(1) The member resigns (unless the terms of the operating contract limit it); As you can see, the typical LLC enterprise agreement, such as the LLC Act, provides, in certain circumstances, for unbundling caused by the dissociated member, but most LLC enterprise agreements do not have provisions allowing for the unbundling of one member at the choice of the other members. However, it is possible that an LLC enterprise agreement may include such a provision. For example, there is no reason why an LLC enterprise agreement should not allow the dissociation of one member by the unanimous vote of the other members. Of course, it would not work very well if there were only two members — as soon as there is an argument, one member could vote for the other. Even for more than two members, a provision to vote one member “off the island” appears to be being misused. If the company agreement does not grant the right to expel a member, the company or member must rely on a court order under Article 45(6), which can be chaotic and costly for all parties. Section 45(6) contains little guidance on what is “conduct in relation to activity that does not reasonably make the conduct of business with the member” or “unlawful” conduct harmful to the business. `Unlawful` conduct most likely does not mean a breach of the company agreement, since Article 45(2) of the Act already provides that members may be dissociated due to a breach of the company agreement. § 45, para. 4 of the Act provides for the exclusion of a member under the company agreement. This dissociation event also supplants a member when an agreed event arrives, but it is much more contradictory. For example, the parties may agree in advance that conviction for an offence results in the exclusion of a member. The dissociation of a member`s interests can occur in different ways.
First, in certain circumstances, a member may voluntarily distance himself or herself under the law. For example, a member of a member-run business has the power to distance himself or herself at any time, rightly or wrongly, under the law. The posting of a member is illegal only if it is contrary to an express provision of the company agreement. To avoid conflicts, the company agreement, if the members wish to have the possibility of voluntarily separating from the company, must expressly authorize such abandonment. The revised Act now describes: (1) a member`s power to distance himself or herself; (2) unlawful dissociation by a member; (3) events that lead to the dissociation of a member; and (4) the effects of dissociation of a member. Minn. Stat. § 322C.0601-0603. These new legal provisions are late payment provisions that can be modified, restricted, replaced or extended by the terms of a company agreement. See Minn. Stat. § 322C.0110, subds.
2 and 3. Thus, the parties can agree on termination rules if they wish.. . .