2010 Tennessee Code
Title 48 - Corporations And Associations
Chapter 249 - Tennessee Revised Limited Liability Company Act
Part 3 - Finance
48-249-309 - Series of members, holders, managers, directors, membership interests or financial rights.

48-249-309. Series of members, holders, managers, directors, membership interests or financial rights.

(a)  Establishment of series.  The LLC documents may establish, or provide for the establishment of, one (1) or more designated series of members, holders, managers, directors, membership interests or financial rights having separate rights, powers or duties, with respect to specified property or obligations of the LLC, or profits and losses associated with specified property or obligations, and any such series may have a separate business purpose or investment objective.

(b)  Separateness of series. 

     (1)  Notwithstanding anything to the contrary set forth in this chapter, or under other applicable law, the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing, with respect to a particular series established under subsection (a), shall be enforceable against the assets of such series only, and not against the assets of the LLC generally, or any other series of the LLC, and, unless otherwise provided in the LLC documents, none of the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to the LLC generally, or any other series of the LLC, shall be enforceable against the assets of such series, in the event that:

          (A)  The LLC documents establish or provide for the establishment of one (1) or more series;

          (B)  Separate and distinct records are maintained for any such series, and the assets associated with any such series are reflected and held in such separate and distinct records, directly or indirectly, including through a nominee or otherwise, and accounted for in such separate and distinct records separately from the other assets of the LLC and the assets of any other series of the LLC; and

          (C)  Notice of the limitation on liabilities of a series, as referenced in this subsection (b) is set forth in the articles of the LLC.

     (2)  Notice in the articles of the limitation on liabilities of a series as provided in this subsection (b) shall be sufficient for all purposes of this chapter, whether or not the LLC has established any series, when such notice is included in the articles, and there shall be no requirement that any specific series of the LLC be referenced in such notice. The fact that articles that contain the notice of the limitation on liabilities of a series is on file with the secretary of state shall constitute notice of such limitation on liabilities of a series.

(c)  Voluntary personal liability.  Notwithstanding the provisions of § 48-249-114(a), a member may agree to be liable for all of the debts, liabilities and obligations of one (1) or more specified series of an LLC, by provision in the articles with respect to such specified series in the manner set forth in § 48-249-114(f). Such provision in the articles with respect to one (1) or more specified series of an LLC shall not cause the member to be liable for the debts, liabilities and obligations of any of the other series of the LLC.

(d)  Classification of interests and voting rights.  The LLC documents may include the provisions authorized under § 48-249-303(a) or (b), or both, as to the directors, members, managers or holders of financial rights associated with a particular series, as if the series were a separate LLC.

(e)  Distributions.  The provisions of §§ 48-249-304 - 48-249-306 shall apply to a series of an LLC, as if the series were a separate LLC.

(f)  Management duties; admission of members; transfer.  The provisions of parts 4 and 5 of this chapter shall apply to a series of an LLC, as if the series were a separate LLC.

(g)  Termination.  A series of an LLC may be terminated and its affairs wound up without causing the dissolution of the LLC or the termination of any other series of the LLC and without affecting the limitation on liability of the terminated series or any other series of the LLC. All provisions of this chapter regarding dissolution or winding up of an LLC, including the rights of members, directors or managers to cause a dissolution of an LLC, shall apply to a series of an LLC, as if the series were a separate LLC.

(h)  Events of termination.  A series of an LLC shall be terminated and its affairs shall be wound up upon the occurrence of the same events or reasons as are provided in this chapter for an LLC.

(i)  Series of foreign LLCs.  If a foreign LLC that is applying for a certificate of authority to transact business in this state, or is authorized to transact business in this state, is governed by articles, an operating agreement or similar equivalent documents that establish or provide for the establishment of designated series of members, directors, managers or interests having separate rights, powers or duties with respect to specified property or obligations of the foreign LLC or profits and losses associated with specified property or obligations, that fact shall be so stated in the foreign LLC's application for a certificate of authority to transact business in this state, or an amendment of such certificate of authority. In addition, the foreign LLC shall state in such application or amendment, as applicable, whether the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to a particular series, if any, shall be enforceable against the assets of such series only, and not against the assets of the foreign LLC generally or any other series of the foreign LLC, and, unless otherwise provided in such application or amendment, none of the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to the foreign LLC generally, or any other series of the foreign LLC, shall be enforceable against the assets of such series.

[Acts 2005, ch. 286, § 1; 2006, ch. 620, § 27.]  

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