HB 563 - Limited liability partnerships; provisions

Georgia House of Representatives - 1995/1996 Sessions

HB 563 - Limited liability partnerships; provisions

Page Numbers - 1/ 2/ 3/ 4/ 5/ 6/ 7/ 8/ 9/ 10/ 11/ 12/ 13/ 14/ 15
Code Sections - 14-8-15/ 14-8-34/ 14-8-62/ 14-8-63/ 14-8-64/ 14-9-108/ 14-11-405
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1. Chambless  163rd       2. Bostick  165th          3. Barnes  33rd

House Comm: Judy / Senate Comm: SJudy / House Vote: Yeas 155 Nays 1 Senate Vote: Yeas 50 Nays 0 ---------------------------------------- House Action Senate ---------------------------------------- 2/1/95 Read 1st Time 2/27/95 2/2/95 Read 2nd Time 3/10/95 2/15/95 Favorably Reported 3/9/95 Sub Committee Amend/Sub 2/22/95 Read 3rd Time 3/14/95 2/22/95 Passed/Adopted 3/14/95 CS Comm/Floor Amend/Sub 3/30/95 Sent to Governor 4/11/95 Signed by Governor 307 Act/Veto Number 7/1/95 Effective Date ---------------------------------------- Rules Suspended to Introduce Postponed by the House 2/21 Until 2/22/95 Code Sections amended: 14-8-2, 14-8-6, 14-8-15, 14-8-18, 14-8-34, 14-8-36, 14-8-40, 14-8-44, 14-8-45, 14-8-48, 14-8-62, 14-8-63, 14-8-64, 14-9-108, 14-9-206.1, 14-9-902, 14-11-201, 14-11-212, 14-11-305, 14-11-405, 14-11-602, 14-11-702, 14-11-901, 14-11-903, 14-22-905
HB 563 LC 22 1626S _______________________ offers the following substitute to HB 563: A BILL TO BE ENTITLED AN ACT 1- 1 To amend Title 14 of the Official Code of Georgia Annotated, 1- 2 relating to corporations, partnerships, and associations, so 1- 3 as to provide for limited liability partnerships; to provide 1- 4 and revise definitions; to provide for limited liability of 1- 5 partners in a limited liability partnership; to provide for 1- 6 exceptions; to conform existing law relating to liability of 1- 7 partners following dissolution of a partnership, relating to 1- 8 the property of a deceased partner, and relating to 1- 9 settlement of accounts between partners after dissolution; 1-10 to eliminate the requirement of capital accounts or 1-11 liability insurance for foreign limited liability 1-12 partnerships and to conform the required submission to the 1-13 Secretary of State; to authorize use of the designation LLP 1-14 to signify limited liability partnership; to provide for 1-15 recording a limited liability partnership election in the 1-16 office of the clerk of the superior court and for 1-17 procedures, fees, notice, and cancellation; to provide for 1-18 legislative intent regarding recognition of limited 1-19 liability partnerships outside the state and state policy 1-20 that internal affairs of partnerships shall be governed by 1-21 state law; to provide for changing a partner's duties by the 1-22 partnership agreement and for exceptions; to provide that a 1-23 foreign corporation or foreign limited liability company 1-24 merging with a domestic limited partnership or limited 1-25 liability company need not obtain a certificate of 1-26 withdrawal in certain circumstances; to change the 1-27 activities not constituting transacting business in the 1-28 state for foreign limited partnerships and foreign limited 1-29 liability companies; to change the purpose of limited 1-30 liability companies; to authorize the certificate of 1-31 election filed when an entity becomes a limited partnership 1-32 to include the date or the date and time the change becomes 1-33 effective; to authorize the articles of organization or 1-34 written operating agreement to change the duties of a 1-35 member; to change the circumstances under which a member who 1-36 ceases to be a member of a limited liability company is 1-37 entitled to receive the fair value of the member's interest; -1- (Index) LC 22 1626S 2- 1 to change the circumstances relating to disassociation which 2- 2 cause dissolution of a limited liability company; to 2- 3 eliminate a prohibition against merger of a limited 2- 4 liability company and a corporation in certain 2- 5 circumstances; to change provisions relating to merger 2- 6 approval; to repeal conflicting laws; and for other 2- 7 purposes. 2- 8 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA: SECTION 1. 