Adkisson's

Uniform Protected Series Act

(UPSA)

Caution State Law Variances!

SECTION 607. EFFECT OF MERGER.

When a merger under Section 604 becomes effective, in addition to the effects stated in [cite the provisions of this state's limited liability company act stating the effect of a merger]:

 

JayNote: Once the merger has been completed, § 607 tells us what, if anything, was accomplished thereby.

 

(1) as provided in the plan of merger, each protected series of each merging company which was established before the merger:

(A) is a relocated protected series or continuing protected series; or

(B) is dissolved, wound up, and terminated;

 

Reporter's Comment to Paragraph (1)(B) – This provision triggers Section 502 and thereby (through extrapolation) the winding up requirements of an enacting state's limited liability company act. These requirements include settling debts with creditors. The rule here is the same as for any other dissolution and winding up of a protected series.

 

(2) any protected series to be established as a result of the merger is established;

(3) any relocated protected series or continuing protected series is the same person without interruption as it was before the merger;

 

JayNote: Paragraphs (1), (2) and (3) of § 607 basically say that if the Plan of Merger says that a protected series is terminated, established or relocated by the merger, then upon conclusion of the merger it is.

 

(4) all property of a relocated protected series or continuing protected series continues to be vested in the protected series without transfer, reversion, or impairment;

(5) all debts, obligations, and other liabilities of a relocated protected series or continuing protected series continue as debts, obligations, and other liabilities of the protected series;

 

JayNote: Paragraphs (4) and (5) of § 607 tell us that whatever assets and liabilities that a protected series had before the merger, whether protected series is relocated or simply continues, is exactly the same after the merger, i.e., the merger doesn't affect any of that.

 

(6) except as otherwise provided by law or the plan of merger, all the rights, privileges, immunities, powers, and purposes of a relocated protected series or continuing protected series remain in the protected series;

 

JayNote: The powers and rights, etc., of the protected series can be changed in the plan of merger per ¶ (6) of § 607.

 

(7) the new name of a relocated protected series may be substituted for the former name of the protected series in any pending action or proceeding;

 

JayNote: Under §607(7), any change of name of a protected series can become effective upon the merger.

 

(8) if provided in the plan of merger:

 

JayNote: Paragraph (8) of § 607 basically says that all changes regarding the associated members, managers and other persons involved with the protected series are given effect by the merger, including the payment of consideration to such person if that was part of the merger deal.

 

(A) a person becomes an associated member or protected-series transferee of a relocated protected series or continuing protected series;

 

Reporter's Comment to Paragraph (8)(A) – This provision is subject to Section 303(a): "A protected-series transferable interest of a protected series must be owned initially by an associated member of the protected series or the series limited liability company that establishes the protected series." Thus, for a person to become a protected-series transferee as a result of a merger, the plan of merger would have to provide for an existing associated member or protected series transferee to transfer a protected-series transferable interest to the person.

 

(B) a person becomes an associated member of a protected series established by the surviving company as a result of the merger;

 

Reporter's Comment to Paragraph (8)(B) – Under Section 303(a), discussed in the comment to Paragraph (8)(A), a protected-series transferable interest must first be owned by an associated member of the protected series or the series limited liability company that established the protected series. As a result, a merger under Section 604 cannot cause a person to become a protected-series transferee ab initio of a protected series established as a result of the merger.

 

(C) any change in the rights or obligations of a person in the person's capacity as an associated member or protected-series transferee of a relocated protected series or continuing protected series take effect; and

(D) any consideration to be paid to a person that before the merger was an associated member or protected-series transferee of a relocated protected series or continuing protected series is due; and

 

Reporter's Comment to Paragraphs (4)-(8) – These provisions are derived from Uniform Limited Liability Company Act (2006) (Last Amended 2013), Section 1046(a) (effects of conversion). The list of effects does not include the taking effect of amendments to the operating agreement, because the merger provisions of an enacting state's limited liability company act should address the point. See, e.g., Uniform Limited Liability Company Act (2006) (Last Amended 2013), Section 1026(a)(8)(B) (stating that, "if the surviving entity exists before the merger .... its private organic rules that are to be in a record, if any, are amended to the extent provided in the plan of merger").

 

(9) any person that is a member of a relocated protected series becomes a member of the surviving company, if not already a member.

