Wyoming Single-Member LLC Operating Agreement

Introduction

Key Things to Know

1. 1

   Wyoming does not require an operating agreement to be in writing, or even signed; the Act's own definition of 'operating agreement' expressly covers an oral or implied agreement of a sole member (Wyoming Statutes Section 17-29-102(a)(xiv)).

2. 2

   Without an operating agreement, Wyoming law splits distributions in equal shares among members, not proportional to capital contribution, the opposite default from states like California and Delaware (Wyoming Statutes Section 17-29-404(a)).

3. 3

   Wyoming's charging order statute names a 'sole member' directly, making it one of the more explicit statutory statements that a charging order is the exclusive remedy against a single-member LLC interest (Wyoming Statutes Section 17-29-503(g)).

4. 4

   Wyoming LLCs owe an annual report license fee of $60, or two-tenths of one mill on their Wyoming-based assets, whichever is greater, due each year by the first day of the LLC's formation-anniversary month (Wyoming Statutes Section 17-29-209).

5. 5

   The operating agreement can modify a member's duties of loyalty and care, but it cannot eliminate the contractual obligation of good faith and fair dealing or unreasonably restrict a member's right to company information (Wyoming Statutes Section 17-29-110(c)).

6. 6

   The operating agreement itself is not filed with the state. You form the LLC by filing Articles of Organization ($100 fee) with the Wyoming Secretary of State, and must continuously maintain a Wyoming registered agent.

7. 7

   Wyoming's Act expressly authorizes Series LLCs, letting one LLC create internally segregated series with separate liability shields, but only if the operating agreement, separately maintained series records, and the articles of organization all provide for it (Wyoming Statutes Section 17-29-211).

Wyoming Requirements for LLC Operating Agreement

• Operating Agreement Authority (Wyoming Statutes § 17-29-110)

  The operating agreement governs relations among the members and between the members and the LLC, management and voting rights, and the means and conditions for amending itself, among other matters (W.S. 17-29-110(a)). It cannot, however, eliminate a member's contractual obligation of good faith and fair dealing, or unreasonably restrict a member's statutory right to company information (W.S. 17-29-110(c)).

• Limited Liability Protection (Wyoming Statutes § 17-29-304)

  Members and managers are not personally liable for the LLC's debts, obligations, or liabilities solely by reason of being a member or manager (W.S. 17-29-304(a)). A court may impose liability only after considering fraud, inadequate capitalization, failure to observe LLC formalities, or intermingling of company and member assets, and Wyoming law expressly states that ordinary features of running an LLC, including flexible or informal operation, cannot by themselves be held against a member or manager (W.S. 17-29-304(c)-(d)).

• Management Structure (Wyoming Statutes § 17-29-407)

  Specifies whether the LLC will be member-managed or manager-managed. Wyoming law presumes member-management unless the Operating Agreement states otherwise.

• Voting Rights and Procedures (Wyoming Statutes § 17-29-407)

  Ordinary-course matters are decided by a majority of the members; matters outside the ordinary course, including amending the operating agreement, require the consent of all members (W.S. 17-29-407(b)). What counts as a "majority of the members" for voting-weight purposes depends on the LLC's formation date: contribution-proportional for an LLC formed before July 1, 2010, and per-capita (one member, one vote) for an LLC formed on or after that date, unless the operating agreement provides otherwise (W.S. 17-29-102(a)(xxv)).

• Allocation of Profits and Losses (Wyoming Statutes § 17-29-404)

  Unless the operating agreement provides otherwise, distributions made by the LLC before its dissolution and winding up are split in equal shares among the members, not in proportion to each member's capital contribution (W.S. 17-29-404(a)). The same equal-shares default applies to the final distribution tier when winding up the LLC, after creditors are paid and unreturned capital contributions are returned (W.S. 17-29-708(b)(ii)).

• Transfer of Membership Interests (Wyoming Statutes § 17-29-502)

  Addresses restrictions on transferring membership interests and the rights of transferees, noting that Wyoming law allows transfer of economic rights but not management rights without consent.

• Withdrawal or Dissociation of Members (Wyoming Statutes § 17-29-601)

  A member may dissociate from the LLC at any time, rightfully or wrongfully (W.S. 17-29-601). Wyoming's LLC Act does not give a dissociated member a default right to be bought out by the company: dissociation instead converts the person's interest into that of a mere transferee, with a right to receive distributions but no further right to participate in management (W.S. 17-29-603). A buyout right exists only if the operating agreement creates one.

• Dissolution and Winding Up (Wyoming Statutes § 17-29-701)

  A Wyoming LLC dissolves after 90 consecutive days with no members, among other triggering events (W.S. 17-29-701). For a single-member LLC, this does not mean automatic, immediate dissolution: if the sole member dies or otherwise ceases to be a member, a successor may be designated and admitted within 90 days, avoiding dissolution (W.S. 17-29-401(d)(vi)). On winding up, assets go first to creditors, then to return unreturned capital contributions, then in equal shares among the members (W.S. 17-29-708).

• Records and Accounting (Wyoming Statutes § 17-29-410)

  Wyoming's LLC Act does not separately mandate what records an LLC must keep. What it does provide is a member's right to inspect and copy company records on reasonable notice, and the company's duty to furnish information material to the member's rights and duties on demand (W.S. 17-29-410). A dissociated member retains more limited access to information from the period they were a member.

• Fiduciary Duties (Wyoming Statutes § 17-29-409)

  Members in a member-managed LLC (or managers, in a manager-managed LLC) owe duties of loyalty and care (W.S. 17-29-409(a)-(c)). The operating agreement may modify these duties, but it can never eliminate the contractual obligation of good faith and fair dealing (W.S. 17-29-409(d), 17-29-110(c)(v)) or unreasonably restrict a member's statutory information rights (W.S. 17-29-110(c)(vi)).

• Indemnification (Wyoming Statutes § 17-29-408)

  Wyoming law requires the LLC to reimburse and indemnify a member (in a member-managed LLC) or manager (in a manager-managed LLC) for a payment made or liability incurred on the company's behalf, provided the member or manager complied with the distribution limits of W.S. 17-29-405 and the standards of conduct of W.S. 17-29-409 (W.S. 17-29-408(a)). This is a mandatory default, not merely a discretionary power to indemnify.

• Series LLCs (Wyoming Statutes § 17-29-211)

  Wyoming's LLC Act allows an operating agreement to establish one or more designated series with separately segregated assets and liabilities (W.S. 17-29-211(a)-(b)). The liability segregation between series only applies if all three of the following are true: the operating agreement specifically provides for it, records for each series are separately maintained, and the limitation is disclosed in the articles of organization (W.S. 17-29-211(c)).

• Amendment Procedures (Wyoming Statutes § 17-29-110)

  The operating agreement governs its own means and conditions for amendment (W.S. 17-29-110(a)(iv)). If the agreement is silent, Wyoming's default threshold is strict: amending the operating agreement requires the consent of all members, in both a member-managed LLC (W.S. 17-29-407(b)(v)) and a manager-managed LLC (W.S. 17-29-407(c)(iv)(D)).