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General Assembly Substitute Bill No. 7127
January Session, 2019
AN ACT CONCERNING TH E UNIFORM PROTECTED SERIES ACT.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. (NEW) (Effective October 1, 2019) Sections 1 to 42, 1
inclusive, of this act may be cited as the Uniform Protected Series Act. 2
Sec. 2. (NEW) (Effective October 1, 2019) As used in sections 1 to 42, 3
inclusive, of this act: 4
(1) "Asset" means property: (A) In which a series limited liability 5
company or protected series has rights; or (B) as to which the company 6
or protected series has the power to transfer rights. 7
(2) "Associated asset" means an asset that meets the requirements of 8
section 15 of this act. 9
(3) "Associated member" means a member that meets the 10
requirements of section 16 of this act. 11
(4) "Foreign protected series" means an arrangement, configuration 12
or other structure established by a foreign limited liability company 13
which has attributes comparable to a protected series established 14
under sections 1 to 42, inclusive, of this act. "Foreign protected series" 15
applies whether or not the law under which the foreign company is 16
organized refers to "protected series". 17
(5) "Foreign series limited liability company" means a foreign 18 Substitute Bill No. 7127
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limited liability company that has at least one foreign protected series. 19
(6) "Non-associated asset" means: 20
(A) An asset of a series limited liability company which is not an 21
associated asset of the company; or 22
(B) An asset of a protected series of the company which is not an 23
associated asset of the protected series. 24
(7) "Person" includes a protected series. 25
(8) "Protected series", except in the phrase "foreign protected series", 26
means a protected series established under section 9 of this act. 27
(9) "Protected-series manager" means a person under whose 28
authority the powers of a protected series are exercised and under 29
whose direction the activities and affairs of the protected series are 30
managed under the operating agreement, sections 1 to 42, inclusive, of 31
this act and chapter 613a of the general statutes. 32
(10) "Protected-series transferable interest" means a right to receive a 33
distribution from a protected series. 34
(11) "Protected-series transferee" means a person to which all or part 35
of a protected-series transferable interest of a protected series of a 36
series limited liability company has been transferred, other than the 37
company. "Protected-series transferee" includes a person that owns a 38
protected-series transferable interest as a result of ceasing to be an 39
associated member of a protected series. 40
(12) "Series limited liability company", except in the phrase "foreign 41
series limited liability company", means a limited liability company 42
that has at least one protected series. 43
Sec. 3. (NEW) (Effective October 1, 2019) A protected series of a series 44
limited liability company is a person distinct from: 45 Substitute Bill No. 7127
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(1) The company, subject to subsection (c) of section 4 of this act, 46
subdivision (1) of section 24 of this act and subsection (d) of section 25 47
of this act; 48
(2) Another protected series of the company; 49
(3) A member of the company, whether or not the member is an 50
associated member of the protected series; 51
(4) A protected-series transferee of a protected series of the 52
company; and 53
(5) A transferee of a transferable interest of the company. 54
Sec. 4. (NEW) (Effective October 1, 2019) (a) A protected series of a 55
series limited liability company has the capacity to sue and be sued in 56
its own name. 57
(b) Except as otherwise provided in subsections (c) and (d) of this 58
section, a protected series of a series limited liability company has the 59
same powers and purposes as the company. 60
(c) A protected series of a series limited liability company ceases to 61
exist not later than when the company completes its winding up. 62
(d) A protected series of a series limited liability company may not: 63
(1) Be a member of the company; 64
(2) Establish a protected series; or 65
(3) Except as permitted by law of this state other than sections 1 to 66
42, inclusive, of this act, have a purpose or power that the law of this 67
state other than sections 1 to 42, inclusive, of this act prohibits a limited 68
liability company from doing or having. 69
Sec. 5. (NEW) (Effective October 1, 2019) The law of this state governs: 70
(1) The internal affairs of a protected series of a series limited 71 Substitute Bill No. 7127
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liability company, including: 72
(A) Relations among any associated members of the protected 73
series; 74
(B) Relations between the protected series and: (i) Any associated 75
member; (ii) the protected-series manager; or (iii) any protected-series 76
transferee; 77
(C) Relations between any associated member and: (i) The 78
protected-series manager; or (ii) any protected-series transferee; 79
(D) The rights and duties of a protected-series manager; 80
(E) Governance decisions affecting the activities and affairs of the 81
protected series and the conduct of those activities and affairs; and 82
(F) Procedures and conditions for becoming an associated member 83
or a protected-series transferee; 84
(2) The relations between a protected series of a series limited 85
liability company and each of the following: 86
(A) The company; 87
(B) Another protected series of the company; 88
(C) A member of the company which is not an associated member of 89
the protected series; 90
(D) A protected-series manager that is not a protected-series 91
manager of the protected series; and 92
(E) A protected-series transferee that is not a protected-series 93
transferee of the protected series; 94
(3) The liability of a person for a debt, obligation or other liability of 95
a protected series of a series limited liability company if the debt, 96
obligation or liability is asserted solely by reason of the person being or 97 Substitute Bill No. 7127
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acting as: 98
(A) An associated member, a protected-series transferee or a 99
protected-series manager of the protected series; 100
(B) A member of the company which is not an associated member of 101
the protected series; 102
(C) A protected-series manager that is not a protected-series 103
manager of the protected series; 104
(D) A protected-series transferee that is not a protected-series 105
transferee of the protected series; 106
(E) A manager of the company; or 107
(F) A transferee of a transferable interest of the company; 108
(4) The liability of a series limited liability company for a debt, 109
obligation or other liability of a protected series of the company if the 110
debt, obligation or liability is asserted solely by reason of the company: 111
(A) Having delivered to the Secretary of the State for filing (i) under 112
subsection (b) of section 9 of this act, a protected series designation 113
pertaining to the protected series, or (ii) under subsection (d) of section 114
9 of this act or subsection (c) of section 10 of this act, a certificate of 115
designation change pertaining to the protected series; 116
(B) Being or acting as a protected-series manager of the protected 117
series; 118
(C) Having the protected series be or act as a manager of the 119
company; or 120
(D) Owning a protected-series transferable interest of the protected 121
series; and 122
(5) The liability of a protected series of a series limited liability 123 Substitute Bill No. 7127
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company for a debt, obligation or other liability of the company or of 124
another protected series of the company if the debt, obligation or 125
liability is asserted solely by reason of: 126
(A) The protected series: (i) Being a protected series of the company 127
or having as a protected-series manager the company or another 128
protected series of the company; or (ii) being or acting as a protected-129
series manager of another protected series of the company or a 130
manager of the company; or 131
(B) The company owning a protected-series transferable interest of 132
the protected series. 133
Sec. 6. (NEW) (Effective October 1, 2019) (a) Except as otherwise 134
provided in this section and subject to sections 7 and 8 of this act, the 135
operating agreement of a series limited liability company governs: 136
(1) The internal affairs of a protected series, including: 137
(A) Relations among any associated members of the protected 138
series; 139
(B) Relations between the protected series and: (i) Any associated 140
member; (ii) the protected-series manager; or (iii) any protected-series 141
transferee; 142
(C) Relations between any associated member and: (i) The 143
protected-series manager; or (ii) any protected-series transferee; 144
(D) The rights and duties of a protected-series manager; 145
(E) Governance decisions affecting the activities and affairs of the 146
protected series and the conduct of those activities and affairs; and 147
(F) Procedures and conditions for becoming an associated member 148
or protected-series transferee; 149
(2) Relations among the protected series, the company and any 150 Substitute Bill No. 7127
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other protected series of the company; 151
(3) Relations between: 152
(A) The protected series, its protected-series manager, any 153
associated member of the protected series or any protected-series 154
transferee of the protected series; and 155
(B) A person in the person's capacity as: (i) A member of the 156
company which is not an associated member of the protected series; 157
(ii) a protected-series transferee or protected-series manager of another 158
protected series; or (iii) a transferee of the company. 159
(b) If any provision of chapter 613a of the general statutes restricts 160
the power of an operating agreement to affect a matter, the restriction 161
applies to a matter under sections 1 to 42, inclusive, of this act in 162
accordance with section 8 of this act. 163
(c) If law of this state other than sections 1 to 42, inclusive, of this act 164
imposes a prohibition, limitation, requirement, condition, obligation, 165
liability or other restriction on a limited liability company, a member, 166
manager or other agent of the company, or a transferee of the 167
company, except as otherwise provided in law of this state other than 168
sections 1 to 42, inclusive, of this act, the restriction applies in 169
accordance with section 8 of this act. 170
(d) Except as otherwise provided in section 7 of this act, if the 171
operating agreement of a series limited liability company does not 172
provide for a matter described in subsection (a) of this section in a 173
manner permitted by sections 1 to 42, inclusive, of this act, the matter 174
is determined in accordance with the following rules: 175
(1) To the extent sections 1 to 42, inclusive, of this act address the 176
matter, sections 1 to 42, inclusive, of this act govern. 177
(2) To the extent sections 1 to 42, inclusive, of this act do not address 178
the matter, chapter 613a of the general statutes governs the matter in 179 Substitute Bill No. 7127
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accordance with section 8 of this act. 180
Sec. 7. (NEW) (Effective October 1, 2019) (a) An operating agreement 181
