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North Dakota Century Code Title 10. Corporations § 10-32.1-48. Events causing dissociation

Current as of January 01, 2024 | Updated by Findlaw Staff

A person is dissociated as a member from a limited liability company when:

1. The company has notice of the express will of the person to withdraw as a member, but, if the person specified a withdrawal date later than the date the company had notice, then on that later date;

2. An event stated in the operating agreement as causing the dissociation of the person occurs;

3. The person is expelled as a member pursuant to the operating agreement;

4. The person is expelled as a member by the unanimous consent of the other members if:

a. It is unlawful to carry on the activities of the company with the person as a member;

b. There has been a transfer of all of the transferable interest of the person in the company, other than:

(1) A transfer for security purposes; or

(2) A charging order in effect under section 10-32.1-45 which has not been foreclosed;

c. The person is a corporation and, within ninety days after the company notifies the person that it will be expelled as a member because:

(1) The person has filed articles of dissolution or the equivalent;

(2) Its charter has been revoked;

(3) Its right to conduct business has been suspended by the jurisdiction of its incorporation;

(4) The articles of dissolution have not been revoked; or

(5) Its charter or right to conduct business has not been reinstated; or

d. The person is a limited liability company or partnership that has been dissolved and whose business is being wound up;

5. On application by the company, the person is expelled as a member by judicial order because the person:

a. Has engaged, or is engaging, in wrongful conduct that has adversely and materially affected, or will adversely and materially affect, the activities of the company;

b. Has willfully or persistently committed, or is willfully and persistently committing, a material breach of the operating agreement or the duties or obligations of the person under section 10-32.1-41; or

c. Has engaged, or is engaging, in conduct relating to the activities of the company which makes it not reasonably practicable to carry on the activities with the person as a member;

6. In the case of a person who is an individual:

a. The individual dies; or

b. In a member-managed limited liability company:

(1) A guardian or general conservator for the individual is appointed; or

(2) There is a judicial order that the individual has otherwise become incapable of performing the duties of the individual as a member under this chapter or the operating agreement;

7. In a member-managed limited liability company, the person:

a. Becomes a debtor in bankruptcy;

b. Executes an assignment for the benefit of creditors; or

c. Seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or liquidator of the person or of all or substantially all of the property of the person;

8. In the case of a person that is a trust or is acting as a member by virtue of being a trustee of a trust, the entire transferable interest of the trust in the company is distributed;

9. In the case of a person that is an estate or is acting as a member by virtue of being a personal representative of an estate, the entire transferable interest of the estate in the company is distributed;

10. In the case of a member that is not an individual, partnership, limited liability company, corporation, trust, or estate, the termination of the member;

11. The company participates in a merger under sections 10-32.1-55 through 10-32.1-71, if:

a. The company is not the surviving entity; or

b. Otherwise as a result of the merger, the person ceases to be a member;

12. The company participates in a conversion under sections 10-32.1-61 through 10-32.1-71;

13. The company participates in a domestication under sections 10-32.1-67 through 10-32.1-71, if, as a result of the domestication, the person ceases to be a member; or

14. The company terminates.

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Cite this article: FindLaw.com - North Dakota Century Code Title 10. Corporations § 10-32.1-48. Events causing dissociation - last updated January 01, 2024 | https://codes.findlaw.com/nd/title-10-corporations/nd-cent-code-sect-10-32-1-48/

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