2- 9 Title 14 of the Official Code of Georgia Annotated, relating 2-10 to corporations, partnerships, and associations, is amended 2-11 by inserting in Code Section 14-8-2, relating to 2-12 definitions, a new paragraph to be designated paragraph 2-13 (7.1) to read as follows: 2-14 "(7.1) 'Limited liability partnership' means a 2-15 partnership formed pursuant to an agreement governed by 2-16 the laws of this state that has become a limited 2-17 liability partnership under Code Section 14-8-62 and 2-18 that complies with Code Section 14-8-63." SECTION 2. 2-19 Said title is further amended by striking in its entirety 2-20 subsection (a) of Code Section 14-8-6, relating to the 2-21 definition of partnership, and inserting in lieu thereof the 2-22 following: 2-23 "(a) A partnership is an association of two or more 2-24 persons to carry on as co-owners a business for profit and 2-25 includes, for all purposes of the laws of this state, a 2-26 limited liability partnership." SECTION 3. 2-27 Said title is further amended by striking in its entirety 2-28 Code Section 14-8-15, relating to liability of partners, and 2-29 inserting in lieu thereof a new Code section to read as 2-30 follows: 2-31 "14-8-15. (Index) 2-32 (a) Except as provided in subsection (b) of this Code 2-33 section, all All partners are jointly and severally liable 2-34 for all debts, and obligations, and liabilities of the 2-35 partnership. -2- (Index) LC 22 1626S 3- 1 (b) Subject to subsection (c) of this Code section and to 3- 2 any contrary agreement among the partners, a partner in a 3- 3 limited liability partnership is not individually liable 3- 4 or accountable either directly or indirectly by way of 3- 5 indemnification, reimbursement, contribution, assessment, 3- 6 or otherwise for any debts, obligations, or liabilities of 3- 7 or chargeable to the partnership or another partner, 3- 8 whether arising in tort, contract, or otherwise, that are 3- 9 incurred, created, or assumed while such partnership is a 3-10 limited liability partnership, solely by reason of being 3-11 such a partner or acting or omitting to act in such 3-12 capacity or otherwise participating in the conduct of the 3-13 activities of the limited liability partnership. 3-14 (c) Subsection (b) of this Code section shall not affect 3-15 the liability of a partner in a limited liability 3-16 partnership or the liability of the limited liability 3-17 partnership for such partner's own errors, omissions, 3-18 negligence, malpractice, wrongful acts, incompetence, or 3-19 misconduct. 3-20 (d) A partner in a limited liability partnership is not a 3-21 proper party to a proceeding if the object of the 3-22 proceeding is to hold such partner liable either directly 3-23 or indirectly by way of indemnification, reimbursement, 3-24 contribution, assessment, or otherwise for liabilities for 3-25 which such partner is not liable by reason of the 3-26 provisions of this Code section." SECTION 4. 3-27 Said title is further amended by striking in its entirety 3-28 paragraph (1) of Code Section 14-8-18, relating to rights 3-29 and duties of partners, and inserting in lieu thereof a new 3-30 paragraph to read as follows: 3-31 "(1) Each partner shall be repaid his or her 3-32 contributions, whether by way of capital or advances to 3-33 the partnership property and share equally in the 3-34 profits and surplus remaining after all liabilities, 3-35 including those to partners, are satisfied; and, except 3-36 as provided in subsection (b) of Code Section 14-8-15, 3-37 must contribute towards the losses, whether of capital 3-38 or otherwise, sustained by the partnership according to 3-39 his or her share in the profits;". -3- (Index) LC 22 1626S SECTION 5. 4- 1 Said title is further amended by striking in its entirety 4- 2 Code Section 14-8-34, relating to liability of partners to 4- 3 copartners for actions following dissolution of partnership, 4- 4 and inserting in lieu thereof a new Code section to read as 4- 5 follows: 4- 6 "14-8-34. (Index) 4- 7 Subject to contrary agreement of the partners, each 4- 8 partner is liable to his or her copartners for his or her 4- 9 share of any liability created by any partner acting for 4-10 the partnership after dissolution as if the partnership 4-11 had not been dissolved; provided, however, that a partner 4-12 shall not be liable to the partner acting for the 4-13 partnership after dissolution where: 4-14 (1) The dissolution being by act of any partner, the 4-15 partner acting for the partnership had knowledge of the 4-16 dissolution; 4-17 (2) The dissolution being by the death of a partner, the 4-18 partner acting for the partnership had knowledge or 4-19 notice of the death; or 4-20 (3) The dissolution is not by the act or death of a 4-21 partner; or 4-22 (4) The liability is for a debt or obligation for which 4-23 the partner is not liable as provided in subsection (b) 4-24 of Code Section 14-8-15." SECTION 6. 