may not vary the effect of: 182
(1) This section; 183
(2) Section 3 of this act; 184
(3) Subsection (a) of section 4 of this act; 185
(4) Subsection (b) of section 4 of this act to provide a protected series 186
a power beyond the powers chapter 613a of the general statutes 187
provides a limited liability company; 188
(5) Subsection (c) or (d) of section 4 of this act; 189
(6) Section 5 of this act; 190
(7) Section 6 of this act; 191
(8) Section 8 of this act; 192
(9) Section 9 of this act, except to vary the manner in which a limited 193
liability company approves establishing a protected series; 194
(10) Section 10 of this act; 195
(11) Section 15 of this act; 196
(12) Section 16 of this act; 197
(13) Subsection (a) or (b) of section 17 of this act; 198
(14) Subsection (c) or (f) of section 18 of this act; 199
(15) Section 20 of this act, except to decrease or eliminate a limitation 200
of liability stated in section 20 of this act; 201
(16) Section 21 of this act; 202 Substitute Bill No. 7127
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(17) Section 22 of this act; 203
(18) Section 23 of this act; 204
(19) Subdivisions (1), (4) and (5) of section 24 of this act; 205
(20) Section 25 of this act, except to designate a different person to 206
manage winding up; 207
(21) Section 26 of this act; 208
(22) Sections 27 to 34, inclusive, of this act; 209
(23) Sections 35 to 38, inclusive, of this act; 210
(24) Sections 39 to 42, inclusive, of this act; or 211
(25) A provision of sections 1 to 42, inclusive, of this act pertaining 212
to: 213
(A) Registered agents; or 214
(B) The Secretary of the State, including provisions pertaining to 215
records authorized or required to be delivered to the Secretary of the 216
State for filing under sections 1 to 42, inclusive, of this act. 217
(b) An operating agreement may not unreasonably restrict the 218
duties and rights under section 19 of this act but may impose 219
reasonable restrictions on the availability and use of information 220
obtained under section 19 of this act and may provide appropriate 221
remedies, including liquidated damages, for a breach of any 222
reasonable restriction on use. 223
Sec. 8. (NEW) (Effective October 1, 2019) (a) Except as otherwise 224
provided in subsection (b) of this section and section 7 of this act, the 225
following rules apply in applying section 6 of this act, subsections (c) 226
and (f) of section 18 of this act, subparagraph (A) of subdivision (4) of 227
section 24 of this act, subsection (a) of section 25 of this act, and 228 Substitute Bill No. 7127
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subdivision (2) of section 26 of this act: 229
(1) A protected series of a series limited liability company is deemed 230
to be a limited liability company that is formed separately from the 231
series limited liability company and is distinct from the series limited 232
liability company and any other protected series of the series limited 233
liability company. 234
(2) An associated member of the protected series is deemed to be a 235
member of the company deemed to exist under subdivision (1) of this 236
subsection. 237
(3) A protected-series transferee of the protected series is deemed to 238
be a transferee of the company deemed to exist under subdivision (1) 239
of this subsection. 240
(4) A protected-series transferable interest of the protected series is 241
deemed to be a transferable interest of the company deemed to exist 242
under subdivision (1) of this subsection. 243
(5) A protected-series manager is deemed to be a manager of the 244
company deemed to exist under subdivision (1) of this subsection. 245
(6) An asset of the protected series is deemed to be an asset of the 246
company deemed to exist under subdivision (1) of this subsection, 247
whether or not the asset is an associated asset of the protected series. 248
(7) Any creditor or other obligee of the protected series is deemed to 249
be a creditor or obligee of the company deemed to exist under 250
subdivision (1) of this subsection. 251
(b) Subsection (a) of this section does not apply if its application 252
would: 253
(1) Contravene the provisions of section 34-243d of the general 254
statutes; or 255
(2) Authorize or require the Secretary of the State to: 256 Substitute Bill No. 7127
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(A) Accept for filing a type of record that neither sections 1 to 42, 257
inclusive, of this act nor chapter 613a of the general statutes authorizes 258
or requires a person to deliver to the Secretary of the State for filing; or 259
(B) Make or deliver a record that neither sections 1 to 42, inclusive, 260
of this act nor chapter 613a of the general statutes authorizes or 261
requires the Secretary of the State to make or deliver. 262
Sec. 9. (NEW) (Effective October 1, 2019) (a) With the affirmative vote 263
or consent of all members of a limited liability company, the company 264
may establish a protected series. 265
(b) To establish a protected series, a limited liability company shall 266
deliver to the Secretary of the State for filing a protected series 267
designation, signed by the company, stating the name of the company 268
and the name of the protected series to be established. 269
(c) A protected series is established when the protected series 270
designation takes effect under section 34-247f of the general statutes, as 271
amended by this act. 272
(d) To amend a protected series designation, a series limited liability 273
company shall deliver to the Secretary of the State for filing a 274
certificate of designation change, signed by the company, that changes 275
the name of the company, the name of the protected series to which the 276
designation applies, or both. The change takes effect when the 277
certificate of designation change takes effect under section 34-247f of 278
the general statutes, as amended by this act. 279
Sec. 10. (NEW) (Effective October 1, 2019) (a) Except as otherwise 280
provided in subsection (b) of this section, the name of a protected 281
series shall comply with section 34-243k of the general statutes. 282
(b) The name of a protected series of a series limited liability 283
company shall: 284
(1) Begin with the name of the company, including any word or 285 Substitute Bill No. 7127
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abbreviation required by subsection (a) of section 34-243k of the 286
general statutes; and 287
(2) Contain the phrase "Protected Series" or "protected series" or the 288
abbreviation "P.S." or "PS". 289
(c) If a series limited liability company changes its name, the 290
company shall deliver to the Secretary of the State for filing a 291
certificate of designation change for each of the company's protected 292
series, changing the name of each protected series to comply with this 293
section. 294
Sec. 11. (NEW) (Effective October 1, 2019) (a) The registered agent in 295
this state for a series limited liability company is the registered agent in 296
this state for each protected series of the company. 297
(b) Before delivering a protected series designation to the Secretary 298
of the State for filing, a limited liability company shall agree with a 299
registered agent that the agent will serve as the registered agent in this 300
state for both the company and the protected series. 301
(c) A person that signs a protected series designation delivered to 302
the Secretary of the State for filing affirms as a fact that the limited 303
liability company on whose behalf the designation is delivered has 304
complied with subsection (b) of this section. 305
(d) A person that ceases to be the registered agent for a series 306
limited liability company ceases to be the registered agent for each 307
protected series of the company. 308
(e) A person that ceases to be the registered agent for a protected 309
series of a series limited liability company, other than as a result of the 310
termination of the protected series, ceases to be the registered agent of 311
the company and any other protected series of the company. 312
(f) Except as otherwise agreed by a series limited liability company 313
and its registered agent, the agent is not obligated to distinguish 314 Substitute Bill No. 7127
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between a process, notice, demand or other record concerning the 315
company and a process, notice, demand or other record concerning a 316
protected series of the company. 317
Sec. 12. (NEW) (Effective October 1, 2019) (a) A protected series of a 318
series limited liability company may be served with a process, notice, 319
demand or other record required or permitted by law by: 320
(1) Serving the company; 321
(2) Serving the registered agent of the protected series; or 322
(3) Other means authorized by law of this state other than chapter 323
613a of the general statutes. 324
(b) Service of a summons and complaint on a series limited liability 325
company is notice to each protected series of the company of service of 326
the summons and complaint and the contents of the complaint. 327
(c) Service of a summons and complaint on a protected series of a 328
series limited liability company is notice to the company and any other 329
protected series of the company of service of the summons and 330
complaint and the contents of the complaint. 331
(d) Service of a summons and complaint on a foreign series limited 332
liability company is notice to each foreign protected series of the 333
foreign company of service of the summons and complaint and the 334
contents of the complaint. 335
(e) Service of a summons and complaint on a foreign protected 336
series of a foreign series limited liability company is notice to the 337
foreign company and any other foreign protected series of the 338
company of service of the summons and complaint and the contents of 339
the complaint. 340
(f) Notice to a person under subsection (b), (c), (d) or (e) of this 341
section is effective whether or not the summons and complaint identify 342 Substitute Bill No. 7127
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the person if the summons and complaint name as a party and 343
identify: 344
(1) The series limited liability company or a protected series of the 345
company; or 346
(2) The foreign series limited liability company or a foreign 347
protected series of the foreign company. 348
Sec. 13. (NEW) (Effective October 1, 2019) (a) On request of any 349
person, the Secretary of the State shall issue a certificate of legal 350
existence for a protected series of a series limited liability company or a 351
certificate of registration for a foreign protected series if: 352
(1) In the case of a protected series: 353
(A) No certificate of dissolution, termination or relocation 354
pertaining to the protected series has been filed; and 355
(B) The company has delivered to the Secretary of the State for filing 356
the most recent annual report required by section 34-247k of the 357
general statutes and the report includes the name of the protected 358
series, unless: (i) When the company delivered the report for filing, the 359
protected series designation pertaining to the protected series had not 360
yet taken effect; or (ii) after the company delivered the report for filing, 361
the company delivered to the Secretary of the State for filing a 362
certificate of designation change changing the name of the protected 363
series; or 364
(2) In the case of a foreign protected series, it is registered to do 365
business in this state. 366
(b) A certificate issued under subsection (a) of this section shall 367
