The Formation Process
          
               Each party to an LLC must agree to a contract with
          all the other members that will become the
          "constitution" of the company.  This document may be
          called the "Company Agreement," "The Articles of
          Organization," "The Minutes of the First Meeting of
          Members", or any other name, unless the particular
          state has a required name. 
               This agreement should set forth the company's
          policy and procedure regarding important matters such
          as voting rights and restrictions, differences among
          members, or classes of members, investment into the
          company by each member, restrictions on access to
          information among members, rights of management,
          restrictions on transfer of ownership interests,
          distribution of profits, required meetings (if any),
          notices of meetings, quorum rules, inclusion of new
          members, continuation options upon the death of a
          member and all other provisions the company wants to
          include.
               Most states allow the inclusion of provisions and
          elements almost without restriction.  This gives the
          drafters of the agreement the opportunity to be
          creative.  Since this form of entity is relatively new
          all the available inclusions will not be commonly known
          immediately.  This represents a danger to the LLC,
          which can only change it's agreement by the unanimous
          agreement of the members.
               In drafting the agreement, careful consideration
          must be given to the IRS position regarding tax
          classification of the entity.  Although the law allows
          tremendous flexibility, the IRS is very specific about
          the test it will apply when determining whether to tax
          the entity as a partnership or as a corporation.  Since
          pass through tax treatment is expected to be a prime
          consideration of most organizers, the drafters must
          create an agreement which provides for the IRS Rules. 
          (If your lawyer or accountant is not familiar with
          these rules, they are contained at 28 CFR 301.7701-2, 3
          and 4).
               Although do-it-yourself incorporation is generally
          not a problem, because the limited liability company
          agreement is as complex as a partnership, and calls for
          originality and creativity, it is probably best to use
          a lawyer experienced in such matters.  (He does not
          necessarily have to be a lawyer in the state where it
          is formed -- you may find better experience elsewhere,
          and that experience will usually translate to the state
          that has just enacted a statute more readily than a
          local lawyer will absorb the nuances of a strange
          entity.)  The differences and possibilities are too
          vast for a simple do-it-yourself procedure to be wise
          at this time.