A.
Unless the articles of organization vest management in one or more
managers, management of the LLC shall be vested in the owners subject
to any provision in the operating agreement or this chapter restricting
or enlarging the management rights and duties of any owner or group
of owners. In an owner-managed liability company, the following rules
shall apply, unless otherwise provided in the operating agreement
or this chapter:
B.
If the articles of organization vest management in one or more managers,
management of the business or affairs of the LLC shall be vested in
the manager or managers subject to any provisions in the operating
agreement or this chapter restricting or enlarging the management
rights and duties of any manager or group of managers. Unless otherwise
provided in the operating agreement, the manager or managers:
Unless otherwise provided in the operating agreement:
A.
No owner or manager shall act or fail to act in a manner that constitutes
any of the following:
(1)
A willful failure to deal fairly with the LLC or its owners in connection
with a matter in which the owner or manager has a material conflict
of interest.
(2)
A violation of criminal law involving moral turpitude.
(3)
A transaction from which the owner or manager derived an improper
personal profit.
(4)
Willful misconduct.
B.
Every owner and manager shall account to the LLC and hold as trustee
for it any improper personal profit derived by that owner or manager
without the consent of a majority of the disinterested owners or managers,
or other persons participating in the management of the LLC, from
any of the following:
A.
In this section, "expenses" mean expenses of defending a lawsuit,
including attorney's fees, and any civil judgment or penalty,
or settlement payment in lieu thereof, paid in connection with a lawsuit
against an owner or manager in such capacity.
B.
An LLC shall indemnify or allow expenses to each owner and each manager
for all reasonable expenses incurred with respect to a proceeding
if that owner or manager was a party to the proceeding in the capacity
of an owner or manager.
C.
The operating agreement may alter or provide additional rights to
indemnification or allowance of expenses to owners and managers.
E.
Unless otherwise provided in the operating agreement:
(1)
An owner or manager shall be conclusively presumed not to have breached
or failed to perform a duty to the LLC to the extent that the owner
or manager has been successful on the merits or otherwise in the defense
of the proceeding.
(2)
In situations not described in Subsection E(1), above, the determination of whether owner or manager has breached or failed to perform a duty to the LLC shall be made by the vote of a majority in interest of the owners, excluding any owner who is a party to the same or related proceeding unless all owners are parties.
A.
Unless otherwise provided in the operating agreement or this section, and subject to Subsection B below, an affirmative vote, approval, or consent as follows shall be required to decide any matter connected with the business of an LLC:
B.
Unless otherwise provided in the operating agreement or this chapter,
the affirmative vote, approval, or consent of all owners shall be
required to do any of the following:
(1)
Amend the articles of organization.
(2)
Issue an interest in an LLC to any person.
(3)
Adopt, amend, or revoke the operating agreement.
[Amended 6-15-2017 by Res. No. 06-15-17-18]
(4)
Allow an LLC to accept any additional contribution from an owner.
(7)
Authorize a manager, owner, or other person to do any act on behalf
of the LLC that contravenes the operating agreement.
C.
Unless otherwise provided in the operating agreement, if any owner is precluded from voting with respect to a given matter, the value of the contribution represented by the interest in the LLC with respect to which the owner would otherwise have been entitled to vote shall be excluded from the total contributions made to the LLC for purposes of determining the 50% threshold under the definition of "majority in interest" in § 4.2-5 for that matter.
D.
Unless otherwise provided in the operating agreement or this section, if all or part of an interest in the LLC is assigned under § 4.2-43, the assigning owner shall be considered the owner of the assigned interest for purposes of determining the 50% threshold under the definition of "majority in interest" in § 4.2-5 until the assignee of the interest in the LLC becomes an owner under § 4.2-45.
A.
An LLC shall keep at its principal place of business all of the following:
(1)
A list, in alphabetical order, of each past and present owner and,
if applicable, manager.
(2)
A copy of the executed articles of organization and all amendments
to the articles, together with executed copies of any powers of attorney
under which any articles were executed.
(3)
A copy of the executed operating agreement and all amendments thereto;
together with executed copies of any powers of attorney under which
any operating agreement was executed.
(4)
A record of all matters referred to in this chapter as maintained
in such records which are not otherwise specified in the operating
agreement.
B.
Upon reasonable request, an owner may, at the owner's own expense,
inspect and copy during ordinary business hours any LLC record unless
otherwise provided in the operating agreement.
C.
Owners or, if the management of the LLC is vested in one or more
managers, managers shall provide true and full information of all
things affecting the owners to any owner or to the legal representative
of any owner upon reasonable request of the owner or the legal representative.
D.
Failure of an LLC to keep or maintain any of the records of information
required under this section shall not be grounds for imposing liability
on any person for the debts and obligations of the LLC.
A.
In connection with the formation of an LLC, a person acquiring an
LLC interest is admitted as an owner upon formation unless the operating
agreement otherwise provides.
A.
A person ceases to be an owner of an LLC upon the simultaneous occurrence
of and at the same time of any of the following events:
(1)
The owner withdraws by voluntary act.
(2)
The owner is removed as an owner in accordance with the operating
agreement or this chapter.
(3)
Unless otherwise provided in the operating agreement or by the written
consent of all owners at the time of the event, the owner does any
of the following:
(a)
Makes an assignment for the benefit of the creditors.
(b)
Files a petition in bankruptcy.
(c)
Becomes the subject of an order for relief under the federal
bankruptcy laws or state or tribal insolvency laws.
(d)
Fails to gain dismissal of any federal bankruptcy or state or
tribal insolvency proceeding within one hundred twenty (120) days
of commencement of an involuntary proceeding.
(4)
Unless provided in the operating agreement or by the written consent
of all owners, if the owner is an individual, either of the following
occurs:
(5)
Unless otherwise provided in the operating agreement or by written
agreement or by the written consent of all owners at the time, if
the owner is a trust, corporation, partnership, or limited liability
company upon liquidation, dissolution, or termination.
B.
The owners may provide in the operating agreement for other events,
the occurrence of which result in a person ceasing to be an owner
of the LLC.
C.
Unless the operating agreement provides that an owner does not have
the power to withdraw by voluntary act from an LLC, the owner may
do so at any time by giving written notice to the other owners or
as provided in the operating agreement. If the owner has the power
to withdraw but the withdrawal is a breach of the operating agreement,
the LLC may offset the damages against the amount otherwise distributable
to the owner, in addition to pursuing any remedies provided for in
the operating agreement or otherwise available under applicable law.
