reglab/statecodes huggingface dataset:
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 2 - RIGHT TO DISSENT (§§ 48-231-201 — 48-231-209) › Section 48-231-203 - Notice of intent to demand payment

(a)
If proposed LLC action creating dissenters' rights under §
48-231-201
is submitted to a vote at a members' meeting, a member who wishes to assert dissenters' rights:
(1)
Must deliver to the LLC, before the vote is taken, written notice of such member's intent to demand payment for such member's membership interest if the proposed action is effectuated; and
(2)
Must not vote such member's membership interest in favor of the proposed action. No such written notice of intent to demand payment is required of any member to whom the LLC failed to provide the notice required by §
48-231-202
.
(b)
A member who does not satisfy the requirements of subsection (a) is not entitled to payment for such member's membership interest under this chapter.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 2 - RIGHT TO DISSENT (§§ 48-231-201 — 48-231-209) › Section 48-231-204 - Dissenters' notice

(a)
If proposed LLC action creating dissenters' rights under §
48-231-201
is authorized at a members' meeting, the LLC shall deliver a written dissenters' notice to all members who satisfied the requirements of §
48-231-203
.
(b)
The dissenters' notice must be sent no later than ten (10) days after the LLC action was authorized by the members or effectuated, whichever is the first to occur, and must:
(1)
State where the payment demand must be sent;
(2)
Supply a form for demanding payment that includes the date of the first announcement to news media or to members of the principal terms of the proposed LLC action and requires that the person asserting dissenters' rights certify whether or not the member acquired membership interest before that date;
(3)
Set a date by which the LLC must receive the payment demand, which date may not be fewer than one (1) nor more than two (2) months after the date required in subsection (a) is delivered; and
(4)
Be accompanied by a copy of this chapter, if the LLC has not previously sent a copy of this chapter to the member pursuant to §
48-231-202
.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 2 - RIGHT TO DISSENT (§§ 48-231-201 — 48-231-209) › Section 48-231-205 - Duty to demand payment

(a)
A member sent a dissenters' notice described in §
48-231-204
must demand payment and certify whether the member acquired the membership interest before the date required to be set forth in the dissenters' notice pursuant to §
48-231-204(b)(2)
.
(b)
The member who demands payment under subsection (a) retains all other rights of a member until these rights are cancelled or modified by the effectuation of the proposed LLC action.
(c)
A member who does not demand payment by the date set in the dissenters' notice is not entitled to payment for such member's membership interest under this chapter.
(d)
A demand for payment filed by a member may not be withdrawn unless the LLC with which it was filed, or the surviving LLC, consents to such withdrawal.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 2 - RIGHT TO DISSENT (§§ 48-231-201 — 48-231-209) › Section 48-231-206 - Payment

(a)
Except as provided in §
48-231-208
, as soon as the proposed LLC action is effectuated, or upon receipt of a payment demand, whichever is later, the LLC shall pay each dissenter who complied with §
48-231-205
the amount the LLC estimates to be the fair value of such dissenter's partnership interest, plus accrued interest.
(b)
The payment must be accompanied by:
(1)
The LLC's balance sheet as of the end of a fiscal year ending not more than sixteen (16) months before the date of payment, an income statement for that year, and the latest available interim financial statements, if any;
(2)
A statement of the LLC's estimate of the fair value of the membership interests;
(3)
An explanation of how the value of the membership interest was calculated;
(4)
A statement of the dissenter's right to demand payment under §
48-231-209
; and
(5)
A copy of this chapter, if the LLC has not previously sent a copy of this chapter to the member pursuant to §
48-231-202
or §
48-231-204
.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 2 - RIGHT TO DISSENT (§§ 48-231-201 — 48-231-209) › Section 48-231-207 - Failure to take action

If the LLC does not effectuate the proposed action that gave rise to the dissenters' rights within two (2) months after the date set for demanding payment, it must send a new dissenters' notice under §
48-231-203
and repeat the payment demand procedure if it effectuates the proposed action.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 2 - RIGHT TO DISSENT (§§ 48-231-201 — 48-231-209) › Section 48-231-208 - After-acquired membership interests

