Fillable California Llc Operating Agreement Template (Page 6 of 16) in pdf

6.1 Resignation of Membership and Return of Capital. For a period of one (1) year after

the Articles of Organization for the Company are filed (“the filing”), no Member may voluntarily

resign his membership in the Company, and no Member shall be entitled to any return of capital

from the company, except upon the written consent of all of the other Voting Members. During the

second year after the filing, a Member may voluntarily resign his membership, but such Member shall

be entitled to receive from the Company only the book value of his Ownership Interest, adjusted for

profits and losses to the date of resignation, unless otherwise agreed by written consent of all of the

other Voting Members. Subsequent to the second year after filing, a Member may voluntarily resign

his membership and shall be entitled to receive from the Company the fair market value of his

Ownership Interest, adjusted for profits and losses to the date of resignation. Fair market value may

be determined informally by unanimous agreement of all of the Voting Members, including the

resigning Member. In the absence of an informal agreement as to fair market value, the Voting

Members shall hire an appraiser to determine fair market value. The cost of any appraisal shall be

deducted from the fair market value to which the resigning Member is entitled. The other Voting

Members may elect, by written notice that is provided to the resigning Member within thirty (30)

days after the resignation date, for the Company to purchase the resigning Member’s Interest

(whether the interest is being purchased at book value or fair market value) in four (4) equal annual

installments, with the first installment being due sixty (60) days after the Member’s resignation.

6.2 Death of a Member. Upon the death of a Member, the Member’s estate or

beneficiary or beneficiaries, as the case may be, shall be entitled to receive from the Company, in

exchange for all of the deceased Member’s Ownership Interest, the fair market value of the

deceased Member’s Ownership Interest, adjusted for profits and losses to the date of death. Fair

market value may be determined informally by a unanimous good-faith agreement of all of the

Voting Members. In the absence of an informal agreement as to fair market value, the Voting

Members shall hire an appraiser to determine fair market value. The cost of any appraisal shall be

deducted from the fair market value to which the deceased Member’s estate or beneficiary or

beneficiaries is or are entitled. The Voting Members may elect, by written notice that is provided to

the deceased Member’s estate or beneficiary or beneficiaries, within thirty (30) days after the

Member’s death, to purchase the deceased Member’s Ownership Interest over a one-year (1 year)

period, in four (4) equal installments, with the first installment being due sixty (60) days after the

Member’s date of death. Unless otherwise agreed unanimously by the Voting Members, prior to

the completion of such purchase, the Member’s estate or beneficiary or beneficiaries, shall have no

right to become a Member or to participate in the management of the business and affairs of the

Company as a Member or Manager, and shall only have the rights of an Assignee and be entitled

only to receive the share of profits and the return of capital to which the deceased Member would

otherwise have been entitled. The Company, or the other Voting Members, in its or their

discretion, may purchase insurance on the lives of any of the Members, with the company or the

purchasing Member named as the beneficiary, as the purchaser may decide, and use all or any of

the proceeds from such insurance as a source of proceeds from which the deceased Member’s

Membership Ownership Interest may be purchased by the Company.

6.3 Restrictions on Transfer. Except (i) as otherwise provided in this Article or (ii) upon

the unanimous consent of all of the other Voting Members, no Member shall sell, hypothecate,

pledge, assign or otherwise transfer, with or without consideration, any part or all of his Ownership

Interest in the Company to any other person or entity (a “Transferee”), without first offering (the

“Offer”) that portion of his or her Ownership Interest in the Company subject to the contemplated

transfer (the “Offered Interest”) first to the Company, and secondly, to the other Voting Members,

at the purchase price (hereinafter referred to as the “Transfer Purchase Price”) and in the manner as

prescribed in the Offer.

The Offering Member shall make the Offer first to the Company by written notice (hereinafter

referred to as the “Offering Notice”). Within twenty (20) days (the “Company Offer Period”) after

California Llc Operating Agreement Template Page 6

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