Operating Agreement Template Page 9
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16(c)
The Members shall cause to be prepared and sent to each Member each
year (a) annual reports of the Company, including an annual balance sheet and
profit and loss statement, within 90 days after the close of each fiscal year, (b)
annual statements indicating the share of each Member of the net income, net
loss, depreciation, gain, loss and other relevant items of the Company for each
calendar year for federal income tax purposes; and (c) a copy of the Company's
federal information tax return (Form 1065) and related Schedules K and K-1.
6.7 Fiscal Year and Tax Year. The fiscal year and tax year of the Company shall be
January 1 to December 31.
6.8 Accounting Method. For tax and financial accounting purposes, the Company shall
adopt the cash or accrual method of accounting as determined by the Members. All books and
records of the Company shall be available for inspection by all Members.
6.9. Auditing. An auditing committee, comprised of two Members appointed by the
President, shall inspect the Company's records in conjunction with the Treasurer. This audit shall
be completed each year prior to the completion of the tax documents.
6.10 Operating Procedures. The Members may from time to time adopt separate
procedures relating to the details of the operation of the Company.
ARTICLE 7
Dissociation; Liquidation of Membership Interest
7.1 Dissociation. A person shall cease to be a Member of the Company upon the
occurrence of any of the relevant events and circumstances specified in Iowa Code Section
489.602 (including, without limitation, death, adjudication of incompetency, bankruptcy,
insolvency, dissolution, or voluntary or involuntary dissociation from the Company of a
Member) ("Dissociation"). A Member shall have the right to dissociate from the Company at
any time and for any reason, but shall not be entitled to any payment for his, her or its
Membership Interest except as mutually agreed by the Company, or as otherwise provided
herein.
7.2
Liquidation of Dissociated Member's Membership Interest.
Following the
dissociation of a Member, the remaining Members (in proportion to their Membership Interests),
or at their election, the Company, shall have the option, but not the obligation, to purchase and
thereby liquidate the Membership Interest of such dissociated Member in accordance with this
Article 7. Notice of such election shall be made by written notice delivered to the dissociated
Member or the dissociated Member's personal representative within sixty (60) days of the
dissociation.
7.3 Valuation of Company Interest. If the remaining Members (or the Company) elect to
liquidate the Membership Interest of a dissociated Member, negotiations shall be undertaken
between (a) the remaining Members (or the Company) and (b) the dissociated Member or the
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