Company Agreement
The principal governance document of a Texas LLC, the contract among members (and managers, if applicable) that establishes the LLC's internal rules. The TBOC equivalent of "operating agreement" or "limited liability company agreement" used in other states.
A company agreement is the principal governance document of a Texas LLC, the contract among the members (and, if applicable, managers) that establishes the LLC's internal rules. The TBOC uses the term "company agreement"; the Delaware equivalent is "limited liability company agreement"; the colloquial term, particularly in non-Texas markets, is "operating agreement." The terms are typically used interchangeably in practice.
What it governs
Under § 101.052, the company agreement governs (a) the relations among the LLC's members, managers, officers, and assignees, and (b) other internal affairs of the company. Where the company agreement is silent, the default rules of TBOC Chapter 101 and Title 1 fill the gap.
Form and execution
The company agreement may be written, oral, or implied. § 101.001(1). The agreement does not need to be filed with the Texas Secretary of State and is not a public document.
The Texas-distinctive flexibility
Tex. Bus. Orgs. Code § 101.052(c) provides that, with limited exceptions specified in § 101.054, any provision of TBOC Title 3 or Title 1 applicable to LLCs may be waived or modified in the company agreement. Provisions that can be modified include voting rights (default: per capita, § 101.354), distribution rights (default: pro rata by contribution, § 101.203), management structure (member vs. manager-managed), and, under § 101.401 as amended effective May 14, 2025, fiduciary duties themselves, which the company agreement may now expand, restrict, or eliminate. The same SB 29 legislation added § 152.002(e), which lets a limited partnership agreement expressly eliminate the duties of loyalty and care and the obligation of good faith. Under § 152.006, that subsection applies only to partnerships with interests listed on a national securities exchange, though other partnerships are not barred from adopting provisions with the same effect.
Non-waivable provisions
Under § 101.054, the company agreement cannot waive or modify certain provisions, including § 101.151 (written, signed promise to contribute), § 101.206 (limits on distributions), § 101.501 (required records), most of the winding-up rules in Subchapter M, and most of Chapters 2 through 5. It may not unreasonably restrict a member's or assignee's right of access to records under § 101.502, and it may waive or modify a right the statute grants to a person other than a member, manager, officer, or assignee only with that person's consent.
Amendment
Default rule: a company agreement may be amended only with the unanimous consent of all members. § 101.053. This default is itself routinely modified, many company agreements substitute a majority-in-interest or supermajority threshold.
In Texas, what the company agreement says matters more than what the statute says. The default rules in TBOC Chapter 101 frequently produce results no one would want, equal voting regardless of contribution, no withdrawal rights, distributions only when affirmatively authorized, and the company agreement is the mechanism for tailoring those rules to the parties' actual deal.
Companion article: Starting a Business in Texas