A Hawaii single-member LLC operating agreement establishes the operational structure and protocols for a company owned by a single person. Additionally, it delineates the separation between personal and business assets, helping to maintain limited liability protection. Other provisions can address contingency plans for business succession, ensuring continuity in case of the owner’s incapacity or death.
While not mandated by state law, not having an agreement in place could leave the owner vulnerable to personal asset seizure in the event of business failure or legal action. Furthermore, the document offers crucial asset protection and potential tax benefits. It’s advisable for members to draft one promptly after business registration with the Secretary of State.