HB 2272 — Limited liability companies; Protected Series Act.

"Foreign limited liability company" means an entity, excluding a foreign business trust, that is an unincorporated organization that is organized under laws other than the laws of the Commonwealth and that is denominated by that law as a limited liability company, and that affords to each of its members, pursuant to the laws under which it is organized, limited liability with respect to the liabilities of the entity.

"Foreign limited partnership" has the same meaning as specified in § 50-73.1.

"Foreign nonstock corporation" has the same meaning as "foreign corporation" as specified in § 13.1-803.

"Foreign other business entity" means a partnership, limited partnership, business trust, stock corporation, or nonstock corporation that is formed, organized, or incorporated under the laws of a state or jurisdiction other than the Commonwealth.

"Foreign partnership" means an association of two or more persons to carry on as co-owners a business for profit formed under the laws of any state or jurisdiction other than the Commonwealth, and includes, for all purposes of the laws of the Commonwealth, a foreign registered limited liability partnership.

"Foreign protected series" means a protected series established by a foreign series limited liability company and having attributes comparable to a protected series established under Article 16 (§ 13.1-1088 et seq.).

The term applies whether or not the law under which the foreign series limited liability company is organized refers to "protected series" or "series." "Foreign registered limited liability partnership" has the same meanings as specified in §§ 50-2 and 50-73.79.

"Foreign series limited liability company" means a foreign limited liability company having at least one foreign protected series.

"Foreign stock corporation" has the same meaning as "foreign corporation" as specified in § 13.1-603.

"Jurisdiction," when used to refer to a political entity, means the United States, a state, a foreign country, or a political subdivision of a foreign country.

"Jurisdiction of formation" means the jurisdiction whose law governs the internal affairs of a person.

"Limited liability company" or "domestic limited liability company" means an entity that is an unincorporated organization organized and existing under this chapter, or that has become a domestic limited liability company of the Commonwealth pursuant to § 13.1-1010.3 as it existed prior to its repeal, even though also being a non-United States entity organized under laws other than the laws of the Commonwealth, or that has become a domestic limited liability company of the Commonwealth pursuant to § 56-1, even though also being a non-United States entity organized under laws other than the laws of the Commonwealth, or that has become a domestic limited liability company of the Commonwealth pursuant to § 13.1-1010.1 as it existed prior to its repeal, or that has become a domestic limited liability company of the Commonwealth pursuant to Article 12.2 (§ 13.1-722.8 et seq.) of Chapter 9, Article 17.1 (§ 13.1-944.1 et seq.) of Chapter 10, Article 14 (§ 13.1-1074 et seq.) or Article 15 (§ 13.1-1081 et seq.) of this chapter, or Article 12 (§ 13.1-1264 et seq.) of Chapter 14.

A limited liability company's status for federal tax purposes shall not affect its status as a distinct entity organized and existing under this chapter.

"Manager" or "managers" means a person or persons designated by the members of a limited liability company to manage the limited liability company as provided in the articles of organization or an operating agreement.

"Manager-managed limited liability company" means a limited liability company that is managed by a manager or managers as provided for in its articles of organization or an operating agreement.

"Member" means a person that has been admitted to membership in a limited liability company as provided in § 13.1-1038.1 and that has not ceased to be a member.

"Member-managed limited liability company" means a limited liability company that is not a manager-managed limited liability company.

"Membership interest" or "interest" means a member's share of the profits and the losses of the limited liability company and the right to receive distributions of the limited liability company's assets.

"Non-United States entity" means a foreign limited liability company (other than one formed under the laws of a state), or a corporation, business trust or association, real estate investment trust, common-law trust, or any other unincorporated business, including a partnership, formed, incorporated, organized, created or that otherwise came into being under the laws of any foreign country or other foreign jurisdiction (other than any state).

"Operating agreement" means an agreement of the members as to the affairs of a limited liability company and the conduct of its business, or a writing or agreement of a limited liability company with one member that satisfies the requirements of subdivision A 2 of § 13.1-1023.

"Person" has the same meaning as specified in § 13.1-603.