state: 368
(1) In the case of a protected series: 369
(A) The name of the protected series of the series limited liability 370 Substitute Bill No. 7127
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company and the name of the company; 371
(B) That the requirements of subsection (a) of this section are met; 372
(C) The date the protected series designation pertaining to the 373
protected series took effect; and 374
(D) If a certificate of designation change pertaining to the protected 375
series has been filed, the effective date and contents of the certificate; 376
(2) In the case of a foreign protected series, that it is registered to do 377
business in this state; 378
(3) That the fees, taxes, interest and penalties owed to this state by 379
the protected series or foreign protected series and collected through 380
the Secretary of the State have been paid, if: 381
(A) Payment is reflected in the records of the Secretary of the State; 382
and 383
(B) Nonpayment affects the good standing of the protected series; 384
and 385
(4) Other facts reflected in the records of the Secretary of the State 386
pertaining to the protected series or foreign protected series which the 387
person requesting the certificate reasonably requests. 388
(c) Subject to any qualification stated by the Secretary of the State in 389
a certificate issued under subsection (a) of this section, the certificate 390
may be relied on as conclusive evidence of the facts stated in the 391
certificate. 392
Sec. 14. (NEW) (Effective October 1, 2019) (a) In the annual report 393
required by section 34-247k of the general statutes, a series limited 394
liability company shall include the name of each protected series of the 395
company: 396
(1) For which the company has previously delivered to the Secretary 397 Substitute Bill No. 7127
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of the State for filing a protected series designation; and 398
(2) Which has not dissolved and completed winding up. 399
(b) A failure by a series limited liability company to comply with 400
subsection (a) of this section with regard to a protected series prevents 401
issuance of a certificate of legal existence pertaining to the protected 402
series but does not otherwise affect the protected series. 403
Sec. 15. (NEW) (Effective October 1, 2019) (a) Only an asset of a 404
protected series may be an associated asset of the protected series. 405
Only an asset of a series limited liability company may be an 406
associated asset of the company. 407
(b) An asset of a protected series of a series limited liability 408
company is an associated asset of the protected series only if the 409
protected series creates and maintains records that state the name of 410
the protected series and describe the asset with sufficient specificity to 411
permit a disinterested, reasonable individual to: 412
(1) Identify the asset and distinguish it from any other asset of the 413
protected series, any asset of the company and any asset of any other 414
protected series of the company; 415
(2) Determine when and from what person the protected series 416
acquired the asset or how the asset otherwise became an asset of the 417
protected series; and 418
(3) If the protected series acquired the asset from the company or 419
another protected series of the company, determine any consideration 420
paid, the payor and the payee. 421
(c) An asset of a series limited liability company is an associated 422
asset of the company only if the company creates and maintains 423
records that state the name of the company and describe the asset with 424
sufficient specificity to permit a disinterested, reasonable individual to: 425 Substitute Bill No. 7127
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(1) Identify the asset and distinguish it from any other asset of the 426
company and any asset of any protected series of the company; 427
(2) Determine when and from what person the company acquired 428
the asset or how the asset otherwise became an asset of the company; 429
and 430
(3) If the company acquired the asset from a protected series of the 431
company, determine any consideration paid, the payor and the payee. 432
(d) The records and recordkeeping required by subsections (b) and 433
(c) of this section may be organized by specific listing, category, type, 434
quantity or computational or allocational formula or procedure, 435
including a percentage or share of any asset, or in any other reasonable 436
manner. 437
(e) To the extent permitted by this section and law of this state other 438
than sections 1 to 42, inclusive, of this act, a series limited liability 439
company or protected series of the company may hold an associated 440
asset directly or indirectly, through a representative, nominee or 441
similar arrangement, except that: 442
(1) A protected series may not hold an associated asset in the name 443
of the company or another protected series of the company; and 444
(2) The company may not hold an associated asset in the name of a 445
protected series of the company. 446
Sec. 16. (NEW) (Effective October 1, 2019) (a) Only a member of a 447
series limited liability company may be an associated member of a 448
protected series of the company. 449
(b) A member of a series limited liability company becomes an 450
associated member of a protected series of the company if the 451
operating agreement or a procedure established by the agreement 452
states: 453 Substitute Bill No. 7127
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(1) That the member is an associated member of the protected series; 454
(2) The date on which the member became an associated member; 455
and 456
(3) Any protected-series transferable interest the associated member 457
has in connection with becoming or being an associated member. 458
(c) If a person that is an associated member of a protected series of a 459
series limited liability company is dissociated from the company, the 460
person ceases to be an associated member of the protected series. 461
Sec. 17. (NEW) (Effective October 1, 2019) (a) A protected-series 462
transferable interest of a protected series of a series limited liability 463
company shall be owned initially by an associated member of the 464
protected series or the company. 465
(b) If a protected series of a series limited liability company has no 466
associated members when established, the company owns the 467
protected-series transferable interests of the protected series. 468
(c) In addition to acquiring a protected-series transferable interest of 469
the protected series under subsection (b) of this section, a series limited 470
liability company may acquire a protected-series transferable interest 471
through a transfer from another person or as provided in the operating 472
agreement. 473
(d) Except for subdivision (3) of subsection (a) of section 8 of this 474
act, a provision of sections 1 to 42, inclusive, of this act that applies to a 475
protected-series transferee of a protected series of a series limited 476
liability company applies to the company in its capacity as an owner of 477
a protected-series transferable interest of the protected series. A 478
provision of the operating agreement of a series limited liability 479
company that applies to a protected-series transferee of a protected 480
series of the company applies to the company in its capacity as an 481
owner of a protected-series transferable interest of the protected series. 482 Substitute Bill No. 7127
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Sec. 18. (NEW) (Effective October 1, 2019) (a) A protected series may 483
have more than one protected-series manager. 484
(b) If a protected series has no associated members, the series 485
limited liability company is the protected-series manager. 486
(c) Section 8 of this act applies to determine any duties of a 487
protected-series manager of a protected series of a series limited 488
liability company to: 489
(1) The protected series; 490
(2) Any associated member of the protected series; and 491
(3) Any protected-series transferee of the protected series. 492
(d) Solely by reason of being or acting as a protected-series manager 493
of a protected series of a series limited liability company, a person 494
owes no duty to: 495
(1) The company; 496
(2) Another protected series of the company; or 497
(3) Another person in that person's capacity as: 498
(A) A member of the company which is not an associated member 499
of the protected series; 500
(B) A protected-series transferee or protected-series manager of 501
another protected series; or 502
(C) A transferee of the company. 503
(e) An associated member of a protected series of a series limited 504
liability company has the same rights as any other member of the 505
company to vote on or consent to an amendment to the company's 506
operating agreement or any other matter being decided by the 507
members, whether or not the amendment or matter affects the interests 508 Substitute Bill No. 7127
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of the protected series or the associated member. 509
(f) Part VIII of chapter 613a of the general statutes applies to a 510
protected series in accordance with section 8 of this act. 511
Sec. 19. (NEW) (Effective October 1, 2019) (a) A member of a series 512
limited liability company which is not an associated member of a 513
protected series of the company has a right to information concerning 514
the protected series to the same extent, in the same manner and under 515
the same conditions that a member that is not a manager of a manager-516
managed limited liability company has a right to information 517
concerning the company under section 34-255i of the general statutes. 518
(b) A person that was formerly an associated member of a protected 519
series has a right to information concerning the protected series to the 520
same extent, in the same manner and under the same conditions that a 521
person dissociated as a member of a manager-managed limited 522
liability company has a right to information concerning the company 523
under section 34-255i of the general statutes. 524
(c) If an associated member of a protected series dies, the legal 525
representative of the deceased associated member has a right to 526
information concerning the protected series to the same extent, in the 527
same manner and under the same conditions that the legal 528
representative of a deceased member of a limited liability company has 529
a right to information concerning the company under section 34-255i of 530
the general statutes. 531
(d) A protected-series manager of a protected series has a right to 532
information concerning the protected series to the same extent, in the 533
same manner and under the same conditions that a manager of a 534
manager-managed limited liability company has a right to information 535
concerning the company under section 34-255i of the general statutes. 536
Sec. 20. (NEW) (Effective October 1, 2019) (a) A person is not liable, 537
directly or indirectly, by way of contribution or otherwise, for a debt, 538
obligation or other liability of: 539 Substitute Bill No. 7127
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(1) A protected series of a series limited liability company solely by 540
reason of being or acting as: (A) An associated member, a series 541
manager or a protected-series transferee of the protected series; or (B) a 542
member, manager or transferee of the company; or 543
(2) A series limited liability company solely by reason of being or 544