4-25 Said title is further amended by striking in its entirety 4-26 subsection (d) of Code Section 14-8-36, relating to the 4-27 effect of dissolution of a partnership on the existing 4-28 liability of partners, and inserting in lieu thereof a new 4-29 subsection to read as follows: 4-30 "(d) The individual property of a deceased partner shall 4-31 be liable for all those obligations of the partnership 4-32 incurred while he the deceased partner was a partner and 4-33 for which he or she was liable under Code Section 14-8-15, 4-34 but subject to the prior payment of his or her separate 4-35 debts." -4- (Index) LC 22 1626S SECTION 7. 5- 1 Said title is further amended by striking in their entirety 5- 2 paragraphs (1) and (4) of Code Section 14-8-40, relating to 5- 3 settlement of accounts between partners after dissolution, 5- 4 and inserting in lieu thereof new paragraphs to read as 5- 5 follows: 5- 6 "(1) The assets of the partnership are: 5- 7 (A) The partnership property; 5- 8 (B) The contributions of the partners necessary for 5- 9 the payment of all the liabilities specified in 5-10 paragraph (2) (4) of this Code section;" 5-11 "(4) Except as provided in subsection (b) of Code 5-12 Section 14-8-15, 5-13 (A) The partners shall contribute, as provided by 5-14 paragraph (1) of Code Section 14-8-18, the amount 5-15 necessary to satisfy the liabilities; but and 5-16 (B) If if any, but not all, of the partners are 5-17 insolvent, or, not being subject to process, refuse to 5-18 contribute, the other partners shall contribute their 5-19 share of the liabilities, and, in the relative 5-20 proportions in which they share the profits, the 5-21 additional amount necessary to pay the liabilities;". SECTION 8. 5-22 Said title is further amended by striking in its entirety 5-23 subsection (a) of Code Section 14-8-44, relating to the law 5-24 governing foreign limited liability partnerships, and 5-25 inserting in lieu thereof a new subsection to read as 5-26 follows: 5-27 "(a) The laws of the jurisdiction under which a foreign 5-28 limited liability partnership is organized govern its 5-29 organization and internal affairs and the liability of its 5-30 partners, regardless of whether the foreign limited 5-31 liability partnership procured or should have procured a 5-32 certificate of authority under this chapter upon condition 5-33 that such foreign limited liability partnership shall have 5-34 capital accounts or carry liability insurance of a type 5-35 that is designed to cover the kind of errors, omissions, 5-36 negligence, incompetence, or malfeasance for which 5-37 liability is limited by the laws of the jurisdiction under 5-38 which it was formed in an amount of not less than $1 5-39 million." -5- (Index) LC 22 1626S SECTION 9. 6- 1 Said title is further amended by striking in their entirety 6- 2 paragraphs (7), (8), and (9) of subsection (a) of Code 6- 3 Section 14-8-45, relating to certificates of authority for 6- 4 foreign limited liability partnerships and activities not 6- 5 constituting transacting business in the state, and 6- 6 inserting in lieu thereof the following paragraphs: 6- 7 "(7) The address of the office at which is kept a list 6- 8 of the names and addresses of its partners, together 6- 9 with an undertaking by it to keep those records until 6-10 its registration in this state is canceled or revoked; 6-11 and 6-12 (8) The name and a business address of a partner who has 6-13 substantial responsibility for managing its business 6-14 activities; and 6-15 (9) A statement that the foreign limited liability 6-16 partnership either has capital accounts or liability 6-17 insurance of a type that is designed to cover the kind 6-18 of errors, omissions, negligence, incompetence, or 6-19 malfeasance for which liability is limited by the laws 6-20 of the jurisdiction under which it was formed in an 6-21 amount of not less than $1 million." SECTION 10. 6-22 Said title is further amended by striking in its entirety 6-23 paragraph (1) of subsection (a) of Code Section 14-8-48, 6-24 relating to name of foreign limited liability partnership, 6-25 and inserting in lieu thereof a new paragraph to read as 6-26 follows: 6-27 "(1) Must contain the words 'limited liability 6-28 partnership' (it being permitted to abbreviate the word 6-29 'limited' as 'ltd.') or the abbreviation 'L.L.P.' or the 6-30 designation LLP;". SECTION 11. 