Dissolution clause

A Dissolution Clause is a section in the Operating Agreement that explains how the LLC will be closed if members decide to end the business. It typically outlines how debts will be paid, assets distributed, and legal filings completed. Having a clear dissolution clause helps avoid conflicts during winding down. Without it, state default rules will apply, which may not align with the members’ preferences. It’s an important safeguard even if you don’t plan to close your business anytime soon.