acting as an associated member, a protected-series manager or a 545
protected-series transferee of a protected series of the company. 546
(b) Subject to section 23 of this act, the following rules apply: 547
(1) A debt, obligation or other liability of a series limited liability 548
company is solely the debt, obligation or liability of the company. 549
(2) A debt, obligation or other liability of a protected series is solely 550
the debt, obligation or liability of the protected series. 551
(3) A series limited liability company is not liable, directly or 552
indirectly, by way of contribution or otherwise, for a debt, obligation 553
or other liability of a protected series of the company solely by reason 554
of the protected series being a protected series of the company or the 555
company: 556
(A) Being or acting as a protected-series manager of the protected 557
series; 558
(B) Having the protected series manage the company; or 559
(C) Owning a protected-series transferable interest of the protected 560
series. 561
(4) A protected series of a series limited liability company is not 562
liable, directly or indirectly, by way of contribution or otherwise, for a 563
debt, obligation or other liability of the company or another protected 564
series of the company solely by reason of: 565
(A) Being a protected series of the company; 566 Substitute Bill No. 7127
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(B) Being or acting as a manager of the company or a protected-567
series manager of another protected series of the company; or 568
(C) Having the company or another protected series of the company 569
be or act as a protected-series manager of the protected series. 570
Sec. 21. (NEW) (Effective October 1, 2019) (a) Except as otherwise 571
provided in subsection (b) of this section, a claim seeking to disregard 572
a limitation in section 20 of this act is governed by the principles of law 573
and equity, including a principle providing a right to a creditor or 574
holding a person liable for a debt, obligation or other liability of 575
another person, which would apply if each protected series of a series 576
limited liability company were a limited liability company formed 577
separately from the series limited liability company and distinct from 578
the series limited liability company and any other protected series of 579
the series limited liability company. 580
(b) The failure of a limited liability company or a protected series to 581
observe a formality relating to the exercise of its powers or 582
management of its activities and affairs is not a ground to disregard a 583
limitation in subsection (a) of section 20 of this act, but may be a 584
ground to disregard a limitation in subsection (b) of section 20 of this 585
act. 586
(c) This section applies to a claim seeking to disregard a limitation of 587
liability applicable to a foreign series limited liability company or 588
foreign protected series and comparable to a limitation stated in 589
section 20 of this act, if: 590
(1) The claimant is a resident of this state or doing business or 591
registered to do business in this state; or 592
(2) The claim is to establish or enforce a liability arising under law of 593
this state other than sections 1 to 42, inclusive, of this act or from an act 594
or omission in this state. 595
Sec. 22. (NEW) (Effective October 1, 2019) Section 34-259b of the 596 Substitute Bill No. 7127
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general statutes applies to a judgment creditor of: 597
(1) An associated member or a protected-series transferee of a 598
protected series; or 599
(2) A series limited liability company, to the extent the company 600
owns a protected-series transferable interest of a protected series. 601
Sec. 23. (NEW) (Effective October 1, 2019) (a) As used in this section: 602
(1) "Enforcement date" means 12:01 a.m. on the date on which a 603
claimant first serves process on a series limited liability company or 604
protected series in an action seeking to enforce under this section a 605
claim against an asset of the company or protected series by 606
attachment, levy or the like. 607
(2) Subject to subsection (b) of section 34 of this act, "incurrence 608
date" means the date on which a series limited liability company or 609
protected series incurred the liability giving rise to a claim that a 610
claimant seeks to enforce under this section. 611
(b) If a claim against a series limited liability company or a protected 612
series of the company has been reduced to judgment, in addition to 613
any other remedy provided by law or equity, the judgment may be 614
enforced in accordance with the following rules: 615
(1) A judgment against the company may be enforced against an 616
asset of a protected series of the company if the asset: (A) Was a non-617
associated asset of the protected series on the incurrence date; or (B) is 618
a non-associated asset of the protected series on the enforcement date. 619
(2) A judgment against a protected series may be enforced against 620
an asset of the company if the asset: (A) Was a non-associated asset of 621
the company on the incurrence date; or (B) is a non-associated asset of 622
the company on the enforcement date. 623
(3) A judgment against a protected series may be enforced against 624 Substitute Bill No. 7127
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an asset of another protected series of the company if the asset: (A) 625
Was a non-associated asset of the other protected series on the 626
incurrence date; or (B) is a non-associated asset of the other protected 627
series on the enforcement date. 628
(c) In addition to any other remedy provided by law or equity, if a 629
claim against a series limited liability company or a protected series 630
has not been reduced to a judgment and law other than sections 1 to 631
42, inclusive, of this act permits a prejudgment remedy by attachment, 632
levy or the like, the court may apply subsection (b) of this section as a 633
prejudgment remedy. 634
(d) In a proceeding under this section, the party asserting that an 635
asset is or was an associated asset of a series limited liability company 636
or a protected series of the company has the burden of proof on the 637
issue. 638
(e) This section applies to an asset of a foreign series limited liability 639
company or foreign protected series if: 640
(1) The asset is real or tangible property located in this state; 641
(2) The claimant is a resident of this state or doing business or 642
registered to do business in this state, or the claim under this section is 643
to enforce a judgment, or to seek a prejudgment remedy, pertaining to 644
a liability arising under law of this state other than sections 1 to 42, 645
inclusive, of this act or an act or omission in this state; and 646
(3) The asset is not identified in the records of the foreign series 647
limited liability company or foreign protected series in a manner 648
comparable to the manner required by section 15 of this act. 649
Sec. 24. (NEW) (Effective October 1, 2019) A protected series of a 650
series limited liability company is dissolved, and its activities and 651
affairs wound up, only on the: 652
(1) Dissolution of the company; 653 Substitute Bill No. 7127
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(2) Occurrence of an event or circumstance the operating agreement 654
states causes dissolution of the protected series; 655
(3) Affirmative vote or consent of all members; 656
(4) Entry by the court of an order dissolving the protected series on 657
application by an associated member or a protected-series manager of 658
the protected series: 659
(A) In accordance with section 8 of this act; and 660
(B) To the same extent, in the same manner and on the same 661
grounds the court would enter an order dissolving a limited liability 662
company on application by a member or manager of the company; or 663
(5) Entry by the court of an order dissolving the protected series on 664
application by the company or a member of the company on the 665
ground that the conduct of all or substantially all the activities and 666
affairs of the protected series is illegal. 667
Sec. 25. (NEW) (Effective October 1, 2019) (a) Subject to subsections 668
(b) and (c) of this section and in accordance with section 8 of this act: 669
(1) A dissolved protected series shall wind up its activities and 670
affairs in the same manner that a limited liability company winds up 671
its activities and affairs under section 34-267a of the general statutes, 672
subject to the same requirements and conditions and with the same 673
effects; and 674
(2) Judicial supervision or another judicial remedy is available in the 675
winding up of the protected series to the same extent, in the same 676
manner, under the same conditions and with the same effects that 677
apply under section 34-267a of the general statutes. 678
(b) When a protected series of a series limited liability company 679
dissolves, the company may deliver to the Secretary of the State for 680
filing a certificate of protected series dissolution stating the name of 681 Substitute Bill No. 7127
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the company and the protected series and that the protected series is 682
dissolved. The filing of the certificate by the Secretary of the State has 683
the same effect as the filing by the Secretary of the State of a certificate 684
of dissolution under section 34-267a of the general statutes. 685
(c) When a protected series of a series limited liability company has 686
completed winding up, the company may deliver to the Secretary of 687
the State for filing a certificate of designation cancellation stating the 688
name of the company and the protected series and that the protected 689
series is terminated. The filing of the certificate by the Secretary of the 690
State has the same effect as the filing by the Secretary of the State of a 691
certificate of dissolution under subsection (b) of section 34-267a of the 692
general statutes. 693
(d) A series limited liability company has not completed its winding 694
up until each of the protected series of the company has completed its 695
winding up. 696
Sec. 26. (NEW) (Effective October 1, 2019) If a series limited liability 697
company that has been administratively dissolved is reinstated, or a 698
series limited liability company that voluntarily dissolved rescinds its 699
dissolution: 700
(1) Each protected series of the company ceases winding up; and 701
(2) Section 34-267b of the general statutes applies to each protected 702
series of the company in accordance with section 8 of this act. 703
Sec. 27. (NEW) (Effective October 1, 2019) As used in this section and 704
sections 28 to 34, inclusive, of this act: 705
(1) "After a merger" or "after the merger" means when a merger 706
under section 30 of this act becomes effective and afterwards. 707
(2) "Before a merger" or "before the merger" means before a merger 708
under section 30 of this act becomes effective. 709 Substitute Bill No. 7127
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(3) "Continuing protected series" means a protected series of a 710
surviving company which continues in uninterrupted existence after a 711
merger under section 30 of this act. 712
(4) "Merging company" means a limited liability company that is 713
party to a merger under section 30 of this act. 714
(5) "Non-surviving company" means a merging company that does 715
not continue in existence after a merger under section 30 of this act. 716
(6) "Relocated protected series" means a protected series of a non-717
