347.103. Dissolution as result of withdrawal of member, distribution--withdrawal in violation of agreement.
Dissolution as result of withdrawal of member,distribution--withdrawal in violation of agreement.
347.103. 1. If a limited liability company dissolves and winds up itsbusiness and affairs as a result of an event of withdrawal of a member, then,except as otherwise provided in the operating agreement, such member and hispersonal representatives, successors and assigns shall have the rights of anassignee of the withdrawn member's interest in the limited liability companyto receive distributions with respect to such interest during and uponcompletion of winding up, but the limited liability company may, in additionto any remedies otherwise available under applicable law, reduce the amountsdistributable with respect to such interest by any damages recoverable againstthe withdrawn member if such event of withdrawal violated the operatingagreement.
2. If the business of a limited liability company is continued followingan event of withdrawal of a member, then, except as otherwise provided in theoperating agreement, such member shall have the rights of an assignee of thewithdrawn member's interest in the limited liability company. The withdrawnmember shall be entitled to receive any distributions to which he is entitledupon such event of withdrawal under the provisions of the operating agreement. If the operating agreement does not provide for the amount of or a method fordetermining the distribution, if any, to which a withdrawn member is entitled,the withdrawn member shall be entitled, except in the case of an event ofwithdrawal pursuant to subsection 2 of section 347.123, to receive from the**limited liability company, upon demand for such distribution made by or onbehalf of such withdrawn member within one hundred eighty days after suchevent of withdrawal and subject to the limitation set forth in section347.109, the fair value of such withdrawn member's interest in the limitedliability company as of the date of withdrawal based upon such withdrawnmember's right to share in distributions from the limited liability company asan ongoing operation. If such demand is not made on a timely basis, thelimited liability company may, except as provided in the operating agreement,purchase the withdrawn member's interest in the limited liability company, forthe fair value of such withdrawn member's interest in the limited liabilitycompany determined as of the date of withdrawal based upon such withdrawnmember's right to share in distributions from the limited liability company asan ongoing operation, at any time, upon thirty days' written notice from thelimited liability company to the withdrawn member, such withdrawn member'spersonal representatives, successors or assigns. In any event, if such eventof withdrawal violated the operating agreement:
(1) The goodwill of the limited liability company's business shall beexcluded in determining the fair value of the withdrawn member's interest;
(2) In addition to any remedies otherwise available under applicablelaw, the amount payable to the withdrawn member shall be reduced by anydamages suffered by the limited liability company or its members as a resultof the withdrawn member's breach of the operating agreement; and
(3) The limited liability company may defer payment of the amount thewithdrawn member is entitled to receive for such period, and shall secure thesame by such collateral, as may be approved by a court, in order to preventunreasonable hardship to the limited liability company.
3. The provisions of this section apply to all limited liabilitycompanies in existence on the effective date of this section*, unless suchlimited liability company elects otherwise by the written agreement of all itsmembers.
(L. 1993 S.B. 66 & 20 § 359.758, A.L. 1997 H.B. 655 merged with S.B. 170)*Effective 6-24-97 (H.B. 655) 5-20-97 (S.B. 170)
**Word "the" does not appear in original rolls.