6-31 Said title is further amended by inserting new Code sections 6-32 to be designated Code Sections 14-8-62, 14-8-63, and 14-8-64 6-33 to read as follows: 6-34 "14-8-62. (Index) 6-35 (a) To become and to continue as a limited liability 6-36 partnership, a partnership shall record in the office of 6-37 the clerk of the superior court of any county in which the -6- (Index) LC 22 1626S 7- 1 partnership has an office a limited liability partnership 7- 2 election. Such election shall be recorded by such clerk 7- 3 in a book to be kept for that purpose, which may be the 7- 4 book in which are recorded statements of partnership 7- 5 recorded pursuant to Code Section 14-8-10.1, and open to 7- 6 public inspection. As a prerequisite to such filing, the 7- 7 clerk of each such registry may collect a fee in the 7- 8 amount of the fee then allowed for the filing of 7- 9 statements of partnership. A limited liability 7-10 partnership election shall state: 7-11 (1) The name of the partnership, which must comply with 7-12 Code Section 14-8-63; 7-13 (2) The business, profession, or other activity in which 7-14 the partnership engages; 7-15 (3) That the partnership thereby elects to be a limited 7-16 liability partnership; 7-17 (4) That such election has been duly authorized; and 7-18 (5) Any other matters the partnership determines to 7-19 include therein. 7-20 (b) Subject to any contrary agreement among the partners, 7-21 the election shall be executed by a majority of the 7-22 partners or by one or more partners authorized to execute 7-23 an election. 7-24 (c) A partnership becomes a limited liability partnership 7-25 at the time of the recording of the election or at such 7-26 later date or time, if any, as is stated in the election 7-27 and continues to be a limited liability partnership until 7-28 a cancellation of limited liability partnership election, 7-29 which states that it has been duly authorized, is: 7-30 (1) Subject to any contrary agreement among the 7-31 partners, executed by a majority of the partners or by 7-32 one or more partners authorized to execute such a 7-33 cancellation; and 7-34 (2) Recorded in the office of the clerk of the superior 7-35 court of each county in which the partnership recorded a 7-36 limited liability partnership election. 7-37 (d) The status of a partnership as a limited liability 7-38 partnership shall not be affected by changes, after the 7-39 recording of a limited liability partnership election, in 7-40 the information stated in the election. -7- (Index) LC 22 1626S 8- 1 (e) The fact that a limited liability partnership election 8- 2 has been recorded as required by this Code section is 8- 3 notice that the partnership is a limited liability 8- 4 partnership. 8- 5 (f) If a limited liability partnership is dissolved and 8- 6 its business continued without liquidation of the 8- 7 partnership's affairs, the new partnership shall succeed 8- 8 to the old partnership's election to become a limited 8- 9 liability partnership and shall continue to be a limited 8-10 liability partnership until cancellation of such election. 8-11 14-8-63. (Index) 8-12 The name of a limited liability partnership shall contain 8-13 the words 'limited liability partnership,' it being 8-14 permitted to abbreviate the word 'limited' as 'ltd.,' or 8-15 the abbreviation 'L.L.P.' or the designation 'LLP' as the 8-16 last words or letters of its name. 8-17 14-8-64. (Index) 8-18 (a) A partnership, including a limited liability 8-19 partnership, formed and existing under this chapter, may 8-20 conduct its business, carry on its operations, and have 8-21 and exercise the powers granted by this chapter in any 8-22 state, territory, district, or possession of the United 8-23 States or in any foreign country. It is the intent of 8-24 this state that the legal existence of limited liability 8-25 partnerships be recognized outside the boundaries of this 8-26 state. 8-27 (b) It is the policy of this state that the internal 8-28 affairs of partnerships, including limited liability 8-29 partnerships, formed and existing under this chapter, 8-30 including the liability of partners for debts, 8-31 obligations, and liabilities of partnerships, shall be 8-32 subject to and governed by the laws of this state." SECTION 12. 