surviving company which, after a merger under section 30 of this act, 718
continues in uninterrupted existence as a protected series of the 719
surviving company. 720
(7) "Surviving company" means a merging company that continues 721
in existence after a merger under section 30 of this act. 722
Sec. 28. (NEW) (Effective October 1, 2019) A protected series may not: 723
(1) Be an acquiring, acquired, converting, converted, merging or 724
surviving entity; 725
(2) Participate in a domestication; or 726
(3) Be a party to or be formed, organized, established or created in a 727
transaction substantially like a merger, interest exchange, conversion 728
or domestication. 729
Sec. 29. (NEW) (Effective October 1, 2019) A series limited liability 730
company may not be: 731
(1) An acquiring, acquired, converting, converted, domesticating or 732
domesticated entity; or 733
(2) Except as otherwise provided in section 30 of this act, a party to 734
or the surviving company of a merger. 735 Substitute Bill No. 7127
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Sec. 30. (NEW) (Effective October 1, 2019) A series limited liability 736
company may be party to a merger in accordance with sections 34-737
279h to 34-279k, inclusive, of the general statutes, this section and 738
sections 31 to 34, inclusive, of this act only if: 739
(1) Each other party to the merger is a limited liability company; and 740
(2) The surviving company is not created in the merger. 741
Sec. 31. (NEW) (Effective October 1, 2019) In a merger under section 742
30 of this act, the plan of merger shall: 743
(1) Comply with section 34-279h of the general statutes; and 744
(2) State in a record: 745
(A) For any protected series of a non-surviving company, whether 746
after the merger the protected series will be a relocated protected series 747
or be dissolved, wound up and terminated; 748
(B) For any protected series of the surviving company which exists 749
before the merger, whether after the merger the protected series will be 750
a continuing protected series or be dissolved, wound up and 751
terminated; 752
(C) For each relocated protected series or continuing protected 753
series: 754
(i) The name of any person that becomes an associated member or 755
protected-series transferee of the protected series after the merger, any 756
consideration to be paid by, on behalf of, or in respect of the person, 757
the name of the payor and the name of the payee; 758
(ii) The name of any person whose rights or obligations in the 759
person's capacity as an associated member or protected-series 760
transferee will change after the merger; 761
(iii) Any consideration to be paid to a person who before the merger 762 Substitute Bill No. 7127
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was an associated member or a protected-series transferee of the 763
protected series and the name of the payor; and 764
(iv) If after the merger the protected series will be a relocated 765
protected series, its new name; 766
(D) For any protected series to be established by the surviving 767
company as a result of the merger: 768
(i) The name of the protected series; 769
(ii) Any protected-series transferable interest to be owned by the 770
surviving company when the protected series is established; and 771
(iii) The name of and any protected-series transferable interest 772
owned by any person that will be an associated member of the 773
protected series when the protected series is established; and 774
(E) For any person that is an associated member of a relocated 775
protected series and will remain a member after the merger, any 776
amendment to the operating agreement of the surviving company 777
which: 778
(i) Is or is proposed to be in a record; and 779
(ii) Is necessary or appropriate to state the rights and obligations of 780
the person as a member of the surviving company. 781
Sec. 32. (NEW) (Effective October 1, 2019) In a merger under section 782
30 of this act, the certificate of merger shall: 783
(1) Comply with the requirements for a certificate of merger under 784
section 34-279j of the general statutes; and 785
(2) Include as an attachment the following records, each to become 786
effective when the merger becomes effective: 787
(A) For a protected series of a merging company being terminated 788 Substitute Bill No. 7127
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as a result of the merger, a certificate of termination signed by the 789
company; 790
(B) For a protected series of a non-surviving company which after 791
the merger will be a relocated protected series: 792
(i) A certificate of relocation signed by the non-surviving company 793
which contains the name of the company and the name of the 794
protected series before and after the merger; and 795
(ii) A certificate of protected series designation signed by the 796
surviving company; and 797
(C) For a protected series being established by the surviving 798
company as a result of the merger, a certificate of designation signed 799
by the company. 800
Sec. 33. (NEW) (Effective October 1, 2019) When a merger under 801
section 30 of this act becomes effective, in addition to the effects stated 802
in section 34-279k of the general statutes: 803
(1) As provided in the plan of merger, each protected series of each 804
merging company which was established before the merger: 805
(A) Is a relocated protected series or continuing protected series; or 806
(B) Is dissolved, wound up, and terminated; 807
(2) Any protected series to be established as a result of the merger is 808
established; 809
(3) Any relocated protected series or continuing protected series is 810
the same person without interruption as it was before the merger; 811
(4) All property of a relocated protected series or continuing 812
protected series continues to be vested in the protected series without 813
transfer, reversion or impairment; 814 Substitute Bill No. 7127
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(5) All debts, obligations and other liabilities of a relocated protected 815
series or continuing protected series continue as debts, obligations and 816
other liabilities of the protected series; 817
(6) Except as otherwise provided by law or the plan of merger, all 818
the rights, privileges, immunities, powers and purposes of a relocated 819
protected series or continuing protected series remain in the protected 820
series; 821
(7) The new name of a relocated protected series may be substituted 822
for the former name of the protected series in any pending action or 823
proceeding; 824
(8) If provided in the plan of merger: 825
(A) A person becomes an associated member or a protected-series 826
transferee of a relocated protected series or continuing protected series; 827
(B) A person becomes an associated member of a protected series 828
established by the surviving company as a result of the merger; 829
(C) Any change in the rights or obligations of a person in the 830
person's capacity as an associated member or a protected-series 831
transferee of a relocated protected series or continuing protected series 832
take effect; and 833
(D) Any consideration to be paid to a person that before the merger 834
was an associated member or a protected-series transferee of a 835
relocated protected series or continuing protected series is due; and 836
(9) Any person that is a member of a relocated protected series 837
becomes a member of the surviving company, if not already a member. 838
Sec. 34. (NEW) (Effective October 1, 2019) (a) A creditor's right that 839
existed under section 23 of this act immediately before a merger under 840
section 30 of this act may be enforced after the merger in accordance 841
with the following rules: 842 Substitute Bill No. 7127
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(1) A creditor's right that existed immediately before the merger 843
against the surviving company, a continuing protected series or a 844
relocated protected series continues without change after the merger. 845
(2) A creditor's right that existed immediately before the merger 846
against a non-surviving company: 847
(A) May be asserted against an asset of the non-surviving company 848
which vested in the surviving company as a result of the merger; and 849
(B) Does not otherwise change. 850
(3) Subject to subsection (b) of this section, the following rules 851
apply: 852
(A) In addition to the remedy stated in subdivision (1) of this 853
subsection, a creditor with a right under section 23 of this act which 854
existed immediately before the merger against a non-surviving 855
company or a relocated protected series may assert the right against: (i) 856
An asset of the surviving company, other than an asset of the non-857
surviving company which vested in the surviving company as a result 858
of the merger; (ii) an asset of a continuing protected series; (iii) an asset 859
of a protected series established by the surviving company as a result 860
of the merger; (iv) if the creditor's right was against an asset of the non-861
surviving company, an asset of a relocated series; or (v) if the creditor's 862
right was against an asset of a relocated protected series, an asset of 863
another relocated protected series. 864
(B) In addition to the remedy stated in subdivision (2) of this 865
subsection, a creditor with a right that existed immediately before the 866
merger against the surviving company or a continuing protected series 867
may assert the right against: 868
(i) An asset of a relocated protected series; or 869
(ii) An asset of a non-surviving company which vested in the 870
surviving company as a result of the merger. 871 Substitute Bill No. 7127
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(b) For the purposes of subdivision (3) of subsection (a) of this 872
section and subparagraph (A) of subdivision (1) of subsection (b) of 873
section 23 of this act, subparagraph (A) of subdivision (2) of subsection 874
(b) of section 23 of this act and subparagraph (A) of subdivision (3) of 875
subsection (b) of section 23 of this act, the incurrence date is deemed be 876
the date on which the merger becomes effective. 877
(c) A merger under section 30 of this act does not affect the manner 878
in which section 23 of this act applies to a liability incurred after the 879
merger. 880
Sec. 35. (NEW) (Effective October 1, 2019) The law of the jurisdiction 881
of formation of a foreign series limited liability company governs: 882
(1) The internal affairs of a foreign protected series of the company, 883
including: 884
(A) Relations among any associated members of the foreign 885
protected series; 886
(B) Relations between the foreign protected series and: (i) Any 887
associated member; (ii) the protected-series manager; or (iii) any 888
protected-series transferee; 889
(C) Relations between any associated member and: (i) The 890
protected-series manager; or (ii) any protected-series transferee; 891
(D) The rights and duties of a protected-series manager; 892
(E) Governance decisions affecting the activities and affairs of the 893
foreign protected series and the conduct of those activities and affairs; 894
and 895
(F) Procedures and conditions for becoming an associated member 896
or a protected-series transferee; 897
(2) Relations between the foreign protected series and: 898 Substitute Bill No. 7127
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(A) The company; 899
(B) Another foreign protected series of the company; 900
(C) A member of the company which is not an associated member of 901
the foreign protected series; 902
