(A) No distribution may be made if, after giving effect to the distribution:

1. (1) the limited liability company would not be able to pay its debts as they become due in the usual course of business; or
2. (2) the limited liability company's assets would be less than the sum of its liabilities plus, unless otherwise provided in an operating agreement, the amount that would be needed, if the limited liability company were to be dissolved at the time of the distribution, to satisfy the preferential rights of other members upon dissolution which are superior to the rights of the member receiving the distribution.

(B) The limited liability company may base a determination that a distribution is not prohibited under subsection (A) either on:

1. (1) financial statements prepared on the basis of accounting practices and principles that are reasonable under the circumstances; or
2. (2) a fair valuation or other method that is reasonable under the circumstances.

(C) The effect of a distribution under subsection (A) is measured:

1. (1) in the case of distribution by purchase or other acquisition of the member's interest in the limited liability company, as of the date money or other property is transferred or debt incurred by the limited liability company;
2. (2) in the case of any other distribution of indebtedness, as of the date the indebtedness is distributed;
3. (3) in all other cases, as of (i) the date the distribution is authorized if the payment occurs within one hundred twenty days after the date of authorization, or (ii) the date the payment is made if it occurs more than one hundred twenty days after the date of authorization.