"Person" includes a protected series.

"Principal office" means the office, in or out of the Commonwealth, where the principal executive offices of a domestic or foreign limited liability company are located or, if there are no such offices, the office, in or out of the Commonwealth, so designated by the limited liability company.

The designation of the principal office in the most recent statement of change filed pursuant to § 13.1-1018.1 shall be conclusive for the purpose of this chapter.

"Property" means all property, whether real, personal, or mixed or tangible or intangible, or any right or interest therein.

"Protected series," except in the term "foreign protected series," means a person established under § 13.1-1095.

"Record," when used as a noun, means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

"Series limited liability company," except in the term "foreign series limited liability company," means a limited liability company having at least one protected series.

"Sign" means, with present intent to authenticate or adopt a record, to execute or adopt a tangible symbol or to attach to or logically associate with the record an electronic symbol, sound, or process.

"State," when referring to a part of the United States, includes a state, commonwealth and the District of Columbia, and their agencies and governmental subdivisions;

and a territory or insular possession, and their agencies and governmental subdivisions, of the United States.

"Transfer" includes an assignment, a conveyance, a sale, a lease, an encumbrance including a mortgage or security interest, a gift, and a transfer by operation of law.

"United States" includes a district, authority, bureau, commission, department, and any other agency of the United States.

§ 13.1-1004.

Issuance of certificate by Commission;

recordation of documents.

A.

Whenever this chapter conditions the effectiveness of a document upon the issuance of a certificate by the Commission to evidence the effectiveness of the document, the Commission shall by order issue the certificate if it finds that the document complies with the provisions of this chapter and that all required fees have been paid.

The Commission shall admit any such certificate to record in its office.

B.

The existence of a limited liability company or a protected series shall begin at the time the Commission issues a certificate of organization or certificate of protected series designation unless a later date and time are specified as provided by subsection D of this section.

The certificate of organization shall be conclusive evidence that all conditions precedent required to be performed by the person(s) forming the limited liability company have been complied with and that the limited liability company has been formed under this chapter.

C.

Whenever the Commission is directed to admit any document to record in its office, it shall cause it to be spread upon its record books or to be recorded or reproduced in any other manner the Commission may deem suitable.

Except as otherwise provided by law, the Commission may furnish information from and provide access to any of its records by any means the Commission may deem suitable.

D.

1.

A certificate issued by the Commission is effective at the time such certificate is issued, unless the certificate relates to articles filed with the Commission or a statement filed with the Commission pursuant to Article 16 (§ 13.1-1088 et seq.) and the articles state or statement states that the certificate shall become effective at a later time and date specified in the articles or statement.

In that event, the certificate shall become effective at the earlier of the time and date so specified or 11:59 p.m.

on the fifteenth day after the date on which the certificate is issued by the Commission.

Any other document filed with the Commission shall be effective when accepted for filing unless otherwise provided for in this chapter.

2.

Notwithstanding subdivision 1 of this subsection, any certificate that has a delayed effective time and date shall not become effective if, prior to the effective time and date, the parties to the articles or statement to which the certificate relates file a request for cancellation with the Commission, and the Commission, by order, cancels the certificate.

3.

Notwithstanding subdivision 1 of this subsection, for purposes of §§ 13.1-1012 and, 13.1-1054, and 13.1-1096, any certificate that has a delayed effective date shall be deemed to be effective when the certificate is issued.

E.

Notwithstanding any other provision of law to the contrary, the Commission shall have the power to act upon a petition filed by a limited liability company or protected series at any time to correct Commission records so as to eliminate the effects of clerical errors and of filings made by a person without authority to act for the limited liability company.

§ 13.1-1005.

Fees.

The Commission shall charge and collect the following fees:

1.

For filing any one of the following, the fee shall be $100:

a.

Articles of organization.

b.

An application for registration as a foreign limited liability company.

c.

Articles of entity conversion to convert a domestic corporation to a limited liability company to a domestic business trust or to convert a domestic partnership or limited partnership to a limited liability company.

d.

Articles of domestication.

e.

A statement of protected series designation.

f.