(D) A foreign protected-series manager that is not a protected-series 903
manager of the protected series; 904
(E) A foreign protected-series transferee that is not a foreign 905
protected-series transferee of the protected series; and 906
(F) A transferee of a transferable interest of the company; 907
(3) Except as otherwise provided in sections 21 and 23 of this act, the 908
liability of a person for a debt, obligation or other liability of a foreign 909
protected series of a foreign series limited liability company if the debt, 910
obligation or liability is asserted solely by reason of the person being or 911
acting as: 912
(A) An associated member, a protected-series transferee or a 913
protected-series manager of the foreign protected series; 914
(B) A member of the company which is not an associated member of 915
the foreign protected series; 916
(C) A protected-series manager of another foreign protected series 917
of the company; 918
(D) A protected-series transferee of another foreign protected series 919
of the company; 920
(E) A manager of the company; or 921
(F) A transferee of a transferable interest of the company; and 922
(4) Except as otherwise provided in sections 21 and 23 of this act: 923 Substitute Bill No. 7127
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(A) The liability of the foreign series limited liability company for a 924
debt, obligation or other liability of a foreign protected series of the 925
company if the debt, obligation or liability is asserted solely by reason 926
of the foreign protected series being a foreign protected series of the 927
company or the company: (i) Being or acting as a foreign protected-928
series manager of the foreign protected series; (ii) having the foreign 929
protected series manage the company; or (iii) owning a protected-930
series transferable interest of the foreign protected series; and 931
(B) The liability of a foreign protected series for a debt, obligation or 932
other liability of the company or another foreign protected series of the 933
company if the debt, obligation or liability is asserted solely by reason 934
of the foreign protected series: (i) Being a foreign protected series of 935
the company or having the company or another foreign protected 936
series of the company be or act as a foreign protected-series manager 937
of the foreign protected series; or (ii) managing the company or being 938
or acting as a foreign protected-series manager of another foreign 939
protected series of the company. 940
Sec. 36. (NEW) (Effective October 1, 2019) In determining whether a 941
foreign series limited liability company or foreign protected series of 942
the company does business in this state or is subject to the personal 943
jurisdiction of the courts of this state: 944
(1) The activities and affairs of the company are not attributable to a 945
foreign protected series of the company solely by reason of the foreign 946
protected series being a foreign protected series of the company; and 947
(2) The activities and affairs of a foreign protected series are not 948
attributable to the company or another foreign protected series of the 949
company solely by reason of the foreign protected series being a 950
foreign protected series of the company. 951
Sec. 37. (NEW) (Effective October 1, 2019) (a) Except as otherwise 952
provided in this section and subject to sections 21 and 23 of this act, the 953
law of this state governing the registration of a foreign limited liability 954 Substitute Bill No. 7127
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company to do business in this state, including the consequences of not 955
complying with that law, applies to a foreign protected series of a 956
foreign series limited liability company as if the foreign protected 957
series were a foreign limited liability company formed separately from 958
the foreign series limited liability company and distinct from the 959
foreign series limited liability company and any other foreign 960
protected series of the foreign series limited liability company. 961
(b) An application by a foreign protected series of a foreign series 962
limited liability company for registration to do business in this state 963
shall include: 964
(1) The name and jurisdiction of formation of the foreign series 965
limited liability company; and 966
(2) If the company has other foreign protected series, the name and 967
street and mailing address of an individual who knows the name and 968
street and mailing address of: 969
(A) Each other foreign protected series of the foreign series limited 970
liability company; and 971
(B) The foreign protected-series manager of and agent for service of 972
process for each other foreign protected series of the foreign series 973
limited liability company. 974
(c) The name of a foreign protected series applying for registration 975
or registered to do business in this state shall comply with section 10 of 976
this act and may do so using an alternate name adopted pursuant to 977
section 34-275e of the general statutes, if the name complies with 978
section 10 of this act. 979
(d) The requirement in section 34-275c of the general statutes to 980
amend a foreign registration certificate to update information applies 981
to the information required by subsection (b) of this section. 982
Sec. 38. (NEW) (Effective October 1, 2019) (a) Not later than thirty 983 Substitute Bill No. 7127
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days after becoming a party to a proceeding b efore a civil, 984
administrative or other adjudicative tribunal of or located in this state 985
or a tribunal of the United States located in this state: 986
(1) A foreign series limited liability company shall disclose to each 987
other party the name and street and mailing address of: 988
(A) Each foreign protected series of the company; and 989
(B) Each foreign protected-series manager of and a registered agent 990
for service of process for each foreign protected series of the company; 991
and 992
(2) A foreign protected series of a foreign series limited liability 993
company shall disclose to each other party the name and street and 994
mailing address of: 995
(A) The company and each manager of the company and an agent 996
for service of process for the company; and 997
(B) Any other foreign protected series of the company and each 998
foreign protected-series manager of and an agent for service of process 999
for the other foreign protected series. 1000
(b) If a foreign series limited liability company or foreign protected 1001
series challenges the personal jurisdiction of the tribunal, the 1002
requirement that the foreign company or foreign protected series make 1003
a disclosure under subsection (a) of this section is tolled until the 1004
tribunal determines whether it has personal jurisdiction. 1005
(c) If a foreign series limited liability company or foreign protected 1006
series does not comply with subsection (a) of this section, a party to the 1007
proceeding may: 1008
(1) Request the tribunal to treat the noncompliance as a failure to 1009
comply with the tribunal's discovery rules; or 1010
(2) Bring a separate proceeding in the court to enforce subsection (a) 1011 Substitute Bill No. 7127
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of this section. 1012
Sec. 39. (NEW) (Effective October 1, 2019) In applying and construing 1013
sections 1 to 42, inclusive, of this uniform act, consideration shall be 1014
given to the need to promote uniformity of the law with respect to its 1015
subject matter among states that enact it. 1016
Sec. 40. (NEW) (Effective October 1, 2019) The provisions of sections 1 1017
to 42, inclusive, of this act modify, limit and supersede the Electronic 1018
Signatures in Global and National Commerce Act, 15 USC 7001 et seq., 1019
but do not modify, limit or supersede Section 101(c) of said act, 15 USC 1020
7001(c), or authorize electronic delivery of any of the notices described 1021
in Section 103(b) of said act, 15 USC 7003(b). 1022
Sec. 41. (NEW) (Effective October 1, 2019) (a) On and after October 1, 1023
2019, sections 1 to 42, inclusive, of this act govern all series limited 1024
liability companies and protected series. 1025
(b) Prior to October 1, 2020, sections 21 and 23 of this act do not 1026
apply to a foreign protected series that was established before October 1027
1, 2019, or a foreign limited liability company that became a foreign 1028
series limited liability company before October 1, 2019. 1029
Sec. 42. (NEW) (Effective October 1, 2019) The provisions of sections 1 1030
to 42, inclusive, of this act do not affect an action commenced, 1031
proceeding brought or right accrued before October 1, 2019. 1032
Sec. 43. Section 34-243a of the general statutes is repealed and the 1033
following is substituted in lieu thereof (Effective October 1, 2019): 1034
As used in sections 34-243 to 34-283d, inclusive, and sections 1 to 42, 1035
inclusive, of this act: 1036
(1) "Certificate of organization" means the certificate required by 1037
section 34-247, and includes the certificate as amended or restated. 1038
(2) "Connecticut Entity Transactions Act" means chapter 616. 1039 Substitute Bill No. 7127
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(3) "Contribution", except in the phrase "right of contribution", 1040
means property or a benefit described in section 34-255a which is 1041
provided by a person to a limited liability company to become a 1042
member or in the person's capacity as a member. 1043
(4) "Debtor in bankruptcy" means a person that is the subject of: (A) 1044
An order for relief under Title 11 of the United States Code or a 1045
comparable order under a successor statute of general application; or 1046
(B) a comparable order under federal, state or foreign law governing 1047
insolvency. 1048
(5) "Disinterested individual" means an individual, including a 1049
disinterested member, who, at the time action is to be taken under 1050
section 34-271d, does not have (A) a material interest in the outcome of 1051
the proceeding, or (B) a material relationship with a person who has 1052
such an interest. 1053
(6) "Disinterested member" means a member who, at the time action 1054
is to be taken under: 1055
(A) Subsection (b) or (d) of section 34-255g, (i) is not a party to the 1056
proceeding, (ii) is not a member who sought approval for a member's 1057
conflicting interest transaction under subsection (f) of section 34-255h 1058
or a disclaimer of the limited liability company's interest in a business 1059
opportunity under subsection (b) of section 34-255h, which approval or 1060
disclaimer is challenged in the proceeding, and (iii) does not have a 1061
material relationship with a party or member described in clause (i) or 1062
(ii) of this subparagraph; 1063
(B) Subsection (f) of section 34-255h, is not a member (i) as to whom 1064
the transaction is a member's conflicting interest transaction, or (ii) 1065
who has a material relationship with another member as to whom the 1066
transaction is a member's conflicting interest transaction; or 1067
(C) Subsection (b) of section 34-255h, would be a disinterested 1068
member under subparagraph (B) of this subdivision if the business 1069
opportunity were a member's conflicting interest transaction. 1070 Substitute Bill No. 7127
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(7) "Disinterested person" means a person, including a disinterested 1071
member, who, at the time action is to be taken under subparagraph (A) 1072
of subdivision (1) of subsection (d) of section 34-243d, does not have 1073
