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<p class="MsoNormal">Working on a purchase of a property in another state. As part of the deal the buyer is trying to assume an existing CMBS loan. The client has formed a Washington LLC with a Washington LLC as the sole member. Lender is insisting that
with a single member LLC it must be a Delaware LLC so we can include the Delaware springing member provisions that will allow appointment of a new member in the event the existing single member goes into bankruptcy. The want an opinion letter from a Delaware
attorney that includes the following language:<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal" style="text-align:justify;text-autospace:none"><i><span style="font-size:12.0pt;font-family:"Times New Roman",serif">Under the LLC Act and the LLC Agreement, the Bankruptcy or dissolution of the Member will not, by itself, cause the Company
to be dissolved or its affairs to be wound up.<o:p></o:p></span></i></p>
<p class="MsoNormal" style="text-align:justify;text-autospace:none"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal">I am wondering if anyone has come up with a work around by which a Washington LLC can automatically appoint a new member to keep the borrowing entity alive in the event the single member goes into bankruptcy. We need the borrowing entity
to be a “disregarded entity” for tax purposes in order to complete a 1031 exchange.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Any thoughts?<o:p></o:p></p>
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<p class="MsoNormal">Stuart<o:p></o:p></p>
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<p class="MsoNormal"><span style="font-family:"Lucida Calligraphy"">Stuart M. Ainsley<o:p></o:p></span></p>
<p class="MsoNormal">Attorney<o:p></o:p></p>
<p class="MsoNormal"><b><o:p> </o:p></b></p>
<p class="MsoNormal"><b>GOURLEY LAW GROUP<o:p></o:p></b></p>
<p class="MsoNormal"><b>THE EXCHANGE CONNECTION<o:p></o:p></b></p>
<p class="MsoNormal"><b>SNOHOMISH ESCROW <o:p></o:p></b></p>
<p class="MsoNormal">P.O. Box 1091<o:p></o:p></p>
<p class="MsoNormal">Snohomish, WA 98291<o:p></o:p></p>
<p class="MsoNormal">PH: (360) 568-5065<o:p></o:p></p>
<p class="MsoNormal">Fax: (360) 568-8092 <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:10.0pt">CONFIDENTIALITY NOTICE: This electronic mail transmission may contain legally privileged, confidential information belonging to the sender. The information is intended only for the use of the individual or
entity named above. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or taking any action based on the contents of this electronic mail is strictly prohibited. If you have received this electronic mail
in error, please contact sender and delete all copies</span>.<o:p></o:p></p>
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