8-33 Said title is further amended by striking in its entirety 8-34 Code Section 14-9-108, relating to indemnification of 8-35 partners or other persons, and inserting in lieu thereof a 8-36 new Code section to read as follows: 8-37 "14-9-108. (Index) 8-38 (a) Subject to any limitations expressly set forth in the 8-39 partnership agreement, a limited partnership may, and 8-40 shall have the power to, indemnify and hold harmless any -8- (Index) LC 22 1626S 9- 1 partner or other person from and against any and all 9- 2 claims and demands whatsoever, provided that the 9- 3 partnership shall not indemnify any person: 9- 4 (1) For intentional misconduct or a knowing violation of 9- 5 law; or 9- 6 (2) For any transaction for which the person received a 9- 7 personal benefit in violation or breach of any provision 9- 8 of the partnership agreement. 9- 9 This Code section shall govern limited partnerships to the 9-10 exclusion of paragraph (2) of Code Section 14-8-18. 9-11 (b) To the extent that, at law or in equity, a partner has 9-12 duties including but not limited to fiduciary duties and 9-13 liabilities relating thereto to a limited partnership or 9-14 another partner: 9-15 (1) The partner's duties and liabilities may be 9-16 expanded, restricted, or eliminated by provisions in the 9-17 partnership agreement; provided, however, that no such 9-18 provision shall eliminate or limit the liability of a 9-19 partner for intentional misconduct or a knowing 9-20 violation of law or for any transaction for which the 9-21 partner received a personal benefit in violation or 9-22 breach of any provision of the partnership agreement; 9-23 and 9-24 (2) The partner shall have no liability to the limited 9-25 partnership or to any other partner for his or her good 9-26 faith reliance on the provisions of the partnership 9-27 agreement, including, without limitation, provisions 9-28 thereof that relate to the scope of duties including but 9-29 not limited to fiduciary duties of partners." SECTION 13. 9-30 Said title is further amended by inserting in Code Section 9-31 14-9-206.1, relating to mergers, a new subsection to be 9-32 designated subsection (g) to read as follows: 9-33 "(g) A foreign corporation or foreign limited liability 9-34 company authorized to transact business in this state that 9-35 merges with and into a domestic limited partnership 9-36 pursuant to this Code section and is not the surviving 9-37 entity in such merger need not obtain a certificate of 9-38 withdrawal from the Secretary of State." -9- (Index) LC 22 1626S SECTION 14. 10- 1 Said title is further amended by striking in their entirety 10- 2 paragraphs (9), (10), (11), (12), and (13) from subsection 10- 3 (b) of Code Section 14-9-902, relating to certificates of 10- 4 authority and activities not constituting transacting 10- 5 business, which read as follows: 10- 6 "(9) Effecting transactions in interstate or foreign 10- 7 commerce; 10- 8 (10) Owning or controlling a subsidiary corporation 10- 9 incorporated in or transacting business within this 10-10 state; 10-11 (11) Owning or controlling a general or limited 10-12 partnership organized or transacting business within 10-13 this state; 10-14 (12) Conducting an isolated transaction not in the 10-15 course of a number of repeated transactions of like 10-16 nature; or 10-17 (13) Serving as trustee, executor, administrator, or 10-18 guardian, or in like fiduciary capacity, where permitted 10-19 so to serve by the laws of this state.", 10-20 and inserting in lieu thereof new paragraphs to read as 10-21 follows: 10-22 "(9) Owning, without more, real or personal property; 10-23 (10) Conducting an isolated transaction not in the 10-24 course of a number of repeated transactions of a like 10-25 nature; 10-26 (11) Effecting transactions in interstate or foreign 10-27 commerce; 10-28 (12) Serving as trustee, executor, administrator, or 10-29 guardian, or in like fiduciary capacity, where permitted 10-30 so to serve by the laws of this state; or 10-31 (13) Owning directly or indirectly an interest in or 10-32 controlling directly or indirectly another person 10-33 organized under the laws of or transacting business 10-34 within this state." SECTION 15. 