(a)
An LLC may elect to withhold payment required by §
48-231-206
from a dissenter unless the dissenter was a member before the date set forth in the dissenters' notice as the date of the first announcement to news media or to members of the principal terms of the proposed LLC action.
(b)
To the extent the LLC elects not to withhold payment under subsection (a), after effectuating the proposed LLC action, it shall estimate the fair value of the membership interest, plus accrued interest, and shall pay this amount to each dissenter who agrees to accept it in full satisfaction of the dissenter's demand. The LLC shall send with its offer a statement of its estimate of the fair value of the membership interest, an explanation of how the interest was calculated, and a statement of the dissenter's right to demand payment under §
48-231-209
.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 2 - RIGHT TO DISSENT (§§ 48-231-201 — 48-231-209) › Section 48-231-209 - Procedure if member dissatisfied with payment or offer

(a)
A dissenter may notify the LLC in writing of the dissenter's own estimate of the fair value of such dissenter's membership interest and amount of interest due, and demand payment of the dissenter's estimate (less any payment under §
48-231-206
), or reject the LLC's offer under §
48-231-208
and demand payment of the fair value of membership interest and interest due, if:
(1)
The dissenter believes that the amount paid under §
48-231-206
or offered under §
48-231-208
is less than the fair value of such dissenter's membership interest or that the interest due is incorrectly calculated; or
(2)
The LLC fails to make payment under §
48-231-206
within two (2) months after the date set for demanding payment.
(b)
A dissenter waives the right to demand payment under this section unless the dissenter notifies the LLC of such dissenter's demand in writing under subsection (a) within one (1) month after the LLC made or offered payment for such dissenter's membership interest.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 3 - COURT ACTION (§§ 48-231-301 — 48-231-302) › Section 48-231-301 - Court action

(a)
If a demand for payment under §
48-231-209
remains unsettled, the LLC shall commence a proceeding within two (2) months after receiving the payment demand and petition the court to determine the fair value of the membership interest and accrued interest. If the LLC does not commence the proceeding within the two-month period, it shall pay each dissenter whose demand remains unsettled the amount demanded.
(b)
The LLC shall commence the proceeding in a court of record having equity jurisdiction in the county where the LLC's principal executive office (or, if none in this state, its registered office) is located. If the LLC is a foreign LLC without a registered office in this state, it shall commence the proceeding in the county in this state where the registered office of the domestic LLC merged with, or whose membership interests were acquired by, the foreign LLC was located.
(c)
The LLC shall make all dissenters (whether or not residents of this state) whose demands remain unsettled, parties to the proceeding as in an action against their membership interests, and all parties must be served with a copy of the petition. Nonresidents may be served by registered or certified mail or by publication as provided by law.
(d)
The jurisdiction of the court in which the proceeding is commenced under subsection (b) is plenary and exclusive. The court may appoint one (1) or more persons as appraisers to receive evidence and recommend decision on the question of fair value. The appraisers have the powers described in the order appointing them, or in any amendment to it. The dissenters are entitled to the same discovery rights as parties in other civil proceedings.
(e)
Each dissenter made a party to the proceeding is entitled to judgment:
(1)
For the amount, if any, by which the court finds the fair value of the dissenter's membership interest plus accrued interest exceeds the amount paid by the LLC; or
(2)
For the fair value, plus accrued interest, of such dissenter's after-acquired membership interests for which the LLC elected to withhold payment under §
48-231-208
.
(f)
The LLC is entitled to judgment against each specific dissenter for the amount, if any, by which the court finds the fair value of such dissenter's membership interest, plus accrued interest, is less than the amount paid by the LLC to each dissenter.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 3 - COURT ACTION (§§ 48-231-301 — 48-231-302) › Section 48-231-302 - Court costs and counsel fees

