there could be a problem with LLC2. I can't say how the IRS would look at the transfer of securities. technically a distribution of securities (property) would require LLC1 to recognize gain for the difference between the FMV on the date of distribution and their cost. Losses would be deferred. there could be other issues unique to each partner depending on their participation in activities of the partnerships.
Consulting a professional who could research the tax consequences of these actions in more detail would be advisable.
