Utah Code 48-3a-404. Sharing of and right to distributions before dissolution
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(1) Any distributions made by a limited liability company before its dissolution and winding up must be in equal shares among members and persons dissociated as members, except to the extent necessary to comply with a transfer effective under Section 48-3a-502 or charging order in effect under Section 48-3a-503.
Terms Used In Utah Code 48-3a-404
- Distribution: means a transfer of money or other property from a limited liability company to a person on account of a transferable interest or in the person's capacity as a member. See Utah Code 48-3a-102
- Equal: means , with respect to biological sex, of the same value. See Utah Code 68-3-12.5
- Member: means a person that:(14)(a) has become a member of a limited liability company under Section 48-3a-401 or was a member in a company when the company became subject to this chapter under Section 48-3a-1405; and(14)(b) has not dissociated under Section 48-3a-602. See Utah Code 48-3a-102
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: means an individual, business corporation, nonprofit corporation, partnership, limited partnership, limited liability company, limited cooperative association, unincorporated nonprofit association, statutory trust, business trust, common-law business trust, estate, trust, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. See Utah Code 48-3a-102
- Transfer: includes :
(28)(a) an assignment;(28)(b) a conveyance;(28)(c) a sale;(28)(d) a lease;(28)(e) an encumbrance, including a mortgage or security interest;(28)(f) a gift; and(28)(g) a transfer by operation of law. See Utah Code 48-3a-102- Transferee: means a person to which all or part of a transferable interest has been transferred, whether or not the transferor is a member. See Utah Code 48-3a-102
(2) A person has a right to a distribution before the dissolution and winding up of a limited liability company only if the limited liability company decides to make an interim distribution. A person’s dissociation does not entitle the person to a distribution.(3) A person does not have a right to demand or receive a distribution from a limited liability company in any form other than money. Except as otherwise provided in Subsection 48-3a-711(4), a limited liability company may distribute an asset in kind only if each part of the asset is fungible with each other part and each person receives a percentage of the asset equal in value to the person’s share of distributions.(4) If a member or transferee becomes entitled to receive a distribution, the member or transferee has the status of, and is entitled to all remedies available to, a creditor of the limited liability company with respect to the distribution. However, the limited liability company’s obligation to make a distribution is subject to offset for any amount owed to the limited liability company by the member or a person dissociated as a member on whose account the distribution is made.