An application for registration as a foreign protected series.

2.

For filing any one of the following, the fee shall be $25:

a.

Articles of amendment.

b.

Articles of cancellation.

c.

Articles of correction referred to in § 13.1-1011.1, a copy of an amendment or correction referred to in § 13.1-1055, or an amended application for registration referred to in § 13.1-1055, provided that an amended application shall not require a separate fee when it is filed with a copy of an amendment or a correction referred to in § 13.1-1055.

d.

A copy of an instrument of merger of a foreign limited liability company referred to in § 13.1-1060.

e.

Articles of merger.

f.

Articles of entity conversion to convert a limited liability company to a domestic corporation, in addition to a charter fee ascertained in accordance with § 13.1-615.1.

g.

A copy of an instrument of entity conversion of a foreign limited liability company holding a certificate of registration to transact business in the Commonwealth.

g.

h.

Articles of restatement.

h.

i.

Articles of organization surrender.

i.

j.

An application for a certificate of cancellation of to cancel a certificate of registration as a foreign limited liability company.

k.

A statement of designation change pursuant to § 13.1-1095 or 13.1-1096.

l.

A statement of designation cancellation.

m.

An application for a certificate of cancellation to cancel a certificate of registration as a foreign protected series.

3.

For filing any one of the following, the fee shall be $10:

a.

An application to reserve or to renew the reservation of a name for use by a domestic or foreign limited liability company or any protected series thereof.

b.

A notice of the transfer of a name reserved for use by a domestic or a foreign limited liability company or any protected series thereof.

4.

For issuing a certificate pursuant to § 13.1-1067 or 13.1-1099, $6 for each certificate.

§ 13.1-1012.

Name.

A.

A limited liability company name shall contain the words "limited company" or "limited liability company" or their abbreviations "L.C.," "LC," "L.L.C.," or "LLC." B.

A limited liability company name shall not contain:

1.

Any word, abbreviation, or combination of characters that states or implies the limited liability company is a corporation or, a limited partnership, or a protected series of a series limited liability company;

or 2.

Any word or phrase the use of which is prohibited by law for such company.

C.

Except as authorized by subsection D, a limited liability company name shall be distinguishable upon the records of the Commission from:

1.

The name of a domestic limited liability company or a foreign limited liability company registered to transact business in the Commonwealth;

2.

A limited liability company name reserved under § 13.1-1013;

3.

The designated name adopted by a foreign limited liability company because its real name is unavailable for use in the Commonwealth;

4.

The name of any corporation, whether issuing shares or not issuing shares, existing under the laws of the Commonwealth or authorized to transact business in the Commonwealth;

5.

A corporate name reserved or registered under § 13.1-631, 13.1-632, 13.1-830 or 13.1-831;

6.

The designated name adopted by a foreign corporation, whether issuing shares or not issuing shares, because its real name is unavailable for use in the Commonwealth;

7.

The name of a domestic business trust or a foreign business trust registered to transact business in the Commonwealth;

8.

A business trust name reserved under § 13.1-1215;

9.

The designated name adopted by a foreign business trust because its real name is unavailable for use in the Commonwealth;

10.

The name of a domestic limited partnership or a foreign limited partnership registered to transact business in the Commonwealth;

11.

A limited partnership name reserved under § 50-73.3;

and 12.

The designated name adopted by a foreign limited partnership because its real name is unavailable for use in the Commonwealth.

D.

A domestic limited liability company may apply to the Commission for authorization to use a name that is not distinguishable upon its records from one or more of the names described in subsection C.

The Commission shall authorize use of the name applied for if the other entity consents to the use in writing and submits an undertaking in form satisfactory to the Commission to change its name to a name that is distinguishable upon the records of the Commission from the name of the applying limited liability company.

E.

The use of assumed names or fictitious names, as provided for in Chapter 5 (§ 59.1-69 et seq.) of Title 59.1, is not affected by this chapter.

F.

