(a) A person ceases to be a member of a limited liability company upon the occurrence of one (1) or more of the following events:
(1) The member withdraws by voluntary act from the limited liability company as provided in subsection (c) of this section;
(2) The member ceases to be a member of the limited liability company as provided in ยง 4-32-706;
(3) The member is removed as a member:
(A) In accordance with an operating agreement; or
(B) Unless otherwise provided in writing in an operating agreement, when the member assigns all of his or her interest in the limited liability company, by an affirmative vote of a majority of the members who have not assigned their interests;
(4) Unless otherwise provided in writing in an operating agreement or by the written consent of all members at the time, the member:
(A) Makes an assignment for the benefit of creditors;
(B) Files a voluntary petition in bankruptcy;
(C) Is adjudicated a bankrupt or insolvent;
(D) Files a petition or answer seeking for the member any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any statute, law, or regulation;
(E) Files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against the member in any proceeding of the nature described in (a)(4)(D) of this section; or
(F) Seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or liquidator of the member or of all or any substantial part of the member's properties;
(5) Unless otherwise provided in writing in an operating agreement or by the written consent of all members at the time, if:
(A) Within one hundred twenty (120) days after the commencement of any proceeding against the member seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any statute, law, or regulation, the proceeding has not been dismissed; or
(B) (i) Within one hundred twenty (120) days after the appointment without his or her consent or acquiescence of a trustee, receiver, or liquidator of the member or of all or any substantial part of his or her properties, the appointment is not vacated or stayed; or
(ii) Within one hundred twenty (120) days after the expiration of any stay, the appointment is not vacated;
(6) Unless otherwise provided in writing in an operating agreement or by the written consent of all members at the time, in the case of a member who is an individual:
(i) The member's death; or
(ii) The entry of an order by a court of competent jurisdiction adjudicating the member incompetent to manage his or her person or estate;
(7) Unless otherwise provided in writing in an operating agreement or by the written consent of all members at the time, in the case of a member who is a trust or is acting as a member by virtue of being a trustee of a trust, the termination of the trust, but not merely the substitution of a new trustee;
(8) Unless otherwise provided in writing in an operating agreement or by the written consent of all members at the time, in the case of a member that is a separate limited liability company, the dissolution and commencement of winding up of the separate limited liability company;
(9) Unless otherwise provided in writing in an operating agreement or by the written consent of all members at the time, in the case of a member that is a corporation, the filing of a certificate of its dissolution or the equivalent for the corporation or the revocation of its charter and the lapse of ninety (90) days after notice to the corporation of revocation without reinstatement of its charter; or
(10) Unless otherwise provided in writing in an operating agreement or by the written consent of all members at the time, in the case of an estate, the distribution by the fiduciary of the estate's entire interest in the limited liability company.
(b) The members may provide in writing in an operating agreement for other events, the occurrence of which shall result in a person's ceasing to be a member of the limited liability company.
(c) A member may withdraw from a limited liability company only at the time or upon the happening of an event specified in the articles of organization or an operating agreement. Unless the articles of organization or an operating agreement provides otherwise, a member may not withdraw from a limited liability company prior to the dissolution and winding up of the limited liability company.
Section: 4-32-802Last modified: November 15, 2016