(a)
The court in an appraisal proceeding commenced under §
48-231-301
shall determine all costs of the proceeding, including the reasonable compensation and expenses of appraisers appointed by the court. The court shall assess the costs against the LLC, except that the court may assess costs against all or some of the dissenters, in amounts the court finds equitable, to the extent the court finds the dissenters acted arbitrarily, vexatiously, or not in good faith in demanding payment under §
48-231-209
.
(b)
The court may also assess the fees and expenses of counsel and experts for the respective parties, in amounts the court finds equitable:
(1)
Against the LLC and in favor of any or all dissenters if the court finds the LLC did not substantially comply with the requirements of part 2 of this chapter;
(2)
Against either the LLC or a dissenter, in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously, or not in good faith with respect to the rights provided by this chapter.
(c)
If the court finds that the services of counsel for any dissenter were of substantial benefit to other dissenters similarly situated, and that the fees for those services should not be assessed against the LLC, the court may award to these counsel reasonable fees to be paid out of the amounts awarded to the dissenters who were benefited.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 231 - DISSENTERS' RIGHTS (§§ 48-231-101 — 48-231-401) › Part 4 - PROCEDURES AS TO ASSIGNEES OF FINANCIAL RIGHTS (§ 48-231-401) › Section 48-231-401 - Procedures as to assignees of financial rights

When an assignment of some or all of the financial rights of a membership interest is in effect and a copy delivered to the LLC prior to the time described in §
48-231-206
, then as to that membership interest parts 1-3 of this chapter must be followed subject to the following revisions:
(1)
All rights to be exercised and actions to be taken by a member under parts 2 and 3 of this chapter shall be taken by the member and not by any assignee of the member's financial rights as between the LLC and the assignees, the actions taken or omitted by the member bind the assignees;
(2)
Instead of remitting a payment under §
48-231-206
, the LLC shall forward to the dissenter member:
(A)
The materials described in §
48-231-206(b)
;
(B)
An offer to pay the amount listed in the materials, with that amount to be allocated among and paid to the member and the assignees of financial rights according to the terms of the assignments reflected in the required records; and
(C)
A statement of that allocation;
(3)
If the dissenter member accepts the amount of the offer made under subdivision (2) but disputes the allocation, the dissenter shall promptly so notify the LLC and promptly after the notification bring an action to determine the proper allocation. The suit must be filed in the county in which the registered office of the LLC is located, or in the case of a surviving foreign LLC or other entity that is complying with this section following a merger with a constituent LLC, the suit must be filed in the county in this state in which the last registered office of the constituent LLC was located. The suit must name as parties the member, the LLC and all assignees of the member's financial rights. Upon being served with the action, the LLC shall promptly pay into the court the amount offered under subdivision (2) and shall then be dismissed from the action;
(4)
If the dissenter considers the amount offered under subdivision (2) inadequate, the dissenter may decline the offer and demand payment under §
48-231-209
. If the dissenter makes demand, part 3 of this chapter applies, with the court having jurisdiction also to determine the correctness of the allocation;
(5)
If the member fails to take action under either subdivision (3) or (4), then:
(A)
As to the LLC, both the member and the assignees of the member's financial rights are limited to the amount and allocation offered under subdivision (2); and
(B)
The LLC discharges its obligation of payment by making payment according to the amount and allocation offered under subdivision (2).
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 232 - CONTRIBUTIONS AND ADMISSION OF MEMBERS (§§ 48-232-101 — 48-232-102) › Section 48-232-102 - Admission of members

