Single-Member LLC Operating Agreement — Oklahoma

Single-Member LLC Operating Agreement (OKLAHOMA)

This Operating Agreement (the "Agreement") of [COMPANY NAME], LLC, an Oklahoma limited liability company (the "Company"), is entered into and effective as of [__/__/____] (the "Effective Date") by [SOLE MEMBER NAME] (the "Member"), the sole member of the Company, pursuant to the Oklahoma Limited Liability Company Act, 18 O.S. § 2000 et seq. (the "Act").

Quick-Reference Summary

Article I — Formation

1.1 Formation. The Company was organized as an Oklahoma limited liability company on [__/__/____] upon the filing of Articles of Organization with the Oklahoma Secretary of State, pursuant to 18 O.S. § 2004 and § 2005.

1.2 Name. The name of the Company is [COMPANY NAME], LLC.

1.3 Principal Office. The principal office of the Company is located at:
[________________________________]
[________________________________]

1.4 Registered Office and Agent. The Company's registered office in Oklahoma and its registered agent are:

• Registered Agent: [________________________________]
• Registered Office: [________________________________]

1.5 Term. The Company shall continue perpetually until dissolved in accordance with Article VII or 18 O.S. § 2037.

1.6 Sole Member. The Member intends that the Company be a single-member limited liability company under the Act and a "disregarded entity" for federal income tax purposes under Treas. Reg. § 301.7701-3, unless the Member elects otherwise.

Article II — Purpose and Powers

2.1 Purpose. Pursuant to 18 O.S. § 2002, the Company is formed for the following purpose(s) and any other lawful business or activity:
[________________________________]

2.2 Powers. The Company shall have all powers granted to a limited liability company under 18 O.S. § 2003, including the power to own property, enter contracts, sue and be sued, and engage in any lawful act.

2.3 Limitation on Liability. Pursuant to 18 O.S. § 2022, no Member, manager, employee, or agent of the Company shall be personally liable for the debts, obligations, or liabilities of the Company solely by reason of being a Member, manager, employee, or agent.

Article III — Member (Sole Member)

3.1 Identity of Sole Member.

3.2 Initial Capital Contribution. The Member has contributed to the Company the cash and/or property described in Schedule A, with an agreed value of $[____________].

3.3 Additional Contributions. The Member is not required to make additional capital contributions but may do so at the Member's sole discretion. Any additional contribution shall be recorded on Schedule A.

3.4 No Personal Liability. Consistent with 18 O.S. § 2022, the Member is not personally liable for any debt, obligation, or liability of the Company arising in contract, tort, or otherwise.

3.5 Member's Authority. The Member possesses full authority to bind the Company, subject to Article IV.

Article IV — Management

4.1 Management Structure. Check one:

☐ Member-Managed (default under 18 O.S. § 2015 when no managers are designated). The Member shall manage the Company and shall have full authority to act on its behalf.

☐ Manager-Managed (per 18 O.S. § 2013 — § 2019). The Company is managed by one or more managers, as designated on Schedule B. The Member retains the right to remove and replace any manager at any time, with or without cause, under 18 O.S. § 2014.

4.2 Authority of the Member (or Manager). The Member (or designated manager) is authorized to:
(a) Execute contracts, leases, deeds, notes, and other instruments on behalf of the Company;
(b) Open and operate Company bank accounts;
(c) Hire and terminate employees and independent contractors;
(d) Borrow funds, issue notes, and pledge Company assets as collateral;
(e) Acquire, hold, and dispose of Company property;
(f) Engage tax, legal, and other professionals;
(g) Establish and administer protected series or registered series under Article VIII if elected; and
(h) Take any other action permitted under 18 O.S. § 2000 et seq. or this Agreement.

4.3 Standard of Conduct. The Member (and any manager) shall discharge duties to the Company in accordance with 18 O.S. § 2016, including the duty of good faith. Pursuant to 18 O.S. § 2017, fiduciary duties may be modified by this Agreement to the extent permitted.

4.4 Conflict-of-Interest Transactions. A transaction between the Company and the Member (or an affiliate) is not voidable solely because of the Member's interest, provided the transaction is fair to the Company at the time it is authorized.

4.5 Officers (Optional). The Member may, but is not required to, designate officers of the Company. Any such officers serve at the pleasure of the Member.

Article V — Capital Accounts and Distributions

5.1 Capital Account. A capital account shall be maintained for the Member in accordance with Treas. Reg. § 1.704-1(b)(2)(iv).

5.2 Allocation of Profits and Losses. All items of income, gain, loss, deduction, and credit shall be allocated 100% to the Member, consistent with 18 O.S. § 2025.

