Single-Member LLC Operating Agreement — Virginia

Single-Member LLC Operating Agreement (VIRGINIA)

Quick-Reference Summary

Article I — Formation

1.1 Formation. The Member has caused Articles of Organization to be filed with the Virginia State Corporation Commission ("SCC") on [__/__/____] under Va. Code § 13.1-1011, forming [________________________________] (the "Company") as a domestic limited liability company. The SCC has issued a Certificate of Organization, SCC ID No. [________________________________].

1.2 Name. The name of the Company is [________________________________], which complies with Va. Code § 13.1-1012 (name requirements; must contain "limited liability company," "limited company," or an authorized abbreviation).

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

1.4 Registered Office and Registered Agent. The Company's Virginia registered office and registered agent (Va. Code § 13.1-1015):
Name: [________________________________]
Office Address (must be a Virginia street address): [________________________________]
Status: ☐ Member of Virginia State Bar ☐ Officer/Director/Manager of the Company ☐ Domestic or foreign business entity authorized to act as registered agent

1.5 Term. The Company shall have perpetual duration unless dissolved under Article VII or by operation of law.

1.6 Governing Law. The internal affairs of the Company are governed by Virginia law, including Va. Code § 13.1-1000 et seq., to the maximum extent permitted by Va. Code § 13.1-1010.5 (governing law).

Article II — Purpose and Powers

2.1 Purpose. The Company is organized for any lawful business purpose under Va. Code § 13.1-1008, including: [________________________________].

2.2 Powers. The Company has all powers under Va. Code § 13.1-1009 to carry out its business, including the powers to sue and be sued, hold and convey property, contract, borrow, lend, invest, and exercise any other power consistent with its purpose.

Article III — Member (Sole Member)

3.1 Sole Member. The sole member of the Company is:
Name: [________________________________]
Address: [________________________________]
(the "Member")

3.2 Initial Capital Contribution. The Member has contributed:
| Form of Contribution | Agreed Value |
|---|---|
| Cash | $ [____] |
| Property (Schedule A) | $ [____] |
| Services rendered | $ [____] |
| Total | $ [____] |

3.3 Additional Contributions. The Member is not obligated to make additional capital contributions; however, the Member may do so at any time.

3.4 No Personal Liability. Under Va. Code § 13.1-1019, the debts, obligations, and liabilities of the Company are solely those of the Company. The Member is not personally liable for any debt, obligation, or liability of the Company solely by reason of being a member.

3.5 Separateness Covenants. The Member agrees to maintain the Company as a legal entity separate and apart from the Member:

• ☐ Maintain separate Company bank accounts;
• ☐ Maintain separate Company books and records;
• ☐ Avoid commingling of Company and personal assets;
• ☐ Title Company property in the Company's name;
• ☐ Sign Company contracts and instruments in the Member's representative capacity;
• ☐ Maintain adequate capitalization for foreseeable operations.

Article IV — Management

4.1 Member-Managed. Pursuant to Va. Code § 13.1-1024, the Company is member-managed. The Member has full and exclusive authority to manage and control the Company's business.

4.2 Authority to Bind. The Member is an agent of the Company and may execute and deliver, on behalf of the Company, any instrument, including contracts, deeds, mortgages, leases, and security agreements, and may otherwise bind the Company in any matter.

4.3 Officers (Optional). The Member may appoint officers under Va. Code § 13.1-1024(D). Any officer serves at the pleasure of the Member.

4.4 Standards of Conduct. As permitted by Va. Code § 13.1-1024.1 and § 13.1-1023(D), the Member, as sole member, owes no fiduciary duties to any other member, but shall act in good faith and in accordance with the implied contractual covenant of good faith and fair dealing.

Article V — Capital Accounts and Distributions

5.1 Capital Account. A capital account shall be maintained for the Member consistent with U.S. Treasury Regulation § 1.704-1(b)(2)(iv).

