Iowa Code 489.404 – Sharing of and right to distributions before dissolution
Current as of: 2024 | Check for updates
|
Other versions
1. Any distribution 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 489.502 and any charging order in effect under section 489.503.
Terms Used In Iowa Code 489.404
- Asset: means any of the following:a. See Iowa Code 489.14102
- Distribution: includes all of the following:
(1) A redemption or other purchase by a limited liability company of a transferable interest. See Iowa Code 489.102- Member: means a person for whom all of the following are true:
a. See Iowa Code 489.102- 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: includes a protected series, however denominated, of an entity if the protected series is established under law that limits, or limits if conditions specified under law are satisfied, the ability of a creditor of the entity or of any other protected series of the entity to satisfy a claim from assets of the protected series. See Iowa Code 489.102
- Transfer: includes any of the following:
a. See Iowa Code 489.102- Transferee: includes a person that owns a transferable interest under section 489. See Iowa Code 489.102
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 section 489.707, subsection 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 company’s obligation to make a distribution is subject to offset for any amount owed to the company by the member or a person dissociated as a member on whose account the distribution is made. - Distribution: includes all of the following: