Section 183.0405 - Limitations on distributions(1) A limited liability company may not make a distribution, including a distribution under s. 183.0707, if after the distribution any of the following applies: (a) The company would not be able to pay its debts as they become due in the ordinary course of the company's activities and affairs.(b) The company's total assets would be less than or equal to the sum of its total liabilities plus the amount that would be needed, if the company were to be dissolved and wound up at the time of the distribution, to satisfy the preferential rights upon dissolution and winding up of members and transferees whose preferential rights are superior to the rights of persons receiving the distribution.(2) A limited liability company may base a determination that a distribution is not prohibited under sub. (1) on any of the following:(a) Financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances.(b) A fair valuation or other method that is reasonable under the circumstances.(3) Except as otherwise provided in sub. (5), the effect of a distribution under sub. (1) is measured as follows: (a) In the case of a distribution as described in s. 183.0102 (4) (a) 1 and 2., as of the earlier of the following: 1. The date money or other property is transferred or debt is incurred by the limited liability company.2. The date the person entitled to the distribution ceases to own the interest or right being acquired by the company in return for the distribution.(b) In the case of any distribution of indebtedness other than one under par. (a), as of the date the indebtedness is distributed.(c) In all cases other than those under par. (a) or (b), as of the following: 1. The date the distribution is authorized, if the payment occurs not later than 120 days after that date.2. The date the payment is made, if the payment occurs more than 120 days after the distribution is authorized.(4) A limited liability company's indebtedness to a member or transferee 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, except to the extent subordinated by agreement.(5) A limited liability company's indebtedness, including indebtedness issued as a distribution, is not a liability for purposes of sub. (1) if the terms of the indebtedness provide that payment of principal and interest is made only if and to the extent that payment of a distribution could then be made under this section. If the indebtedness is issued as a distribution, each payment of principal or interest is treated as a distribution, the effect of which is measured on the date the payment is made.(6) In measuring the effect of a distribution under s. 183.0707, the liabilities of a dissolved limited liability company do not include any claim that has been disposed of under s. 183.0704, 183.0705, or 183.0706.Amended by Acts 2021 ch, 258,s 616, eff. 4/17/2022.1993 a. 112; 1995 a. 400. The scope of a member's right of inspection under sub. (2) is exceptionally broad and hinges on what constitutes an LLC record and the degree and kind of restrictions on access that upon reasonable request may impose. Kasten v. Doral Dental USA, 2007 WI 76, 301 Wis. 2d 598, 733 N.W.2d 300, 05-0995. Inspection "upon reasonable request" in sub. (2) pertains to the breadth of an inspection request, as well as the timing and form of the inspection. One purpose of the "upon reasonable request" requirement is to protect the company from member inspection requests that impose undue financial burdens on the company. Whether an inspection request is unreasonable requires balancing the statute's bias in favor of member access to records against the costs of the inspection to the company. Kasten v. Doral Dental USA, 2007 WI 76, 301 Wis. 2d 598, 733 N.W.2d 300, 05-0995. When applying the balancing test to determine whether a request for records imposes undue financial burdens, a number of factors may be relevant, including: 1) whether the request is restricted by date or subject matter; 2) the reason given, if any, for the request, and whether the request is related to that reason; 3) the importance of the information to the member's interest in the company; and 4) whether the information may be obtained from another source. Kasten v. Doral Dental USA, 2007 WI 76, 301 Wis. 2d 598, 733 N.W.2d 300, 05-0995. Sub. (3) establishes a member right to true and full information, without regard to whether that information is recorded and stored as a record or document, but restricted to information affecting the members and to the extent that the circumstances render the provision of the information just and reasonable. "All things affecting the members" means all things affecting the requesting member's financial interest in the company. To the extent records and documents requested contain information affecting a member's financial interest in the company, the information contained in the records or documents must be furnished to the requesting member. Kasten v. Doral Dental USA, 2007 WI 76, 301 Wis. 2d 598, 733 N.W.2d 300, 05-0995.