5.2 Allocations. All items of income, gain, loss, deduction, and credit are allocated 100% to the Member.

5.3 Distributions. The Member may cause the Company to make distributions at any time, subject to Va. Code § 13.1-1035 (limitations on distributions if the Company would be unable to pay its debts as they become due in the ordinary course of business, or if total assets would be less than total liabilities).

5.4 Tax Status. The Company is a disregarded entity for federal and Virginia income tax purposes under Treasury Regulation § 301.7701-3 unless the Member affirmatively elects otherwise on IRS Form 8832 (or Form 2553 for S-corp election). The Member shall report Company income on the Member's federal Form 1040 and Virginia Form 760.

Article VI — Transfer of Interest / Charging Order

6.1 Membership Interest. A membership interest is personal property and consists of the Member's share of profits and losses and the right to receive distributions, as defined in Va. Code § 13.1-1002 ("membership interest") and § 13.1-1038 ("transferable interest").

6.2 Transfer. The Member may transfer all or part of the Member's transferable interest. A transferee receives only the transferable interest (economic rights) and is not admitted as a member except as expressly permitted in writing by the Member.

6.3 Charging Order — Exclusive Remedy. Pursuant to Va. Code § 13.1-1041.1, on application by a judgment creditor of the Member, a court may charge the Member's transferable interest to satisfy the judgment. The charging order:

(a) constitutes a lien on the judgment debtor's transferable interest;
(b) entitles the creditor only to distributions that would otherwise be paid to the judgment debtor; and
(c) is the exclusive remedy by which a judgment creditor may satisfy a judgment out of the judgment debtor's transferable interest (Va. Code § 13.1-1041.1(D)).

6.4 No Creditor Remedies Against Company Property. No creditor of the Member shall have any right to obtain possession of, or otherwise exercise legal or equitable remedies with respect to, the property of the Company (Va. Code § 13.1-1041.1(E)).

Article VII — Dissolution

7.1 Events of Dissolution. The Company shall be dissolved upon the earliest of (a) the Member's written election; (b) an event under Va. Code § 13.1-1046; or (c) entry of a judicial decree.

7.2 Death or Incapacity. Upon the Member's death or adjudicated incapacity, the Member's executor, administrator, personal representative, or other legal successor (the "Successor") shall succeed to all of the Member's interest and shall be admitted as a member effective as of the date of the death or incapacity, consistent with Va. Code § 13.1-1040.2. The Company shall not dissolve solely by reason of the Member's death or incapacity.

7.3 Winding Up. Upon dissolution, the Member shall wind up the Company's affairs (Va. Code § 13.1-1047) and distribute assets in accordance with Va. Code § 13.1-1049: first to creditors, then to the Member.

7.4 Articles of Cancellation. Upon completion of winding up, Articles of Cancellation shall be filed with the SCC pursuant to Va. Code § 13.1-1050.

Article VIII — State-Specific Provisions

8.1 Annual Registration Fee. Pursuant to Va. Code § 13.1-1062, the Company shall pay an annual registration fee of $50 to the SCC on or before the last day of the twelfth month next succeeding the month in which it was organized. Failure to pay within three months following the due date may result in automatic cancellation under Va. Code § 13.1-1064.

8.2 No Annual Report Required. Unlike Virginia stock corporations, Virginia LLCs are not required to file an annual report disclosing officers/directors. Only payment of the annual registration fee is required.

8.3 Series / Protected Series. Virginia permits formation of a "protected series" under the Virginia Protected Series Act, Va. Code § 13.1-1088 et seq. (effective July 1, 2020). If the Member elects to establish a protected series:

• ☐ A Statement of Protected Series Designation must be filed with the SCC for each protected series;
• ☐ Each protected series is treated as a separate person for liability purposes;
• ☐ Each protected series pays its own $50 annual registration fee (Va. Code § 13.1-1062);
• ☐ Records must clearly identify the assets, members, and obligations of each protected series.

If no protected series is designated, the Company shall not hold itself out as having internal series with separate liability shields.

