Operating Agreement Of Llc Page 11
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17On completion of the purchase of the Incapacitated Member’s Sharing Ratio in the Company, the
Sharing Ratio of the remaining Members will increase proportionately.
iii.
Should Company fail to exercise its right to purchase the Sharing Ratio of
the Incapacitated Member within __________ (__) [Instructions: Insert the number of days
the Company has to purchase the shares of an incapacitated member] days of the occurrence
of the Incapacitating Event, the Successor may attempt to transfer the Incapacitated Member’s
Sharing Ratio to a third party. In the event that the substitution complies with the terms of this
Agreement, the third party shall become a Member; otherwise, the transfer shall only be of the
Incapacitated Member’s Economic Rights.
e.
Buyout upon Deadlock. Notwithstanding anything to the contrary contained
herein, in the event that a Deadlock occurs and the parties agree that a buyout is the best course
of action, the Members covenant and agree that the Member(s) that are purchasing, acquiring,
and redeeming (the “Purchasing Member(s)”) the Sharing Ratio of the other Member(s) (the
“Selling Member(s)”) must pay fair market value. To determine the fair market value of the
Selling Member(s)’ Sharing Ratio of the Company, the Purchasing Member(s) and the Selling
Member(s) shall each select a qualified appraiser. The selected appraisers must attempt to
determine the value of the Sharing Ratio owned by the Selling Member(s) at the time of
appraisal, based solely on their appraisal of the total value of the Company’s assets and the
amount the Selling Member(s) 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 two appraisers have to agree on the value of
shares] days after being selected, the appraisers must, within __________ (__) [Instructions:
Insert the number of days the two appraisers have to select a third appraiser] days, select a
third appraiser. The value of the Sharing Ratio owned by the Selling Member(s) 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 appraisers will be offset against the purchase price paid for the Selling
Member(s)’ interest in the Company.
7.
DISSOLUTION AND WINDING UP
a.
The Company will be dissolved, its assets disposed of, and its affairs wound up on
the first of the following “Dissolution Events” to occur:
i.
The happening of an event stated in this Agreement or the Articles;
ii.
A determination that the Company be dissolved and wound up by
Members whose Sharing Ratios equal more than __________ percent (___%) [Instructions:
Insert the percentage of shares that must approve dissolution] of the Sharing Ratios of all
Members;
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