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Mississippi Single-Member Operating Arrangement

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Single-Member Operating Arrangement of Limited Liability Company

State of Mississippi

This Operating Arrangement is hereby established, this the day of , by the Initial Member.

The Initial Member contemplates that additional Members may join the limited liability company in the future, and the following Operating Arrangement has therefore been developed.

ARTICLE I

FORMATION OF LIMITED LIABILITY COMPANY

1. Formation of LLC. The Initial Member has formed a limited liability company in the State of Mississippi named ("LLC"). The operation of the LLC shall be governed by the terms of this Arrangement and the applicable laws of the State of Mississippi relating to the formation, operation and taxation of a LLC.

2. Certificate of Formation. The Initial Member has caused to be filed a Certificate of Formation, ("Certificate") of record with the state, thereby creating the LLC.

3. Business. The business of the LLC shall be:

a)

and

b) To conduct or promote any lawful businesses or purposes that a limited liability company is legally allowed to conduct or promote, within this state or any other jurisdiction.

4. Registered Office and Registered Agent. The registered office and place of business of the LLC shall be and the registered agent at such office shall be .

5. Duration. The LLC will commence business as of the date of filing its Certificate and will continue in perpetuity.

6. Fiscal Year. The LLC's fiscal and tax year shall end December 31.

ARTICLE II

MEMBERS

7. Initial Member. The Initial Member of the LLC is .

8. Additional Members. The first new Member, or new Members if several are to be added simultaneously, may be admitted only upon the approval of the Initial Member.

ARTICLE III

MANAGEMENT

9. Management. The Initial Member shall manage the LLC, and shall have authority to take all necessary and proper actions to conduct the business of the LLC. Anyone authorized by the Initial Member may take any authorized action on behalf of the LLC.

ARTICLE IV

CONTRIBUTIONS, PROFITS, LOSSES, AND DISTRIBUTIONS

10. Interest of Members. Each Member shall own a percentage interest in the LLC.

11. Initial Contribution. The initial contribution of the Initial Member is $ , representing a 100% interest in the LLC.

12. Additional Contributions. In the event additional Members are added, upon a majority vote, the Members may be called upon to make additional cash contributions as may be necessary to carry on the LLC's business.

13. Record of Contributions/Percentage Interests. A record shall be kept of all contributions to, and percentage interests in, the LLC.

14. Profits and Losses. The profits and losses and all other tax attributes of the LLC shall be allocated to the Initial Member until such time as additional Members are added.

15. Distributions. Any Distributions of cash or other assets of the LLC shall be made as determined by the Initial Member.

16. Change in Interests. In the event additional Members are added, and if during any year there is a change in a Member's percentage interest, the Member's share of profits and losses and distributions in that year shall be determined under a method which takes into account the varying interests during the year.

ARTICLE V

VOTING; CONSENT TO ACTION

17. Voting by Members. Until such time as additional Members are added, all decisions will be made by the Initial Member.

18. Majority Defined. "Majority" of the Members shall mean a majority of the ownership interest of the LLC.

19. Majority Required. Should additional Members be added, any action that requires the vote or consent of the Members may be taken upon a majority vote of the Members.

20. Meetings - Written Consent. Action of the Members or Officers may be accomplished with or without a meeting.

21. Meetings. Meetings of the Members shall be held as determined by the Members or as may be called by a majority of the Members.

ARTICLE VI

DISSOCIATION OF MEMBERS

22. Termination of Membership. A Member’s interest in the LLC shall cease upon the occurrence of one or more of the following events:

(a) A Member withdraws by giving the LLC thirty (30) days written in advance of the withdrawal date.

(b) A Member assigns all of his/her interest to a qualified third party.

(c) A Member dies.

(d) There is an entry of an order by a court adjudicating the Member incompetent.

(e) In the case of an estate that is a Member, the distribution by the fiduciary of the estate's entire interest in the LLC.