(A) a material interest in the outcome of the action, or (B) a material 1074
relationship with a person who has such an interest. 1075
(8) "Distribution" means a transfer of money or other property from 1076
a limited liability company to a person on account of a transferable 1077
interest or in the person's capacity as a member. "Distribution": (A) 1078
Includes (i) a redemption or other purchase by a limited liability 1079
company of a transferable interest; and (ii) a transfer to a member in 1080
return for the member's relinquishment of any right to participate as a 1081
member in the management or conduct of the company's activities and 1082
affairs or to have access to records or other information concerning the 1083
company's activities and affairs; and (B) does not include amounts 1084
constituting reasonable compensation for present or past service or 1085
payments made in the ordinary course of business under a bona fide 1086
retirement plan or other bona fide benefits program. 1087
(9) "Foreign limited liability company" means an unincorporated 1088
entity formed under the law of a jurisdiction other than this state 1089
which would be a limited liability company if formed under the law of 1090
this state. 1091
(10) "Governing jurisdiction" means the jurisdiction whose law 1092
governs the internal affairs of an entity. 1093
(11) "Jurisdiction", when used to refer to a political entity, means the 1094
United States, a state, a foreign county or a political subdivision of a 1095
foreign country. 1096
(12) "Limited liability company", except in the phrase "foreign 1097
limited liability company" and when used in sections 34-279 to 34-279i, 1098
inclusive, means an entity formed under sections 34-243 to 34-283d, 1099
inclusive, or which becomes subject to said sections under the 1100
Connecticut Entity Transactions Act, or section 34-243i or 34-279h. 1101 Substitute Bill No. 7127
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(13) "Majority in interest of the members" means the members 1102
owning more than fifty per cent of the transferable interests of the 1103
limited liability company, excluding any transferable interests not 1104
owned by the members; except that if it is not possible to determine 1105
which members own more than fifty per cent of the transferable 1106
interests based on the operating agreement of the limited liability 1107
company, then majority in interest of the members means the members 1108
who would receive more than fifty per cent of the distributions with 1109
respect to the dissolution of the limited liability company at the time of 1110
the vote if there would be such distributions, or if there would not be 1111
such distributions, the "majority in interest of the members" means the 1112
members who at the time of the vote contributed more than fifty per 1113
cent of the unreturned capital contributions made to the limited 1114
liability company since the date of formation of the limited liability 1115
company. 1116
(14) "Manager" means a person that, under the operating agreement 1117
of a manager-managed limited liability company, is responsible, alone 1118
or in concert with others, for performing the management functions set 1119
forth in subsection (c) of section 34-255f, regardless of the title used to 1120
describe such person. 1121
(15) "Manager-managed limited liability company" means a limited 1122
liability company that qualifies under subsection (a) of section 34-255f. 1123
(16) "Material relationship" means a familial, financial, professional 1124
or employment relationship that would reasonably be expected to 1125
impair the objectivity of the person's judgment when participating in 1126
the action to be taken. 1127
(17) "Material interest" means an actual or potential benefit or 1128
detriment, other than one which would devolve on the limited liability 1129
company or the members generally, that would reasonably be 1130
expected to impair the objectivity of the person's judgment when 1131
participating in the action to be taken. 1132 Substitute Bill No. 7127
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(18) "Member" means a person that: (A) Has become a member of a 1133
limited liability company under section 34-255 or was a member in a 1134
company when the company became subject to sections 34-243 to 34-1135
283d, inclusive, under section 34-243i; and (B) has not dissociated 1136
under section 34-263a. 1137
(19) "Member-managed limited liability company" means a limited 1138
liability company that is not a manager-managed limited liability 1139
company. 1140
(20) "Operating agreement" means the agreement, whether or not 1141
referred to as an operating agreement and whether oral, implied, in a 1142
record or in any combination thereof, of all the members of a limited 1143
liability company, including a sole member, concerning the matters 1144
described in subsection (a) of section 34-243d. "Operating agreement" 1145
includes the agreement as amended or restated. 1146
(21) "Organizer" means a person that acts under section 34-247 to 1147
form a limited liability company. 1148
(22) "Person" means an individual, business corporation, nonprofit 1149
corporation, partnership, limited partnership, limited liability 1150
company, foreign limited liability company, cooperative association, 1151
limited cooperative association, unincorporated nonprofit association, 1152
statutory trust, business trust, common law business trust, estate, trust, 1153
association, joint venture, public corporation, government or 1154
governmental subdivision, agency or instrumentality, or any other 1155
domestic or foreign legal or commercial entity. 1156
(23) "Principal office" means the principal executive office of a 1157
limited liability company or foreign limited liability company, whether 1158
or not the office is located in this state. 1159
(24) "Professional service" means any type of service to the public 1160
that requires members of a profession rendering such service to obtain 1161
a license or other legal authorization as a condition precedent to the 1162
rendition thereof, limited to the professional services rendered by 1163 Substitute Bill No. 7127
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dentists, naturopaths, chiropractors, physicians and surgeons, 1164
physician assistants, doctors of dentistry, physical therapists, 1165
occupational therapists, podiatrists, optometrists, nurses, nurse-1166
midwives, veterinarians, pharmacists, architects, professional 1167
engineers, or jointly by architects and professional engineers, 1168
landscape architects, real estate brokers, insurance producers, certified 1169
public accountants and public accountants, land surveyors, 1170
psychologists, attorneys-at-law, licensed marital and family therapists, 1171
licensed professional counselors, licensed or certified alcohol and drug 1172
counselors and licensed clinical social workers. 1173
(25) "Property" means all property, whether real, personal, or mixed 1174
or tangible or intangible, or any right or interest therein. 1175
(26) "Record", when used as a noun, means information that is 1176
inscribed on a tangible medium or that is stored in an electronic or 1177
other medium and is retrievable in perceivable form. 1178
(27) "Registered agent" means an agent of a limited liability 1179
company or foreign limited liability company which is authorized to 1180
receive service of any process, notice, or demand required or permitted 1181
by law to be served on the company. 1182
(28) "Registered foreign limited liability company" means a foreign 1183
limited liability company that is registered to do business in this state 1184
pursuant to a certificate of registration filed by the Secretary of the 1185
State. 1186
(29) "Sign" means, with the present intent to authenticate or adopt a 1187
record: (A) To execute or adopt a tangible symbol; or (B) to attach to or 1188
logically associate with the record an electronic symbol, sound or 1189
process. 1190
(30) "State", when used as a noun, means a state of the United States, 1191
the District of Columbia, Puerto Rico, the United States Virgin Islands, 1192
or any territory or insular possession subject to the jurisdiction of the 1193
United States. 1194 Substitute Bill No. 7127
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(31) "Transfer" includes: (A) An assignment; (B) a conveyance; (C) a 1195
sale; (D) a lease; (E) an encumbrance, including a mortgage or security 1196
interest; (F) a gift; and (G) a transfer by operation of law. 1197
(32) "Transferable interest" means the right, as initially owned by a 1198
person in the person's capacity as a member, to receive distributions 1199
from a limited liability company, whether or not the person remains a 1200
member or continues to own any part of the right. "Transferable 1201
interest" applies to any fraction of the interest, by whomever owned. 1202
(33) "Transferee" means a person to which all or part of a 1203
transferable interest has been transferred, whether or not the transferor 1204
is a member. "Transferee" includes a person that owns a transferable 1205
interest under subdivision (3) of subsection (a) of section 34-263b. 1206
(34) "Two-thirds in interest of the members" means the members 1207
owning at least two-thirds of the transferable interests of the limited 1208
liability company, excluding any transferable interests not owned by 1209
the members; except that if it is not possible to determine which 1210
members own at least two-thirds of the transferable interests based on 1211
the operating agreement of the limited liability company, two-thirds in 1212
interest of the members means the members who would receive at 1213
least two-thirds of the distributions with respect to the dissolution of 1214
the limited liability company at the time of the vote if there would be 1215
such distributions, or if there would not be such distributions, two-1216
thirds in interest of the members means the members who at the time 1217
of the vote contributed at least two-thirds of the unreturned capital 1218
contributions made to the limited liability company since the date of 1219
formation of the limited liability company. 1220
Sec. 44. Section 34-247f of the general statutes is repealed and the 1221
following is substituted in lieu thereof (Effective October 1, 2019): 1222
Except as provided in section 34-247g and subject to the provisions 1223
of subsection (c) of section 34-247h, a certificate of organization is 1224
effective and a foreign registration certificate is effective on the date 1225 Substitute Bill No. 7127
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and at the time of its filing by the Secretary of the State, as provided in 1226
section 34-247e. Each other record filed under sections 34-243 to 34-1227
283d, inclusive, or under sections 1 to 42, inclusive, of this act, is 1228
effective on the later of: 1229
(1) On the date and at the time of its filing by the Secretary of the 1230
State, as provided in section 34-247e; 1231
(2) On the date of filing and at the time specified in the record as its 1232
effective time, if later than the time under subdivision (1) of this 1233
section; 1234
(3) At a specified delayed effective date and time, which may not be 1235
more than ninety days after the date of filing; or 1236
(4) If a delayed effective date is specified, but no time is specified, at 1237
12:01 a.m. on the date specified, which may not be more than ninety 1238
days after the date of filing. 1239
Sec. 45. Section 34-275 of the general statutes is repealed and the 1240
