post-7/31/2017 votes follow distribution interests; profits, losses, and distributions follow contribution value; later admission defaults to unanimity, and transfer carries economics only (§§ 10-32.1-27, 10-32.1-30 to -30.1, 10-32.1-39, 10-32.1-44) |
| Nonwaivable rules and duties | May narrow or eliminate specified loyalty aspects and alter care or other duties only within manifest-unreasonableness and misconduct floors; cannot eliminate good faith, unreasonably restrict information or member actions, vary protected court dissolution, or impair outsider rights (§§ 10-32.1-13, 10-32.1-41 to -42, 10-32.1-50) |
| Amendment, filing, and records | Default unanimous amendment; required outsider approvals or conditions are honored; agreement prevails internally over a conflicting filing, while reasonable outsider reliance favors the filing; no agreement filing or universal written-copy rule (§§ 10-32.1-02(36), 10-32.1-15, 10-32.1-20, 10-32.1-39, 10-32.1-42) |
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Requirements one by one
Governing law and document name
North Dakota's statute is the North Dakota Uniform Limited Liability Company
Act, N.D.C.C. ch. 10-32.1. Section 10-32.1-01 supplies that name, and
§ 10-32.1-02(36) calls the members' internal arrangement an operating
agreement regardless of its label.
Required or optional
North Dakota does not command an ordinary LLC to adopt an agreement. Instead,
§ 10-32.1-13(1) says what an agreement may govern, and subsection (2) supplies
the consequence of silence: “To the extent the operating agreement does not
otherwise provide ... this chapter governs the matter.”
Permitted form and signatures
Section 10-32.1-02(36) recognizes an agreement that is “oral, in a record,
implied, or in any combination thereof.” A record may be tangible or electronic,
and § 10-32.1-03 gives electronic records and signatures the same legal effect
when a writing or signature is otherwise required.
Because oral and implied agreements qualify, the LLC Act has no general rule
requiring every operating agreement to be signed, witnessed, acknowledged, or
notarized. Another law can still require a signed or recorded instrument for a
particular transaction.
Adoption timing and effect
North Dakota states the preformation rule directly. Under § 10-32.1-14(3), two
or more intended initial members may agree that their terms will become the
operating agreement “upon the formation of the company”; an intended sole
member may do the same.
Under § 10-32.1-20(4), the LLC forms when the articles of organization are filed,
or on the articles' stated later date. The Act sets no separate deadline for a
later agreement, so its defaults govern until valid terms replace them.
Single member and assent
The definition in § 10-32.1-02(36) expressly includes a sole member. Section
10-32.1-14 then binds the LLC whether or not the company manifested assent and
deems each person who becomes a member to assent to the agreement.
Formation alone does not make someone a member. Section 10-32.1-20(4)(d)
preserves agreements made before or after formation that determine who becomes
a member in connection with formation.
Management and authority defaults
Under § 10-32.1-39(1), the LLC defaults to member management unless the agreement uses
manager-managed, board-managed, or similar language. For a member-managed LLC
created after July 31, 2017, members vote in proportion to their interests in
pre-dissolution distributions. A majority of that voting power decides
ordinary-course disputes, while an outside-the-ordinary-course act requires all
members.
The internal management rule is not an automatic agency rule. Section
10-32.1-23 says a member is not the LLC's agent solely because of membership.
Under § 10-32.1-24, the LLC may file a statement granting or limiting authority
for transactions with nonmembers, including real-property transfers.
Voting, economic, and transfer defaults
North Dakota's post-2017 defaults use two related measures. Section
10-32.1-39(2)(b) allocates member voting by interests in distributions, while
§§ 10-32.1-30(5) and 10-32.1-30.1 allocate interim distributions and profits
and losses by the value of contributions. The articles or operating agreement
may replace those rules.
Section 10-32.1-27(4) follows the agreement's admission route; if it supplies
none, later admission generally requires all-member consent. A transfer under
§ 10-32.1-44 carries the assigned distribution right but does not by itself
give the transferee management, conduct, or ordinary information rights.