10-35 Said title is further amended by striking in its entirety 10-36 subsection (b) of Code Section 14-11-201, relating to -10- (Index) LC 22 1626S 11- 1 purposes of limited liability companies, and inserting in 11- 2 lieu thereof a new subsection to read as follows: 11- 3 "(b) A limited liability company formed under this chapter 11- 4 has, unless a more limited purpose is set forth in the 11- 5 articles of organization or a written operating agreement, 11- 6 the purpose of engaging in any lawful business in which 11- 7 corporations for profit, professional corporations, 11- 8 limited partnerships, or general partnerships formed in 11- 9 this state may engage activity." SECTION 16. 11-10 Said title is further amended by striking in its entirety 11-11 paragraph (3) of subsection (b) of Code Section 14-11-212, 11-12 relating to the election to become a limited liability 11-13 company, and inserting in lieu thereof a new paragraph to 11-14 read as follows: 11-15 "(3) The effective date, or the effective date and time, 11-16 of such election if later than the date and time the 11-17 certificate of election is filed;". SECTION 17. 11-18 Said title is further amended by striking in their entirety 11-19 paragraphs (1) and (3) of Code Section 14-11-305, relating 11-20 to duties, and inserting in lieu thereof new paragraphs to 11-21 read as follows: 11-22 "(1) A member or manager shall act in a manner he or she 11-23 believes in good faith to be in the best interests of 11-24 the limited liability company and with the care an 11-25 ordinarily prudent person in a like position would 11-26 exercise under similar circumstances. A member or 11-27 manager is not liable to the limited liability company, 11-28 its members, or its managers for any action taken in 11-29 managing the business or affairs of the limited 11-30 liability company if he or she performs the duties of 11-31 his or her office in compliance with this Code section. 11-32 Except as otherwise provided in the articles of 11-33 organization or a written operating agreement, a A 11-34 person who is a member of a limited liability company in 11-35 which management is vested in one or more managers, and 11-36 who is not a manager, shall have no duties to the 11-37 limited liability company or to the other members solely 11-38 by reason of acting in his or her capacity as a member;" 11-39 "(3) In the instances described in paragraph (1) (2) of 11-40 this Code section, a member or manager is not entitled -11- (Index) LC 22 1626S 12- 1 to rely if he or she has knowledge concerning the matter 12- 2 in question that makes reliance otherwise permitted by 12- 3 paragraph (1) (2) of this Code section unwarranted; 12- 4 and". SECTION 18. 12- 5 Said title is further amended by striking in its entirety 12- 6 Code Section 14-11-405, relating to distributions upon the 12- 7 event of dissociation, and inserting in lieu thereof a new 12- 8 Code section to read as follows: 12- 9 "14-11-405. (Index) 12-10 Except as otherwise provided in the articles of 12-11 organization or a written operating agreement, and subject 12-12 to Code Section 14-11-407, a member with respect to which 12-13 an event of dissociation occurs (other than one of the 12-14 events specified in paragraphs (1), (2), and (4) of 12-15 subsection (a) of Code Section 14-2-601 14-11-601) is 12-16 entitled to receive, within a reasonable time after the 12-17 occurrence of the event, the fair value of the member's 12-18 interest in the limited liability company as of the date 12-19 of such occurrence, but only if such event does not result 12-20 in dissolution of the limited liability company." SECTION 19. 12-21 Said title is further amended by striking in its entirety 12-22 paragraph (4) of Code Section 14-11-602, relating to 12-23 dissolution, and inserting in lieu thereof a new paragraph 12-24 to read as follows: 12-25 "(4) Subject to contrary provision in the articles of 12-26 organization or a written operating agreement, 90 days 12-27 after any event of dissociation with respect to any 12-28 member (other than an event specified in paragraph (1) 12-29 of subsection (a) of Code Section 14-11-601), unless 12-30 within such 90 day period the limited liability company 12-31 is continued by the written consent of all other members 12-32 or as otherwise provided in the articles of organization 12-33 or a written operating agreement; or". SECTION 20. 