183.0404(1)(1) Unless otherwise provided in an operating agreement or this chapter, and subject to
sub. (2), an affirmative vote, approval or consent as follows shall be required to decide any matter connected with the business of a limited liability company:
183.0404(1)(a)
(a) If management of a limited liability company is reserved to the members, an affirmative vote, approval or consent by members whose interests in the limited liability company represent contributions to the limited liability company of more than 50% of the value, as stated in the records required to be kept under
s. 183.0405 (1), of the total contributions made to the limited liability company.
183.0404(1)(b)
(b) If the management of a limited liability company is vested in one or more managers, the affirmative vote, consent or approval of more than 50% of the managers.
183.0404(2)
(2) Unless otherwise provided in an operating agreement or this chapter, the affirmative vote, approval or consent of all members shall be required to do any of the following:
183.0404(2)(b)
(b) Issue an interest in a limited liability company to any person.
183.0404(2)(d)
(d) Allow a limited liability company to accept any additional contribution from a member.
183.0404(2)(e)
(e) Allow a partial redemption of an interest in a limited liability company under
s. 183.0603.
183.0404(2)(g)
(g) Authorize a manager, member or other person to do any act on behalf of the limited liability company that contravenes an operating agreement, including any provision of the operating agreement that expressly limits the purpose or business of the limited liability company or the conduct of the business of the limited liability company.
183.0404(3)
(3) Unless otherwise provided in an operating agreement, if any member is precluded from voting with respect to a given matter, then the value of the contribution represented by the interest in the limited liability company with respect to which the member would otherwise have been entitled to vote shall be excluded from the total contributions made to the limited liability company for purposes of determining the 50% threshold under
sub. (1) (a) for that matter.
183.0404(4)
(4) Unless otherwise provided in an operating agreement or this chapter, if all or part of an interest in the limited liability company is assigned under
s. 183.0704, all of the following apply:
183.0404(4)(a)
(a) The assigning member shall be considered the owner of the assigned interest for purposes of determining the 50% threshold under
sub. (1) (a) until the assignee of the interest in the limited liability company becomes a member under
s. 183.0706.
183.0404(4)(b)
(b) If the assigning member ceases to be a member of the limited liability company, and until the assignee of the interest in the limited liability company becomes a member under
s. 183.0706, the contribution represented by the assigned interest shall be excluded from the total contributions made to the limited liability company for purposes of determining the 50% threshold under
sub. (1) (a).
183.0404 History
History: 1993 a. 112.
183.0405
183.0405
Records and information. 183.0405(1)
(1) A limited liability company shall keep at its principal place of business all of the following:
183.0405(1)(a)
(a) A list, kept in alphabetical order, of each past and present member and, if applicable, manager. The list shall include the full name and last-known mailing address of each member or manager, the date on which the person became a member or manager and the date, if applicable, on which the person ceased to be a member or manager.
183.0405(1)(b)
(b) A copy of the articles of organization and all amendments to the articles.
183.0405(1)(c)
(c) Copies of the limited liability company's federal, state and local income or franchise tax returns and financial statements, if any, for the 4 most recent years or, if such returns and statements are not prepared for any reason, copies of the information and statements provided to, or which should have been provided to, the members to enable them to prepare their federal, state and local income tax returns for the 4 most recent years.
183.0405(1)(d)
(d) Copies of all operating agreements, all amendments to operating agreements and any operating agreements no longer in effect.
183.0405(1)(e)
(e) Unless already set forth in an operating agreement, written records containing all of the following information:
183.0405(1)(e)2.
2. Records of the times at which or the events upon which any additional contributions are agreed to be made by each member.
183.0405(1)(e)3.
3. Any events upon which the limited liability company is to be dissolved and its business wound up.
183.0405(2)
(2) Upon reasonable request, a member may, at the member's own expense, inspect and copy during ordinary business hours any limited liability company record required to be kept under
sub. (1) and, unless otherwise provided in an operating agreement, any other limited liability company record, wherever the record is located.
183.0405(3)
(3) Members or, if the management of the limited liability company is vested in one or more managers, managers shall provide, to the extent that the circumstances render it just and reasonable, true and full information of all things affecting the members to any member or to the legal representative of any member upon reasonable request of the member or the legal representative.
