29-3602. Events causing dissociation
A person is dissociated as a member if and when:
1. The limited liability company knows or has notice of the person's express will to withdraw as a member, but if the person has specified a withdrawal date later than the date the company knew or had notice, the person is dissociated as a member on that later date.
2. An event stated in the operating agreement as causing the person's dissociation occurs.
3. The person is expelled as a member pursuant to the operating agreement.
4. The person is expelled as a member by the affirmative vote or consent of all the other members if any of the following applies:
(a) It is unlawful to carry on the limited liability company's activities and affairs with the person as a member.
(b) There has been a transfer of all of the person's transferable interest in the company other than either:
(i) A transfer for security purposes.
(ii) A charging order in effect under section 29-3503.
(c) The person is an entity and both of the following apply:
(i) The company notifies the person that the person will be expelled as a member because the person has filed a statement of dissolution or the equivalent, the person has been administratively dissolved, the person's charter or the equivalent has been revoked or the person's right to conduct business has been suspended by the person's jurisdiction of formation.
(ii) Not later than ninety days after the notification described in item (i) of this subdivision, the statement of dissolution or the equivalent has not been withdrawn, rescinded or revoked, the person has not been reinstated or the person's charter or the equivalent or right to conduct business has not been reinstated.
(d) The person is an unincorporated entity that has been dissolved and whose activities and affairs are being wound up.
5. On application by the limited liability company or a member in a direct action under section 29-3801, the person is expelled as a member by judicial order because the person does any of the following:
(a) Has engaged or is engaging in wrongful conduct that has affected adversely and materially, or will affect adversely and materially, the company's activities and affairs.
(b) Has committed wilfully or persistently, or is committing wilfully or persistently, a material breach of the operating agreement or a duty or obligation under section 29-3409 as modified by the operating agreement.
(c) Has engaged or is engaging in conduct relating to the company's activities and affairs that makes it not reasonably practicable to carry on the activities and affairs with the person as a member.
6. In the case of an individual, any of the following:
(a) The individual dies.
(b) A guardian or general conservator for the individual is appointed.
(c) A court orders that the individual has otherwise become incapable of performing the individual's duties as a member under this chapter or the operating agreement.
(d) A court of competent jurisdiction enters an order or judgment adjudicating the individual incompetent to manage the individual's person or estate.
7. The person does any of the following:
(a) Becomes a debtor in bankruptcy.
(b) Signs an assignment for the benefit of creditors.
(c) Seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of the person or of all or substantially all the person's property.
8. If the person is a testamentary or inter vivos trust or is acting as a member by virtue of being a trustee of such a trust, the trust's entire transferable interest in the limited liability company is distributed.
9. If the person is an estate or is acting as a member by virtue of being a personal representative of an estate, the estate's entire transferable interest in the limited liability company is distributed.
10. If the person is not an individual, the existence of the person terminates.
11. The limited liability company participates in a merger under article 10 of this chapter and either of the following applies:
(a) The company is not the surviving entity.
(b) Otherwise as a result of the merger, the person ceases to be a member.
12. The limited liability company participates in an interest exchange under article 10 of this chapter and, as a result of the interest exchange, the person ceases to be a member.
13. The limited liability company participates in a conversion under article 10 of this chapter.
14. The limited liability company participates in a domestication under article 10 of this chapter and, as a result of the domestication, the person ceases to be a member.
15. The limited liability company participates in a division under article 10 of this chapter and either of the following applies:
(a) The company is not the surviving entity.
(b) Otherwise as a result of the division, the person ceases to be a member.
16. The limited liability company dissolves and completes winding up.
17. The person's entire transferable interest is transferred and either of the following apply:
(a) At the effective time of the transfer, at least one transferee is a member or becomes a member.
(b) At any time after the effective time of the transfer, at least one transferee becomes a member and the transferring person has not otherwise acquired a transferable interest.