The Commission, in determining whether a limited liability company name is distinguishable upon its records from the name of any of the business entities listed in subsection C, shall not consider any word, phrase, abbreviation, or designation required or permitted under this section and § 13.1-544.1, subsection A of § 13.1-630, § 13.1-1104, subsection A of § 50-73.2, and subdivision A 2 of § 50-73.78 to be contained in the name of a business entity formed or organized under the laws of the Commonwealth or authorized or registered to transact business in the Commonwealth.

§ 13.1-1051.

Authority to transact business required;

governing law.

A.

A foreign limited liability company may not transact business in the Commonwealth until it obtains a certificate of registration from the Commission.

B.

Subject to the Constitution of the Commonwealth:

1.

The Except as provided in §§ 13.1-1099.8 and 13.1-1099.10, the laws of the state or other jurisdiction under which a foreign limited liability company is formed govern its formation and internal affairs and the liability of its members and managers;

and 2.

A foreign limited liability company may not be denied a certificate of registration by reason of any difference between those laws and the laws of the Commonwealth.

However, a foreign limited liability company holding a valid certificate of registration to transact business in the Commonwealth shall have no greater rights and privileges than a domestic limited liability company.

The certificate of registration shall not be deemed to authorize the foreign limited liability company to exercise any of its powers or purposes that a domestic limited liability company is forbidden by law to exercise in the Commonwealth.

§ 13.1-1061.

Annual registration fees to be assessed and collected by Commission;

application of payment.

The Commission shall assess and collect the annual registration fees imposed by this chapter.

When the Commission receives payment of a registration fee assessed against a domestic or foreign limited liability company, or any protected series thereof, such payment shall be applied against any unpaid registration fees previously assessed against such limited liability company or protected series, including any penalties incurred thereon, beginning with the assessment that has remained unpaid for the longest period of time.

§ 13.1-1062.

Assessment of annual registration fees;

annual registration fees to be paid by domestic and foreign limited liability companies.

A.

Each domestic limited liability company and, each protected series, each foreign limited liability company registered to transact business in the Commonwealth, and each foreign protected series registered to transact business in the Commonwealth shall pay into the state treasury on or before the last day of the twelfth month next succeeding the month in which it was organized, established, or registered to transact business in the Commonwealth, and by such date in each year thereafter, an annual registration fee of $50, provided that the initial annual registration fee to be paid by a domestic limited liability company created by entity conversion shall be due in the year after the calendar year in which it converted.

The annual registration fee shall be imposed irrespective of any specific license tax or other tax or fee imposed by law upon the domestic or foreign limited liability company or any protected series thereof for the privilege of carrying on its business in the Commonwealth or upon its franchise, property or receipts.

B.

Each year, the Commission shall ascertain from its records each domestic limited liability company and, each protected series, each foreign limited liability company registered to transact business in the Commonwealth, and each foreign protected series registered to transact business in the Commonwealth, as of the first day of the second month next preceding the month in which it was organized, established, or registered to transact business in the Commonwealth, and, except as provided in subsection A, shall assess against each such limited liability company and each such protected series the annual registration fee herein imposed.

C.

At the discretion of the Commission, the annual registration fee due date for a limited liability company may be extended, on a monthly basis for a period of not less than one month nor more than 11 months, at the request of its registered agent of record or as may be necessary to distribute annual registration fee due dates of limited liability companies as equally as practicable throughout the year on a monthly basis.

D.

A statement of the assessment, when made, shall be forwarded by the clerk of the Commission to the Comptroller and to each domestic and foreign limited liability company and each protected series thereof.

E.

Any domestic limited liability company that has ceased to exist in the Commonwealth because of the issuance of a certificate of cancellation of existence, certificate of organization surrender, or certificate of entity conversion, or any protected series that has been canceled, any foreign limited liability company that has obtained a certificate of cancellation, or any foreign protected series that has obtained a certificate of cancellation, effective on or before its annual registration fee due date pursuant to subsection A in any year, shall not be required to pay the annual registration fee for that year.

Any domestic or foreign limited liability company that has merged, effective on or before its annual registration fee due date pursuant to subsection A in any year, into a surviving domestic or foreign corporation, limited liability company, business trust, limited partnership, or partnership that files with the Commission an authenticated copy of the instrument of merger on or before such date, shall not be required to pay the annual registration fee for that year.

