Article VIII. Dissociation, Dissolution, and Winding Up Revised
6.30.480 Dissociation.
(1) A person ceases to be an owner of a limited liability company upon the simultaneous occurrence of and at the same time of any of the following events:
(a) The owner withdraws by voluntary act.
(b) The owner is removed as an owner in accordance with the operating agreement or this chapter.
(c) Unless otherwise provided in the operating agreement or by the written consent of all owners at the time of the event, the owner does any of the following:
(i) Makes an assignment for the benefit of the creditors.
(ii) Files a petition in bankruptcy.
(iii) Becomes the subject of an order for relief under the federal bankruptcy laws or state or tribal insolvency laws.
(iv) Fails to gain dismissal of any federal bankruptcy or state or tribal insolvency proceeding within 120 days of commencement of an involuntary proceeding.
(d) Unless provided in the operating agreement or by the written consent of all owners, if the owner is an individual, either of the following occurs:
(i) The owner’s death.
(ii) The entry of an order by a court of competent jurisdiction adjudicating the owner or incompetent to manage the owner’s person or estate.
(e) Unless otherwise provided in the operating agreement or by written agreement or by the written consent of all owners at the time, if the owner is a trust, corporation, partnership, or limited liability company upon liquidation, dissolution, or termination.
(2) The owners may provide in the operating agreement for other events the occurrence of which result in a person ceasing to be an owner of the limited liability company.
(3) Unless the operating agreement provides that an owner does not have the power to withdraw by voluntary act from a limited liability company, the owner may do so at any time by giving written notice to the other owners or as provided in the operating agreement. If the owner has the power to withdraw but the withdrawal is a breach of the operating agreement, the limited liability company may offset the damages against the amount otherwise distributable to the owner, in addition to pursuing any remedies provided for in the operating agreement or otherwise available under applicable law. [Res. 2023-10-019 § 1, 2023.]