1997 Minnesota Statutes

     322B.306 Termination of a membership interest. 

    Subdivision 1.    Member's power to terminate membership. 
  A member always has the power, though not necessarily the 
 right, to terminate its membership by resigning or retiring at 
 any time.  A member's resignation or retirement, whether 
 rightful or wrongful, causes dissolution under section 322B.80, 
 subdivision 1, clause (5), unless dissolution is avoided under 
 that clause.  A member has no power to transfer all or part of 
 the member's membership interest, except as provided in sections 
 322B.31 and 322B.313. 

    Subd. 2.    When expulsion permitted.  Unless otherwise 
 provided in the articles of organization, a member may not be 
 expelled.  

    Subd. 3.    Effect of termination of membership on the 
 governance rights of the terminated member.  If for any reason 
 the continued membership of a member is terminated:  

    (1) if dissolution under section 322B.80, subdivision 1, 
 clause (5), is avoided under that clause, then the member whose 
 membership has terminated loses all governance rights and will 
 be considered merely an assignee of the financial rights owned 
 before the termination of membership; and 

    (2) if dissolution under section 322B.80, subdivision 1, 
 clause (5), is not avoided under that clause, the member whose 
 continued membership has terminated retains all governance 
 rights and financial rights owned before the termination of the 
 membership and may exercise those rights through the winding up 
 and termination of the limited liability company.  

    Subd. 4.    Additional effects if termination of 
 membership is wrongful.  If a member resigns or retires in 
 contravention of the articles of organization or a member 
 control agreement then: 

    (1) if dissolution avoidance consent is obtained, the 
 member who has wrongfully resigned or retired is liable to the 
 limited liability company to the extent damaged by the wrongful 
 resignation or retirement; and 

    (2) if dissolution avoidance consent is not obtained, 
 section 322B.873 applies. 

    HIST: 1992 c 517 art 2 s 27; 1993 c 137 s 32-34