following is substituted in lieu thereof (Effective October 1, 2019): 1241
(a) The law of the governing jurisdiction of a foreign limited liability 1242
company governs: (1) The internal affairs of the company; (2) subject to 1243
sections 21 and 23 of this act, the liability of a member as member and 1244
a manager as manager for a debt, obligation or other liability of the 1245
company; and (3) subject to sections 21 and 23 of this act, the liability 1246
of a series of the company. 1247
(b) A foreign limited liability company is not precluded from 1248
registering to transact business in this state because of any difference 1249
between the law of the governing jurisdiction and the law of this state. 1250
(c) Registration of a foreign limited liability company to transact 1251
business in this state does not authorize the foreign company to 1252
engage in any activities or affairs or exercise any power in this state 1253
that a limited liability company may not engage in or exercise in this 1254 Substitute Bill No. 7127
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state. 1255
Sec. 46. Section 34-600 of the general statutes is repealed and the 1256
following is substituted in lieu thereof (Effective October 1, 2019): 1257
As used in this chapter and sections 1 to 42, inclusive, of this act: 1258
(1) "Acquired entity" means the entity, all of one or more classes or 1259
series of interests of which are acquired in an interest exchange. 1260
(2) "Acquiring entity" means the entity that acquires all of one or 1261
more classes or series of interests of the acquired entity in an interest 1262
exchange. 1263
(3) "Approve" means, in the case of an entity, for its governors and 1264
interest holders to take whatever steps are necessary under its organic 1265
rules, organic law and other law to (A) propose a transaction subject to 1266
this chapter; (B) adopt and approve the terms and conditions of the 1267
transaction; and (C) conduct any required proceedings or otherwise 1268
obtain any required votes or consents of the governors or interest 1269
holders. 1270
(4) "Business corporation" means a corporation whose internal 1271
affairs are governed by chapter 601 or a professional service 1272
corporation governed by chapter 594a. 1273
(5) "Conversion" means a transaction authorized by part IV of this 1274
chapter. 1275
(6) "Converted entity" means the converting entity as it continues in 1276
existence after a conversion. 1277
(7) "Converting entity" means the domestic entity that approves a 1278
plan of conversion pursuant to section 34-633 or the foreign entity that 1279
approves a conversion pursuant to the law of its jurisdiction of 1280
organization. 1281
(8) "Domestic entity", unless the context otherwise requires, means 1282 Substitute Bill No. 7127
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an entity whose internal affairs are governed by the law of this state. 1283
(9) "Domesticated entity" means the domesticating entity as it 1284
continues in existence after a domestication. 1285
(10) "Domesticating entity" means the domestic entity that approves 1286
a plan of domestication pursuant to section 34-643 or the foreign entity 1287
that approves a domestication pursuant to the law of its jurisdiction of 1288
organization. 1289
(11) "Domestication" means a transaction authorized by part V of 1290
this chapter. 1291
(12) "Entity", unless the context otherwise requires, means (A) a 1292
business corporation; (B) a nonprofit corporation; (C) a general 1293
partnership, including a limited liability partnership; (D) a limited 1294
partnership, including a limited liability limited partnership; (E) a 1295
limited liability company; (F) a business trust or statutory trust entity; 1296
(G) an unincorporated nonprofit association; (H) a cooperative; or (I) 1297
any other person who has a separate legal existence or the power to 1298
acquire an interest in real property in his or her own name other than 1299
(i) an individual; (ii) a testamentary, inter vivos or charitable trust, 1300
with the exception of a business trust, statutory trust entity or similar 1301
trust; (iii) an association or relationship that is not a partnership solely 1302
by reason of the law of any other jurisdiction; (iv) a decedent's estate; 1303
or (v) a government, a governmental subdivision, agency or 1304
instrumentality, or a quasi-governmental instrumentality. 1305
(13) "Filing entity" means an entity that is created by the filing of a 1306
public organic document. 1307
(14) "Foreign entity" means an entity other than a domestic entity. 1308
(15) "Governance interest" means the right under the organic law or 1309
organic rules of an entity, other than as a governor, agent, assignee or 1310
proxy, to (A) receive or demand access to information concerning, or 1311
the books and records of, the entity; (B) vote for the election of the 1312 Substitute Bill No. 7127
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governors of the entity; or (C) receive notice of or vote on any or all 1313
issues involving the internal affairs of the entity. 1314
(16) "Governor" means a person by or under whose authority the 1315
powers of an entity are exercised and under whose direction the 1316
business and affairs of the entity are managed pursuant to the organic 1317
law and organic rules of the entity. 1318
(17) "Interest", unless the context otherwise requires, means (A) a 1319
governance interest in an unincorporated entity; (B) a transferable 1320
interest in an unincorporated entity; or (C) a share or membership in a 1321
corporation. 1322
(18) "Interest exchange" means a transaction authorized by part III 1323
of this chapter. 1324
(19) "Interest holder" means a direct holder of an interest. 1325
(20) "Interest holder liability" means (A) personal liability for a 1326
liability of an entity that is imposed on a person (i) solely by reason of 1327
the status of the person as an interest holder, or (ii) by the organic rules 1328
of the entity pursuant to a provision of the organic law authorizing the 1329
organic rules to make one or more specified interest holders or 1330
categories of interest holders liable in their capacity as interest holders 1331
for all or specified liabilities of the entity; or (B) an obligation of an 1332
interest holder under the organic rules of an entity to contribute to the 1333
entity. 1334
(21) "Jurisdiction of organization" of an entity means the jurisdiction 1335
under which the law includes the organic law of the entity. 1336
(22) "Liability" means a debt, obligation or any other liability arising 1337
in any manner, regardless of whether it is secured or contingent. 1338
(23) "Merger" means a transaction in which two or more merging 1339
entities are combined into a surviving entity pursuant to a filing with 1340
the Secretary of the State. 1341 Substitute Bill No. 7127
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(24) "Merging entity" means an entity that is a party to a merger and 1342
exists immediately before the merger becomes effective. 1343
(25) "Nonprofit corporation" means a corporation whose internal 1344
affairs are governed by chapter 602. 1345
(26) "Organic law" means the section of the general statutes, if any, 1346
other than this section and sections 34-601 to 34-646, inclusive, 1347
governing the internal affairs of an entity. 1348
(27) "Organic rules" means the public organic document and private 1349
organic rules of an entity. 1350
(28) "Person" means an individual, corporation, estate, trust, 1351
partnership, limited liability company, business or similar trust, 1352
association, joint venture, public corporation, government or 1353
governmental subdivision, agency or instrumentality, or any other 1354
legal or commercial entity. 1355
(29) "Plan" means a plan of merger, interest exchange, conversion or 1356
domestication. 1357
(30) "Private organic rules" means the rules, whether or not in a 1358
record, that govern the internal affairs of an entity, are binding on all 1359
of its interest holders and are not part of its public organic document, 1360
if any. 1361
(31) "Protected agreement" means (A) a record evidencing 1362
indebtedness and any related agreement in effect on or after January 1, 1363
2014; (B) an agreement that is binding on an entity on or after January 1364
1, 2014; (C) the organic rules of an entity in effect on or after January 1, 1365
2014; or (D) an agreement that is binding on any of the governors or 1366
interest holders of an entity on or after January 1, 2014. 1367
(32) "Public organic document" means the public record, the filing of 1368
which creates an entity and any amendment to or restatement of such 1369
record. 1370 Substitute Bill No. 7127
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(33) "Qualified foreign entity" means a foreign entity that is 1371
authorized to transact business in this state pursuant to a filing with 1372
the Secretary of the State. 1373
(34) "Record" means information that is inscribed on a tangible 1374
medium or that is stored in an electronic or other medium and is 1375
retrievable in perceivable form. 1376
(35) "Sign" or "signature" includes any manual, facsimile, conformed 1377
or electronic signature. 1378
(36) "Surviving entity" means the entity that continues in existence 1379
after a merger or that is created by a merger. 1380
(37) "Transferable interest" means the right under an entity's organic 1381
law to receive distributions from the entity. 1382
(38) "Type", with regard to an entity, means a generic form of entity 1383
(A) recognized at common law, or (B) organized under an organic law, 1384
whether or not an entity organized under such organic law is subject to 1385
the provisions of such organic law creating different categories of the 1386
form of entity. 1387
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2019 New section
Sec. 2 October 1, 2019 New section
Sec. 3 October 1, 2019 New section
Sec. 4 October 1, 2019 New section
Sec. 5 October 1, 2019 New section
Sec. 6 October 1, 2019 New section
Sec. 7 October 1, 2019 New section
Sec. 8 October 1, 2019 New section
Sec. 9 October 1, 2019 New section
Sec. 10 October 1, 2019 New section
Sec. 11 October 1, 2019 New section
Sec. 12 October 1, 2019 New section
Sec. 13 October 1, 2019 New section Substitute Bill No. 7127
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Sec. 14 October 1, 2019 New section
Sec. 15 October 1, 2019 New section
Sec. 16 October 1, 2019 New section
Sec. 17 October 1, 2019 New section
Sec. 18 October 1, 2019 New section
Sec. 19 October 1, 2019 New section
Sec. 20 October 1, 2019 New section
Sec. 21 October 1, 2019 New section
Sec. 22 October 1, 2019 New section
Sec. 23 October 1, 2019 New section
Sec. 24 October 1, 2019 New section
Sec. 25 October 1, 2019 New section
Sec. 26 October 1, 2019 New section
Sec. 27 October 1, 2019 New section
Sec. 28 October 1, 2019 New section
Sec. 29 October 1, 2019 New section
Sec. 30 October 1, 2019 New section
Sec. 31 October 1, 2019 New section
Sec. 32 October 1, 2019 New section
Sec. 33 October 1, 2019 New section
Sec. 34 October 1, 2019 New section
Sec. 35 October 1, 2019 New section
Sec. 36 October 1, 2019 New section
Sec. 37 October 1, 2019 New section
Sec. 38 October 1, 2019 New section
Sec. 39 October 1, 2019 New section
Sec. 40 October 1, 2019 New section
Sec. 41 October 1, 2019 New section
Sec. 42 October 1, 2019 New section
Sec. 43 October 1, 2019 34-243a
Sec. 44 October 1, 2019 34-247f
Sec. 45 October 1, 2019 34-275
Sec. 46 October 1, 2019 34-600
JUD Joint Favorable Subst. -LCO
APP Joint Favorable