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Distribution two years liquidating love maddison

CHAPTER 25-5
NON-LIQUIDATING DISTRIBUTIONS

25-5-1 Interim Distributions.

Except as provided in this Part, an Owner is entitled to receive distributions from an LLC before the Owner’s dissociation from the LLC and before its dissolution and winding up to the extent and at the times or upon the events specified in the Operating Agreement, or to the extent and at the times determined by the Owners or managers.

25-5-2 Allocation of Distributions.

Distributions of cash or other assets of an LLC shall be allocated among the Owners as provided in Operating Agreement, or if the Operating Agreement does not so provide, on the basis of the value of the contributions made by each Owner.

25-5-3 Distribution Upon Partial Redemption.

Except as provided in this Part, upon the distribution in partial liquidation of an Owner’s interest, the redeeming Owner is entitled to receive the amount to which the Owner is entitled under the Operating Agreement and, if not otherwise provided in the Operating Agreement, the fair value of the redeemed interest based on the Owner’s right to share in distributions from the LLC.

25-5-4 Distribution Upon Dissociation.

Except as otherwise provided in this Part, upon an event of dissociation under Section 25-3-7 that does not cause dissolution of the LLC, a dissociating Owner is entitled to receive any distribution to which Owner is entitled under the Operating Agreement and, if not otherwise provided in the Operating Agreement, the fair market value of the Owner’s interest in the LLC based on the Owner’s rights to share in distributions from the LLC.

25-5-5 Distribution in Kind.

Unless otherwise provided in the Operating Agreement:

(A)    An Owner may not demand and receive any distribution from an LLC in any form other than cash.

(B)    An Owner may not be compelled to accept a distribution of any asset in kind except for a liquidating distribution made proportionately.

25-5-6 Right to Distribution.

At the time that an Owner becomes entitled to receive a distribution from an LLC, the Owner has the status of and is entitled to all remedies available to a creditor of the LLC with respect to the distribution; provided, however, that such right shall not in any way limit any other remedy available to such Owner under any other provision of applicable law of the Operating Agreement.

25-5-7 Limitations of Distributions.

(A)    An LLC may not declare or make a distribution to any of its Owners, if after giving effect to the distribution, any of the following would occur:

(1)    The LLC would be unable to pay its debts as they become due in the usual course of business.

(2)    The fair market value of the LLC’s total assets would be less than the sum of its total liabilities plus, unless the Operating Agreement provides otherwise, the amount that would be needed for the preferential rights upon dissolution of Owners, if any.

(B)    An LLC may base a determination that a distribution is not prohibited by subsection (A), above, on any of the following:

(1)    Financial statements and other financial data prepared on the basis of accounting practices and principles that are reasonable under the circumstances.

(2)    A fair market valuation or other method that is reasonable under the circumstances.

(C)    An LLC’s indebtedness to an Owner incurred by reason of a distribution made in accordance with this Section is at parity with the LLC’s indebtedness to its general unsecured creditors, except to the extent subordinated by written agreement. This Section does not affect the validity or priority of a security interest in an LLC’s property that is created to secure the indebtedness to the Owner.

25-5-8 Liability for Wrongful Distribution.

(A)    Except as provided in subsection (B) below, an Owner (other than the Nation or Tribal Entity) or manager who votes or assents to a distribution in violation of Section 25-5-7 or of the Operating Agreement is personally liable to the LLC for the amount of the excess distribution, subject to contribution from all other managers or Owners participating in such action.

(B)    An action to recover under this Section may be brought in the Tribal Court; however, a proceeding under this Section is barred unless it is brought within two (2) years after the date of the distribution.

(C)    Nothing in this Code serves to waive any aspect of the Nation’s sovereign immunity, and any waiver thereof must be provided explicitly in the LLC’s Operating Agreement.

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