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November 1, 2012Jennifer Avery, David Lawrence, Todd Lowther, Karen Rose, Joshua Russ, Brandon Schubert, Andrew Wootton, Travis Youngblood
Series LLCs: Nuts and Bolts, Benefits and Risks, and the Uncertainties That Remain
A series limited liability company (“Series LLC”) is a variation of the traditional limited liability company (“Traditional LLC”) that is available under several states’ limited liability company (“LLC”) statutes. A Series LLC is, effectively, a collection of subunits within one LLC that can be created according to statute without actually forming multiple LLCs. Under a typical Series LLC statute, found in Delaware, Texas, Illinois, and several other states, a Series LLC can have as many different, individual series as the members desire, and each series looks and acts almost exactly like a separate LLC. In effect, a Series LLC is a way around creating multiple LLCs – only a single entity need be created, but assets, ownership and, therefore, liability, can be allocated exactly as if multiple entities had been formed.
November 1, 2012Adrienne Randle Bond, Allen Sparkman
The Series LLC: a New Planning Tool
Texas adopted new provisions permitting the creation and operation of series limitedliability companies (the “Series LLC”) under Texas law in 2009.1 This paper discusses thestate of law on Series LLCs under the Texas Business Organizations Code (“TBOC”) withsome consideration of other jurisdictions’ laws and practice pointers for resolving the issuespresented by the statutory formulation for the Series LLC. After discussing what Series LLCsare and can do, the paper will analyze points of ambiguity and development where the resultsof the use of the Series structure may not be perfectly clear. This vehicle for formation is stillunder development, but, in the right circumstances, presents an elegant solution to ownershipand management of closely related, but not identical, groups of assets.
March 6, 2020Roger A. Key
Series Limited Liability Companies: Formation, Operation and Practical Considerations
This paper and presentation are intended to address the statutory authority for a “Series LLC” (hereinafter referred to as a “Series”), selected statutory provisions relating Limited Liability Companies (“LLCs”), a limited examination of how Series LLCs are taxed, how they are treated under the Uniform Commercial Code (“UCC”), under the United States Bankruptcy Code, and various practical considerations related to Series LLCs. Limited Liability Companies will be referred to as LLC, Company or Mothership in this paper.
November 18, 2016Allen Sparkman
Splitting The Pie — Structuring Equity Compensation In Alternative Entities
One key difference between equity compensation in alternative entities and in corporations derives from the fundamental difference between the tax consequences of issuing equity in exchange for services in each form of entity. Receipt of stock from a corporation in exchange for services is generally taxable, absent use of an incentive stock option plan, while receipt of interests in an LLC or partnership may be non-taxable if the interests issued are profits interests.
March 7, 2014Carmen Flores
The Basics from the Secretary of State's Office
One of the first hurdles a practitioner must overcome is the secretary of state’s review of the business entity name selected by the client. The availability of an entity name remains the most frequently deliberated, and heavily contested, reason for rejection of a filing instrument.
May 26, 2012Adrienne Randle Bond, Allen Sparkman
The Series LLC: A New Planning Tool
Texas adopted new provisions permitting the creation and operation of series limited liability companies (the ―Series LLC‖) under Texas law in 2009. This paper discusses the state of law on series under the Texas statute, with some consideration of other jurisdictions and laws and practice pointers for resolving the issues presented by the statutory formulation for the Series LLC. After discussing what series are and can do, the paper will analyze points of ambiguity and development where the results of the use of the series structure may not be perfectly clear. This vehicle for formation is still under development, but, in the right circumstances, presents an elegant solution to ownership and management of closely related, but not identical, groups of assets.
May 11, 2012Lorna Wassdorf, Carmen Flores
Avoiding Pitfalls in Doing Business with the Secretary of State
After the mandatory application date of the Texas Business Organizations Code (BOC) on January 1, 2010, many practitioners were unsure whether the governing documents of an entity, which contained old terminology and references to prior law, must be amended or restated to conform and comply with the BOC. Senate Bill 748, which was passed by the 82nd Legislature in its Regular Session and became effective September 1, 2011, amended chapter 402 of the BOC to address this uncertainty.
November 2, 2012Bryan Dunklin
Texas Series LLCs, A Valuable New Option and a Coming Trend for Holding and Operating Texas Real Estate; or Too Many Unanswered Questions
When Texas authorized the use of a series limited liability company (SLLC) in 2009, it became one of a small number of states to do so. This paper will address the question of whether and under what circumstances the Texas series limited liability company (TSLLC) might be recommended by a Texas lawyer for use by his real estate or business clients, or whether there are too many unanswered questions and too many risks still remaining to use this legal entity at this time.
October 15, 2011Adrienne Randle Bond, Allen Sparkman
The Series LLC: A New Planning Tool
While the Series LLC is a new vehicle that has some unanswered questions, it is a solution to problems of management of assets that have common, but not identical features. The statute makes very clear the ability to deal with assets and the transactions surrounding assets that may be held by an entity. If you focus on the feature of asset management and commonality, but not identity, the confusion caused by the flexibility permitted in the TBOC provisions falls away, and you are able to focus on fact patterns that are truly facilitated by this structure. The single most ―common‖ commonality is management, but the commonality may be the nature of the asset (such as the accumulation of one large asset from divided parts) or the development of an asset over time, where ownership may shift. We would like to encourage you to join the ranks of the optimists and urge you to study and think about this new vehicle. Consider embracing the good points of a Series LLC in transactions appropriate for the solutions that it provides.
May 28, 2011Adrienne Randle Bond, Steven D. Moore
What are Series LLCs? An Overview of Drafting and Operational Considerations
This paper is to discuss what the state of law is on series under the Texas statute, with some consideration of the other jurisdiction and practice pointers for resolving the issues presented by the statutory formulation for the Series LLC.
May 28, 2011Adrienne Randle Bond, Steven D. Moore
What are Series LLCs? An Overview of Drafting and Operational Considerations
This paper is to discuss what the state of law is on series under the Texas statute, with some consideration of the other jurisdiction and practice pointers for resolving the issues presented by the statutory formulation for the Series LLC.
December 31, 1969Newsletter Committee
Fall, 2015
Includes articles the 84th Session of the Texas Legislature, specifically: "2015 Texas Legislative Update on Entity Law" by Daryl Robertson; "A Series LLC Is Now Included Under The Texas UCC’s Definition Of Person, Removing Uncertainty For Secured Lending Transactions" by James Leeland; "Power of Attorney Bill (HB 3095)" by Jacqueline Akins. There were two non-legislative articles as well, including: "Confidentiality of Email – The Changing Consensus" by Ronald Chichester; and "Texas Crowdfunding Portals Provide Texas Businesses New Access to Investment Dollars" by R. Jason Pierce.
December 31, 1969Newsletter Committee
Fall, 2015
Includes articles the 84th Session of the Texas Legislature, specifically: "2015 Texas Legislative Update on Entity Law" by Daryl Robertson; "A Series LLC Is Now Included Under The Texas UCC’s Definition Of Person, Removing Uncertainty For Secured Lending Transactions" by James Leeland; "Power of Attorney Bill (HB 3095)" by Jacqueline Akins. There were two non-legislative articles as well, including: "Confidentiality of Email – The Changing Consensus" by Ronald Chichester; and "Texas Crowdfunding Portals Provide Texas Businesses New Access to Investment Dollars" by R. Jason Pierce.