[§425E-1112] Power of general partners and persons dissociated as general partners to bind organization after conversion or merger. (a) An act of a person that immediately before a conversion or merger became effective was a general partner in a converting or constituent limited partnership binds the converted or surviving organization after the conversion or merger becomes effective, if:
(1) Before the conversion or merger became effective, the act would have bound the converting or constituent limited partnership under section 425E-402; and
(2) At the time the third party enters into the transaction, the third party:
(A) Does not have notice of the conversion or merger; and
(B) Reasonably believes that the converted or surviving business is the converting or constituent limited partnership and that the person is a general partner in the converting or constituent limited partnership.
(b) An act of a person that before a conversion or merger became effective was dissociated as a general partner from a converting or constituent limited partnership binds the converted or surviving organization after the conversion or merger becomes effective, if:
(1) Before the conversion or merger became effective, the act would have bound the converting or constituent limited partnership under section 425E-402 if the person had been a general partner; and
(2) At the time the third party enters into the transaction, less than two years have passed since the person dissociated as a general partner and the third party:
(A) Does not have notice of the dissociation;
(B) Does not have notice of the conversion or merger; and
(C) Reasonably believes that the converted or surviving organization is the converting or constituent limited partnership and that the person is a general partner in the converting or constituent limited partnership.
(c) If a person having knowledge of the conversion or merger causes a converted or surviving organization to incur an obligation under subsection (a) or (b), the person shall be liable:
(1) To the converted or surviving organization for any damage caused to the organization arising from the obligation; and
(2) If another person is liable for the obligation, to that other person for any damage caused to that other person arising from the liability. [L 2003, c 210, pt of §1]
Section: Previous 425e-1105 425e-1106 425e-1107 425e-1108 425e-1109 425e-1110 425e-1111 425e-1112 425e-1113 425e-1114 425e-1201 425e-1202 425e-1203 425e-1204 425e-1205 NextLast modified: October 27, 2016