Legal Question in Business Law in Virginia

I am a 50% shareholder in a two-person LLC. It is a restaurant. I submitted for retirement March 2009. Other shareholder opted not to buy me out. Is refusing to keep restaurant open with interested buyer who wants to buy but only as an operating business. My partner's refusal to stay open may cost the sale.
LLC agreement states that if the other shareholder opts not to purchase my shares, all reasonable and diligent efforts to liquidate the assets must be persued. The business is worth $50K more as an operation than closed. Is the refusal to continue to operate until the sale a violation of the reasonable and dilligent efforts to liquidate requirement?

Asked on 12/28/09, 6:05 am

Michael Hendrickson Law Office Michael E. Hendrickson

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As long as the provision cited in the operating agreement could

be reasonably interpreted to allow for such "reasonable and

diligent efforts to liquidate" whether the restaurant was open

or closed, I would be inclined to say, no, your partner's refusal

should not be considered a violation of the agreement (in my opinion).

Furthermore, from the partner's perspective, there could be the

issue of additional losses incurred on his part if he were

required to keep the business open.

Answered on 1/02/10, 7:52 am

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