183.0405(4)
(4) Failure of a limited liability company to keep or maintain any of the records or information required under this section shall not be grounds for imposing liability on any person for the debts and obligations of the limited liability company.
183.0405 History
History: 1993 a. 112;
1995 a. 400.
FINANCE
183.0501(1)(1) A member's contributions to a limited liability company may consist of cash, property or services rendered, or promissory notes or other written obligations to provide cash or property or to perform services.
183.0501(2)
(2) The value of a member's contribution shall be determined in the manner provided in an operating agreement. If the members do not enter into an operating agreement or if an operating agreement does not so provide, the value of a contribution shall be approved by the members under
s. 183.0404 (2) (f). That value shall be properly reflected in the records and information kept by the limited liability company under
s. 183.0405 (1) and the value shall be binding and conclusive on the limited liability company and its members.
183.0501 History
History: 1993 a. 112.
183.0502
183.0502
Liability for contribution. 183.0502(1)
(1) An obligation of a member to provide cash or property or to perform services as a contribution to a limited liability company is not enforceable unless specified in a writing signed by the member.
183.0502(2)
(2) Unless otherwise provided in an operating agreement, a member is obligated to a limited liability company to perform any enforceable promise to provide cash or property or to perform services, even if the member is unable to perform because of death, disability or any other reason. If a member does not provide cash, property or services as promised, the member is obligated at the option of the limited liability company to provide cash equal to that portion of the value, as stated in the records required to be kept under
s. 183.0405 (1), of the stated contribution that has not been fulfilled.
183.0502(3)
(3) Unless otherwise provided in an operating agreement, a member's obligation to provide cash or property or perform services as a contribution to the limited liability company may be compromised only by the written consent of all of the members.
183.0502 History
History: 1993 a. 112.
183.0503
183.0503
Allocation of profits and losses. The profits and losses of a limited liability company shall be allocated among the members in the manner provided in an operating agreement. If the members do not enter into an operating agreement or the operating agreement does not so provide, profits and losses shall be allocated on the basis of value, as stated in the records required to be kept under
s. 183.0405 (1), of the contributions made by each member.
183.0503 History
History: 1993 a. 112.
NONLIQUIDATING DISTRIBUTIONS
183.0601
183.0601
Interim distributions. Except as provided in this subchapter, a member is entitled to receive distributions from a limited liability company, before the member's dissociation from the limited liability company and before its dissolution and winding up, to the extent and at the times or upon the events specified in an operating agreement, or, if not otherwise provided in an operating agreement, to the extent and at the times determined by the members or managers under
s. 183.0404 (1).
183.0601 History
History: 1993 a. 112;
1995 a. 400.
183.0602
183.0602
Allocation of distributions. Distributions of cash or other assets of a limited liability company shall be allocated among the members as provided in an operating agreement. If the members do not enter into an operating agreement or the operating agreement does not so provide, distributions shall be allocated in the same manner that profits are allocated under
s. 183.0503.
183.0602 History
History: 1993 a. 112;
1995 a. 400.
183.0603
183.0603
Distribution upon partial redemption. Except as provided in this subchapter, upon the distribution in partial redemption by a limited liability company of a member's interest, the redeeming member is entitled to receive with respect to the redeemed interest any distribution to which the member is entitled under an operating agreement and, if not otherwise provided in an operating agreement, within a reasonable time after the redemption, the redeeming member is entitled to receive the fair value of the redeemed interest as of the date of redemption based on the member's right to share in distributions from the limited liability company.
183.0603 History
History: 1993 a. 112.
183.0604
183.0604
Distribution upon dissociation. Except as otherwise provided in this subchapter, upon an event of dissociation under
s. 183.0802 that does not cause dissolution of the limited liability company, a dissociating member is entitled to receive any distribution to which the member is entitled under an operating agreement and, if not otherwise provided in an operating agreement, within a reasonable time after dissociation, the dissociating member is entitled to receive a distribution in complete redemption of the fair value of the member's interest in the limited liability company as of the date of dissociation based on the member's right to share in distributions from the limited liability company.
183.0604 History
History: 1993 a. 112.
183.0605
183.0605
Distribution in kind. Unless otherwise provided in an operating agreement, all of the following apply:
183.0605(1)
(1) A member may not demand and receive any distribution from a limited liability company in any form other than cash, regardless of the form of the member's contribution to the limited liability company.
