Unit Operating Agreement
What this document covers
The Unit Operating Agreement is a legal document used by parties, referred to as Working Interest Owners, to outline the terms and conditions for managing unit operations in a predetermined area as established by an existing Unit Agreement. This form differs from other legal agreements by specifically addressing the operational and administrative duties of the Working Interest Owners regarding joint extraction and management of resources within a defined unit.
What’s included in this form
- Ratification of the existing Unit Agreement.
- Exhibits detailing ownership interests and accounting procedures.
- Authority and duties of the Unit Operator.
- Rights and obligations of each Working Interest Owner.
- Provisions for insurance and handling of taxes related to unit operations.
- Processes for withdrawal and abandonment of wells.
Situations where this form applies
This form is necessary when parties involved in a Unit Agreement need to formalize their operational procedures and responsibilities relating to the extraction and management of resources. It is commonly used in scenarios such as initiating a new drilling project, managing shared interests in oil or gas production, or when changes in ownership require clear guidelines for operation oversight.
Who this form is for
- Oil and gas companies managing joint operations.
- Investors or owners of working interests in a specific natural resource unit.
- Legal representatives responsible for drafting or reviewing operational agreements.
- Any parties engaged in partnerships relating to resource extraction within a unitized area.
Completing this form step by step
- Identify all parties involved by listing the Working Interest Owners and their respective contributions.
- Complete the necessary fields regarding the Unit, including physical location and operational details.
- Fill in specific clauses concerning the duties of the Unit Operator and supervision of operations.
- Attach relevant exhibits outlining ownership stakes and accounting practices.
- Ensure all parties sign and date the agreement to finalize its effectiveness.
Is notarization required?
This form does not typically require notarization to be legally valid. However, some jurisdictions or document types may still require it. US Legal Forms provides secure online notarization powered by Notarize, available 24/7 for added convenience.
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Make edits, fill in missing information, and update formatting in US Legal Forms—just like you would in MS Word.
Download a copy, print it, send it by email, or mail it via USPS—whatever works best for your next step.
Sign and collect signatures with our SignNow integration. Send to multiple recipients, set reminders, and more. Go Premium to unlock E-Sign.
If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
We protect your documents and personal data by following strict security and privacy standards.
Typical mistakes to avoid
- Failing to specify the exact operational authority for the Unit Operator.
- Omitting important exhibits that outline ownership interests and responsibilities.
- Not including all Working Interest Owners in the agreement, leading to potential disputes.
- Neglecting to update the agreement when ownership percentages change.
Advantages of online completion
- Convenience of immediate access to necessary legal documents.
- Editability to tailor the agreement based on specific operational needs.
- Reliability through attorney-reviewed templates ensuring legal compliance.
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FAQ
The core elements of an LLC operating agreement include provisions relating to equity structure (contributions, capital accounts, allocations of profits, losses and distributions), management, voting, limitation on liability and indemnification, books and records, anti-dilution protections, if any, restrictions on
The core elements of an LLC operating agreement include provisions relating to equity structure (contributions, capital accounts, allocations of profits, losses and distributions), management, voting, limitation on liability and indemnification, books and records, anti-dilution protections, if any, restrictions on
Most states do not require LLCs to have this document, so many LLCs choose not to draft one. While it may not be a requirement to have an operating agreement, it's actually in the best interest of an LLC to draft one.However, a written operating agreement defines in writing how the LLC is run.
An operating agreement is a key document used by LLCs because it outlines the business' financial and functional decisions including rules, regulations and provisions. The purpose of the document is to govern the internal operations of the business in a way that suits the specific needs of the business owners.
You can use online services to create an operating agreement, but you are better served by getting the help of an attorney. Your attorney can make sure all the relevant clauses are included, and he or she can tailor the document to the requirements of your state.
No. Though California law requires you to have an Operating Agreement for your LLC, it doesn't require you to file it anywhere. Your California Operating Agreement is an internal document.This means that your business address will be posted on the California Secretary of State's website, exposing your privacy.
The core elements of an LLC operating agreement include provisions relating to equity structure (contributions, capital accounts, allocations of profits, losses and distributions), management, voting, limitation on liability and indemnification, books and records, anti-dilution protections, if any, restrictions on
The operating agreement outlines who owns the LLC and what percentage of ownership each party has. Most of the time the members of an LLC will own a percentage relative to the contribution they made to the formation of the business, such as cash investments, but you can divide up ownership however you like.