(a)
Approval of a New Member.
Except as otherwise provided in the articles or operating agreement after an LLC is formed, all members must approve the admission of a new person or entity as a member, the interest of such member and the contribution of such member. The articles or operating agreement may delegate the authority to approve the identity of a new member, such member's contribution and/or such member's interest to the board of governors. The sole member of an LLC may freely assign governance rights and/or membership interests in the LLC at any time. The articles or operating agreement may provide that the governance rights associated with membership interests or classes of membership interests may be transferred to persons who will become members upon such transfer without requiring consent of the members or governors.
(b)
Minimum Approval of Members.
Except in the case of a single-member LLC or as provided in subsection (d), if approval of the admission of a new member is by the members, neither the articles nor the operating agreement may reduce the vote of the members required to approve the admission of a new member to less than either a per capita majority of the nontransferring members or a majority of the profits interest of the nontransferring members or a majority of the capital interest of the nontransferring members. With respect to a single-member LLC, the transferring member may approve the admission of one (1) or more new members.
(c)
Minimum Approval of Governors.
If approval of the admission of a new member of a board-managed LLC is by the board of governors, neither the articles nor the operating agreement may reduce the vote of the governors required to approve the admission of a new member to less than a majority in number of the nontransferring governors who are members.
(d)
Consent Is Discretionary.
All consents under this section may be unreasonably withheld and are in the sole discretion of the member or governor.
Acts 1994, ch. 868, § 1; 1995, ch. 403, § 40; 1999, ch. 346, §§ 4, 5; 1999, ch. 455, § 16.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 233 - CONTRIBUTION AGREEMENTS (§ 48-233-101) › Section 48-233-101 - Contribution agreements

(a)
Signed Writing.
(1)
A contribution agreement, whether made before or after the formation of the LLC, is not enforceable against the prospective contributor unless it is in writing and signed by the prospective contributor.
(2)
A contribution agreement made after the formation of the LLC is not enforceable against the LLC unless it is approved by the required members or the board of governors sufficient to admit a new member under the articles or operating agreement and §
48-232-102
.
(3)
If the consideration to be contributed to the LLC for the membership interest is other than money, the contribution agreement shall state the value being accorded such consideration.
(b)
Irrevocable Period.
A contribution agreement is irrevocable for a period of six (6) months, unless the contribution agreement provides for, or unless all other prospective contributors who are a party to a contribution agreement consent to, a different duration.
(c)
Current and Deferred Payment.
A contribution agreement, whether made before or after the formation of an LLC, must be paid or performed in full at the time or times, or in the installments, if any, specified in the contribution agreement. In the absence of a provision in the contribution agreement specifying the time at which the contribution is to be paid or performed, the contribution must be paid or performed at the time or times determined by the members or the board of governors. If a call is made for payment or performance of contributions, the contributions must be uniform for all membership interests of the same class or for all membership interests of the same series.
(d)
Restrictions on Assignment.
The rights of a party to a contribution agreement may not be assigned, in whole or in part, to a person who was not a member or a party to a contribution agreement or a party to a contribution allowance agreement at the time of the assignment, unless all the members approve the assignment by unanimous written consent or, if the articles or operating agreement so permit, by the written consent of the members or governors sufficient to approve the admission of a new member under the articles or operating agreement and in accordance with §
48-232-102
.
Acts 1994, ch. 868, § 1; 1995, ch. 403, §§ 41-44; 1999, ch. 455, § 17.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 234 - CONTRIBUTION ALLOWANCE AGREEMENTS (§ 48-234-101) › Section 48-234-101 - Contribution allowance agreements

(a)
Agreements Permitted.
Subject to any restrictions in the articles, an LLC may enter into contribution allowance agreements under the terms, provisions, and conditions, including the value being accorded such consideration called for in the contribution allowance agreement, fixed by the board of governors or the members by an action of the members or governors as required for the admission of a new member under §
48-232-102
and permitted under the articles or operating agreement.
(b)
Writing Required and Terms to Be Stated.
A contribution allowance agreement must be in writing, and the writing must state in full, summarize, or incorporate by reference all the agreement's terms, provisions, and conditions. A contribution allowance agreement made after the formation of the LLC is not enforceable against the LLC unless it is approved by the required members or the board of governors, if applicable, sufficient to admit a new member under the articles or operating agreement and §
48-232-102
.
(c)
Restrictions on Assignment.
The rights of a party to a contribution allowance agreement may not be assigned in whole or in part to a person who was not a member or a party to a contribution agreement or a party to a contribution allowance agreement at the time of the assignment, unless all the members approve the assignment by unanimous written consent or, if the articles or the operating agreement so permit, by the written consent of the members or the board of governors as required under §
48-232-101
and as permitted in the articles or operating agreement.
Acts 1994, ch. 868, § 1; 1995, ch. 403, §§ 45-47.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 235 - FINANCIAL PROVISIONS (§§ 48-235-101 — 48-235-102) › Section 48-235-102 - Restatement of value of previous contributions

