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California Corporations Code Section 16909

Legal Research Home > California Laws > Corporations Code > California Corporations Code Section 16909

16909.  (a) An entity that converts into another entity pursuant to
this article is for all purposes the same entity that existed before
the conversion.
   (b) When a conversion takes effect, all of the following apply:
   (1) All the rights and property, whether real, personal, or mixed,
of the converting entity remains vested in the converted entity.
   (2) All debts, liabilities, and obligations of the converting
entity continue as debts, liabilities, and obligations of the
converted entity.
   (3) All rights of creditors and liens upon the property of the
converting entity shall be preserved unimpaired and remain
enforceable against the converted entity to the same extent as
against the converting entity as if the conversion had not occurred.
   (4) Any action or proceeding pending by or against the converting
entity may be continued against the converted entity as if the
conversion had not occurred.
   (c) A partner of a converting partnership is liable for:
   (1) All obligations of the converting partnership for which the
partner was personally liable before the conversion.
   (2) All obligations of the converted entity incurred after the
conversion takes effect, but those obligations may be satisfied only
out of property of the entity if (A) the converted other business
entity is a limited partnership and the partner becomes a limited
partner, (B) the converted other business entity is a limited
liability company and the partner becomes a member, unless the
articles of organization or the operating agreement of the limited
liability company provide otherwise, or (C) the converted other
business entity is a corporation and the partner becomes a
shareholder.
   (d) A partner of a partnership that converted from an other
business entity is liable for any and all obligations of the
converting other business entity for which the partner was personally
liable before the conversion, but only to the extent the partner was
liable for the obligation of the converting entity prior to the
conversion.
   (e) A partner of a converting partnership, who does not vote in
favor of the conversion and does not agree to become a partner,
member, shareholder, or holder of interest of the converted other
business entity shall have the right to dissociate from the
partnership, as of the date the conversion takes effect. Within 10
days after the approval of the conversion by the partners as required
under this article, the converting partnership shall send notice of
the approval of the conversion to each partner that has not approved
the conversion, accompanied by copies of Section 16701 and a brief
description of the procedure to be followed under that section if the
partner wishes to dissociate from the partnership. A partner that
desires to dissociate from the converting partnership shall send
written notice of that dissociation within 30 days after the date of
the notice of the approval of the conversion. The converting
partnership shall cause the partner's interest in the entity to be
purchased under Section 16701. The converting partnership is bound
under Section 16702 by an act of a general partner dissociated under
this subdivision, and the partner is liable under Section 16703 for
transactions entered into by the converted entity after the
conversion takes effect. The dissociation of a partner in connection
with a conversion pursuant to the terms of this subdivision shall not
be deemed to be a wrongful dissociation under Section 16602.

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Last modified: March 17, 2014