South Dakota Codified Laws 47-34A-403. Member’s and manager’s rights to payments and reimbursement
(a) A limited liability company shall reimburse a member or manager for payments made and indemnify a member or manager for liabilities incurred by the member or manager in the ordinary course of the business of the company or for the preservation of its business or property.
(b) A limited liability company shall reimburse a member for an advance to the company beyond the amount of contribution the member agreed to make.
Terms Used In South Dakota Codified Laws 47-34A-403
- Business: includes every trade, occupation, profession, and other lawful purpose, whether or not carried on for profit. See South Dakota Codified Laws 47-34A-101
- Contribution: means any benefit provided by a person to a limited liability company:
(A) In order to become a member upon formation of the company and in accordance with an agreement between or among the persons that have agreed to become the initial members of the company. See South Dakota Codified Laws 47-34A-101
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Manager: means a person, whether or not a member of a manager-managed company, who is vested with authority under section 301. See South Dakota Codified Laws 47-34A-101
- Member: means a person that:
(A) Prior to formation of the limited liability company, becomes a member as agreed by that person and the organizer of the limited liability company. See South Dakota Codified Laws 47-34A-101
- 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 natural persons, partnerships, associations, cooperative corporations, limited liability companies, and corporations. See South Dakota Codified Laws 2-14-2
- Property: includes property, real and personal. See South Dakota Codified Laws 2-14-2
(c) A payment or advance made by a member which gives rise to an obligation of a limited liability company under subsection (a) or (b) constitutes a loan to the company upon which interest accrues from the date of the payment or advance.
(d) A member is not entitled to remuneration for services performed for a limited liability company, except for reasonable compensation for services rendered in winding up the business of the company.
(e) A limited liability company may purchase and maintain insurance on behalf of a member or manager of the limited liability company against liability asserted against or incurred by the member or manager in that capacity or arising from that status even if the operating agreement could not eliminate or limit the person‘s liability to the company for the conduct giving rise to the liability.
Source: SL 1998, ch 272, § 403; SL 2013, ch 233, § 9.