Any foreign limited liability company that has converted, effective on or before its annual registration fee due date pursuant to subsection A in any year, to a different entity type that files with the Commission an authenticated copy of the instrument of entity conversion on or before such date, shall not be required to pay the annual registration fee for that year.

The Commission shall cancel the annual registration fee assessments specified in this subsection that remain unpaid.

F.

Registration fee assessments that have been paid shall not be refunded.

G.

The fees paid into the state treasury under this section and the fees collected under § 13.1-1005 shall be set aside and paid into the special fund created under § 13.1-775.1, and shall be used only by the Commission as it deems necessary to defray the costs of the Commission and of the office of the clerk of the Commission in supervising, implementing, administering and enforcing the provisions of this chapter.

The projected excess of fees collected over the costs of administration and enforcement so incurred shall be paid into the general fund prior to the close of each fiscal year, based on the unexpended balance of the special fund at the end of the prior fiscal year.

An adjustment of this transfer amount to reflect actual fees collected shall occur during the first quarter of the succeeding fiscal year.

§ 13.1-1064.

Penalty for failure to timely pay annual registration fees.

A.

Any domestic or foreign limited liability company, or any protected series thereof, that fails to pay the annual registration fee into the state treasury within the time prescribed in § 13.1-1062 shall incur a penalty of $25, which shall be added to the amount of the annual registration fee due.

The penalty prescribed herein shall be in addition to any other penalty or liability imposed by law.

B.

The Commission shall mail to each domestic and foreign limited liability company that fails to pay the annual registration fee within the time prescribed in § 13.1-1062 a notice of assessment of the penalty imposed herein and of the impending cancellation of its existence or certificate of registration, as the case may be.

C.

The Commission shall mail to each protected series and each foreign protected series that fails to pay the annual registration fee within the time prescribed in § 13.1-1062 a notice of assessment of the penalty imposed herein and of its impending cancellation or the impending cancellation of its certificate of registration, as the case may be.

§ 13.1-1065.

Payment of fees, fines, penalties, and interest prerequisite to Commission action;

refunds.

A.

The Commission shall not file or issue with respect to any domestic or foreign limited liability company any document or certificate specified in this chapter, except a statement of change pursuant to § 13.1-1016, a statement of resignation pursuant to § 13.1-1017, and a statement of change pursuant to § 13.1-1018.1, until all fees, fines, penalties, and interest assessed, imposed, charged, or to be collected by the Commission pursuant to this chapter or Title 12.1 have been paid by or on behalf of such limited liability company.

Notwithstanding the foregoing, the Commission may file or issue any document or certificate with respect to a domestic or foreign limited liability company that has been assessed an annual registration fee if the document or certificate is filed or issued with an effective date that is on or before the due date of the limited liability company's annual registration fee payment in any year, provided that the Commission shall not issue a certificate of domestication with respect to a foreign limited liability company until the annual registration fee has been paid by or on behalf of that limited liability company.

B.

The Commission shall not file or issue with respect to any protected series or foreign protected series any document or certificate specified in this chapter until all fees, fines, penalties, and interest assessed, imposed, charged, or to be collected by the Commission pursuant to this chapter or Title 12.1 have been paid by or on behalf of such protected series.

Notwithstanding the foregoing, the Commission may file or issue any document or certificate with respect to a protected series or foreign protected series that has been assessed an annual registration fee if the document or certificate is filed or issued with an effective date that is on or before the due date of the protected series' annual registration fee payment in any year.

C.

The Commission shall have authority to certify to the Comptroller directing refund of any overpayment of a fee, or of any fee collected for a document that is not accepted for filing, at any time within one year from the date of its payment.

§ 13.1-1067.

Property title records.

A.

Whenever the records in the office of the clerk of the Commission reflect that a domestic or foreign limited liability company, or any protected series thereof, has changed or corrected its name, merged into a domestic or foreign limited liability company, corporation, business trust, limited partnership or partnership, converted into to or from a domestic or foreign corporation, business trust, limited partnership or partnership, or domesticated in or from another jurisdiction, the clerk of the Commission, upon request, shall issue a certificate reciting such change, correction, merger, conversion or domestication.