183.0605(2)
(2) A member may not be compelled to accept a distribution of any asset in kind from a limited liability company to the extent that the percentage of the asset distributed to the member exceeds the percentage in which the member shares in distributions from the limited liability company.
183.0605 History
History: 1993 a. 112.
183.0606
183.0606
Right to distribution. At the time that a member becomes entitled to receive a distribution from a limited liability company, the member has the status of and is entitled to all remedies available to a creditor of the limited liability company with respect to the distribution.
183.0606 History
History: 1993 a. 112.
183.0607
183.0607
Limitations on distribution. 183.0607(1)
(1) A limited liability company may not declare or make a distribution to any of its members if, after giving effect to the distribution, any of the following would occur:
183.0607(1)(a)
(a) The limited liability company would be unable to pay its debts as they become due in the usual course of business.
183.0607(1)(b)
(b) The fair value of the limited liability company's total assets would be less than the sum of its total liabilities plus, unless an operating agreement provides otherwise, the amount that would be needed, if the limited liability company were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of members, if any, whose preferential rights are superior to those of the members receiving the distribution.
183.0607(2)
(2) A limited liability company may base a determination that a distribution is not prohibited by
sub. (1) on any of the following:
183.0607(2)(a)
(a) Financial statements and other financial data prepared on the basis of accounting practices and principles that are reasonable under the circumstances.
183.0607(2)(b)
(b) A fair valuation or other method that is reasonable under the circumstances.
183.0607(3)
(3) Except as provided in
sub. (5), the effect of a distribution for purposes of
sub. (1) is measured as of the following date:
183.0607(3)(a)
(a) The date on which the distribution is authorized if the payment occurs within 120 days after the date of authorization.
183.0607(3)(b)
(b) The date on which payment is made if the payment occurs more than 120 days after the date of authorization.
183.0607(4)
(4) A limited liability company's indebtedness to a member incurred by reason of a distribution made in accordance with this section is at parity with the limited liability company's indebtedness to its general, unsecured creditors, except to the extent subordinated by written agreement. This subsection does not affect the validity or priority of a security interest in a limited liability company's property that is created to secure the indebtedness to the member.
183.0607(5)
(5) Indebtedness of a limited liability company, including indebtedness issued as a distribution, is not considered a liability for purposes of a determination under
sub. (1) if the terms of the indebtedness provide that payment of principal and interest is to be made only if, and to the extent that, payment of a distribution to members could then be made under this section. If indebtedness is issued as a distribution, each payment of principal or interest on the indebtedness is treated as a distribution, the effect of which is measured on the date on which the payment is made.
183.0607 History
History: 1993 a. 112.
183.0608
183.0608
Liability for wrongful distribution. 183.0608(1)
(1) Except as provided in
sub. (3), a member or manager who votes for or assents to a distribution in violation of
s. 183.0607 or of an operating agreement is personally liable to the limited liability company for the amount of the distribution that exceeds what could have been distributed without violating
s. 183.0607 or the operating agreement.
183.0608(2)
(2) Each member or manager who is liable under
sub. (1) for a wrongful distribution is entitled to contribution from all of the following persons:
183.0608(2)(a)
(a) Every other member or manager who could be held liable under
sub. (1) for the wrongful distribution.
183.0608(2)(b)
(b) Every member for the amount that the member received knowing that the distribution was made in violation of
s. 183.0607 or of an operating agreement.
183.0608(3)
(3) A proceeding under this section is barred unless it is brought within 2 years after the date on which the effect of the distribution was measured under
s. 183.0607.
183.0608 History
History: 1993 a. 112.
OWNERSHIP AND TRANSFER OF
PROPERTY
183.0701
183.0701
Ownership of limited liability company property. 183.0701(1)(1) All property originally transferred to or subsequently acquired by or on account of a limited liability company is property of the limited liability company and not of the members individually.
183.0701(2)
(2) Property acquired with limited liability company funds is presumed to be limited liability company property.
183.0701(3)
(3) Property may be acquired, held and conveyed in the name of a limited liability company. Any interest in real property may be acquired in the name of a limited liability company and title to any interest so acquired shall vest in the limited liability company rather than in the members individually.
183.0701 History
History: 1993 a. 112.
