Except as provided in this article, 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.
Distributions of cash or other assets of an LLC shall be allocated
among the owners as provided in the operating agreement, or if the
operating agreement does not so provide, on the basis of the value
of the contributions made by each owner.
Except as provided in this article, 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.
Except as otherwise provided in this article, upon an event of dissociation under § 4.2-28 that does not cause dissolution of the LLC, a dissociating owner is entitled to receive any distribution to which the 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.
Unless otherwise provided in the operating agreement:
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.
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 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:
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.
A.
Except as provided in Subsection B below, an owner (other than the Band or tribal entity) or manager who votes or assents to a distribution in violation of § 4.2-38 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 chapter serves to waive any aspect of the Band's
sovereign immunity, and any waiver thereof must be provided explicitly
in the LLC's operating agreement.
