Limited Liability Company
Members may withdraw from an LLC unless the operating agreement or articles of organization limit their ability to do so. A member must usually provide to the LLC written notice that he or she intends to withdraw. If a withdrawal violates the operating agreement, the withdrawing member may be liable to the other members or the LLC for damages associated with it. State law frequently sets forth the circumstances under which a member may withdraw from an LLC. In many states a member may withdraw only if he or she provides six months' written notice of the intent to withdraw. In a few states, an LLC cannot prevent a member's withdrawal.
A member who withdraws is usually entitled to a return of his capital contribution to an LLC, unless the withdrawal is unauthorized. Some LLCs instead pay a withdrawing member the fair market value of his or her membership interest. The operating agreement typically provides for the method and manner of payment of a withdrawing member's interest. State law also governs those issues.
- Limited Liability Company - Dissolution
- Limited Liability Company - Taxation
- Other Free Encyclopedias
Law Library - American Law and Legal InformationFree Legal Encyclopedia: Legislative Veto to Lloyd'sLimited Liability Company - History, Formation, Structure, Operating Agreement, Membership Interests, Member Contributions, Liability, Records And Books