The certificate may be admitted to record in the deed books, in accordance with § 17.1-227, of any court's office within the jurisdiction of which any property of the limited liability company is located in order to maintain the continuity of title records.

The person filing the certificate shall pay a fee of $10 to the clerk of the court, but no tax shall be due thereon.

B.

Whenever a foreign limited liability company or foreign protected series has changed or corrected its name, merged into another business entity, converted into another type of business entity, or domesticated in another jurisdiction, and it cannot or chooses not to obtain a certificate reciting such change, correction, merger, conversion or domestication from the clerk of the Commission pursuant to subsection A, a similar certificate by any competent authority of the foreign limited liability company's or foreign protected series' jurisdiction of organization formation may be admitted to record in the deed books, in accordance with § 17.1-227, of any recording office within the jurisdiction of which any property of the limited liability company is located in order to maintain the continuity of title records.

The person filing the certificate shall pay a fee of $10 to the clerk of the court, but no tax shall be due thereon.

Article 16.

Protected Series.

§ 13.1-1088.

Definitions.

As used in this article, unless the context requires a different meaning:

"After a merger" or "after the merger" means when a merger under § 13.1-1099.16 becomes effective and afterwards.

"Asset" means property:

1.

In which a series limited liability company or protected series has rights;

or 2.

As to which the series limited liability company or protected series has the power to transfer rights.

"Associated asset" means an asset that meets the requirements stated in § 13.1-1099.2.

"Associated member" means, with respect to a protected series, a member that meets the requirements stated in § 13.1-1099.3.

"Before a merger" or "before the merger" means before a merger under § 13.1-1099.16 becomes effective.

"Continuing protected series" means a protected series of a surviving company that continues in uninterrupted existence after a merger under § 13.1-1099.16.

"Merging company" means a limited liability company that is party to a merger under § 13.1-1099.16.

"Non-associated asset" means:

1.

An asset of a series limited liability company that is not an associated asset of the series limited liability company;

or 2.

Any asset of a protected series of the series limited liability company that is not an associated asset of the protected series.

"Non-surviving company" means a merging company whose separate existence ceases after a merger under § 13.1-1099.16.

"Principal office of the protected series" means the office, in or out of the Commonwealth, where the principal executive offices of a protected series of a domestic or foreign series limited liability company are located or, if there are no such offices, the office, in or out of the Commonwealth, so designated by the protected series.

The designation of the principal office of a protected series in the most recent statement of change filed pursuant to § 13.1-1018.1 and subsection G of § 13.1-1095 shall be conclusive for the purpose of this chapter.

"Protected series assignee" means a person to which all or part of a protected series membership interest of a protected series of a series limited liability company has been transferred, other than the series limited liability company.

"Protected series assignee" includes a person that owns a protected series membership interest as a result of ceasing to be an associated member of a protected series.

"Protected series manager" means a person under whose authority the powers of a protected series are exercised and under whose direction the activities and affairs of the protected series are managed pursuant to the operating agreement, this article, and other provisions of this chapter.

"Protected series membership interest" means the share of the profits and losses of a protected series and the right to receive distributions.

"Relocated protected series" means a protected series of a non-surviving company which, after a merger under § 13.1-1099.16, continues in uninterrupted existence as a protected series of the surviving company.

"Surviving company" means a merging company that is the survivor of a merger under § 13.1-1099.16.

"Survivor" has the same meaning as specified in § 13.1-1069.1.

§ 13.1-1089.

Nature of protected series.

A protected series of a series limited liability company is a person distinct from:

1.

The series limited liability company, subject to subsection C of § 13.1-1090, subdivision 1 of § 13.1-1099.11, and § 13.1-1099.12;

2.

Another protected series of the series limited liability company;

3.

A member of the series limited liability company, whether or not the member is an associated member of the protected series;

4.

A protected series assignee of any protected series of the series limited liability company;

and 5.

An assignee of a membership interest of the series limited liability company.

