Legal Question in Business Law in Colorado

You normally do not file anything with the state for member dissociation unless for some very strange reason you put each of the members in the articles of organization. Normally you provide very little in the articles unless you provided some attachment on these specific members. The first place to determine what the LLC must do should be provided in the written operating agreement. If you do not have a written operating agreement, is something that should be done ASAP or you will regret not having this.

In the event you have no operating agreement, you need to come to an agreement on the purchase of this departing member�s interest (in LLCs they are termed members not partners). If you have three members each of those members should have a specified ownership interest either in the form of economic units or sharing ratios. That interest should have been issued by the LLC on the basis of some form of capital (either cash, property, a note, sweat equity, so on) for the necessary capital account. You therefore should have an agreement to purchase this interest either by the LLC or the members. There may be tax consequences in this transaction that need to be considered.

As to the agreement, it should be very clear and backed up by consents for the LLC records. You would normally want terms like releases, representations and warranties, and other relevant terms. In short, it is complex and doing this incorrectly could be costly on a legal and a tax basis.

I again strongly recommend talking to a business attorney as soon as possible to draft the documents for this matter and to complete an operating agreement. Good luck.

DISCLAIMER�This answer is for informational purposes only and discusses general legal principles, trends, and considerations and is not intended as specific legal advice regarding your question. This answer does not establish an attorney client relationship.

I agree with Robert's answer and that you should retain a business attorney. There are potentially many issues, such as insurance, notes, taxes, competition, asset protection, other liabilities and benefits, and so on that should be addressed. The short answer is NO. Just a separation agreement will not be enough.

DISCLAIMER�This answer is for informational purposes only and discusses general legal principles, trends, and considerations and is not intended as specific legal advice regarding your question. This answer does not establish an attorney client relationship. http://www.garycjohnsonlaw.com 720-323-3776