 

Reporter's Comment

 

For section to be cited just before Paragraph (1): A state that has enacted Uniform Limited Liability Company Act (2006) (Last Amended 2013) would cite Section 1026.

 

JayNote: Paragraph (9) of § 607 adds that if a person is an associated member of a relocated protected series after the merger, then they automatically become a member of the surviving series organization if they weren't such a member before.

 

C O M M O N    P A G E    F O O T E R

UPSA AND WEBSITE CONTENTS

 

ARTICLE 1. GENERAL PROVISIONS

 

          SECTION 101. SHORT TITLE.

 

          SECTION 102. DEFINITIONS.

 

          SECTION 103. NATURE OF PROTECTED SERIES.

 

          SECTION 104. POWERS AND DURATION OF PROTECTED SERIES.

 

          SECTION 105. GOVERNING LAW.

 

          SECTION 106. RELATION OF OPERATING AGREEMENT, THIS ACT, AND LIMITED LIABILITY COMPANY ACT.

 

          SECTION 107. ADDITIONAL LIMITATIONS ON OPERATING AGREEMENT.

 

         SECTION 108. RULES FOR APPLYING LIMITED LIABILITY COMPANY ACT TO SPECIFIED PROVISIONS OF ACT.

 

ARTICLE 2. ESTABLISHING PROTECTED SERIES

 

         SECTION 201. PROTECTED SERIES DESIGNATION; AMENDMENT.

 

          SECTION 202. NAME.

 

          SECTION 203. REGISTERED AGENT.

 

          SECTION 204. SERVICE OF PROCESS, NOTICE, DEMAND, OR OTHER RECORD.

 

          SECTION 205. CERTIFICATE OF GOOD STANDING FOR PROTECTED SERIES.

 

          SECTION 206. INFORMATION REQUIRED IN ANNUAL BIENNIAL REPORT; EFFECT OF FAILURE TO PROVIDE.

 

ARTICLE 3. ASSOCIATED ASSET; ASSOCIATED MEMBER; PROTECTED-SERIES TRANSFERABLE INTEREST; MANAGEMENT; RIGHT OF INFORMATION

 

          SECTION 301. ASSOCIATED ASSET.

 

         SECTION 302. ASSOCIATED MEMBER.

 

          SECTION 303. PROTECTED-SERIES TRANSFERABLE INTEREST.

 

          SECTION 304. MANAGEMENT.

 

          SECTION 305. RIGHT OF PERSON NOT ASSOCIATED MEMBER OF PROTECTED SERIES TO INFORMATION CONCERNING PROTECTED SERIES.

 

ARTICLE 4. LIMITATION ON LIABILITY AND ENFORCEMENT OF CLAIMS

 

          SECTION 401. LIMITATIONS ON LIABILITY.

 

          SECTION 402. CLAIM SEEKING TO DISREGARD LIMITATION OF LIABILITY.

 

          SECTION 403. REMEDIES OF JUDGMENT CREDITOR OF ASSOCIATED MEMBER OR PROTECTED-SERIES TRANSFEREE.

 

          SECTION 404. ENFORCEMENT AGAINST NON-ASSOCIATED ASSET.

 

ARTICLE 5. DISSOLUTION AND WINDING UP OF PROTECTED SERIES

 

          SECTION 501. EVENTS CAUSING DISSOLUTION OF PROTECTED SERIES.

 

          SECTION 502. WINDING UP DISSOLVED PROTECTED SERIES.

 

          SECTION 503. EFFECT OF REINSTATEMENT OF SERIES LIMITED LIABILITY COMPANY OR REVOCATION OF VOLUNTARY DISSOLUTION.

 

ARTICLE 6. ENTITY TRANSACTIONS RESTRICTED

 

          SECTION 601. DEFINITIONS.

 

          SECTION 602. PROTECTED SERIES MAY NOT BE PARTY TO ENTITY TRANSACTION.

 

          SECTION 603. RESTRICTION ON ENTITY TRANSACTION INVOLVING PROTECTED SERIES.

 

          SECTION 604. MERGER AUTHORIZED; PARTIES RESTRICTED.

 

          SECTION 605. PLAN OF MERGER.

 

          SECTION 606. STATEMENT OF MERGER.

 

          SECTION 607. EFFECT OF MERGER.