§ 13.1-1090.

Powers and duration of protected series.

A.

A protected series of a series limited liability company has the capacity to sue and be sued in its own name.

B.

Except as otherwise provided in subsections C and D, a protected series of a series limited liability company has the same powers and purpose as the series limited liability company.

C.

A protected series of a series limited liability company ceases to exist not later than when the series limited liability company ceases to exist.

D.

A protected series of a series limited liability company shall not:

1.

Be a member of the series limited liability company;

2.

Establish a protected series;

or 3.

Except as permitted by a law of the Commonwealth other than this article, have any purpose or power that the law of the Commonwealth other than this article prohibits a limited liability company from doing or having.

§ 13.1-1091.

Governing law.

The law of the Commonwealth governs:

1.

The internal affairs of a protected series of a series limited liability company, including:

a.

Relations among any associated members of the protected series;

b.

Relations among the protected series and (i) any associated member, (ii) the protected series manager, or (iii) any protected series assignee;

c.

Relations between any associated member and (i) the protected series manager or (ii) any protected series assignee;

d.

The rights and duties of a protected series manager;

e.

Governance decisions affecting the activities and affairs of the protected series and the conduct of those activities and affairs;

and f.

Procedures and conditions for becoming an associated member or protected series assignee;

2.

The relations between a protected series of a series limited liability company and each of the following:

a.

The series limited liability company;

b.

Another protected series of the series limited liability company;

c.

A member of the series limited liability company that is not an associated member of the protected series;

d.

A protected series manager that is not a protected series manager of the protected series;

and e.

A protected series assignee that is not a protected series assignee of the protected series;

3.

The liability of a person for a debt, obligation, or other liability of a protected series of a series limited liability company if the debt, obligation, or liability is asserted solely by reason of the person being or acting as:

a.

An associated member, protected series assignee, or protected series manager of the protected series;

b.

A member of the series limited liability company that is not an associated member of the protected series;

c.

A protected series manager that is not a protected series manager of the protected series;

d.

A protected series assignee that is not a protected series assignee of the protected series;

e.

A manager of the series limited liability company;

or f.

An assignee of a membership interest of the series limited liability company;

4.

The liability of a series limited liability company for a debt, obligation, or other liability of a protected series of the series limited liability company if the debt, obligation, or liability is asserted solely by reason of the series limited liability company:

a.

Having a statement of protected series designation or a statement of designation change filed with the Commission;

b.

Being or acting as a protected series manager of the protected series;

c.

Having the protected series be or act as a manager of the series limited liability company;

or d.

Owning a protected series assignable interest of the protected series;

and 5.

The liability of a protected series of a series limited liability company for a debt, obligation, or other liability of the series limited liability company or of another protected series of the series limited liability company if the debt, obligation, or liability is asserted solely by reason of:

a.

The protected series:

(1) Being a protected series of the series limited liability company or having as a protected series manager the series limited liability company or another protected series of the series limited liability company;

or (2) Being or acting as a protected series manager of another protected series of the series limited liability company or a manager of the series limited liability company;

or b.

The company owning a protected series membership interest of the protected series.

§ 13.1-1092.

Relation of operating agreement, this article, and the other articles of this chapter.

A.

Except as otherwise provided in this section and subject to §§ 13.1-1093 and 13.1-1094, the operating agreement of a series limited liability company governs:

1.

The internal affairs of a protected series, including:

a.

Relations among any associated members of the protected series;

b.

Relations among the protected series and (i) any associated member of the protected series, (ii) any protected series manager, and (iii) any protected series assignee;

c.

Relations between any associated member and (i) any protected series manager or (ii) any protected series assignee;

d.

The rights and duties of a protected series manager;

e.

Governance decisions affecting the activities and affairs of the protected series and the conduct of those activities and affairs;

and f.

Procedures and conditions for becoming an associated member or protected series assignee;

2.

The relations among the protected series of a series limited liability company, the series limited liability company, and any other protected series of the series limited liability company;

and 3.

Relations between:

a.

