Operating Agreement Of Llc Page 10
ADVERTISEMENT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17affirmative vote of __________ percent (___%) [Instructions: Insert the percentage of shares
that must approve a new member’s admission] of the Sharing Ratios of all Members.
Concurrently with admission of a person as a Member, that new Member shall execute and
deliver the Membership Supplement.
d.
Death, Incompetency, or Bankruptcy of Member.
i.
Upon the death, adjudicated incompetence, or bankruptcy (the
“Incapacitating Event”) of a Member, the successor in interest, whether an estate, bankruptcy
trustee, or otherwise (the “Successor”) to any Member that has suffered an Incapacitating Event
(the “Incapacitated Member”), will receive only the Economic Rights of the Incapacitated
Member. For the purposes of Member votes, consents, and participation in management, the
Sharing Ratio of the Incapacitated Member shall be eliminated and the Sharing Ratio of the
remaining Members shall be increased proportionately. Should the remaining Members desire to
substitute the Successor as a Member of the Company, they must do so in accordance with the
provisions of this Agreement.
ii.
Notwithstanding the foregoing, the Members covenant and agree that upon
the occurrence of an Incapacitating Event of a Member, the Company, at its option, may
purchase, acquire, and redeem the Sharing Ratio of the Incapacitated Member in the Company
for fair market value by providing written notice to the Successor of the Incapacitated Member
within __________ (__) [Instructions: Insert the number of days notice required to purchase
the shares of an incapacitated member] days of the occurrence of the Incapacitating Event.
The fair market value of the Incapacitated Member’s Sharing Ratio of the Company shall be
determined by mutual agreement of the remaining Members and the Successor. If the parties
cannot reach an agreement on the value within __________ (__) [Instructions: Insert the
number of days the remaining members have to agree on the fair market value of the
shares] days following Company’s notice, then the surviving Members and the Successor each
must select a qualified appraiser within the next __________ (__) [Instructions: Insert the
number of days that appraisers must be selected] days. The selected appraisers must attempt
to determine the value of the Sharing Ratio owned by the Incapacitated Member at the time of
the Incapacitating Event, based solely on their appraisal of the total value of the Company’s
assets and the amount the decedent would have received had the assets of the Company been
sold at that time for an amount equal to their fair market value and the proceeds (after payment
of all Company obligations) were distributed as they would be upon dissolution of the Company.
In the event the two selected appraisers cannot agree on the value within __________ (__)
[Instructions: Insert the number of days the appraisers have to determine the value of the
shares] days after being selected, the appraisers must, within __________ (__) [Instructions:
Insert the number of days the appraisers have to select a third appraiser] days, select a third
appraiser. The value of the Sharing Ratio owned by the Incapacitated Member at the time of the
Incapacitating Event (and Company’s purchase price thereof) will be the average of the two
appraisals nearest in amount to one another. That amount will be final and binding on all parties
and their respective successors, assigns, and representatives. The costs and expenses of the third
appraiser and any costs and expenses of the appraiser retained but not paid for by Successor will
be offset against the purchase price paid for the Incapacitated Member’s Interest in the Company.
10
ADVERTISEMENT
0 votes
Related Articles
Related forms
Related Categories
Parent category: Business