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Illinois Compiled Statutes

Information maintained by the Legislative Reference Bureau
Updating the database of the Illinois Compiled Statutes (ILCS) is an ongoing process. Recent laws may not yet be included in the ILCS database, but they are found on this site as Public Acts soon after they become law. For information concerning the relationship between statutes and Public Acts, refer to the Guide.

Because the statute database is maintained primarily for legislative drafting purposes, statutory changes are sometimes included in the statute database before they take effect. If the source note at the end of a Section of the statutes includes a Public Act that has not yet taken effect, the version of the law that is currently in effect may have already been removed from the database and you should refer to that Public Act to see the changes made to the current law.

BUSINESS ORGANIZATIONS
(805 ILCS 180/) Limited Liability Company Act.

805 ILCS 180/25-15

    (805 ILCS 180/25-15)
    Sec. 25-15. (Repealed).
(Source: P.A. 87-1062. Repealed by P.A. 90-424, eff. 1-1-98.)

805 ILCS 180/25-20

    (805 ILCS 180/25-20)
    Sec. 25-20. Right to distribution. 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 creditor of the limited liability company with respect to the distributions.
(Source: P.A. 87-1062.)

805 ILCS 180/25-25

    (805 ILCS 180/25-25)
    Sec. 25-25. (Repealed).
(Source: P.A. 87-1062. Repealed by P.A. 90-424, eff. 1-1-98.)

805 ILCS 180/25-30

    (805 ILCS 180/25-30)
    Sec. 25-30. Limitations on distributions.
    (a) A distribution may not be made if:
        (1) the limited liability company would not be able
    
to pay its debts as they become due in the ordinary course of business; or
        (2) the company's total assets would be less than the
    
sum of its total liabilities plus the amount that would be needed, if the company were to be dissolved, wound up, and terminated at the time of the distribution, to satisfy the preferential rights upon dissolution, winding up, and termination of members whose preferential rights are superior to those receiving the distribution.
    (b) A limited liability company may base a determination that a distribution is not prohibited under subsection (a) of this Section on financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances or on a fair valuation or other method that is reasonable in the circumstances.
    (c) Except as otherwise provided in subsection (e) of this Section, the effect of a distribution under subsection (a) of this Section is measured:
        (1) in the case of distribution by purchase,
    
redemption, or other acquisition of a distributional interest in a limited liability company, as of the date money or other property is transferred or debt incurred by the company; and
        (2) in all other cases, as of the date the:
            (A) distribution is authorized if the payment
        
occurs within 120 days after the date of authorization; or
            (B) payment is made if it occurs more than 120
        
days after the date of authorization.
    (d) 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 company's indebtedness to its general, unsecured creditors.
    (e) Indebtedness of a limited liability company, including indebtedness issued in connection with or as part of a distribution, is not considered a liability for purposes of determinations under subsection (a) of this Section if its terms provide that payment of principal and interest are made only if and to the extent that payment of a distribution to members could then be made under this Section. If the 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 made.
(Source: P.A. 90-424, eff. 1-1-98.)

805 ILCS 180/25-35

    (805 ILCS 180/25-35)
    Sec. 25-35. Liability for unlawful distributions.
    (a) Except as otherwise provided in subsections (b) and (c), if a member of a member-managed company or a member or manager of a manager-managed company consents to a distribution made in violation of Section 25-30, the articles of organization, or the operating agreement and in consenting to the distribution fails to comply with Section 15-3, the member or manager is personally liable to the company for the amount of the distribution that exceeds the amount that could have been distributed without violating Section 25-30, the articles of organization, or the operating agreement.
    (b) To the extent the operating agreement of a limited liability company expressly relieves a member of the authority and responsibility to consent to distributions and imposes that authority and responsibility on one or more other members, the liability stated in subsection (a) applies to the other members and not the member that the operating agreement relieves of authority and responsibility.
    (c) If the members of a member-managed company or the members or managers of a manager-managed company consent to a distribution that violates the articles of organization or the operating agreement, but does not violate Section 25-30, by a vote that would have been sufficient to amend the articles of organization or operating agreement, as the case may be, the liability stated in subsection (a) does not apply.
    (d) A person that receives a distribution and that knew the distribution was made in violation of Section 25-30, the articles of organization, or the operating agreement is personally liable to the company, but only to the extent that the distribution received by the person exceeded the amount that could have been properly paid under Section 25-30.
    (e) A person against whom an action is brought under this Section may implead in the action:
        (1) all members or managers who consented to the
    
distribution in violation of subsection (a) of this Section and may compel contribution from them; and
        (2) all persons who received a distribution in
    
violation of subsection (d) of this Section and may compel contribution from any person receiving such a distribution in the amount received in violation of subsection (d) of this Section.
    (f) A proceeding under this Section is barred unless it is commenced within 2 years after the distribution.
(Source: P.A. 99-637, eff. 7-1-17.)

805 ILCS 180/25-45

    (805 ILCS 180/25-45)
    Sec. 25-45. Known claims against dissolved limited liability company.
    (a) A dissolved limited liability company may dispose of the known claims against it by following the procedure described in this Section.
    (b) A dissolved limited liability company shall notify its known claimants in writing of the dissolution. The notice must:
        (1) specify the information required to be included
    
in a claim;
        (2) provide a mailing address where the claim is to
    
be sent;
        (3) state the deadline for receipt of the claim,
    
which may not be less than 120 days after the date the written notice is received by the claimant; and
        (4) state that the claim will be barred if not
    
received by the deadline.
    (c) A claim against a dissolved limited liability company is barred if the requirements of subsection (b) of this Section are met, and:
        (1) the claim is not received by the specified
    
deadline; or
        (2) in the case of a claim that is timely received
    
but rejected by the dissolved company, the claimant does not commence a proceeding to enforce the claim within 90 days after the receipt of the notice of the rejection.
    (d) For purposes of this Section, the term "claim" does not include a contingent liability or a claim based on an event occurring after the effective date of dissolution.
(Source: P.A. 90-424, eff. 1-1-98.)