(f) In the case of an entity that is a Member, the distribution upon dissolution of the entity’s entire interest in the LLC.

(g) A Member, without the consent of a majority of the Members, makes certain bankruptcy-related filings or actions.

(h) If within one hundred twenty (120) days after the commencement of any action against a Member seeking reorganization or similar relief, the action has not been dismissed and/or has not been consented to by a majority of the Members.

(i) If within ninety (90) days after the appointment of a trustee, receiver, or liquidator, the appointment is not vacated and/or has not been consented to by a majority of the Members.

(j) Any of the events provided in applicable provisions of state or federal law that are not inconsistent with the dissociation events identified above.

23. Effect of Dissociation. Any dissociated Member shall not be entitled to receive the fair value of his LLC interest solely by virtue of his dissociation.

ARTICLE VII

RESTRICTIONS ON TRANSFERABILITY OF LLC INTEREST; SET PRICE FOR LLC INTEREST

24. LLC Interest. The LLC interest is personal property. A Member has no interest in property owned by the LLC.

25. Encumbrance. A Member can encumber his LLC interest by a security interest or other form of collateral only with the consent of a majority of the other Members.

26. Sale of Interest. A Member can sell his LLC interest only as follows:

(a) If a Member desires to sell his/her interest, in whole or in part, he/she shall give written notice to the LLC of his desire to sell all or part of his/her interest and must first offer the interest to the LLC.

Purchase price threshold: $ paid in equal quarterly installments.

(b) To the extent the LLC does not buy the offered interest of the selling Member, the other Members shall have the option to buy the offered interest at the Set Price on a pro rata basis.

(c) To the extent the LLC or the Members do not buy the offered interest, the selling Member can then assign the interest to a non-Member.

(d) A non-Member purchaser of a Member’s interest cannot exercise any rights of a Member unless a majority of the non-selling Members consent to him becoming a Member.

27. Set Price. The Set Price for purposes of this Arrangement shall be the price fixed by consent of a majority of the Members.

ARTICLE VIII

OBLIGATION TO SELL ON A DISSOCIATION EVENT CONCERNING A MEMBER

28. Dissociation. Except as otherwise provided, upon the occurrence of a dissociation event with respect to a Member, the LLC and the remaining Members shall have the option to purchase the dissociated Member's interest at the Set Price.

ARTICLE IX

DISSOLUTION

29. Termination of LLC. The LLC will be dissolved and its affairs must be wound up only upon such a decision by the Initial Member, provided no new Members have been added, or upon the written consent of seventy-five percent (75%) of all Members should additional Members be added.

30. Final Distributions. Upon the winding up of the LLC, the assets must be distributed as follows: creditors, liabilities for distributions, and then Members in proportion to their interests.

ARTICLE X

TAX MATTERS

31. Capital Accounts. Capital accounts shall be maintained consistent with Internal Revenue Code § 704 and the regulations thereunder.

32. Sole Proprietorship/Partnership Election. The Initial Member elects that the LLC be taxed as a sole proprietorship, and that if additional Members are admitted, the LLC be taxed as a partnership.

ARTICLE XI

RECORDS AND INFORMATION

33. Records and Inspection. The LLC shall maintain at its place of business the Certificate of Formation, any amendments thereto, this Arrangement, and all other LLC records required to be kept by applicable law.

34. Obtaining Additional Information. Subject to reasonable standards, each Member may obtain from the LLC from time to time upon reasonable demand information regarding the business, financial condition, and tax returns of the LLC.

ARTICLE XII

MISCELLANEOUS PROVISIONS

35. Amendment. Except as otherwise provided in this Arrangement, any amendment to this Arrangement may be proposed by a Member.

36. Applicable Law. To the extent permitted by law, this Arrangement shall be construed in accordance with and governed by the laws of the State of Mississippi.

37. Pronouns, Etc. References to a Member or Manager shall be deemed to include masculine, feminine, singular, plural, individuals, partnerships, corporations or other business entities, where applicable.