8.4 No Publication Requirement. Virginia does not require newspaper publication of LLC formation.

8.5 Registered Agent Qualification. The registered agent must satisfy Va. Code § 13.1-1015 (Virginia State Bar member, officer/director/manager of the LLC, business entity authorized to do business in Virginia, or other qualifying person).

8.6 State Tax Treatment. Virginia generally follows federal classification. As a disregarded entity, the Company is not subject to Virginia corporate income tax; income flows through to the Member's Virginia individual return. If the Company elects corporate taxation, it must file Virginia Form 500.

8.7 Statement of Authority (Optional). The Member may file a Statement of Authority under Va. Code § 13.1-1023.1 to publicly identify persons authorized to transfer real property held by the Company.

Article IX — General Provisions

9.1 Freedom of Contract. This Agreement is to be enforced to the maximum extent permitted by Va. Code § 13.1-1001.1, which gives "maximum effect to the principle of freedom of contract."

9.2 Entire Agreement. This document is the entire operating agreement of the Company.

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

9.4 Severability. If any provision is unenforceable, the remainder remains in effect.

9.5 Indemnification. The Company shall indemnify the Member to the fullest extent permitted by Va. Code § 13.1-1009(16) and § 13.1-1025.

9.6 Notices. Notices shall be delivered in writing to the Member at the address in Section 3.1.

9.7 Counterparts; Electronic Signatures. Executed counterparts and electronic signatures under the Virginia Uniform Electronic Transactions Act, Va. Code § 59.1-479 et seq., are valid.

Signature Block

THE COMPANY:

[________________________________], a Virginia limited liability company

By: [________________________________]
Name: [________________________________]
Title: Sole Member
Date: [__/__/____]

THE MEMBER (in individual capacity, acknowledging and adopting this Agreement):

[________________________________]
Name (print): [________________________________]
Date: [__/__/____]

Commonwealth of Virginia, [________________________________] (City/County)

Acknowledged before me on [__/__/____] by [________________________________].

Notary Public: [________________________________]
Registration No.: [____]
Commission Expiration: [__/__/____]

Pre-Execution Checklist

• ☐ Articles of Organization filed with Virginia SCC (Form LLC-1011)
• ☐ Name availability confirmed in SCC Clerk's Information System (CIS)
• ☐ Registered agent satisfies Va. Code § 13.1-1015 and has accepted appointment
• ☐ Virginia street address (not P.O. Box) used for registered office
• ☐ EIN obtained from IRS (Form SS-4)
• ☐ SCC ID number recorded in this Agreement
• ☐ Annual registration fee calendar reminder set ($50, anniversary month)
• ☐ Separate Company bank account opened
• ☐ Initial contributions documented and deposited
• ☐ Schedule A (property contributions) attached if applicable
• ☐ If protected series desired: Statement of Protected Series Designation filed
• ☐ Operating Agreement signed, dated, notarized
• ☐ Virginia local business license obtained where applicable (BPOL)
• ☐ Tax classification confirmed with CPA (disregarded vs. S-corp / C-corp election)
• ☐ Insurance (general liability / professional / cyber) bound

Sources and References

• Virginia Limited Liability Company Act, Va. Code § 13.1-1000 et seq.: https://law.lis.virginia.gov/vacodepopularnames/virginia-limited-liability-company-act/
• Va. Code § 13.1-1041.1 (charging order): https://law.lis.virginia.gov/vacode/title13.1/chapter12/section13.1-1041.1/
• Va. Code § 13.1-1062 (annual registration fee): https://law.lis.virginia.gov/vacode/title13.1/chapter12/section13.1-1062/
• Virginia State Corporation Commission – Business FAQs: https://www.scc.virginia.gov/businesses/business-faqs/annual-registration-fees/
• Virginia Protected Series Act (Va. Code § 13.1-1088 et seq.)
• SCC Clerk's Information System (CIS): https://cis.scc.virginia.gov/
• IRS, Single Member Limited Liability Companies: https://www.irs.gov/businesses/small-businesses-self-employed/single-member-limited-liability-companies