Buy Sell Provisions in an LLC Operating Agreement
While many LLC Operating Agreements are silent on this point, it is a good idea to include so called Buy Sell provisions in the LLC Operating Agreement.
Buy Sell provisions set forth what is going to happen when an LLC Member wants to leave the LLC, dies, is unable to continue his or here duties, declares bankruptcy, wants to sell his or her interest to an outsider, or when the LLC members are hopelessly deadlocked in the management of the LLC. All of these scenarios could seriously harm the LLC or the remaining members.
The most common buy sell provision is probably the so called right of first refusal, which would provide that an owner can sell his LLC membership interest to an outsider if he or she has first offered it to the LLC or the remaining LLC members and such members declined.
**This post is for informational purposes only. For actual legal advice contact a business lawyer, business attorney or business law firm**