KRS 362.601: Circumstances preventing distribution -- Liability for unlawful

distribution.

(1) A registered limited liability partnership shall not make a distribution to the extent

that at the time of the distribution and after giving effect to the distribution, all

liabilities for the registered limited liability partnership exceed the fair value of the

assets of the registered limited liability partnership, other than liabilities to partners

or transferees on account of their transferable interest in liabilities for which the

recourse of creditors is limited to specified property. The fair value of property that

is subject to a liability for which the recourse of partners is limited shall be included

in the assets of the registered limited liability partnership o nly to the extent that the

fair value of that property exceeds that liability.

(2) A partner or transferee of a registered limited liability partnership who receives a

distribution in violation of subsection (1) of this section is liable to the partnership

for the amount of that distribution. A proceeding under this section shall be barred

unless it is commenced within two (2) years after the date on which the distribution

is paid to the partner or transferee.

(3) This section does not affect any obligation or liability of a partner or transferee of a

registered limited liability partnership under an agreement or other applicable law

for the amount of a distribution.

(4) For purposes of this section, the term "distribution" does not include amounts

constituting reasonable compensation for present or past services or reasonable

payments made in the ordinary course of business pursuant to a bona fide retirement

plan or other benefits program.