38. Counterparts. This instrument may be executed in any number of counterparts each of which shall be considered an original.

39. Specific Performance. Each Member agrees with the other Members that the other Members would be irreparably damaged if any of the provisions of this Arrangement are not performed in accordance with their specific terms.

40. Further Action. Each Member, upon the request of the LLC, agrees to perform all further acts and to execute, acknowledge and deliver any documents which may be necessary, appropriate, or desirable to carry out the provisions of this Arrangement.

41. Method of Notices. All written notices required or permitted by this Arrangement shall be hand delivered or sent by registered or certified mail.

42. Facsimiles. Any copy, facsimile, telecommunication or other reliable reproduction of a writing, transmission or signature may be substituted or used in lieu of the original.

43. Computation of Time. In computing any period of time under this Arrangement, the day of the act, event or default from which the designated period of time begins to run shall not be included.

* * *

WHEREFORE, the Initial Member, being the single Member of this LLC, has executed this Arrangement on the day of , .

Signed:

Print Name:

Address:

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What the Mississippi Single-Member Operating Arrangement Is

A Mississippi Single-Member Operating Arrangement is a written LLC agreement tailored for a single owner that sets out the company’s governance, ownership, capital contributions, management authority, distribution rules, and amendment procedures. Although not required for filing with the Mississippi Secretary of State, a formal operating arrangement documents the member’s rights and can support limited liability protections, tax classification, and internal bank or lender requirements when maintained with corporate records.

Why a Written Operating Arrangement Matters for Single-Member LLCs

A formal agreement clarifies decision-making, records capital contributions, and demonstrates separation between member and business—important evidence if the member’s liability protection is ever challenged under state law.

Why a Written Operating Arrangement Matters for Single-Member LLCs

Who Typically Prepares or Relies on This Arrangement

Primary users include the single member, business counsel, and third parties that require proof of authority before transacting with the LLC.

  • Single-member owners who need a clear record of capital, distributions, and management authority for banks or tax reporting.
  • Attorneys and accountants who draft, review, or rely on the agreement to advise on corporate formalities and tax classification.
  • Lenders, title companies, and partners who request an executed operating arrangement to confirm signing authority and ownership percentage.

Keep an executed copy with the company minute book and provide a copy to advisors and your primary business banker.

Core Elements to Include in a Professional Arrangement

A complete single-member operating arrangement should be clear about authority, money matters, dispute resolution, amendment mechanics, dissolution terms, and recordkeeping expectations to reduce ambiguity and legal risk.

Member Identity

State the full legal name of the sole member, any trade names, and the member’s contact information for authoritative identification and service.

Management Authority

Specify whether the LLC is member-managed or manager-managed, define scope of authority, and list any delegated powers or required approvals.

Capital Contributions

Describe initial and future contributions, valuation methods, and consequences for failure to contribute, including dilution or default mechanics.

Distributions

Set timing, priority, and tax allocation rules for distributions, and state whether distributions require member consent or are at manager discretion.

Amendment Process

Provide the method for amending the agreement, effective date rules, and any notice periods the member must observe before changes take effect.

Dissolution & Exit

Define voluntary dissolution steps, asset distribution priorities, creditor notice requirements, and successor provisions for transferring interests.

Essential Information and Fields to Complete

Member Name: Full legal name
Entity Name: Exact registered LLC name
Effective Date: MM/DD/YYYY format
Member Address: Street, city, state, ZIP
Capital Amount: Dollar amount contributed
Governing Law: State name (Mississippi)

Key Legal Risks if the Arrangement Is Deficient

Piercing the Veil: Loss of liability protection
Tax Misclassification: Unintended IRS treatment
Banking Delays: Denied account setups
Contract Disputes: Unclear signing authority
Creditor Claims: Priority problems on liquidation
State Compliance: Fines or administrative issues

Common Preparation Mistakes to Avoid

  • Using vague phrases like 'reasonable value' for contributions rather than stating exact amounts and valuation dates, which creates avoidable disputes during audits or dissolution.
  • Failing to record the effective date or not initialing each page of the agreement, which can cast doubt on whether the document is fully executed.
  • Keeping an unsigned draft as the company record; only executed, dated signatures demonstrate consent and create enforceable obligations.
  • Combining personal and business funds or records without explicit accounting provisions, which weakens the LLC’s separate-entity protections in litigation.

