Nevis Limited Liability Company Ordinance

PART VII
MEMBERS AND
MEMBERS' INTERESTS
Admission of 37. (1) Subject to subsection (2), a person may become a member in
members a limited liability company:
(a) in the case of a person acquiring an interest in the limited liability
company directly from the limited liability company, upon compliance
with the operating agreement or, if the operating agreement does not so
provide, upon the written consent of all members; and
(b) in the case of an assignee of an interest in the limited liability
company, as provided in section 42.
(2) The effective time of admission of a member to a limited liability company
shall be the later of:
(a) the date the limited liability company is formed; or
(b) the time provided in the operating agreement or, if no such time is
reflected therein, then when the person's admission is reflected in the
records of the limited liability company.
(3) A person may be admitted to a limited liability company as a member of a
limited liability company and may receive an interest in the limited liability
company without making a contribution or being obligated to make a
contribution to the limited liability company.
Nature of 38. A member's interest in the limited liability company is personal
member’s interest property. A member has no interest in specific limited liability company property.
Classes and 39. (1) Members' interest in a limited liability company may be:
series of
member’s interest
(a) of one or more classes or one or more series within any class thereof;
(b) with voting powers, full or limited, or without voting powers;
(c) and with such designations, preferences, rights, qualifications,
limitations or restrictions thereon as shall be stated in the operating
agreement.
(2) A limited liability company may provide in its operating agreement for one
or more classes or series of members' interest which are redeemable, in whole or
in part, at the option of the limited liability company at such price or prices,
within such period and under such conditions as are stated in the operating
agreement.
Termination of 40. (1) As used in this section "Bankruptcy" includes, unless
a member’s otherwise provided in the operating agreement, a member or
interest manager;
(a) assigning any interest for the benefit of creditors;
(b) filing a voluntary petition in bankruptcy, or its equivalent;
(c) adjudicated as a bankrupt or as insolvent;
(d) filing a petition or answer seeking any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief
under any statute, law or regulation;
(e) filing an answer or other pleading admitting or failing to contest the
material allegations of a petition filed in any proceeding of this nature;
(f) seeking, consenting to, or acquiescing in the appointment of a trustee,
receiver, or liquidator of all or any substantial part of his properties;
(g) failing to obtain dismissal within 120 days of any proceeding filed
against him seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any statute,
law or regulation; or
(h) failing to obtain within 120 days vacatur or a stay of the appointment
of, or the failure to obtain within 120 days of the date on which the stay
was obtained vacatur of the appointment of, a trustee, receiver or
liquidator of all or any substantial part of his properties.
(2) Unless otherwise provided in the operating agreement, a person ceases to be
a member of a limited liability company upon the happening of one of the
following termination events:.
(a) the member's resignation, expulsion, death, bankruptcy or
dissolution, or such other event specified in the operating agreement; or
(b) the member's assignment of his entire interest pursuant to section 42.
(3) Upon the happening of a termination event specified in paragraph (a) of
subsection (2), a member shall be treated as having relinquished his member's
interest in the limited liability company and shall become an assignee pursuant
to subsection (2) of section 42.
(4) Unless provided otherwise in the operating agreement, notwithstanding the
termination of a member’s interest, no member, assignee or successor to a
terminated member may withdraw such member’s share of the limited liability
company capital or other property from the limited liability company nor may
he require the limited liability company to acquire his interest prior to
dissolution of the limited liability company or the happening of events specified
in the operating agreement.
(a) If the member, pursuant to the operating agreement, has the power to
withdraw his share of limited liability company capital or other property
at specified times or upon the occurrence of specified events, such a
withdrawal by a member before the specified time or event is a breach of
the operating agreement unless otherwise provided in the operating
agreement.