(a)
Definition.
As used in this section, an "old" contribution is a contribution reflected in the required records of an LLC before the time the LLC accepts a new contribution.
(b)
Restatement Required.
Whenever an LLC accepts a new contribution, the board of governors of a board-governed LLC or the members shall restate the value of all old contributions if and as required by applicable federal tax law.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 236 - DISTRIBUTIONS (§§ 48-236-101 — 48-236-105) › Section 48-236-101 - Sharing of distributions

Unless otherwise provided in or through the articles or operating agreement, distributions of cash or other assets of an LLC, including distributions on termination of the LLC except as provided in §
48-245-1101
, must be allocated equally among the members.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 236 - DISTRIBUTIONS (§§ 48-236-101 — 48-236-105) › Section 48-236-102 - Interim distributions

Except as provided in or through the articles or operating agreement or by a majority vote of the members, a member is entitled to receive distributions before the LLC's termination only as specified in the articles or operating agreement.
Acts 1994, ch. 868, § 1; 1995, ch. 403, § 49.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 236 - DISTRIBUTIONS (§§ 48-236-101 — 48-236-105) › Section 48-236-103 - Distribution in kind

Except as provided in the articles or an operating agreement, a member, regardless of the nature of the member's contribution, has no right to demand and receive any distribution from an LLC in any form other than cash. Except as provided in the articles or an operating agreement, a member may not be compelled to accept a distribution of any asset in kind from an LLC to the extent that the percentage of the asset distributed to the member exceeds a percentage of that asset that is equal to the percentage in which the member shares in distributions from the LLC.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 236 - DISTRIBUTIONS (§§ 48-236-101 — 48-236-105) › Section 48-236-104 - Status as a creditor

At the time a member becomes entitled to receive a distribution, the member has the status of, and is entitled to all remedies available to, a general, unsecured creditor of the LLC with respect to the distribution. The articles or an operating agreement may provide for the establishment of a record date with respect to allocations and distributions by an LLC.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 236 - DISTRIBUTIONS (§§ 48-236-101 — 48-236-105) › Section 48-236-105 - Limitations on distribution

(a)
Rule.
No distribution may be made by an LLC if, after giving effect to the distribution:
(1)
The LLC would not be able to pay its debts as they became due in the normal course of business; or
(2)
The LLC's total assets would be less than the sum of its total liabilities plus, unless the articles or an operating agreement permit otherwise, the amount that would be needed, if the LLC were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of members whose preferential rights are superior to the rights of members receiving the distribution and excluding liabilities for which the recourse of creditors is limited to specified property of the LLC, except that the fair value of property that is subject to a liability for which the recourse of creditors is limited shall be included in the assets of the LLC only to the extent that the fair value of the property exceeds that liability.
(b)
Determination.
The LLC may base a determination that a distribution is not prohibited under subsection (a) either on:
(1)
Financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances; or
(2)
A fair valuation or other method that is reasonable in the circumstances.
(c)
General Measuring Date.
The effect of a distribution under subsection (a) is measured as of:
(1)
The date the distribution is authorized if the payment occurs within four (4) months after the date of authorization; or
(2)
The date the payment is made if it occurs more than four (4) months after the date of authorization.
(d)
Special Measuring Date.
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 the payment is actually made.
(e)
Status of LLC Indebtedness for Distributions.
An LLC's indebtedness to a member incurred by reason of a distribution made in accordance with this section is at parity with the LLC's indebtedness to its general unsecured creditors, except to the extent subordinated by agreement and except to the extent provided otherwise by §
48-245-1101(a)
.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 237 - LIABILITY UPON WRONGFUL DISTRIBUTION (§ 48-237-101) › Section 48-237-101 - Liability upon wrongful distribution

