Kentucky Statutes 275.255 – Assignment of interest
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(1) Unless otherwise provided in a written operating agreement:
(a) A limited liability company interest shall be assignable in whole or in part;
(b) An assignment shall entitle the assignee to receive, to the extent assigned, only the distributions to which the assignor would be entitled;
(c) An assignment of a limited liability company interest shall not dissolve the limited liability company or entitle the assignee to participate in the management and affairs of the limited liability company or to become or exercise any rights of a member other than the right to receive distributions pursuant to subsection (1)(b) of this section;
(d) Until the assignee of a limited liability company interest becomes a member pursuant to KRS § 275.265(1), the assignor shall continue to be a member and to have the power to exercise any rights of a member, subject to the members‘ right to remove the assignor pursuant to KRS § 275.280(1)(c)2.;
(e) Until an assignee of a limited liability company interest becomes a member, the assignee shall have no liability as a member solely as a result of the assignment; and
(f) The assignor of a limited liability company interest shall not be released from liability as a member solely as result of the assignment.
(2) A written operating agreement may provide that a member’s limited liability company interest may be evidenced by a certificate of limited liability company interest issued by the limited liability company and may also provide for the assignment or transfer of any interest represented by the certificate.
(3) Unless otherwise provided in a written operating agreement, the pledge of or granting of a security interest, lien, or other encumbrance in or against any or all of the limited liability company interest of a member shall not constitute an assignment and shall not cause the member to cease to be a member or cease to have the power to exercise any rights or powers of a member.
(4) Limitations upon the assignment or pledge of a membership interest set forth or adopted in accordance with this section shall be enforced notwithstanding KRS
355.9-406 and 355.9-408.
Effective: July 15, 2010
History: Repealed and reenacted 2010 Ky. Acts ch. 51, sec. 116, effective July 15,
2010. — Amended 2007 Ky. Acts ch. 137, sec. 116, effective June 26, 2007. — Created 1994 Ky. Acts ch. 389, sec. 51, effective July 15, 1994.
Legislative Research Commission Note (7/15/2010). 2010 Ky. Acts ch. 51, sec. 183, provides, “The specific textual provisions of Sections 1 to 178 of this Act which reflect amendments made to those sections by 2007 Ky. Acts ch. 137 shall be deemed effective as of June 26, 2007, and those provisions are hereby made expressly retroactive to that date, with the remainder of the text of those sections being unaffected by the provisions of this section.”
(a) A limited liability company interest shall be assignable in whole or in part;
Terms Used In Kentucky Statutes 275.255
- Company: may extend and be applied to any corporation, company, person, partnership, joint stock company, or association. See Kentucky Statutes 446.010
- Lien: A claim against real or personal property in satisfaction of a debt.
- members: means a person or persons who have been admitted to membership in a limited liability company as provided in KRS §. See Kentucky Statutes 275.015
- Operating agreement: means any agreement, written or oral, among all of the members, as to the conduct of the business and affairs of a limited liability company. See Kentucky Statutes 275.015
- Remainder: An interest in property that takes effect in the future at a specified time or after the occurrence of some event, such as the death of a life tenant.
(b) An assignment shall entitle the assignee to receive, to the extent assigned, only the distributions to which the assignor would be entitled;
(c) An assignment of a limited liability company interest shall not dissolve the limited liability company or entitle the assignee to participate in the management and affairs of the limited liability company or to become or exercise any rights of a member other than the right to receive distributions pursuant to subsection (1)(b) of this section;
(d) Until the assignee of a limited liability company interest becomes a member pursuant to KRS § 275.265(1), the assignor shall continue to be a member and to have the power to exercise any rights of a member, subject to the members‘ right to remove the assignor pursuant to KRS § 275.280(1)(c)2.;
(e) Until an assignee of a limited liability company interest becomes a member, the assignee shall have no liability as a member solely as a result of the assignment; and
(f) The assignor of a limited liability company interest shall not be released from liability as a member solely as result of the assignment.
(2) A written operating agreement may provide that a member’s limited liability company interest may be evidenced by a certificate of limited liability company interest issued by the limited liability company and may also provide for the assignment or transfer of any interest represented by the certificate.
(3) Unless otherwise provided in a written operating agreement, the pledge of or granting of a security interest, lien, or other encumbrance in or against any or all of the limited liability company interest of a member shall not constitute an assignment and shall not cause the member to cease to be a member or cease to have the power to exercise any rights or powers of a member.
(4) Limitations upon the assignment or pledge of a membership interest set forth or adopted in accordance with this section shall be enforced notwithstanding KRS
355.9-406 and 355.9-408.
Effective: July 15, 2010
History: Repealed and reenacted 2010 Ky. Acts ch. 51, sec. 116, effective July 15,
2010. — Amended 2007 Ky. Acts ch. 137, sec. 116, effective June 26, 2007. — Created 1994 Ky. Acts ch. 389, sec. 51, effective July 15, 1994.
Legislative Research Commission Note (7/15/2010). 2010 Ky. Acts ch. 51, sec. 183, provides, “The specific textual provisions of Sections 1 to 178 of this Act which reflect amendments made to those sections by 2007 Ky. Acts ch. 137 shall be deemed effective as of June 26, 2007, and those provisions are hereby made expressly retroactive to that date, with the remainder of the text of those sections being unaffected by the provisions of this section.”