Section 48-249-505 - Effect of termination of membership interest(a)Termination other than under § 48-249-503(a)(8). If a member's membership interest terminates for any reason other than as the result of an event specified in § 48-249-503(a)(8), then:(1) If the existence and business of the LLC are continued, the member whose membership interest has terminated loses all governance rights and will be considered merely a holder of the financial rights owned before the termination of the membership interest, other than any financial rights transferred by the member in connection with the termination of the membership interest; and(2) If the existence and business of the LLC are not continued, the member whose membership interest has terminated retains all governance rights owned before the termination, and may exercise those rights through the winding up and termination of the LLC, except as otherwise provided under § 48-249-504, in the case of termination in contravention of the LLC documents.(b)Termination under § 48-249-503(a)(8). If the membership interest of a member terminates as a result of an event specified in § 48-249-503(a)(8): (1) If the existence and business of the LLC are continued, then, effective as of the date of the applicable termination event, the governance rights associated with the affected membership interest are suspended and may not be exercised thereafter, unless and until restored under subdivision (b)(2). So long as such suspension remains in effect, such member, or the personal representative of such member, shall be considered merely the holder of the financial rights owned before the termination under § 48-249-503(a)(8);(2) If the existence and business of the LLC are continued, for a period of sixty (60) days following the event specified in § 48-249-503(a)(8) that results in the suspension of governance rights under subdivision (b)(1), the personal representative of the affected member shall have the option, exercisable by giving written notice to the LLC, to require the LLC to purchase the membership interest of the member whose membership interest has terminated under subsection (c) and § 48-249-506. If the personal representative fails to make such election within such period, then the LLC shall have the option for a period of sixty (60) days following expiration of the personal representative's option, or, if earlier, following the date of written notice from the personal representative that such option will not be exercised, to give written notice to the personal representative that the LLC will purchase the membership interest in accordance with subsection (c) and § 48-249-506. If neither the personal representative nor the LLC elects to exercise their respective options to cause the LLC to purchase the membership interest, the governance rights associated with the membership interest shall be restored, effective as of the first day following expiration of the LLC's option period, and the personal representative shall be automatically admitted and substituted as a member of the LLC without further action. If either the personal representative or the LLC elects to cause the LLC to purchase the membership interest, the suspension of governance rights associated with such membership interest shall continue through the time the purchase is consummated; and(3) If the existence and business of the LLC are not continued, the personal representative of the member whose membership interest has terminated retains all governance rights owned by the affected member before the termination of the membership interest, and may exercise those rights through the winding up and termination of the LLC, except as otherwise provided under § 48-249-504, in the case of termination in contravention of the LLC documents.(c)Purchase at fair value. If the existence and business of the LLC are continued following the termination of a membership interest under § 48-249-503(a), other than terminations arising under § 48-249-503(a)(3), (a)(9), (a)(10) or (a)(11), then, regardless whether such termination of membership interest was wrongful, any member whose membership interest has so terminated, other than a member for whom a personal representative has been automatically substituted and admitted as a member under subdivision (b)(2), is entitled, subject to the offset provisions of § 48-249-504(2), to receive from the LLC the fair value of the terminated membership interest as of the date of termination of such membership interest, calculated as set forth in § 48-249-506, in consideration for all such membership interest.(d)Distribution if business not continued. Subject to § 48-249-504(2), if the business and existence of the LLC are not continued, any member whose membership interest has terminated, regardless of whether such termination was wrongful or otherwise, is entitled to receive that member's distribution under § 48-249-620.