(a)
Personal Liability.
Unless such person complies with the applicable standards of conduct set forth in §
48-240-103
and §
48-241-111
, a member or governor who votes for or assents to a distribution made in violation of §
48-236-105
or the articles or operating agreement is personally liable to the LLC for the amount of the distribution that exceeds what could have been distributed without violating §
48-236-105
or the articles or operating agreement.
(b)
Right of Contribution.
A governor or member held liable for an unlawful distribution under subsection (a) is entitled to contribution:
(1)
From every other governor and member who voted for or assented to the distribution; and
(2)
From each member for the amount the member accepted, knowing the distribution was made in violation of §
48-236-105
or the articles or operating agreement.
(c)
Section Not a Limitation on Liability.
Subject to subsection (d), this section shall not affect any obligation or liability of a governor or member under the articles or operating agreement or other applicable law for the amount of a distribution.
(d)
Member's Liability.
Unless otherwise agreed, a member who receives a distribution from an LLC or a manager or governor who votes for or assents to such distribution shall have no liability under this section or other applicable law for the amount of the distribution after the expiration of three (3) years from the date of the distribution.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 238 - GOVERNANCE (§§ 48-238-101 — 48-238-104) › Section 48-238-101 - Management - Authorized signature

(a)
Management.
(1)
If the LLC is member-managed, all powers shall be exercised by or under the authority of, and the business and affairs of the LLC shall be managed by or under the direction of its members.
(2)
If the LLC is board-managed, all powers shall be exercised by or under the authority of, and the business and affairs of the LLC shall be managed by or under the direction of the board of governors, subject to subsection (b) and any limitations set forth in the articles or operating agreement. An LLC shall be either member-managed or board-managed, as designated in its articles. Unless otherwise provided in the articles or operating agreement, each governor shall have equal voting power per capita with each other governor.
(b)
Authorized Signature.
For convenience, one (1) or more managers, members or governors may be designated in the articles as persons authorized to execute instruments transferring real property held in the name of the LLC and may set forth any limitations on such authority. This designation, however, in the absence of a clear statement that the named person or persons are the only person or persons authorized to execute instruments transferring real property, does not imply that other members, managers or governors do not have the authority to execute such instruments under §
48-238-103
or §
48-238-104
. A grant of authority contained in the current articles is conclusive in favor of a person who gives value without knowledge to the contrary.
Acts 1994, ch. 868, § 1; 1995, ch. 403, §§ 50-52.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 238 - GOVERNANCE (§§ 48-238-101 — 48-238-104) › Section 48-238-103 - Agency of members in a member-managed LLC

(a)
Unless the articles otherwise provide, if an LLC is member-managed, every member is an agent of the LLC for the purpose of its business, and the act of every member, including the execution in the LLC name of any instrument, for apparently carrying on in the usual way the business of the LLC of which such member is a member, binds the LLC, unless the member so acting has in fact no authority to act for the LLC in the particular matter, and the person with whom the member is dealing has knowledge of the fact that the member has no such authority.
(b)
An act of a member which is not apparently for carrying on of the business of the LLC in the usual way does not bind the LLC unless authorized by the other members.
(c)
Unless authorized by the other members, no single member or group of members less than all the members shall have authority to:
(1)
Dispose of the goodwill of the business;
(2)
Do any other act which would make it impossible to carry on the ordinary business of the LLC;
(3)
Confess a judgment; or
(4)
Submit an LLC claim or liability to arbitration or reference.
(d)
No act of a member in contravention of a restriction on such member's authority shall bind the LLC to persons having knowledge of the restriction.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 238 - GOVERNANCE (§§ 48-238-101 — 48-238-104) › Section 48-238-104 - Agency of members in a board-managed LLC

