In practice, the assets we are discussing here are generally intangible assets such as economic instruments or title instruments. To the extent the records maintained for any such series account of the assets associated with such series separately from the other assets of the limited liability company, or any other series thereof, the debts, liabilities, obligations, and expenses incurred, contracted for, or otherwise existing with respect to such series shall be enforceable against the assets of such series only, and not against the assets of the limited liability company generally or any other series thereof, and, unless otherwise provided in the limited liability company, none of the debts, liabilities, obligations, and expenses incurred, contracted for or otherwise existing with respect to the limited liability company generally or any other series thereof shall be enforceable against the assets of such series. The language in the Certificate of Formation would state: Notice: This limited liability company shall have the power to create one of the more protected series. This type of series is again created within the LLC Agreement and the Certificate of Formation must contain the language referenced in Section 215(b). The second type of series is a series created under Section 215 now referred to simply as a “protected series”. ![]() This contractual series lacks the asset protections provided for in Section 215(b). The “series” might have voting rights that differ from other “series”, separate economic rights, preferences in dissolution and liquidation, etc. ![]() The first type of series would be a contractual arrangement provided for in the certificate of formation or in the LLC Agreement whereby the “series” created under the certificate of formation or LLC Agreement have specified rights or obligations different from the members associated with another “series”. Within series practice there can conceptually be three types of series. If the LLC itself (the “ mother ship”) maintains the records as described above in Section 215(b), the assets associated with the series and the obligations of the series are placed in a legal silo and are not subject to any obligations of the LLC itself nor may it or its creditors access the assets of any other series so as to satisfy the obligations of such or any other series of the LLC. ![]() Notwithstanding anything to the contrary set forth in this chapter or user other applicable law, in the event that a limited liability company agreement provides for the establishment of one or more series, and to the extent the records maintained for any such series account of the assets associated with such series separately from the other assets of the limited liability company, or any other series thereof, and if the limited liability company agreements provides, and if notice of the limitation on liabilities of a series as referenced in this subsection is set forth in the certificate of formation of the limited liability company, then the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to such series shall be enforceable against the assets of such series only, and not against the assets of the limited liability company generally or any other series thereof, and, unless otherwise provided in the limited liability company, none of the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to the limited liability company generally or any other series thereof shall be enforceable against the assets of such series.Ī series established under Section 215 is referred to as a “ protected series”. ![]() UNDERSTANDING THE DELAWARE SERIES LLC PROVISIONSĭelaware first adopted a Series LLC provision, Section 215, in 1995. Understanding and Use of Delaware Series LLCs
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