The protected series, its protected series manager, any associated member of the protected series, or any protected series assignee of the protected series;

and b.

A person in the person's capacity as:

(1) A member of the series limited liability company who is not an associated member of the protected series;

(2) A protected series assignee or protected series manager of another protected series;

or (3) An assignee of the series limited liability company.

B.

If the provisions of this chapter other than in this article restrict the power of an operating agreement to affect a matter, the restriction applies to a matter under this article according to the rules stated in § 13.1-1094.

C.

If the law of the Commonwealth other than this article contains a prohibition, limitation, requirement, condition, or other constraint pertaining to a limited liability company, a member, a manager, or other agent of the limited liability company, or an assignee of the limited liability company, except as otherwise provided in the law of the Commonwealth other than this article, the restriction applies according to the rules stated in § 13.1-1094.

D.

Except as otherwise provided in § 13.1-1093, if the operating agreement of a series limited liability company does not provide for a matter described in subsection A in a manner permitted by this article, the matter is determined in accordance with the following rules:

1.

To the extent that this article addresses the matter, this article governs;

and 2.

To the extent that this article does not address the matter, the provisions of this chapter other than in this article govern the matter according to the rules stated in § 13.1-1094.

§ 13.1-1093.

Additional limitations on operating agreement.

A.

An operating agreement shall not vary the effect of:

1.

This section;

2.

Section 13.1-1089;

3.

Subsection A of § 13.1-1090;

4.

Subsection B of § 13.1-1090 to provide a protected series a power in addition to the powers provided to a limited liability company under the other articles of this chapter;

5.

The limitations stated in subsection C or D of § 13.1-1090;

6.

Section 13.1-1091;

7.

Section 13.1-1092;

8.

Section 13.1-1094;

9.

Section 13.1-1095, except to vary the manner in which a limited liability company approves establishing a protected series;

10.

Section 13.1-1096;

11.

Section 13.1-1099.2;

12.

Section 13.1-1099.3;

13.

Subsection A or B of § 13.1-1099.4;

14.

Subsection C, F, or G of § 13.1-1099.5;

15.

Section 13.1-1099.7, except to decrease or eliminate a limitation of liability stated in § 13.1-1099.7;

16.

Section 13.1-1099.8;

17.

Section 13.1-1099.9;

18.

Section 13.1-1099.10;

19.

Subdivisions 1, 4, and 5 of § 13.1-1099.11;

20.

Section 13.1-1099.12, except to designate a different person to manage winding up;

21.

Section 13.1-1099.13;

22.

Sections 13.1-1099.14 through 13.1-1099.20;

23.

Sections 13.1-1099.21, 13.1-1099.22, and 13.1-1099.23;

24.

Sections 13.1-1099.25 and 13.1-1099.26;

or 25.

A provision of this article pertaining to:

a.

A registered office or registered agent;

or b.

The Commission, including provisions pertaining to records authorized or required to be delivered to the Commission for filing under this article or chapter.

B.

An operating agreement shall not unreasonably restrict the duties and rights under § 13.1-1099.6 but may impose reasonable restrictions on the availability and use of information obtained under § 13.1-1099.6 and may provide appropriate remedies, including liquidated damages, for a breach of any reasonable restriction on use.

§ 13.1-1094.

Rules for applying other articles of this chapter to specified provisions of this article.

A.

Except as otherwise provided in subsection B and § 13.1-1093, the following rules apply in applying § 13.1-1092, subsections C and F of § 13.1-1099.5, subdivision 4a of § 13.1-1099.11, subsection A of § 13.1-1099.12, and subdivision 2 of § 13.1-1099.13:

1.

A protected series of a series limited liability company is deemed to be a limited liability company that is organized separately from the series limited liability company and distinct from the series limited liability company and any other protected series of the series limited liability company;

2.

An associated member of the protected series is deemed to be a member of the series limited liability company;

3.

A protected series assignee of the protected series is deemed to be an assignee of the series limited liability company;

4.

A protected series membership interest of the protected series is deemed to be a membership interest of the series limited liability company;

5.

A protected series manager is deemed to be a manager of the series limited liability company;

6.