(a)
Unless the articles provide otherwise, if the LLC is board-managed, no member is an agent of the LLC for the purpose of its business, other than a member designated by the board of governors, including the execution in the LLC name of any instrument, for apparently carrying on in the usual way the business of the LLC of which such person is a member, does not bind the LLC, unless the member so acting has in fact the authority to act for the LLC in the particular matter.
(b)
Unless the articles provide otherwise, if the LLC is board-managed, the following persons are agents of the LLC and may legally bind the LLC, subject to the limitation on such persons contained in chapters 201-248 of this title:
(1)
The chief manager;
(2)
A person designated in the articles or the operating agreement as being so authorized; and
(3)
A person designated in writing by action of the governors as being so authorized.
Acts 1994, ch. 868, § 1; 1999, ch. 455, § 20.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-101 - Board of governors

(a)
General.
In the event the LLC is board-managed, the initial board of governors may be named in the articles or may be elected by the members. The board of governors must consist of one (1) or more entities which are members or individuals. The number of governors must be fixed by or in the manner provided in the articles or the operating agreement. The number of governors may be increased or, subject to §
48-239-103(b)
, decreased at any time by amendment to or in the manner provided in the articles or the operating agreement.
(b)
Size.
The articles or operating agreement may establish a variable range for the size of the board of governors by fixing a minimum and maximum number of governors. If a variable range is established, the number of governors may be fixed or changed from time to time, within the minimum and maximum, by the members or the board of governors as provided in the articles or the operating agreement. Unless the articles or operating agreement specifically provides otherwise, only the members may change the range for the size of the board or change from a fixed to a variable-range size board or vice versa.
Acts 1994, ch. 868, § 1; 1999, ch. 455, § 21.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-102 - Qualifications and election

(a)
Natural Person.
Governors must be natural persons. The method of election and any additional qualifications for governors may be imposed by or in the manner provided in the articles or operating agreement.
(b)
Nonresident.
Unless the articles or operating agreement provides otherwise, a governor need not be a resident of this state or a member of the LLC.
(c)
Governor Other Than a Natural Person.
Except for members, all governors shall be natural persons. In the event an entity that is a member is elected governor, the entity shall exercise its duties and authority by such officer or agent as the bylaws or equivalent of such entity may prescribe or, in the absence of such a provision, as the board of directors, board of governors or equivalent of such entity may determine. The secretary of the LLC shall be provided with written directions as to whom the designated natural person is that is to function on behalf of the entity. This designation may be changed from time to time. The LLC may rely upon the representations of such officer or agent as to the authority unless such authority is questioned.
(d)
Deemed Resignation of a Governor Other Than a Natural Person.
In the event a governor, other than a natural person, bankrupts or dissolves, such governor is deemed to have immediately resigned as a governor.
Acts 1994, ch. 868, § 1; 1995, ch. 403, § 54.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-103 - Terms

(a)
General.
Unless fixed terms (including staggered terms) are provided for in the articles or operating agreement, a governor serves for an indefinite term that expires at the next regular meeting of the members. A fixed term of a governor must not exceed three (3) years. A governor holds office for the term for which the governor was elected and until a successor is elected and has qualified, or until the earlier death, resignation, removal, or disqualification of the governor.
(b)
Decrease in Number.
A decrease in the number of governors does not shorten an incumbent governor's term.
(c)
Vacancy Term.
The term of a governor elected to fill a vacancy expires at the next members' meeting at which governors are elected.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-104 - Acts not void or voidable

The expiration of a governor's term with or without the election of a qualified successor does not make prior or subsequent acts of the governors or the board of governors void or voidable.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-105 - Compensation

Subject to any limitations in the articles or operating agreement, the board of governors may fix the compensation of governors for the following board. Such compensation is subject to approval by the members. If the initial board of governors is selected by the organizers, that board's compensation, if any, shall be retroactively established by the members at the first meeting of the members.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-106 - Classification of governors

Governors may be divided into classes as provided in the articles or operating agreement.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-107 - Voting for governors