 

          SECTION 608. APPLICATION OF SECTION 404 AFTER MERGER.

 

ARTICLE 7. FOREIGN PROTECTED SERIES

 

          SECTION 701. GOVERNING LAW.

 

          SECTION 702. NO ATTRIBUTION OF ACTIVITIES CONSTITUTING DOING BUSINESS OR FOR ESTABLISHING JURISDICTION.

 

          SECTION 703. REGISTRATION OF FOREIGN PROTECTED SERIES.

 

          SECTION 704. DISCLOSURE REQUIRED WHEN FOREIGN SERIES LIMITED LIABILITY COMPANY OR FOREIGN PROTECTED SERIES PARTY TO PROCEEDING.

 

ARTICLE 8. MISCELLANEOUS PROVISIONS

 

          SECTION 801. UNIFORMITY OF APPLICATION AND CONSTRUCTION.

 

          SECTION 802. RELATION TO ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE ACT.

 

          SECTION 803. TRANSITIONAL PROVISIONS.

 

          SECTION 804. SAVINGS CLAUSE.

 

          SECTION 805. SEVERABILITY CLAUSE.

 

          SECTION 806. REPEALS; CONFORMING AMENDMENTS.

 

          SECTION 807. EFFECTIVE DATE.

 

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THE CHARGING ORDER PRACTICE GUIDE BY JAY ADKISSON

 

The Charging Order Practice Guide: Understanding Judgment Creditor Rights Against LLC Members, by Jay D. Adkisson (2018), published by the LLCs, Partnerships and Unincorporated Entities Committee of the Business Law Section of the American Bar Association

Click here for more information

 

Now available for purchase at https://goo.gl/faZzY6

MORE INFORMATIONAL WEBSITES BY JAY ADKISSON

 

  • About Jay Adkisson - More about Jay D. Adkisson, background, books, articles, speaking appearances - https://jayadkisson.com/

 

  • Captive Insurance Companies - Licensed insurance companies formed by the parent organization to handle the insurance and risk management needs of the business, by the author of the book Adkisson's Captive Insurance Companies - https://captiveinsurancecompanies.com/

 

 

  • Collecting On A Judgment - An explanation of common creditor remedies, strategies and tactics to enforce a judgment, including a discussion of common debtor asset protection strategies - https://collectingonajudgment.com/

 

  • Voidable Transactions - Discussion of the Uniform Voidable Transactions Act (a/k/a 2014 Revision of the Uniform Fraudulent Transfers Act) and fraudulent transfer law in general - https://voidabletransactions.com/

 

  • Private Retirement Plans - An exploration of a unique creditor exemption allowed under California law which can be very beneficial but is often misused - https://privateretirementplans.com/

 

  • Charging Orders - The confusing remedy against a debtor's interest in an LLC or partnership is explained in reference to the Uniform Partnership Act, the Uniform Limited Partnership Act, and the Uniform Limited Liability Company Act - https://chargingorder.com/

 

  • California Enforcement of Judgments Law - Considers the topic of judgment enforcement in California, including the California Enforcement of Judgments Law and other laws related to California creditor-debtor issues - https://calejl.com/

 

 

Contact Jay Adkisson:

 

Phone: 702-953-9617     Fax: 877-698-0678     jay [at] jayad.com

 

Unless a dire emergency, please send me an e-mail first in lieu of calling to set up a telephone appointment for a date an time certain.

 

Las Vegas Office: 6671 S. Las Vegas Blvd., Suite 210, Las Vegas, NV 89119, Ph: 702-953-9617, Fax: 877-698-0678. By appointment only.

 

Newport Beach Office: 100 Bayview Circle, Suite 210, Newport Beach, California 92660. Ph: 949-200-7773, Fax: 877-698-0678. By appointment only.

 

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© 2018 by Jay D. Adkisson. All rights reserved. No part of this website may be copied in whole or in any part without the express written permission of Jay D. Adkisson. Nothing herein is any advertisement or offer by the firm to practice in any jurisdiction where no attorney of the firm is licensed to practice law. This website does not give any legal advice or opinion, and is no substitute for the advice and counsel of an attorney consulted in the relevant jurisdiction. Questions about this website should be directed to jay [at] jayad.com, by phone to 702-953-9617 or by fax to 877-698-0678. This website is http://www.protectedseriesact.com