183.0704 Assignment of limited liability company interest.

(1) Unless otherwise provided in an operating agreement, all of the following apply:

(a) A limited liability company interest is assignable in whole or in part.

(b) An assignment of a limited liability company interest entitles the assignee to receive only the distributions and to share in the allocations of profits and losses to which the assignor would be entitled with respect to the assigned interest.

(c) An assignment of a limited liability company interest does not dissolve the limited liability company.

(d) Unless and until the assignee becomes a member of the limited liability company under s. 183.0706, an assignment of a limited liability company interest does not entitle the assignee to participate in the management of the business of the limited liability company or to become or exercise any rights of a member nor does an assignment result in the assignee having liability as a member of the limited liability company as a result of the assignment.

(e) Unless and until the assignee of a limited liability company interest becomes a member of the limited liability company under s. 183.0706, the assignor continues to be a member and to have the power to exercise the rights of a member, subject to the members' right to remove the assignor under s. 183.0802.

(f) The assignor of a limited liability company interest is not released from any personal liability arising under this chapter as a member of the limited liability company solely as a result of the assignment.

(2) An operating agreement may provide that a member's limited liability company interest may be evidenced by a certificate of limited liability company interest issued by the limited liability company and may also provide for the assignment or transfer of any interest represented by the certificate.

(3) Unless otherwise provided in an operating agreement, the pledge of, or the granting of a security interest, lien or other encumbrance in or against any or all of a member's limited liability company interest is not an assignment and shall not cause the member to be an assignor or to cease to have the power to exercise any rights or powers of a member.

History: 1993 a. 112.

When Does a Member's Interest in an LLC Become a Security? Briska. Wis. Law. Sept. 1994.