Step-by-Step: Completing the Operating Arrangement

Follow these sequential steps to prepare, execute, and store a Mississippi single-member operating arrangement correctly.

  • 01
    Draft: Assemble member details and key provisions in clear language.
  • 02
    Review: Have counsel or advisor verify tax and liability implications.
  • 03
    Sign: Execute with dated signature and witness or notary if desired.
  • 04
    Store: Retain executed copy in the company minute book and secure storage.

Configuring an Online Completion and Signature Workflow

Set up an electronic workflow that captures identity, consent, and secure storage while matching your internal approval steps.

Field Configuration
Upload Template Import DOCX or PDF and map fillable fields
Add Signer Enter member email and role
Authentication Choose email link, SMS code, or KBA
Retention Enable audit trail and PDF/A export

Where to Keep and Who to Send the Final Document

The operating arrangement is an internal corporate record but should be shared with key third parties as needed.

  • Company Records: Store original in the minute book or secure digital archive.
  • Banking: Provide executed copy to banks when opening business accounts.
  • Advisors: Share with legal and tax advisors for compliance and filings.
  • Third Parties: Present to lenders or purchasers upon request.

Digital Signing and File Format Considerations

Use digital workflows that preserve an audit trail, create tamper-evident PDF outputs, and support signer authentication appropriate for the transaction.

  • Formats: PDF, DOCX, and PDF/A supported
  • Integrations: Connect with NetSuite, Salesforce, Google Workspace
  • Authentication: Email, SMS, KBA, or advanced methods

Platforms such as signNow support document templates, audit trails, and a range of authentication options; ensure any chosen tool meets ESIGN and UETA expectations for consent and retention.

Timing and Related Filing Deadlines to Monitor

While the operating arrangement itself is not a state filing, several related filings and deadlines affect its use and tax reporting.

Formation Filing:

File Articles of Organization before operating under the LLC name.

Effective Date:

Set the agreement effective date to align with tax and formation filings.

EIN Application:

Obtain EIN from IRS prior to hiring or tax reporting.

Income Tax Return:

Individual returns due April 15; LLC tax treatment follows federal deadlines.

Record Updates:

Amend and store updated agreement when ownership or management changes.

Typical Signatories and Their Roles

Member — Owner

The sole member signs to accept governance terms, capital accounting, and distribution rights. Their signature evidences authority and is usually sufficient unless a third-party requires notarization or witness.

Attorney — Counsel

A business attorney may sign to acknowledge review or to certify that the agreement complies with state law; counsel signatures support enforceability but are not usually required for validity.

Key Formation and Recordkeeping Milestones

Track these milestones to ensure the arrangement is timely, effective, and useful for compliance or third-party requirements.

01

Articles Filed

File Articles of Organization to create the LLC.

02

Agreement Executed

Sign and date the operating arrangement after formation.

03

Bank Setup

Use the executed agreement to open business bank accounts.

04

Periodic Review

Review and update upon material ownership or management changes.

Comparison: eSignature Vendor Pricing and Capabilities

Below are common plan and capability comparisons for eSignature tools often used to execute operating arrangements; signNow is listed first per vendor layout.

signNow DocuSign ($15/user/mo) Adobe Sign ($14/user/mo) PandaDoc ($19/user/mo) HelloSign ($15/user/mo)
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial Yes Yes Yes Yes
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Frequently Asked Questions About Execution and Validity

Answers to common questions about enforceability, e-signatures, notarization, amendments, and what to do if the agreement is incomplete.


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