5.3 Distributions. Distributions of cash or property shall be made to the Member at such times and in such amounts as the Member determines, subject to 18 O.S. § 2030 (no distribution may be made if, after giving effect to it, the Company could not pay its debts as they become due in the usual course of business or its total assets would be less than its total liabilities plus certain preferential amounts).

5.4 Tax Distributions. The Member may cause the Company to distribute amounts sufficient to enable the Member to satisfy federal, state, and local tax liabilities attributable to Company income.

5.5 In-Kind Distributions. Distributions in kind are permitted only with the Member's written election.

Article VI — Transfer of Interest / Charging Order (18 O.S. § 2034)

6.1 Membership Interest Defined. Consistent with 18 O.S. § 2032, the Member's capital interest is personal property, and the Member has no interest in specific Company property. The Member's rights consist of (a) economic rights (rights to distributions) and (b) governance rights (rights to manage and vote), the assignability of which is governed by 18 O.S. § 2033.

6.2 Voluntary Transfer. The Member may assign the capital interest associated with the Member's membership interest, in whole or in part, and may pledge or grant a security interest in the membership interest, consistent with 18 O.S. § 2033. Upon any transfer that results in the Company having more than one member, this Agreement shall be amended or replaced to reflect the multi-member structure.

6.3 Admission of Additional Members. A transferee of a capital interest does not become a Member unless admitted in writing by the Member, consistent with 18 O.S. § 2033 and § 2035.

6.4 Charging Order — Sole and Exclusive Remedy. Pursuant to 18 O.S. § 2034, a charging order is the sole and exclusive remedy by which a judgment creditor of the Member may satisfy a judgment from the Member's membership and capital interest, whether the Company has one member or more than one member. The judgment creditor has only the rights of an assignee of the capital interest, and a charging order entered under § 2034 shall in no event be convertible into a membership interest through foreclosure or other action.

6.5 Caselaw Support. The Member acknowledges Arrington v. Kruger, No. 106,223 (Okla. Civ. App. Nov. 30, 2009), an unpublished Oklahoma Court of Civil Appeals decision addressing the exclusivity of the § 2034 charging-order remedy against a single-member Oklahoma LLC. Because the decision was subject to further review and commentators regard single-member charging-order protection as potentially uncertain, the Member is advised that the protection may be limited in some circumstances and that federal bankruptcy courts may apply different rules under cases such as In re Ehmann and In re Albright.

6.6 Death or Incapacity of Sole Member. Upon the Member's death or adjudicated incapacity:
(a) The Member's economic interest passes to the Member's estate, trust, heirs, or legatees by will, trust instrument, or intestate succession; and
(b) The successor-in-interest is admitted as a Member of the Company without dissolution, in order to avoid dissolution under 18 O.S. § 2037.

The Member designates the following successor-in-interest (revocable; may also be designated by will, trust, or pour-over):
[________________________________]

Article VII — Dissolution

7.1 Events of Dissolution. The Company shall be dissolved upon the first to occur of:
(a) The written election of the Member to dissolve;
(b) An event specified in the Articles of Organization;
(c) Entry of a decree of judicial dissolution under 18 O.S. § 2038; or
(d) Any other event causing dissolution under 18 O.S. § 2037 that is not avoided by Section 6.6.

7.2 Winding Up. Upon dissolution, the Member (or a person designated by the Member) shall wind up the Company's affairs pursuant to 18 O.S. § 2039 and § 2040, including:
(a) Collecting Company assets;
(b) Paying or making provision for Company liabilities;
(c) Distributing remaining assets to the Member; and
(d) Filing Articles of Dissolution with the Oklahoma Secretary of State.

7.3 Notice of Claims. The winding-up Member may give notice to creditors to bar untimely claims.

Article VIII — State-Specific Provisions

8.1 Oklahoma Law Controls. This Agreement shall be governed by and construed in accordance with the laws of the State of Oklahoma, and 18 O.S. § 2000 et seq. shall control to the extent of any conflict that the Act does not permit to be modified.

8.2 Annual Certificate. Pursuant to 18 O.S. § 2055.2, the Member shall ensure the Company timely files its Annual Certificate with the Oklahoma Secretary of State on the anniversary of formation, accompanied by the $25 filing fee.

8.3 Series LLC Authority (Optional Election). The Member acknowledges that 18 O.S. § 2054.4 permits the Company to establish one or more protected series, and 18 O.S. § 2054.5 permits the formation of one or more registered series (formed by filing articles of registered series with the Secretary of State), each of which may have separate members (or be wholly owned), assets, liabilities, and purposes, with internal liability shielding among series provided the notice-in-articles and separate record-keeping requirements are observed.

