PART VI. 
MEMBER'S DISSOCIATION



 



[§428-601]  Events causing a member's
dissociation.  A member is dissociated from a limited liability company
upon the occurrence of any of the following events:



(1)  The company's having notice of the member's
express will to withdraw upon the date of notice or on a later date specified
by the member;



(2)  An event agreed to in the operating agreement as
causing the member's dissociation;



(3)  The member's expulsion pursuant to the operating
agreement;



(4)  The member's expulsion by the unanimous vote of
the other members if:



(A)  It is unlawful to carry on the company's
business with the member;



(B)  There has been a transfer of substantially
all of the member's distributional interest, other than a transfer for security
purposes, or a court order charging the member's distributional interest, which
has not been foreclosed;



(C)  Within ninety days after the company
notifies a  corporate member that it will be expelled because it has filed
articles of dissolution or the equivalent, its registration has been revoked,
dissolved, or canceled, or its right to conduct business has been suspended by
the jurisdiction of its incorporation, the member fails to obtain a revocation
of the dissolution proceedings or a reinstatement of its articles or its right
to conduct business; or



(D)  A partnership or a limited liability
company that is a member has been dissolved and its business is being wound up;



(5)  On application by the company or another member,
the member's expulsion by judicial determination because the member:



(A)  Engaged in wrongful conduct that adversely
and materially affected the company's business;



(B)  Wilfully or persistently committed a
material breach of the operating agreement or of a duty owed to the company or
the other members under section 428-409; or



(C)  Engaged in conduct relating to the
company's  business which makes it not reasonably practicable to carry on the
business with the member;



(6)  If the member:



(A)  Becomes a debtor in bankruptcy;



(B)  Executes an assignment for the benefit of
creditors;



(C)  Seeks, consents to, or acquiesces in the
appointment of a trustee, receiver, or liquidator of the member or of all or
substantially all of the member's property; or



(D)  Fails, within ninety days after the
appointment, to have vacated or stayed the appointment of a trustee, receiver,
or liquidator of the member or of all or substantially all of the member's
property obtained without the member's consent or acquiescence, or failing
within ninety days after the expiration of a stay to have the appointment
vacated;



(7)  In the case of a member who is an individual:



(A)  The member's death;



(B)  The appointment of a guardian or general
conservator for the member; or



(C)  A judicial determination that the member
has  otherwise become incapable of performing the member's duties under the
operating agreement;



(8)  In the case of a member that is a trust or is
acting as a member by virtue of being a trustee of a trust, distribution of the
trust's entire rights to receive distributions from the company, but not merely
by reason of the substitution of a successor trustee;



(9)  In the case of a member that is an estate or is
acting as a member by virtue of being a personal representative of an estate,
distribution of the estate's entire rights to receive distributions from the
company, but not merely the substitution of a successor personal
representative;



(10)  Termination of the existence of a member if the
member is not an individual, estate, or trust other than a business trust; or



(11)  A termination of a member's continued membership
in a limited liability company for any other reason. [L 1996, c 92, pt of §1]