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Membership Interest Purchase Agreement

Document the transfer of ownership in an LLC with this Membership Interest Purchase Agreement Template.

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Membership Interest Purchase Agreement

Membership Interest Purchase Agreement Template


This Membership Interest Purchase Agreement (“Agreement”) is entered into on [Date], by and between:

Seller: [Full Legal Name / Company Name]
Address: [Address]
Contact: [Phone, Email]

Buyer: [Full Legal Name / Company Name]
Address: [Address]
Contact: [Phone, Email]

LLC: [Full Legal Name of LLC]
Address: [Address]
Jurisdiction of Formation: [State/Country]

Together referred to as the “Parties.”


1. Sale and Transfer of Membership Interest

The Seller hereby sells, assigns, and transfers to the Buyer [X%] of the membership interest in the LLC, including all rights, title, and economic interests, subject to the LLC’s operating agreement.


2. Purchase Price and Payment

  • Purchase Price: $[Amount].

  • Payment Method: [Wire transfer, certified check, etc.].

  • Payment Timing: [On closing / installment terms].


3. Closing

The closing shall take place on [Date] at [Location], or at another time and place agreed by the Parties. At closing, the Seller shall deliver assignment documents and the Buyer shall deliver the purchase price.


4. Representations and Warranties of Seller

The Seller represents and warrants that:

  • They are the lawful owner of the membership interest being sold.

  • The membership interest is free of liens or encumbrances.

  • They have full authority to transfer the interest.

  • The transfer does not violate the LLC’s operating agreement or applicable laws.


5. Representations and Warranties of Buyer

The Buyer represents and warrants that:

  • They have full authority to enter this Agreement.

  • They are acquiring the interest for investment/business purposes and not in violation of any law.


6. Conditions Precedent

The obligations of the Parties are subject to:

  • Consent or approval required under the LLC operating agreement.

  • Any necessary third-party or regulatory approvals.


7. Indemnification

Each Party agrees to indemnify and hold harmless the other for losses arising out of breaches of representations, warranties, or covenants under this Agreement.


8. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of [State/Country].


9. Entire Agreement

This document constitutes the full understanding between the Parties and supersedes all prior discussions or agreements. Any amendments must be in writing and signed by both Parties.


Signatures

Seller: ____________________________ Date: _________
Name/Title: [Full Name, Title]

Buyer: ____________________________ Date: _________
Name/Title: [Full Name, Title]

LLC (Acknowledgment): ______________ Date: _________
Name/Title: [Managing Member/Authorized Officer]

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Membership Interest Purchase Agreement

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For quick answers, scroll below to see the FAQ.

MEMBERSHIP INTEREST PURCHASE AGREEMENT FAQ


What is a Membership Interest Purchase Agreement?

A Membership Interest Purchase Agreement is a binding contract used when one party buys all or part of an ownership interest in a limited liability company (LLC). It establishes the terms of the sale, the transfer of rights, and the responsibilities of both buyer and seller.


Why is a Membership Interest Purchase Agreement important?

It protects both parties by documenting the purchase price, warranties, representations, and liabilities. It also ensures compliance with the LLC’s operating agreement and applicable laws.


When should you use a Membership Interest Purchase Agreement?

Use it when an existing member sells their ownership stake, when new investors are admitted, or when ownership is restructured in an LLC. It is essential for ensuring clarity and avoiding disputes.


What should a Membership Interest Purchase Agreement include?

It should specify the LLC details, membership interest being sold, purchase price, payment terms, closing conditions, representations and warranties, indemnification, and governing law.


Does this agreement transfer management rights as well as ownership?

Yes—unless otherwise restricted by the LLC operating agreement, a buyer typically receives both economic rights and management rights associated with the membership interest.


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