12-34 Said title is further amended by striking in subsection (b) 12-35 of Code Section 14-11-702, relating to certificates of 12-36 authority and activities not considered transacting business 12-37 in this state, paragraphs (9), (10), (11), and (12), which 12-38 read as follows: -12- (Index) LC 22 1626S 13- 1 "(9) Effecting transactions in interstate or foreign 13- 2 commerce; 13- 3 (10) Owning or controlling another person organized 13- 4 under the laws of, or transacting business within, this 13- 5 state; 13- 6 (11) Conducting an isolated transaction not in the 13- 7 course of a number of repeated transactions of like 13- 8 nature; or 13- 9 (12) Serving as trustee, executor, administrator, or 13-10 guardian, or in like fiduciary capacity, where permitted 13-11 so to serve by the laws of this state.", 13-12 in their entirety, and inserting in lieu thereof new 13-13 paragraphs to read as follows: 13-14 "(9) Owning, without more, real or personal property; 13-15 (10) Conducting an isolated transaction not in the 13-16 course of a number of repeated transactions of a like 13-17 nature; 13-18 (11) Effecting transactions in interstate or foreign 13-19 commerce; 13-20 (12) Serving as trustee, executor, administrator, or 13-21 guardian, or in like fiduciary capacity, where permitted 13-22 so to serve by the laws of this state; or 13-23 (13) Owning directly or indirectly an interest in or 13-24 controlling directly or indirectly another person 13-25 organized under the laws of or transacting business 13-26 within this state." SECTION 21. 13-27 Said title is further amended by striking in its entirety 13-28 subsection (a) of Code Section 14-11-901, relating to 13-29 mergers, and inserting in lieu thereof a new subsection to 13-30 read as follows: 13-31 "(a) Pursuant to a written agreement, a limited liability 13-32 company may merge with or into one or more business 13-33 entities (other than a corporation) with such limited 13-34 liability company or other business entity as the 13-35 agreement shall provide being the surviving limited 13-36 liability company or other business entity." -13- (Index) LC 22 1626S SECTION 22. 14- 1 Said title is further amended by striking in their entirety 14- 2 subsections (a) and (c) of Code Section 14-11-903, relating 14- 3 to approval of mergers, and inserting in lieu thereof the 14- 4 following subsections: 14- 5 "(a) A limited liability company party to a proposed 14- 6 merger shall have the plan of merger authorized and 14- 7 approved by the unanimous consent of the members, unless 14- 8 the articles of organization or a written operating 14- 9 agreement of such limited liability company provides 14-10 otherwise. A foreign corporation or limited partnership 14-11 party to a proposed merger shall have the plan of merger 14-12 authorized and approved in accordance with the applicable 14-13 chapter of this title." 14-14 "(c) After a merger is authorized, unless the plan of 14-15 merger provides otherwise, and at any time before articles 14-16 of merger (as provided for in Code Section 14-11-904) are 14-17 filed by the Secretary of State, the planned merger may be 14-18 abandoned (subject to any contractual rights) in 14-19 accordance with the procedure set forth in the plan of 14-20 merger or, if none is set forth, as follows: 14-21 (1) By the unanimous consent of the members of each 14-22 limited liability company that is a constituent entity, 14-23 unless the articles of organization or a written 14-24 operating agreement of any such limited liability 14-25 company provides otherwise; 14-26 (2) By each corporation and limited partnership that is 14-27 a constituent entity in accordance with the applicable 14-28 chapter of this title; and 14-29 (3) By each foreign constituent business entity in 14-30 accordance with the laws of the state or jurisdiction in 14-31 which it was organized or formed." SECTION 23. 14-32 Said title is further amended by inserting in Code Section 14-33 14-11-905, relating to effects of merger, a new subsection 14-34 to be designated subsection (d) to read as follows: 14-35 "(d) A foreign business entity authorized to transact 14-36 business in this state that merges with and into a limited 14-37 liability company pursuant to this chapter and is not the 14-38 surviving entity in such merger need not obtain a 14-39 certificate of withdrawal from the Secretary of State." -14- (Index) LC 22 1626S SECTION 24. 15- 1 All laws and parts of laws in conflict with this Act are 15- 2 repealed. -15- (Index)

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