(a)
Plurality.
Unless otherwise provided in the articles or operating agreement, governors are elected by a plurality of the voting power exercised in the election at a meeting at which a quorum is present.
(b)
Noncumulative Voting.
Members do not have a right to cumulate their votes for governors unless the articles or operating agreement so provides.
(c)
Cumulative Voting.
A statement included in the articles or operating agreement that "(all) (a designated voting group of) members are entitled to cumulate their votes for governors" (or words of similar import) means the members designated are entitled to multiply the number of votes they are entitled to cast by the number of governors for whom they are entitled to vote and cast the product for a single candidate or distribute the product among two (2) or more candidates.
(d)
Notice of Cumulative Voting.
Membership interests otherwise entitled to vote cumulatively may not be voted cumulatively at a particular meeting unless:
(1)
The meeting notice states conspicuously that cumulative voting is authorized; or
(2)
A member who has the right to cumulate such member's votes gives notice to the secretary of the LLC no fewer than forty-eight (48) hours before the time set for the meeting of such member's intent to cumulate such member's votes during the meeting, and if one (1) member gives this notice, all other members in the same voting group participating in the election are entitled to cumulate their votes without giving further notice. The secretary shall announce before the election that cumulative voting is in effect.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-108 - Resignation

A governor may resign at any time by giving a written resignation to the secretary or chief manager of the LLC. The resignation is effective without acceptance when such resignation is actually received by the secretary or chief manager of the LLC, unless a later effective time is specified in such resignation.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-109 - Removal of governors

(a)
The members may remove one (1) or more governors with or without cause at any time unless the articles or operating agreement provide that governors may only be removed for cause.
(b)
If a governor is elected by a voting group of members, only the members of that voting group may participate in the vote to remove the governor without cause.
(c)
Cumulative voting and removal.
If cumulative voting is authorized, a governor may not be removed if the number of votes sufficient to elect the governor under cumulative voting is voted against the governor's removal. If cumulative voting is not authorized, a governor may be removed only if the number of votes cast to remove the governor exceeds the number of votes cast not to remove the governor.
(d)
If the articles or operating agreement so provide, any or all of the governors may be removed for cause by a vote of a majority of the entire board of governors.
(e)
Meeting for removal.
A governor may be removed by the members or governors only at a meeting called for the purpose of removing the governor and the meeting notice must state that the purpose, or one (1) of the purposes, of the meeting is removal of one (1) or more governors.
(f)
Removal of governor by judicial proceeding.
(1)
A court of record having equity jurisdiction in the county where an LLC's principal executive office (or, if none in this state, its registered office) is located may remove a governor of the LLC from office in a proceeding commenced either by the LLC or by such number of its members as represent at least ten percent (10%) of the outstanding voting power of the members of the LLC if the court finds that:
(A)
The governor engaged in fraudulent or dishonest conduct, or gross abuse of authority or discretion, with respect to the LLC; and
(B)
Removal is in the best interest of the LLC.
(2)
The court that removes a governor may bar the governor from reelection for a period prescribed by the court.
(3)
If removal is by a court, the secretary or the court on its own motion may call a meeting of the members to elect one (1) or more new governors.
Acts 1994, ch. 868, § 1.
2023 Tennessee Code › Title 48 - CORPORATIONS AND ASSOCIATIONS (§§ 48-1-101 — 48-250-115) › LIMITED LIABILITY COMPANIES (§§ 48-201-101 — 48-250-115) › Chapter 239 - GOVERNOR MANAGEMENT (§§ 48-239-101 — 48-239-116) › Section 48-239-110 - Vacancy on board

(a)
Unless the articles or operating agreement provide otherwise, if a vacancy occurs on a board of governors, including a vacancy resulting from an increase in the number of governors or a vacancy resulting from a removal with or without cause:
(1)
The members may fill the vacancy;
(2)
The board of governors may fill the vacancy; or
(3)
If the governors remaining in office constitute fewer than a quorum of the board, they may fill the vacancy by the affirmative vote of a majority of all the governors remaining in office.
(b)
If the vacant office was held by a governor elected by a voting group of members, only members within that voting group are entitled to vote to fill the vacancy if it is filled by the members.
(c)
A vacancy that will occur at a specific later date (by reason of a resignation effective at a later date under §
48-239-108
or otherwise) may be filled before the vacancy occurs but the new governor may not take office until the vacancy occurs.
Acts 1994, ch. 868, § 1.