Nonwaivable rules and duties
Under § 10-32.1-13(4), if not manifestly unreasonable, an agreement may
restrict or eliminate specified aspects of
loyalty, alter care without authorizing intentional misconduct or a knowing
legal violation, alter other fiduciary duties, and set standards for good-faith
performance. It may not eliminate the contractual good-faith obligation itself.
The same section bars unreasonable restrictions on § 10-32.1-42 information
rights and member actions, protects the court's dissolution power, and preserves
rights of people outside the agreement. Section 10-32.1-41 states the underlying
loyalty, care, and good-faith duties. Section 10-32.1-50 preserves court relief
for unlawful, impracticable, fraudulent, or oppressive operation.
Amendment, filing, and records
If the agreement sets no different method, § 10-32.1-39 makes amendment
unanimous. Section 10-32.1-15(1) also enforces a required nonparty approval or
condition, making an amendment ineffective if the requirement is not met.
The agreement is not the public formation filing; § 10-32.1-20 requires articles
of organization. If another effective filed record conflicts with the agreement,
§ 10-32.1-15(4) makes the agreement control among members and other insiders,
while the filed record controls for an outsider who reasonably relies on it.
Because an agreement may be oral or implied, the Act does not require every LLC
to keep a written copy. Section 10-32.1-42 nevertheless lets a member inspect
and copy company-maintained records material to the member's rights and duties,
subject to reasonable statutory and agreement restrictions.
What trips people up
The creation date changes the default math. LLCs created after July 31,
2017 use distribution interests for voting and contribution value for profits,
losses, and distributions. The older equal-share language remains in the
chapter for earlier LLCs.
Member management does not itself prove signing authority. The internal
management default and third-party authority are separate. Membership alone is
not agency; a filed statement of authority can establish or limit outsider-facing
power.
A filed record can matter even though the agreement stays private. The
agreement controls internally, but an outsider who reasonably relies on a
conflicting effective filing may use the filed record.
Common questions
Does filing the articles automatically make the organizer a member? No.
Section 10-32.1-20(4)(d) says formation alone does not cause any person to
become a member; the parties' agreement and § 10-32.1-27 govern admission.
Can the LLC publish authority for a real-estate signature? Yes. Section
10-32.1-24 permits a filed statement of authority addressing a person's power
to transfer company real property or bind the LLC in other transactions.
Can a former member inspect records from the membership period? Section
10-32.1-42(3) permits a dissociated member to demand qualifying information
about that period if the statutory good-faith and purpose requirements are met.
Can members approve a distribution that leaves the LLC unable to pay its
debts? No. Section 10-32.1-31 bars a distribution that would fail the
ordinary-course debt-payment or balance-sheet tests.
Statutes and sources
- N.D.C.C. §§ 10-32.1-01 to 10-32.1-03 — Act name, operating-agreement
definition, records, and electronic form.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. §§ 10-32.1-13 to 10-32.1-15 — agreement scope, statutory floors,
assent, preformation terms, amendments, and filed-record conflicts.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. § 10-32.1-20 — formation, articles, and membership timing.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. §§ 10-32.1-23 to 10-32.1-24 — no automatic member agency and
statements of authority.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. § 10-32.1-27 — initial and later member admission.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. §§ 10-32.1-30 to 10-32.1-31 — economic defaults and distribution
solvency.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. § 10-32.1-39 — management, voting, amendment, and approval
defaults.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. §§ 10-32.1-41 to 10-32.1-42 — duties and information rights.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. § 10-32.1-44 — transfer of economic rights without management.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27) - N.D.C.C. § 10-32.1-50 — dissolution and oppression remedies.
https://ndlegis.gov/cencode/t10c32-1.pdf (accessed 2026-07-27)
Source links
Every statute quoted above, linked, with the date we checked it.
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