(b) If the member, breaches the operating agreement, or the withdrawal
occurs as a result of otherwise wrongful conduct of the member, or the
member is expelled for cause, the limited liability company may recover
the withdrawing member damages for breach of the operating agreement
or as a result of the wrongful conduct or expulsion, including the
reasonable costs of obtaining replacement of the services the withdrawn
or expelled member was obligated to perform and may offset the
damages against the amount otherwise distributable to him, in addition
to pursuing any remedies provided for in the operating agreement or
otherwise available under applicable law.
(5) Unless provided otherwise in the operating agreement, the pledge of, or
granting of a security interest, lien or other encumbrance in or against any or all
of a member's interest is not an assignment and shall not cause the member to
cease to be a member.
Distribution 41. Upon the happening of a termination event that does not cause a
upon termination dissolution of the limited liability company pursuant to section 51 (1) (c)
of member’s if the operating agreement provides for a distribution to a terminating
interest member in liquidation of such member's interest in the limited liability company but
does not provide the amount of or a method for determining such liquidating
distribution to a terminating member, the member shall receive within a reasonable time
after termination of his interest the fair market value of the member's interest in the
limited liability company as of the date of termination of his interest based upon the net
amount which a willing purchaser would pay for the interest to a willing seller, neither
being under any compulsion to buy or to sell and both having reasonable knowledge of
the relevant facts, but not based solely upon a proportionate value of the underlying
assets of the limited liability company.
Assignment of 42. (1) Unless provided otherwise in the operating agreement and
member’s subject to the restrictions in subsection (2), a member's interest in a
interest limited liability company is assignable in whole or in part:
(2)
(a) Unless provided otherwise in the operating agreement, and except as
provided in paragraph (b), an assignment does not entitle the assignee to
vote on matters on which members may vote, to participate in the
management and affairs of the limited liability company or to become, or
to exercise any rights of, a member, nor is an assignee responsible for
fulfilling fiduciary obligations for which members are responsible, if
any. An assignment entitles the assignee to receive, to the extent
assigned, only those distributions to which the assignor would be entitled
and such share of profits, losses, income, gain, deductions and credits
which were allocable to the assignor pursuant to the operating
agreement.
(b) Unless provided otherwise in the operating agreement, an assignee of
a member's interest may, to the extent assigned, become a member with
the full rights and powers of the assignor, and is subject as a member to
the same restrictions and liabilities as the assignor, including any
liability of the assignor to make capital contributions, if the members
other than the assignor and assignee consent to such assignee becoming
a member.
(c) The assignor is not released from his liability to make capital
contributions to the limited liability company, until such time as the
assignee satisfies such requirement.
(3) Unless provided otherwise in the operating agreement, any person becoming
entitled by operation of law or otherwise to a member's interest due to the death
or incompetency of any member of a limited liability company organized under
this Ordinance shall be considered an assignee under this Ordinance and shall
have all the right of an assignee of the member's interest. The operating
agreement may provide that such person may become a member without
consent of the members upon such evidence being produced as may reasonably
be required by the managers.
Rights of 43. (1) On application to a court of competent jurisdiction by any
judgement judgment creditor of a member of a limited liability company, the
creditor court may charge the member's interest with payment of the unsatisfied amount
of the judgement with interest. To the extent so charged, the judgment creditor
has only the rights of an assignee of the member's interest.
(2) Unless otherwise provided in the operating agreement, the member's interest
charged may, but need not, be redeemed at any time:
(a) with separate property of any member, to any one or more of the
members; or
(b) with respect to property of the limited liability company, to any one
or more of the members whose interests are not charged, on the consent
of the members whose interest are not charged, if all members are
responsible for management duties pursuant to section 44 (1), or on the
consent of the managers whose interest are not charged, if managers are
responsible for management duties pursuant to section 44 (2).
(3) Notwithstanding any other law the remedies provided by subsection (1) shall
be the sole.remedies available to any creditor of a member's interest.
(4) This Ordinance does not deprive any member of the benefit of any
exemption laws applicable to his interest in the limited liability company.