☐ The Company does not currently establish any series.
☐ The Company establishes the following series under 18 O.S. § 2054.4, with separate records as required:

8.4 Operating Agreement; Statutory Override. The Member intends this Agreement to constitute the "operating agreement" within the meaning of 18 O.S. § 2012.2 and to override the default rules of the Act to the maximum extent permitted by Oklahoma law.

8.5 Non-Waivable Provisions. Notwithstanding any provision of this Agreement, the Member acknowledges that the implied covenant of good faith and fair dealing, third-party creditor rights, and statutory formation requirements cannot be waived.

8.6 Indemnification. Consistent with 18 O.S. § 2017, the Company shall indemnify the Member and any manager or officer against losses, damages, and expenses (including reasonable attorneys' fees) incurred in connection with the Company's business, except for acts or omissions involving (a) willful misconduct, (b) a knowing violation of law, or (c) any transaction from which an improper personal benefit was derived.

Article IX — General Provisions

9.1 Entire Agreement. This Agreement constitutes the entire agreement of the Member regarding the operation of the Company.

9.2 Amendment. This Agreement may be amended only by a written instrument signed by the Member.

9.3 Severability. If any provision is held invalid or unenforceable, the remaining provisions shall continue in full force and effect.

9.4 Successors and Assigns. This Agreement binds and inures to the benefit of the Member and the Member's heirs, executors, administrators, successors, and assigns.

9.5 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts and by electronic signature with the same effect as an original.

9.6 Notices. Notices to the Member shall be effective when delivered in person, by certified mail, or by electronic mail.

9.7 Headings. Headings are for convenience only and do not affect interpretation.

Signature Block

IN WITNESS WHEREOF, the undersigned, being the sole Member of the Company, has executed this Operating Agreement as of the Effective Date.

ACKNOWLEDGMENT (Optional but Recommended)

State of Oklahoma, County of [____________________]

On [__/__/____], before me, the undersigned notary public, personally appeared [SOLE MEMBER NAME], known to me (or satisfactorily proven) to be the person whose name is subscribed to this instrument, and acknowledged execution thereof.

Notary Public: _______________________________
My commission expires: [__/__/____]

Schedule A — Capital Contributions

Schedule B — Managers (if Manager-Managed)

Pre-Execution Checklist

☐ Articles of Organization filed with Oklahoma Secretary of State (18 O.S. § 2004)
☐ EIN obtained from IRS (Form SS-4)
☐ Registered agent confirmed and consents in writing
☐ Initial capital contribution made and recorded on Schedule A
☐ Federal tax classification confirmed (disregarded, S-corp, or C-corp)
☐ Annual Certificate calendar reminder set for anniversary (18 O.S. § 2055.2)
☐ Series LLC election considered (Article VIII / 18 O.S. § 2054.4)
☐ Separate books and records established for each series, if any
☐ Business bank account opened in Company name (separate account per series if applicable)
☐ Local business licenses and permits obtained
☐ Required insurance (general liability, professional liability, workers' comp) in place
☐ Operating Agreement signed and stored with corporate records
☐ Successor-in-interest designated (Section 6.6) and coordinated with estate plan
☐ Legal review by Oklahoma-licensed attorney completed

Sources and References

• Oklahoma Statutes, Title 18, Chapter 32 — Oklahoma LLC Act (Official Oklahoma Statutes, Westlaw table of contents): https://govt.westlaw.com/okjc/Browse/Home/Oklahoma/OfficialOklahomaStatutes?guid=NDF2C0020C37E11DB8F04FB3E68C8F4C5
• Oklahoma Statutes, Title 18, Chapter 32 — Oklahoma LLC Act (Justia): https://law.justia.com/codes/oklahoma/title-18/
• 18 O.S. § 2034 (Judgment Creditor; Rights; Exclusive Remedy): https://law.justia.com/codes/oklahoma/title-18/section-18-2034/
• 18 O.S. § 2054.4 (Protected series): https://law.justia.com/codes/oklahoma/title-18/section-18-2054-4/
• Oklahoma Bar Journal — Recent Developments for Corporations and LLCs (Oct. 2024): https://www.okbar.org/barjournal/october-2024/recent-developments-for-corporations-and-llcs/
• McAfee & Taft — Charging Order Protection for a Single Member LLC May Still Be Illusory (discussing Arrington v. Kruger): https://www.mcafeetaft.com/charging-order-protection-for-a-single-member-llc-may-still-be-illusory/
• Oklahoma Tax Commission — Franchise Tax Ends in Oklahoma (repealed effective TY2024): https://oklahoma.gov/tax/newsroom/2023/07-26-23.html
• Oklahoma Secretary of State — Business Forms: https://www.sos.ok.gov/business/forms.aspx