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Searching 2019-2020 Session

The Vermont Statutes Online

 

Title 11 : Corporations, Partnerships and Associations

Chapter 025 : LIMITED LIABILITY COMPANIES

Subchapter 006 : MEMBER'S DISSOCIATION

(Cite as: 11 V.S.A. § 4081)
  • § 4081. Events causing member's dissociation

    A person 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, if a later withdrawal date is specified by the member, on the later date;

    (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 unanimous vote of the other members if:

    (A) it is unlawful to carry on the company's business with the person as a 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) a corporation that is a member fails to obtain a revocation of its certificate of dissolution or a reinstatement of its charter or its right to conduct business within 90 days after the company notifies such member that it will be expelled because it has filed a certificate of dissolution or the equivalent, its charter has been revoked, or its right to conduct business has been suspended by the jurisdiction of its incorporation; or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 has adversely and materially affected, or will adversely and materially affect, the company's business;

    (B) willfully or persistently committed a material breach of the operating agreement or of a duty owed to the company or the other members under section 4059 of this title; or

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

    (6) in a member-managed limited liability company, 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 90 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 fails within 90 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; or

    (B) in a member-managed limited liability company:

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

    (ii) 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 distributional interest in 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, partnership, limited liability company, corporation, estate, or trust;

    (11) the company participates in a merger under subchapter 10 of this chapter and:

    (A) the company is not the surviving entity; or

    (B) the person otherwise ceases to be a member as a result of the merger;

    (12) the company participates in a conversion under subchapter 10 of this chapter;

    (13) the company participates in a domestication under subchapter 10 of this chapter, and, the person ceases to be a member as a result of the domestication; or

    (14) termination of a member's continued membership in a limited liability company for any other reason. (Added 2015, No. 17, § 2.)