2006 New York Code - Assignment Of Membership Interest.



 
    §  603.  Assignment  of membership interest. (a) Except as provided in
  the operating agreement,
    (1) a membership interest is assignable in whole or in part;
    (2) an assignment of a membership interest does not dissolve a limited
  liability  company  or  entitle  the  assignee  to  participate  in  the
  management  and affairs of the limited liability company or to become or
  to exercise any rights or powers of a member;
    (3) the only effect of an assignment of a membership  interest  is  to
  entitle   the   assignee   to  receive,  to  the  extent  assigned,  the
  distributions and  allocations  of  profits  and  losses  to  which  the
  assignor would be entitled; and
    (4)  a  member ceases to be a member and to have the power to exercise
  any rights or powers of a member upon assignment of all of  his  or  her
  membership   interest.   Unless  otherwise  provided  in  the  operating
  agreement, the pledge of, or the granting of a security  interest,  lien
  or  other  encumbrance  in  or  against,  any  or  all of the membership
  interest of a member shall not cause the member to cease to be a  member
  or  to  cease  to  have  the power to exercise any rights or powers of a
  member.
    (b) The operating agreement may provide that a member's  interest  may
  be  evidenced  by  a certificate issued by the limited liability company
  and may also provide for the  assignment  or  transfer  of  any  of  the
  interest represented by such a certificate. A member's interest may be a
  certificated  security  or an uncertificated security within the meaning
  of section 8--102 of the uniform commercial code if the requirements  of
  section  8--103(c)  are  met,  and  if the requirements are not met such
  interest shall, for purposes of the uniform commercial code,  be  deemed
  to  be  a general intangible asset. The existence of the restrictions on
  the sale or transfer of a membership  interest,  as  contained  in  this
  chapter  and,  if applicable, in the operating agreement, shall be noted
  conspicuously on the face or back of every  certificate  representing  a
  membership  interest  issued by a limited liability company. Any sale or
  transfer in violation of such restrictions shall be void.
    (c) Unless otherwise provided in an operating agreement and except  to
  the  extent  assumed  by  agreement,  until  the  time,  if any, that an
  assignee of a membership interest becomes a member, the  assignee  shall
  have no liability as a member solely as a result of the assignment.

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